Brazilian law firms Machado, Meyer, Sendacz e Opice Advogados, Pinheiro Neto Advogados and Sergio Bermudes Advogados have helped mining company Samarco and its owners BHP Billiton and Vale reach a settlement worth at least 6.8 billion Reals (US$1.8 billion) with the Brazilian government. The settlement was over Brazil’s worst ever environmental disaster: a deadly dam failure in November 2015 which killed 17 people and injured 16.

On November 5, 2015, the Samarco-owned iron ore mine in South-East Brazil burst, resulting in the spillage of sixty million cubic meters of iron ore waste – enough to fill 25,000 olympic-sized swimming pools – engulfing villages, contaminating rivers and causing massive destruction to the region’s flora and fauna. Samarco had agreed to pay a preliminary R$1 billion(£177M, $262M) to cover the clean-up costs and compensation – costs the company said already exceeded its insurance cap for civil damages. It was also fined R$250M by Brazilian authorities in charge of the environment, for violations including water pollution and damages to urban areas. Future financial penalties had been predicted, and it was said that the mining companies involved would have to pay for recovery efforts.

Earlier this month, Oil giant BHP Billiton confirmed that its Samarco Mineracao joint venture alongside Vale SA, will pay a total of R$2billion (£362M, $510M) this year, R$ 1.2 billion in 2017 and another R$1.2 billion in the following 12 months, with annual payments of between R$ 800M and R$ 1.6 billion to be paid each year between 2019 and 2021, depending on the project needs. "The settlement provides the market with a degree of certainty regarding the financial impact," said IG's chief market strategist Chris Weston. 

BHP added that Samarco, Vale and BHP Billiton Brasil will establish a foundation to help with the redevelopment of the areas affected by the catastrophe through relevant socio-economic programmes. This foundation will be jointly managed by members representing all 3 parties involved, as well as Brazilian authorities.

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