Samarco to pay $5 billion in damages for deadly dam spill in Brazil

Samarco Mineracao reached an agreement with the Brazilian government to pay an estimated $5.1 billion or 20 billion reais ($5 billion) in damages caused by a deadly dam spill at a mine in November 2015.

The mining company and its owners, Vale SA and BHP Billiton, will pay such amount in the three years, following the agreement that will be signed on Wednesday, as Reuters reported. The remaining funds will then be released in the following years. From 2019 to 2021, the payments will be between 800 million and 1.6 billion reais.

DNA India reported that beyond 2021, the amount will be decided depending on how much work remains to be done. The government estimates the possible total cost of the lengthy environmental place, which includes dredging and replanting, might reach to about 20 billion reais. However, the 20 billion figure was not present from the statements sent by Samarco, Vale and BHP. The companies instead came to about 12 billion reais over the first six years. The government then explained that the difference was because estimates of the amount can only be decided in the future.

Dubbed as Brazil's worst environmental disaster, the bursting of two dams took the lives of 19 people, forced hundreds to leave their homes and polluted one of the nation's main rivers. "We want to build a new life on the rubble of an unprecedented tragedy," said President Dilma Rousseff at the signing ceremony in Brasilia.

The settlement comes after Vale announced a fourth-quarter net loss of $8.57 billion, its lowest figure ever as a private company, says The Daily Mail. BHP recorded its first loss as well in more than 16 years for the six months to December 31.

Although BHP Billiton announced that the agreement was close, the company declined to comment on the terms of any agreement. Meanwhile, Samarco and Vale representatives cannot be reached for a comment.

The dam burst triggered a debate over stricter mining controls in the Congress. Brazilian police accused six Samarco executives and one contractor of murder related to the deaths caused by the dam spill.

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Samarco, 20 billion reais over, dam spill in brazil, Vale SA, bhp billiton, brazilian government, Samarco mining operation, death in Samarco mining

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