By Paulo Trevisani and Rhiannon Hoyle

BHP Group and Vale on Friday signed a $32 billion settlement with Brazilian authorities over the disastrous 2015 collapse of a mine-waste dam that killed 19 people and polluted more than 400 miles of river.

The settlement is the result of years of litigation that revealed a series of management missteps and failed oversight resulting in the disastrous breakdown of earthen dam structure holding tens of millions of cubic meters of muddy waste, according to prosecutors.

The resulting mudslide near the small town of Mariana wreaked havoc as a torrent of toxic waste thundered through houses, farm crops and waterways. Nearby rivers took the contents of the dam all the way to the Atlantic Ocean, displacing families and killing plants and animals on its path.

The settlement was signed by government officials, prosecutors and chief executives in a ceremony at the presidential palace attended by President Luiz Inácio Lula da Silva and a host of local authorities.

"I hope that mining companies have learned a lesson: it would have been much cheaper to have avoided what happened, infinitely cheaper," Da Silva said.

The settlement includes nearly $8 billion already spent on remediation and compensation measures. Another $18 billion will be paid over 20 years to the federal government, two states and several municipalities affected by the disaster. The remaining $6 billion will cover individual indemnification, resettlement and environmental recovery, among other things.

A similar dam owned solely by Vale broke in nearby Brumadinho town in 2019, killing 272 people, an incident that isn't covered by Friday's settlement.

The Mariana dam was owned by Samarco Mineração, a 50-50 joint-venture between Vale and Australia's BHP.

--Samantha Pearson contributed to this article.

Write to Paulo Trevisani at paulo.trevisani@wsj.com and Rhiannon Hoyle at rhiannon.hoyle@wsj.com.

(END) Dow Jones Newswires

October 25, 2024 11:55 ET (15:55 GMT)

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