Mining Giants Sign $30bn Settlement for 2015 Brazil Dam Collapse
Mining giants BHP and Vale have reached an agreement with the Brazilian government to pay nearly $30 billion (£23 billion) in compensation for the Mariana dam collapse in 2015, which resulted in Brazil’s worst environmental disaster.
Brazilian President Luis Inacio Lula da Silva was present at the deal’s signing on Friday.
The dam failure released toxic waste and mud that inundated nearby towns, rivers, and forests.
The disaster claimed the lives of 19 individuals, displaced hundreds, and contaminated the river.
President Lula stated, “I hope the mining companies have learned their lesson; it would have cost them less to prevent the disaster.”
The dam was owned by Samarco, a joint venture between Vale and BHP.
Following the disaster, the companies established a foundation to compensate affected individuals, which has already facilitated billions of dollars in repairs, including the construction of a new town to replace one that was destroyed.
However, many community members continue to assert that they have not received adequate justice or sufficient support to rebuild their lives nearly nine years later.
In addition to the legal proceedings in Brazil, more than 620,000 people have taken BHP to court in the UK, where the company was headquartered at the time. This trial began earlier this week, with plaintiffs seeking approximately $47 billion in damages. The initial phase of the trial will determine whether BHP, as the parent company, bears liability. Around 70,000 claimants are also pursuing legal action against Vale in the Netherlands.
Both companies deny any liability and contend that this international legal action is “unnecessary” and duplicates the ongoing proceedings in Brazil.
Some community members in Mariana have expressed to the BBC that they joined the UK legal action out of frustration with the slow progress of the Brazilian proceedings, though they suspect that a settlement in Brazil may be reached soon following the initiation of the UK case due to increased international pressure.
In 2016, both companies agreed to pay about $3.5bn in today’s rate in compensation but negotiations were reopened in 2021 due to the slow progress of Brazil’s justice system in resolving the dispute.
Friday’s agreement covers their past and future obligations to assist people, communities, and ecosystems affected by the disaster.
The companies agreed to pay 100bn reais ($17.5bn; £13.5bn ) to local authorities over 20 years and 32bn reais towards compensating and resettling the victims and repairing the harm caused to the environment.
The remaining 38bn reais is the amount the companies say they have already paid in compensation.
