BHP responds to allegations it must pay $14b over Mariana Dam disaster

Over the weekend, Reuters reported that Australian mining giant BHP must pay $14 billion to Brazil.

This obligation reportedly also affects Brazilian miner Vale and relates to a tailings dam burst in 2015.

Now called the Mariana Dam disaster, more than 40 million cubic metres of tailings entered the Doce River. A dam holding that waste material failed, killing nearly 20 people.

It was, however, the environmental damage that made the Mariana disaster international news for weeks. There was another issue – the pollution of 670 kilometres of waterways.

Mariana Dam was, in terms of the spread of materials, the largest ever incident of its kind.

General summary of damages

Once those tailings hit the river system, the entire system became toxic, leading to cities running out of fresh water.

The mass of sludge that entered the Doce eventually hit the Atlantic Ocean and did more damage there.

At the time, it was big news, and a legal case has been churning away since.

This legal case was what Reuters reported on over the weekend, stating BHP and Vale – through the JV entity Samarco – must pay $14 billion for damages.

BHP response

The reported order to pay has seemingly come from Brazilian federal prosecutors with whom BHP has been engaged in negotiations since CY2021.

Brazil is seeking “moral damages” according to the reporting.

It was also framed as an early settlement process to receive money before the case dragged on too much longer.

But here’s one big catch: Australia’s BHP says it never got the e-mail.

“BHP Brasil has not been served with a decision by the Court and will review the decision to assess its implications,” the company wrote.

It is unclear if Vale is just as confused, and if BHP being unaware of the finding challenges its finality in any way.

“As disclosed in BHP’s 2023 Annual Report, the Group’s provision related to the Samarco dam failure is US$3.7 billion as at 30 June 2023,” BHP said in a statement.

“Further details of … liabilities related to the Fundão tailings dam failure (including the Federal Public Prosecution Office claim) are set out in the Group’s financial statements for the year ended 30 June 2023.”

And with that, BHP has said all it’s going to say on the matter.

For now.

It’s been a high-profile year of scandals so far this year. Earlier this month, Worley hit back at claims from Ecuador that it owed anyone money due to alleged corruption.