New Wisdom Investment Limited

BHP,iron ore joint venture in Brazil is unlikely to restart this year

(Jul 03, 2017)

Global mining major BHP (AU:BHP) has approved US$250 million over the next six months towards remediation and compensation for the Samarco dam disaster, saying the iron ore joint venture in Brazil is unlikely to restart this year.

BHP said $174 million would be used by the Renova Foundation for remediation and compensation programmes, offset against the group’s provision for the 2015 Fundão tailings dam failure which killed 19 people and caused extensive environmental damage.

The company would also make a short-term facility of up to $76 million available to Samarco Mineração SA, its joint venture with Vale SA (BZ:VALE5), to support operations and carry out remediation work.

BHP and Vale have been granted a four-month extension to October 30 as the final date for negotiation of a multi-billion dollar settlement.

The co-owners had entered an agreement with the Brazil Federal Prosecutor’s Office in January outlining the process and timeline to negotiate a settlement of the circa US$47.5 billion and $6.1 public civil claims relating to the dam failure.

BHP said restarting Samarco was subject to regulatory approvals and debt restructuring, and would only occur if it was safe, economically viable and had community support.

“Accordingly, operations at Samarco are unlikely to restart in CY2017,” BHP said on Friday.

Created from