Brazilian mining company Vale SA will invest 11 billion reais ($2.8 billion) in the next five years on a new method for processing iron ore that eliminates the need for waste storage dams, the company said May 13.

The company came under fire after a tailings dam at its iron mine in Minas Gerais state ruptured in January, killing 240 and leaving 30 missing.

The new technique, called dry-processing, uses a magnetic sluicing system to separate the iron ore from sand, clay, and earth, Klemens Laschefski, professor of geosciences and environmental studies at the Minas Gerais Federal...