Brazil seals $23 billion from mining firms over dam collapse

The Brazilian government signed a compensation deal with BHP and Vale over the 2015 disaster, which caused multiple deaths and huge environmental damage.

Mining giants BHP and Vale on Friday signed a deal with Brazil's government to pay nearly 132 billion reais ($23 billion, €21.3 billion) in damages for a 2015 dam collapse that triggered one of the country's worst environmental disasters.

The cave-in, at an iron ore mine in the southeastern town of Mariana, unleashed a giant mudslide that killed 19 people, left hundreds homeless and polluted the length of the Doce River.

The mine was owned by Samarco, a joint venture between Vale and BHP.

What's in the deal?

Of the 132 billion reais the two mining giants agreed to pay, 100 billion represents "new resources" that must be paid to Brazilian authorities over 20 years.

The first installment of 5 billion is due within 30 days.

The other 32 billion reais is to be allocated as compensation and resettlement costs for about 300,000 of the people affected. The total number of people impacted by the disaster is thought to be much higher.

The government's solicitor general, Jorge Messias, said the money would allow local authorities to make payouts to families hit by the tragedy and settle bills for environmental repairs.

The two firms had already agreed in 2016 to pay about a tenth of Friday's agreed sum in damages, but negotiations were reopened three years ago over accusations by the Brazilian government of non-compliance.

More than a hundred lawsuits have been launched against the mining firms over the disaster, including one being heard this week where BHP is contesting liability in London's High Court.

More than 620,000 complainants, including 46 Brazilian municipalities and several Indigenous communities, are seeking an estimated 36 billion pounds ($47 billion, €43.2 billion) in damages. BHP denies responsibility.

What disaster was caused by the dam collapse?

The collapse caused the release of an immense amount of toxic mining waste into a major river in southeastern Minas Gerais state, which ravaged entire villages.

The sludge was enough to fill 13,000 Olympic-size swimming pools, which polluted the Doce River for 420 miles to the Atlantic Ocean, while also flooding rainforest and waterways in two neighboring states.

Scientists say the mouth of the Doce and parts of the southeast Atlantic coastline are still contaminated with metals from the spill, affecting the area's population of fish, birds, turtles, porpoises and whales.

Disaster 'could have been avoided,' Lula says

Brazilian President Luiz Inacio Lula da Silva, who attended the signing of the deal in the capital, Brasilia, declared it to be the biggest environmental payout in modern history.

We are fixing a disaster that could have been avoided, but wasn't," Lula said at a hall of the presidential palace, before accusing the mining firms of chasing profit over safety.

"I hope the mining companies have learned their lesson: it would have cost them less to prevent (the disaster), much less," Lula said at the ceremony attended by representatives of both mining firms.

mm/lo (AFP, AP, Reuters)