Brazil prosecutors file $58 billion lawsuit against BHP Billiton-owned mining company over fatal dam spill

bhp brazil 2

Reuters | 4 May 2016

Federal prosecutors in Brazil have filed a 155 billion real ($58.2 billion) civil lawsuit against iron miner Samarco, and its owners Vale SA and BHP Billiton, for a collapsed tailings dam that killed 19 people and polluted a major river.

The 359-page lawsuit, which is also against the two states impacted by the spill and the Federal Government, is the result of a six-month investigation led by a task force set up after the disaster, prosecutors said in a statement.

The total damages, prosecutors said, were calculated based upon the cost of the Deepwater Horizon oil spill in the United States — BP’s total pre-tax charge for that spill reached $US53.8 billion ($71.89 billion).

Prosecutors demanded an initial payment of 7.7 billion reals ($2.89 billion).

Vale and Australia’s BHP both said they had not received formal notice of the claim.

However, BHP said in a statement to the Australian Securities Exchange that it was “committed to helping Samarco to rebuild the community and restore the environment affected by the failure of the dam”.

It said that a separate lawsuit that Samarco, Vale and BHP settled with Brazil’s Government in March, in which the companies would pay an estimated 20 billion reals ($7.51 billion), was the best way to repair damage caused by the spill.

“We believe that the agreement (once approved by the court) provides the long-term remedial and compensation framework for responding to the impact of the Samarco tragedy and the appropriate platform for the parties to work together,” BHP said.

Federal and state prosecutors did not form part of that settlement, which they criticised, saying it was insufficient and lacked the legal mechanisms to ensure the companies would fulfil their obligations, making it little more than a “letter of intent”.

The roles of the state and federal governments were also questioned, with prosecutors accusing the state of Minas Gerais, where the spill occurred, as being guilty of negligence in the permitting and monitoring of the dam.

BHP’s shares slumped nearly 8 per cent to a more than two-week low in a broader market that was down 1.2 per cent.

1 Comment

Filed under Australia, Environmental impact

One response to “Brazil prosecutors file $58 billion lawsuit against BHP Billiton-owned mining company over fatal dam spill

  1. aloosley2013

    Sent from my Samsung Galaxy smartphone.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s