BHP Billiton approves $181 million more compensation, remedial work on Samarco iron ore mine in Brazil

Mining giant BHP Billiton (ASX: BHP) approved on Friday another US$181 million (A$244 million) for compensation and remedial work at the collapsed Samarco iron ore mine in Brazil. The accident 12 months ago killed 19 people and led to the filing by Brazilian authorities of charges against 21 officials and employees of BHP, Vale and Samarco.

Although BHP is working toward reopening the mine, it would only restart operations if it has been determined to be safe and economic, and Brazilian authorities have granted the needed approvals. In the meantime, BHP Billiton Brasil would continue to work through options for restart with Vale and Samarco while battling a US$6 billion (A$10.8 billion) civil suit over the accident, Business Insider Australia reports.

In May, the Federal Court of Appeals in Brasilia ratified the deal between BHP and Vale, and Brazilian authorities. But the Federal Prosecutors’ Office won an appeal against the ratification.

The cost of the remedial work is part of a US$1.2 billion (A$1.6 billion) foreshadowed by BHP. However, it is separate from another US$115 million (A$155 million) of new loans BHP and Vale each offered to Samarco while assessing if it would reopen the mine at Bento Rodriguez where toxic tailings spewed into a river and destroyed the surrounding area after a dam wall collapsed, SBS reports.

The loan could be used for onsite tasks such as dam restoration and reapplying for government approvals. In August, geotechnical experts said the dam collapse was caused by a series of design and drainage issue over several years.