Vale-BHP’s Samarco Faces $43 Billion Suit for Dam Disaster – by R.T. Watson and Yasmine Batista (Bloomberg News – May 3, 2016)

http://www.bloomberg.com/

Brazilian prosecutors filed a civil suit worth 155 billion reais ($43 billion) against Vale SA, BHP Billiton Ltd., and Samarco Mineracao SA for a November tailings dam burst that killed as many as 19 people and caused severe environmental damage, according to a document from the prosecutors office obtained by Bloomberg.

The prosecuting task force is demanding an initial payment of 7.8 billion reais within 30 days, according to the document. The civil suit, which prosecutors said they put together after a six-month investigation, also targets Brazil’s federal government along with both Minas Gerais and Espirito Santo state governments, the prosecutors office said in a statement earlier Tuesday.

Samarco’s $1 billion in bonds due in 2022 fell 4.8 percent to 57 cents on the dollar at 4:30 p.m. in Sao Paulo, the biggest drop since Dec. 21. In March, Samarco and its co-controllers signed an agreement with the federal government and the two states committing to pay as much as 12 billion reais over the next 15 years.

Samarco said by telephone it would be looking at the case. Vale and BHP declined to comment when contacted by Bloomberg.

The civil suit is an extensive, 352-page document with more than 200 claims related to ecological, economic and social damages wrought by what has been called Brazil’s worst ever environmental disaster, the team of prosecutors said in the statement.

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