Mining giants BHP and Vale have reached a deal to split equally the cost of any damages related to proceedings in Britain over the 2015 Fundao Dam collapse in Brazil that killed 19 people. While denying liability for related claims, the companies have agreed to each pay 50% of any amount potentially payable to the claimants in the UK proceedings, the Netherlands proceedings, and others in Brazil covered by the agreement.
The collapse of the tailings dam, which stored mining waste and is owned by the Samarco joint venture between BHP and Vale, resulted in the release of about 40 million cubic meters of toxic sludge into communities, the Rio Doce river, and the Atlantic Ocean 650 km away.
BHP believes the English proceedings are unnecessary as they duplicate matters already covered by the existing and ongoing work of the Renova Foundation and legal proceedings in Brazil. However, BHP will continue to defend the UK proceedings and does not consider itself liable to the related claimants.
The agreement reinforces the framework agreement signed in 2016 for BHP Brasil and Vale to each contribute 50% to the funding of the Renova Foundation, which was set up to ensure full and fair remediation for the damages caused by the dam collapse.
In March, a new claim was filed against Vale and the Dutch subsidiary of Samarco in the Netherlands, in which BHP is not a defendant. As a result, BHP has withdrawn its contribution claim against Vale that was filed in December 2022.
The effect of the new agreement is that should BHP or Vale be found to have any liability to the claimants in the UK or Netherlands proceedings, respectively, such liability would be shared equally between the two companies.