A Brazilian court overturned a settlement that BHP Billiton had struck with the country’s government over last year’s deadly dam burst involving its joint venture Samarco Mineração SA, BHP said Friday. The Australian co-owner of Samarco will appeal against the decision, it added.
In May, Brazilian prosecutors challenged the March settlement between the Brazilian government and Samarco — in which the miner agreed to pay $6.2 billion in damages — saying it was insufficient and short of the legal mechanisms to ensure the companies would perform their obligations, making it little more than a “letter of intent.”
However, Brazil’s Superior Court of Justice issued an interim order suspending the agreement between the companies and the government, according to BHP. Also, the order reinstates the $6.2 billion public civil claim made by Brazilian officials for clean-up costs and damages against Samarco, BHP and Vale SA, the embattled miner’s Brazilian co-owner.
“BHP Billiton Brasil intends to appeal the decision of the Superior Court of Justice,” BHP said in a statement.
The dam burst on Nov. 5, 2015, and sent thick red mud rolling down the hilly area killing 19 people. The mining waste buried lorries and cars, and the burst also caused considerable damage to the environment. The cause of the incident, considered Brazil’s worst environmental disaster, is not yet known.
The Samarco mine has been closed since the accident. Environmental officials maintain that the mine will only be allowed to reopen after it can assure and prove mud is no longer leaking into the surrounding area and that the mine can be run safely.