Mining giants sign $30bn settlement for 2015 Brazil dam collapse

Mining giants BHP and Vale have signed an agreement with the Brazilian government to pay almost $30bn (£23bn) in compensation for the 2015 Mariana dam collapse which caused the country’s worst environmental disaster.

Brazilian President Luis Inacio Lula da Silva attended the signing of the agreement on Friday.

The collapse of the dam released toxic waste and mud, which flooded nearby towns, rivers and forests.

It killed 19 people, left hundreds of others homeless, and poisoned the river.

President Lula said: “I hope the mining companies have learned their lesson; it would have cost less to avoid this disaster.”

The dam was owned by Samarco, a joint venture between Vale and BHP.

Since the disaster, companies have set up a foundation to compensate people, which has already made billions of dollars in repairs. This included building a new city to replace one of the destroyed cities.

However, many people in the community still argued that they had not received justice or enough to rebuild their lives in the past nine years.

Separate to the legal proceedings in Brazil, more than 620,000 people took BHP to court in the UK, where BHP was headquartered at the time, in a case that began earlier this week.

They are seeking an estimated $47bn in a civil suit. Its first phase will determine whether BHP – as the parent company – was liable. About 70,000 plaintiffs also took Vale to court in the Netherlands.

Both companies deny responsibility and say the foreign legal action is “unnecessary” and duplicates legal procedures in Brazil.

Some members of the Mariana community told the BBC that they had joined the UK legal action after being frustrated that the Brazilian trial was taking so long, but they suspected that a deal in Brazil could be reached after the UK trial opened due to increased international pressure.

In 2016, both companies agreed to pay around $3.5bn in today’s compensation but talks were reopened in 2021 due to the slow progress of the Brazilian justice system in resolving the dispute.

Friday’s agreement includes their past and future commitments to help people, communities and the environment affected by the disaster.

The companies agreed to pay 100bn reais ($17.5bn; £13.5bn) to local authorities over 20 years and 32bn reais to compensate and resettle victims and repair damage caused to the environment.

The remaining 38bn reais is money the companies say they have paid as compensation.