Hopes are fading for about 300 people missing after a burst dam caused a mudslide in south-eastern Brazil, causing locals to run for their lives.

The death toll has risen to 40, as rescuers continue their frantic search for those missing after a tailings dam burst at an iron ore mine owned by Vale SA in the mining-intensive state of Minas Gerais.

The catastrophe comes a little more than three years after the miner was involved in a similar disaster nearby.  Considered the worst environmental disaster in Brazilian history, it left 250,000 people without drinking water and killed thousands of fish.

Scores of families in the city desperately awaited word on their loved ones, but authorities said there was little chance of finding anyone alive.

“Unfortunately, at this point, the chances of finding survivors are minimal. We’re likely to just be recovering bodies,” Minas Gerais governor Romeu Zema told local media.

At least nine people are dead and an estimated 300 people are missing in Brazil after a dam burst at an iron mine in Brumadinho in the southeastern state of Minas Gerais. https://t.co/KfM9wmkM7N pic.twitter.com/lUF6RVQ9pi

— Voice of America (@VOANews) January 26, 2019

Employees of the mining complex owned and operated by Brazilian mining company Vale were eating lunch on Friday afternoon, local time, when the dam gave way, unleashing a sea of reddish-brown mud that knocked over and buried several structures of the company and surrounding areas.

The flow of waste reached the nearby community of Vila Ferteco and an occupied Vale administrative office, with some residents barely escaping with their lives.

The state is still recovering from the collapse in November 2015 of a larger dam that killed 19 people. That dam, owned by the Samarco Mineracao SA joint venture between Vale and BHP Group Ltd, buried a village and poured toxic waste into a major river.

Before and after the tailings dam rupture in Brumadinho, Minas Gerais, Brazil.#environment #disaster #brazil #Brumadinho pic.twitter.com/YCU0eve0gV

— Bernardo Cândido (@candidobm) January 25, 2019

Vale chief executive Fabio Schvartsman said the dam that burst on Friday at the Feijao iron mine was being decommissioned and its capacity was about a fifth of the total waste spilled at Samarco.

He said equipment had shown the dam was stable on January 10 and it was too soon to say why it collapsed.

The Feijao mine is one of four in Vale’s Paraoeba complex, which includes two processing plants and produced 26 million tonnes of iron ore in 2017, or about seven per cent of Vale’s total output.

Emergency workers suspended their search shortly after nightfall. They planned to resume at first light on Sunday morning.

The rivers of mining waste also raised fears of widespread contamination.

According to Vale’s website, the waste, often called tailings, is composed mostly of sand and is non-toxic. However, a UN report found that the waste from a similar disaster in 2015 “contained high levels of toxic heavy metals”.

Schvartsman declined to comment on how output would be affected.

Operations at Samarco remain halted over new licensing, while the companies have worked to pay damages out of court, including an agreement that quashed a 20 billion reais ($7.4 billion) civil lawsuit last year. Federal prosecutors suspended but have still not closed an even larger lawsuit.

-AAP and agencies