BHP Group to review court decision on $31.53 billion Fundao dam claim

(Reuters) -BHP Group said on Friday it would review a Brazilian Federal Court decision regarding a 155 billion reais ($31.53 billion) government claim over the 2015 collapse of Fundao dam owned by Samarco, its joint venture with Vale.

The company said its unit BHP Brasil had not received a decision from the court, adding that the group would review its implication, potential for an appeal and any potential impact on its provision related to the dam's collapse.

The court has issued an interlocutory decision ordering Vale, BHP and Samarco to pay 47.6 billion reais ($9.67 billion) in collective moral damages for the 2015 tailings dam burst that killed 19 people and led to severe pollution of the Rio Doce river.

This is one of the categories of damages sought in the $31.53 billion claim by the Federal Public Prosecution Office.

The parties have been in negotiations to seek a settlement of obligations under a framework agreement since 2021, and the talks are slated to resume in February this year.

BHP had set aside $3.7 billion in provision related to the Samarco dam failure, according to its 2023 annual report.

BHP said its unit is "fully committed to supporting the extensive ongoing remediation and compensation efforts in Brazil" through a not-for-profit foundation that was established following the dam failure.

"Although both companies' balance sheets should be able to handle these outflows, we think this could drive lower capital returns over time/push net debt in BHP's case through its $15bn target ceiling," RBC analysts said in a note.

($1 = 4.9165 reais)

(Reporting by Archishma Iyer in Bengaluru; Editing by Rashmi Aich and Subhranshu Sahu)

By Matt Earle

Matthew Earle is the Founder of MiningFeeds. In 2005, Matt founded MiningNerds.com to provide data and information to the mining investment community. This site was merged with Highgrade Review to form MiningFeeds. Matt has a B.Sc. degree with a minor in geology from the University of Toronto.

Comments are closed.

If you would like to receive our free newsletter via email, simply enter your email address below & click subscribe.

MOST ACTIVE MINING STOCKS

 Daily Gainers

 Gitennes Exploration, Inc. GIT.V +137.50%
 Adex Mining Inc. ADE.V +100.00%
 Kermode Resources Ltd. KLM.V +100.00%
 Cascadero Copper Corp. CCD.V +50.00%
 Metalex Ventures Ltd. MTX.V +50.00%
 Activex Limited AIV.AX +40.00%
 San Marco Resources Inc. SMN.V +33.33%
 Canuc Resources Corp. CDA.V +30.00%
 Casa Minerals Inc. CASA.V +30.00%
 Purepoint Uranium Group Inc. PTU.V +25.00%