Brazil reportedly nears dam burst deal with Vale, BHP

Brazil's government is close to reaching an agreement with miners Vale and BHP Billiton aimed at covering public damages from the November collapse of a dam operated by their joint venture in Minas Gerais state, the Wall Street Journal reported.

The iron ore tailings dam at the Germano mine, near the town of Mariana, was operated by Samarco, a 50:50 JV between Vale and BHP.

The agreement is expected to settle a 20bn-real (US$4.91bn) government lawsuit filed on November 30 against Samarco and its two parent companies.

According to the report, the deal would cover the social and environmental consequences of the dam breach, but not address ongoing criminal investigations, fines from state and federal regulators, or any private lawsuits.

Under the deal, Vale and BHP would be required to rebuild the community of Bento Rodrigues, where 82% of the buildings were buried by mine waste, and restore about 640km of river in the Doce basin polluted by the flood of toxic sludge released, the report said.

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