BHP has confirmed a settlement agreement with Vale regarding group action proceedings in the UK in respect of the Fundão Dam failure in Brazil.
The miner said it and its UK arm were defendants to a group action claim in the English High Court, which was brought by over 600,000 claimants seeking damages in relation to the 2015 Fundão Dam failure.
“BHP does not consider that it is liable to the claimants in the English proceedings and will continue to defend the English proceedings,” BHP officials said in a post on its website. “BHP believes the English proceedings are unnecessary because they duplicate matters already covered by the existing and ongoing work of the Renova Foundation and legal proceedings in Brazil.”
In March of this year, a new claim was filed against Vale and the Dutch subsidiary of Samarco in the Netherlands on behalf of approximately 78,000 Brazilian claimants for compensation relating to the failure; BHP confirmed it is not a defendant in the Netherlands proceedings.
Specific to the settlement, BHP, BHP Brasil and Vale have entered into an agreement for BHP and Vale to each pay 50% of any amounts potentially payable to the claimants in the English proceedings, the Netherlands proceedings and other proceedings in Brazil covered by the agreement without any admission of liability for these proceedings.
The miner said its deal reinforces the terms of the framework agreement it entered into in 2016, requiring BHP Brasil and Vale to each contribute 50% to the funding of the Renova Foundation for compensation of persons impacted by the Fundão Dam failure where Samarco is unable to contribute that funding.
BHP brought a contribution claim against Vale in December 2022 because the English proceedings were not brought against Vale.
“The contribution claim contends that if BHP’s defences are not successful and it is ordered to pay damages to the claimants in the English Proceedings, Vale should contribute to any amount payable. BHP will withdraw the contribution claim against Vale as it is no longer necessary given the agreement with Vale,” BHP officials said in the post.
In the meantime, BHP Brasil is still committed to the ongoing support of local remediation efforts in Brazil through the Renova Foundation. Those efforts have already provided approximately US$3.5 billion in compensation and direct financial aid in relation to the dam failure to approximately 430,000 people as of 31 May.
The Fundão Dam was owned and operated by Samarco, a non-operated joint venture between BHP Billiton Brasil and Vale. BHP Brasil and Vale each hold 50% of Samarco.
Source: BHP