BHP AND VALE EDGE CLOSER TO $47.5 BILLION SAMARCO DAM DISASTER SETTLEMENT

BHP AND VALE EDGE CLOSER TO $47.5 BILLION SAMARCO DAM DISASTER SETTLEMENT

BHP Billiton (ASX: BHP) and Brazilian mining company Vale have entered into a preliminary agreement with Brazilian federal prosecutors to settle the $47.5 billion civil lawsuit brought after the Samarco dam disaster, which occurred on 5 November 2015.

The failure of the dam, which is owned by Samarco, a joint venture between Vale and BHP Billiton, caused 19 deaths, at least 16 injuries as well as significant environmental damage.

The preliminary agreement outlines the process and timeline for settling the civil lawsuit brought by Brazilian prosecutors against BHP, Vale and Samarco in May 2016.

Under the agreement, it is expected that final settlement between the parties will be reached by 30 June 2017.

BHP says that the preliminary agreement requires BHP, Vale and Samarco to provide an initial security of $US675 million within 90 days to support the social and environmental remediation programs of the affected areas.

BHP, Vale and Samarco are also required to advance $US60 million to support environmental programs in the Brazilian municipalities of Barra Longa, Rio Doce, Santa Cruz do Escalvado and Ponte Nova.

Operations at the Samarco mine remains suspended since the disaster occurred and BHP says that any recommencement of operations is subject to numerous approvals and contingencies.

"Any restart of operations at Samarco is subject to a separate set of negotiations with relevant parties and will occur only if it is safe, economically viable and has the support of the community," the mining powerhouse says in a statement to the ASX.

"Resuming operations would require government approvals, the granting of licenses by state authorities, the restructure of Samarco's debt, and the completion of commercial arrangements with Vale regarding the use of its infrastructure." 

BHP shares closed 17 cents higher yesterday at $26.69 but has fallen slightly this morning.  As at 1.30 pm AEST, the share price is $26.36.

Enjoyed this article?

Don't miss out on the knowledge and insights to be gained from our daily news and features.

Subscribe today to unlock unlimited access to in-depth business coverage, expert analysis, and exclusive content across all devices.

Support independent journalism and stay informed with stories that matter to you.

Subscribe now and get 50% off your first year!

SMEs urged to consider business insurance to mitigate financial risks
Partner Content
A single “bad luck” incident could cause financial disaster for many Australian sma...
Advertisement

Related Stories

Square Peg and Atlassian co-founder Farquhar back AI startup Lorikeet in $5m seed round

Square Peg and Atlassian co-founder Farquhar back AI startup Lorikeet in $5m seed round

Sydney-based customer-experience startup Lorikeet has raised $5 mil...

Digital agency Social Garden grows its e-commerce focus with acquisition of The Natives

Digital agency Social Garden grows its e-commerce focus with acquisition of The Natives

Digital marketing agency Social Garden has acquired fellow Melbourn...

ANZ agrees to fork out $99m for two class actions as Westpac and Macquarie continue the fight

ANZ agrees to fork out $99m for two class actions as Westpac and Macquarie continue the fight

ANZ Banking Group (ASX: ANZ) has agreed to pay out a total of $99 m...

‘It makes a lot of sense’: Glen Richards takes the long view with Arbor Permanent Owners investment

‘It makes a lot of sense’: Glen Richards takes the long view with Arbor Permanent Owners investment

After spending most of his career investing with a timely exit in m...