09/06/2024 – 17:55
Mining companies Vale and BHP, together with their joint venture Samarco, could soon reach an agreement with Brazilian authorities to pay around R$100 billion for the collapse of a dam in Mariana, Minas Gerais, four sources familiar with the discussions said.
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Three of these sources expect a final agreement to be reached in October. The amount is higher than the R$82 billion in new resources to be paid to compensate for the disaster, offered in the last proposal made by the companies, in June.
The day before, President Luiz Inácio Lula da Silva said he expected the agreement to be reached in early October.
“It is well advanced. President Lula’s expectations are in line with reality. It is very close,” said one of the sources, noting that only “a few details of the text and also financial details” are missing.
“All values are being discussed and balanced. Those affected include the environment, health, sanitation, fishermen, farmers, and so on… it is necessary to see what will be implemented by each entity of the federation and by the institutions. It is a huge bill.”
The negotiations involve several justice institutions, public authorities, federal and state public ministries (MG and ES), as well as public defenders from the Union, Minas Gerais and Espírito Santo, representing the affected communities.
A second source stated that the governments of Minas Gerais and Espírito Santo have already reached an agreement to close the deal and that approval from the Union is still needed.
A third source stated that the “rope” of values was stretched “to the absolute limit” and that, to close, it will be an agreement “with definitiveness and settlement in order to close the legal disputes”.
In addition to the new amount to be paid to the authorities, so that they can undertake the necessary actions to repair and compensate for the rupture, the mining companies will also have obligations to fulfill as set out in the text, which will also require their own future investments.
The companies also point out that they have invested a total of 37 billion reais in repairs and compensation since the collapse.
When contacted, Vale, BHP and Samarco reiterated, in different statements, that they are engaged in the process to establish an agreement that guarantees fair and full compensation for the people affected and the environment.
BHP added that it “remains optimistic that a final agreement can be reached soon”.
The collapse of the iron ore tailings dam, which belonged to Samarco, in November 2015, left 19 dead, hundreds homeless, and affected the entire length of the Doce River, all the way to the sea in Espírito Santo.
The mining companies had reached an initial agreement on the disaster back in 2016, which created a basis for implementing reparations, but it was not signed by the federal and state Public Prosecutors’ Offices, did not set a global amount of resources to be committed and left several stages to be completed, being the target of criticism from several parties.
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