Photo by: Reuters
PERTH (miningweekly.com) – Mining major BHP Billiton and its joint venture (JV) partner Vale have set a June 30 deadline to conclude negotiations with Brazilian prosecutors over the 2015 Samarco tailing dams failure, which killed 19 people.
The parties have reached a preliminary agreement with Brazil, which outlines the process and timeline for the negotiation of a $47.5-billion civil claim brought by federal prosecutors in May last year, BHP said in a statement on Thursday.
The preliminary agreement also provided for the appointment of experts to advise the federal prosecutors on the social and environmental impacts of the dam failure, any revisions to the social and environmental remediation programmes under the existing framework agreement, entered into with Brazilian authorities in March 2016, and for the ongoing assessment and monitoring of these programmes.
Under the preliminary agreement, the JV partners have agreed to put in place $675-million worth of security to support payments for the programmes under the framework agreement. The interim security comprises a charge over Samarco’s assets of about $400-million, insurance bonds of about $400-million and liquid assets of about $30-million.
The preliminary agreement also requires the JV partners to advance $60-million of the funding obligations under the framework agreement to programmes for local municipalities, with the funds to be advanced within 90 days of signing the preliminary agreement.
During the period that the interim security is in place, it will, subject to court approval, replace a $370-million injunction issued in the civil claim.
In addition, the applications by the federal prosecutors for a $2.4-billion injunction in the civil claim and asset freezing order, worth around $6-billion, in the criminal proceedings against the JV partners, will be suspended.
BHP stated that, if a final settlement arrangement was not agreed upon by the end of June, the federal prosecutor could request reinstatement of the $370-million injunction.
BHP has previously stated that resuming operations would be technically feasible in 2017, but that the restart would only occur if it was safe to do so and if the necessary approvals were in place. However, Brazil’s Mines and Energy Minister Fernando Coelho Filho reportedly said this week that a restart was “probable” in two months.
Operations at Samarco were halted in November 2015, after the collapse of an iron-ore tailings dam.