Brazil considers reopening $27.4bn civil action lawsuit against Vale, BHP

2 October 2020 (Last Updated October 2nd, 2020 09:50)

Federal and state prosecutors in Brazil are seeking to reopen a multi-billion dollar civil action lawsuit against mining companies Samarco, Vale and BHP.

Brazil considers reopening $27.4bn civil action lawsuit against Vale, BHP
Brumadinho dam collapse disaster claimed lives of at least 270 people. Credit: Ibama.

Federal and state prosecutors in Brazil are seeking to reopen a multi-billion dollar civil action lawsuit against mining companies Samarco, Vale and BHP.

The lawsuit is with respect to the damages related to the Fundao dam collapse that claimed many lives in 2015, Reuters reported citing local authorities.

The burst dam devastated the nearby town with mudslides that destroyed dozens of homes.

This incident at Samarco’s Mariana facilities, a joint venture (JV) between iron ore firms Vale in Brazil and Australia-based BHP Billiton, was Brazil’s biggest environmental disaster.

According to the news agency, the claim is for damages of R$155bn ($27.4bn).

The lawsuit had been suspended in 2018 after prosecutors and the miners reached an agreement.

However, state prosecutors now contend that the firms are not meeting their obligations in a ‘timely fashion’.

Last year, another mining dam owned by Vale burst in Minas Gerais, Brazil.

Known as the Brumadinho mining disaster, the incident occurred on 25 January 2019 when a dam located near the Córrego do Feijão iron mine collapsed, causing a mudslide to hit the town of Brumadinho.

The Brumadinho disaster claimed lives of at least 270 people.

In July, a Brazilian court ordered Vale to pay R$7.9bn ($1.47bn) in guarantees, with respect to Brumadinho tailings dam damage.

Since the start of 2019, iron ore production in Brazil has suffered due to the Brumadinho tailings dam disaster, weather-related conditions and the spread of Covid-19 pandemic.

Last year, Brazil’s overall iron ore output was 404.9Mt.

In a separate development, Vale said that 33 of its 104 dam structures in Brazil had failed to receive positive stability assessments.