Mining companies BHP and Vale reach agreement on process in UK over Brazil dam collapse

Multinational mining company BHP reached a deal on Friday with its Brazilian partner Vale to share damages related to legal proceedings in Britain over a 2015 dam collapse that killed 19 people in Brazil, while the company denied liability for related claims.

BHP Group (UK) Ltd and its parent BHP are being sued in a class action lawsuit in the High Court in the UK, brought by more than 600,000 claimants seeking compensation for the failure of the Fundão dam in 2015.

BHP and Vale will each pay 50% of the amount that plaintiffs may be liable for in proceedings in the UK, the Netherlands and other countries in Brazil covered by the settlement, the companies said on Friday.

This reinforces the framework agreement signed in 2016 for BHP Brazil and Vale to each contribute 50% to the financing of the Renova Foundation, which was established to ensure comprehensive and equitable repair of the damage caused by the dam collapse.

“BHP believes that legal proceedings in the UK are unnecessary as they duplicate issues already covered by the existing legal proceedings and work of the Renova Foundation in Brazil,” the company said.

BHP will continue to defend the legal process in the UK and does not consider itself liable to the relevant claimants, he added.

More than 720,000 Brazilians are suing the two companies over the collapse of the dam, which was owned and operated by their joint venture Samarco.

In March, a new lawsuit was filed against Vale and its Dutch subsidiary Samarco in the Netherlands in which BHP is not a defendant, BHP said.

As legal proceedings in the UK had not been commenced against Vale, BHP had filed a contribution claim against Vale in December 2022, which has now been withdrawn due to the new agreement.

“The effect of this agreement is that if BHP is ultimately found to have any liability to the claimants in the UK, or if Vale is ultimately found to have any liability to the claimants in the Netherlands, then that liability will be shared equally between BHP and Vale,” Vale said in a separate statement.

The collapse of a tailings dam at the Samarco iron ore mine near Mariana, in the state of Minas Gerais in November 2015, caused a massive flow of mud and mining waste that buried a nearby town, killed 19 people, left hundreds homeless and polluted the Doce River.

Roderick Gilbert

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