First arrest in Hungarian toxic mud disaster

The European Union will re-examine laws covering industrial waste.

Budapest: Hungarian police arrested the managing director of the company at the centre of a toxic sludge disaster, as the body of the last missing person was recovered, bringing the death toll to eight.

The MAL Hungarian Aluminium Production and Trade Company`s managing director Zoltan Bakonyi was taken into custody for questioning in connection with the deadly toxic spill, the National Investigative Office said in a statement.

At the same time, the body of the last person missing was recovered a week after Hungary`s worst-ever chemical accident, the regional chief of the disaster relief services, Tibor Dobson told the Hungarian news agency MTI.

"The body of another victim has been found near Devecser, bringing the total to eight," Dobson said. Officials added that 45 people remain in hospital, two in a very serious condition.

The villages of Devecser and Kolontar were hardest hit when a reservoir of chemical residue burst at an alumina plant in Ajka, 160 kilometres (100 miles) west of Budapest.

It sent a torrent of red toxic sludge across an area of 40 square kilometres (15.4 square miles) which also polluted the Danube river and many of its tributaries.

Now officials fear the area could be inundated with another toxic flood from a likely second break in the reservoir walls.

Engineers, volunteers and disaster relief teams were racing against the clock to finish building a new dam to contain a possible new wave of slurry with heavy rain forecast for later this week.

"The new dam is 70 percent completed" and should be finished on Monday evening, Dobson had said.

So far, no official estimates have been made of the total cost of the damage caused by the spill, but environment state secretary Zoltan Illes reckoned MAL could face having to pay up to EUR 73 million (USD 102 million).

Prime Minister Viktor Orban told Parliament in Budapest on Monday that MAL should be called to account for the disaster and the company "placed under state control”.

"Since it was not a natural disaster, but man-made, it won`t be the taxpayer who foots the bill, but those who caused the damage," Orban said.

In Brussels, officials said the European Union was to re-examine laws covering industrial waste in light of Hungary`s ecological disaster.

MAL secured authorisation for storage of toxic waste in 2006 under an EU law that stipulates companies must use best practice techniques, regulators said.

But a commission spokesman noted that the factory underwent an inspection by national supervisors before the accident, "so we have to assess what went wrong”.

Dead fish have been sighted as far as Tahi, which is around 40 kilometres north of Budapest, as well as closer to the capital itself.

But disaster relief officials argue the fish have probably been washed along the river and are not a sign that the pollution is continuing to spread.

Indeed, alkaline levels -- a sign of water contamination -- much closer to the site of the accident are still falling.

Kolontar`s entire population of around 800 people has been forced to evacuate until the construction of the second dam has been completed and the authorities give them permission to return.

According to Illes, 600,000-700,000 cubic metres (21-24 million cubic feet) of sludge spilled from the reservoir last week, leaving 2.5 million tonnes still inside it.

Illes said it was still unclear whether MAL "overloaded the reservoirs or not. But if that is the case, it`s illegal storage of waste and that constitutes a crime”.

MAL, meanwhile, denied suggestions that it might have overfilled the reservoirs.

"The company has strictly observed the technical regulations," said a statement posted on its website. It had spent 30.3 billion forints on maintenance and renovation, it added.

"The regulations have always been literally observed and everything has been executed according to the prevailing regulations," the statement said.

The company`s three owners are among Hungary`s 100 richest people, with personal fortunes of between EUR 61-85 million.

MAL, which was set up in 1995, posted annual revenues of EUR 157 million and a profit of EUR 715,000 in 2008.

Bureau Report