Brazil to File $5.3 Billion Suit Against Dam Owners – by Paul Kiernan (Wall Street Journal – November 27, 2015)

RIO DE JANEIRO—Brazil’s government said it is preparing to sue mining giants Vale SA, BHP Billiton Ltd. and their joint venture Samarco Mineração SA in response to a catastrophic dam failure earlier this month, as Vale acknowledged the presence of toxic elements in a river downstream for the first time.

The civil suit demanding damages of 20 billion Brazilian reais ($5.3 billion) is expected to be filed on Monday, the Attorney General’s office said on Friday in a news release. The proceeds are intended to create a fund to help recovery efforts in the Rio Doce, a major river that was contaminated with mud and toxic mining waste in the wake of the Nov. 5 collapse of Samarco’s dam in Minas Gerais.

As many as 13 people were killed and hundreds displaced as the mud swallowed up entire villages below the dam. An additional 11 are missing.

The lawsuit will represent by far the biggest government response yet to what is widely considered one of Brazil’s worst environmental disasters. Environmental agency Ibama had previously announced a fine of 250 million reais, while prosecutors secured a preliminary commitment from the mining companies to create a 1-billion-real emergency fund.

The amount of damages sought, the Attorney General’s office said, “is preliminary and could be raised over the judicial process, since the environmental damages of the mud’s arrival at the ocean have not yet been calculated.”

Vale’s admission about the river contamination came two days after a United Nations report alleging “high levels of toxic heavy metals and other toxic chemicals” in the Rio Doce and criticizing the mining companies and the Brazilian government for their “defensive” public response to the incident.

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