June 30, 2017 / 6:58 AM / 24 days ago

Court gives BHP, Vale until October 30 to settle $47 billion Samarco claim

3 Min Read

BHP Billiton Chief Executive Andrew Mackenzie is silhouetted against a screen projecting the company's logo at a round table meeting with journalists in Tokyo, Japan June 5, 2017.Kim Kyung-Hoon

SYDNEY (Reuters) - BHP Billiton (BHP.AX) (BLT.L) and Vale (VALE5.SA) have won a four-month extension from a Brazilian court to negotiate a settlement to a $47 billion (£36 billion) claim stemming from the Samarco mine disaster in 2015, BHP said on Friday.

Brazilian federal prosecutors in May last year served the joint partners in the Samarco iron ore mine with a 155 billion Brazilian real ($47 billion) claim to pay for the social, environmental and economic costs of cleaning up the country's worst environmental disaster.

"The Court has extended the final date for negotiation of a settlement until 30 October 2017," BHP said in a statement.

Nineteen people died and nearby towns were inundated with flood waters after a dam designed to hold back mine waste burst on Nov. 5, 2015.

The settlement date was originally set for June 30.

BHP also said it had approved $174 million in financial support for the Renova Foundation, which was set up to help with the restoration of communities affected by the disaster.

Additionally, BHP said it is making available a short-term loan of $76 million to Samarco to conduct remediation and stabilisation work.

After the dam gave way, thick reddish-brown sludge flowed into the Rio Doce, one of Brazil's main rivers, killing fish and fouling water supplies for hundreds of kilometres (miles) before reaching the Atlantic Ocean.

Brazilian prosecutors in October charged 21 people with murder on for their roles in the tragedy.

There were signs that the dam was unsafe for several years before its collapse, Brazilian prosecutors argued last year.

The prosecutors said Samarco officials, executives, employees and board members appointed by Vale and BHP failed to take proper action.

BHP also said it was unlikely to mine would restart this year because of the time required to win federal government approval, licenses from state authorities and to restructure Samarco's debt.

Reporting by James Regan; Editing by Richard Pullin and Christian Schmollinger

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