Mining firm BHP offers $25.7bn settlement for Brazil dam disaster
The mining company BHP has said it hopes to secure a $25.7bn (£20bn) settlement over the 2015 Samarco disaster, when the collapse of a dam left at least 19 people dead, 700 homeless and spread unprecedented levels of pollutants across the rivers and landscape of Brazil.
BHP said it had offered the settlement to the Brazilian authorities in partnership with fellow miner Vale, its 50:50 joint venture partner in a local subsidiary, Samarco.
The Fundão dam, owned by Samarco, collapsed on 5 November 2015, releasing a deluge of mining waste near Mariana, in the Minas Gerais region of Brazil.
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The accident also began a long series of legal claims against BHP, the Australian mining company which had its primary stock market listing in London at the time of the disaster.
The world’s largest mining company said that it and Vale had put forward a proposal worth a total of 127bn Brazilian reals (£19.9bn), although some of that sum has already been paid.
Under the terms of the proposal, the two companies would agree to pay $14.4bn over the course of “well in excess” of a decade, to Brazilian national, regional and municipal governments.
They would also fund a further $3.6bn in compensation and clean-up efforts via the Renova Foundation, which was set up in the wake of the disaster.
The remainder of the settlement, $7.7bn, has already been spent via the foundation, including $3.5bn that has gone directly to about 430,000 affected people.
The proposal by BHP and Vale would wrap together existing agreements with Brazilian authorities with outstanding claims by various government bodies in a single settlement.
BHP, the world’s largest mining company, moved its primary stock market listing to Australia in 2022.
But at the time of the accident its main listing was in London, where its annual meetings were visited by protestors.
They were demanding greater compensation for a disaster that unleashed the largest spill of tailings – mining waste – in history.
BHP announced its settlement proposal to investors after speculation in the Brazilian press.
It said: “The negotiations between the parties are ongoing and no final agreement has been reached on the settlement amount or terms.”
Last week, the London-listed mining company Anglo American rejected a “highly unattractive” £31bn takeover approach from BHP.
