BHP and Vale win extra time to settle Samarco claims, restart unlikely this year

JOHANNESBURG (miningweekly.com) – A Brazilian court has granted mining companies BHP and Vale an extra four months to negotiate a settlement of civil claims relating to the 2015 Samarco dam disaster.

BHP and Vale now have until October 30, to negotiate a settlement of the $47.5-billion and $6.1-billion public civil claims relating to the dam failure, which left 19 people dead. 

The parties had initially aimed to reach a settlement by June this year, in accordance with a January 2017 preliminary agreement, which outlined the process and timeline for the negotiation of the claims.

The preliminary agreement also stated that the joint venture partners would to put in place $675-million worth of security to support payments for the programmes under the framework agreement.

On Friday, BHP reported that it had approved $250-million in financial support for the Renova Foundation and Samarco until December 31. Of this, $174-million would be used to fund the Renova Foundation for remediation and compensation programmes identified under the framework agreement, and $76-million would be used by Samarco to carry out remediation and stabilisation work at its operations.

Meanwhile, BHP said it was unlikely that operations at Samarco would restart in 2017. The resume operations would require separate regulatory approvals, the granting of licences by state authorities and the restructure of Samarco’s debt.

“A restart at Samarco….will only occur if it is safe, economically viable and if it has the support of the community,” BHP reiterated.

Operations at Samarco were halted in November 2015, after the collapse of an iron-ore tailings dam.

Operations at Samarco were halted in November 2015, after the collapse of an iron-ore tailings dam. The fatal dam accident resulted in Brazil’s worst-ever ever environment disaster and resulted in federal prosecutors charging 22 people for the disaster, 21 of whom were charged with qualified homicide and environmental crimes. The people facing prosecution include BHP former iron-ore chief Jimmy Wilson.