BHP puts extra $250m towards dam collapse clear-up work
BHP BILLITON has released a $250m (£193m) payment that will go towards rehabilitation work in Brazil, where efforts continue to clean up a deadly tailings dam collapse.
The world’s largest miner by revenue will put $174m towards the Renova Foundation to aid clean-up work for this year and pay compensation to the victims of the Samarco disaster of 2015.
A further $76m will be set aside for the Samarco mining company – a joint venture between BHP and Brazilian company Vale – to carry out dam stabilisation work and prop up the business.
Samarco was one of the world’s biggest producers of iron ore pellets – used to make steel – until a dam holding back wastewater collapsed in November 2015. The resulting deluge flooded a river valley and destroyed two towns, killing 19 people.
The Renova Foundation was set up by BHP and Vale to carry out remedial work and rebuild relations with the devastated local community.
The funds will be drawn from a $1.3bn provision BHP took last year to cover the costs of the accident.
BHP and Vale are looking to settle two separate claims over Samarco. One was ratified by the government in 2016 and would involve the partners paying at least 6.8bn Brazilian real (£1.6bn) over six years. A second claim for 155bn real was launched by federal prosecutors, who based their sums on damages paid out by BP following the Deepwater Horizon explosion in 2010. The courts are now attempting to roll these claims into one agreement.
BHP also confirmed that the mine was “unlikely” to restart this year. Samarco will need fresh government approvals before reopening as well as a restructuring of its $3bn debt.