Brazil has finalized a significant compensation agreement totaling 170 billion reais (approximately $29.85 billion) with mining companies BHP, Vale, and Samarco, following the catastrophic Mariana dam collapse in 2015. Key details of the agreement include:
Background of the Disaster: The dam collapse, which occurred at a Samarco iron ore mine, resulted in the deaths of 19 individuals, left hundreds homeless, and caused extensive environmental damage along the Doce River.
Compensation Structure: The deal mandates an initial payment of 5 billion reais within 30 days, with a total of 132 billion reais designated for public authorities over the next 20 years. This includes 100 billion reais in new resources and 32 billion reais for compensation and reparative actions.
Impact on Affected Communities: The funds will facilitate financial reparations for impacted families and support environmental recovery efforts in Minas Gerais and Espírito Santo states.
Payment Schedule: Payments will continue annually until 2043, with amounts varying from 7 billion reais in 2026 to 4.41 billion reais in the final installment.
Legal Implications: This agreement may resolve over a hundred lawsuits against the companies in Brazil and could limit legal actions in other jurisdictions. BHP is currently contesting a separate lawsuit in London regarding its liability for the disaster.
Corporate Responses: BHP indicated that the financial outflows from this agreement would align with its existing provisions, while Vale has increased its provisions related to Samarco to nearly $4.7 billion.
Statements from Officials: Brazilian officials emphasized that the resources from this agreement will be crucial for justice and recovery efforts, impacting various sectors including environmental restoration and local economic activities.