Brazil court freezes $78 million in Samarco accounts after disaster

Samarco is owned by Australia’s BHP Billiton, the world’s largest mining company, and Brazil’s Vale, the largest iron ore miner.

Mining is Brazil’s third largest industry.

Samarco will also contribute to clean-up costs in the neighbouring state of Espirito Santo, which was also hit by waste water from the accident, although it has not put a value on the amount.

More than 600 people who lost their homes in the accident have been put in temporary accommodation, Mr Mackenzie added, while Samarco continued to provide food, water and emergency supplies to local communities.

The November 5 disaster in the southeastern state of Minas Gerais saw a flood of mining waste and muddy water pour from a breached reservoir at Samarco’s iron ore mine. The operations will remain suspended as authorities commence investigations and rectification work plans are developed.

BHP has a growing team on the ground including geotechnical, disaster relief and humanitarian response experts, health and safety executives, environmental scientists and support staff.

The mining giant is also reviewing the structures of its Cerrejón coal joint venture in Colombia and the Antamina copper and zinc joint venture in Peru, where it is not the operator.

He said that BHP Billiton fully supports Samarco in taking these necessary steps to enable remediation in the affected areas.

“That is the kind of arrangement we need to review and have been reviewing, to be honest, to decide not just the perspective of our shareholders, but the shareholders of the companies who are partners to that joint venture and whether a more petroleum-type model might be more appropriate in the future”, Mackenzie said. BHP and Glencore each have 33.75 per cent stakes, while Teck Resources holds 22.5 per cent and Mitsubishi Corp 10 per cent.

The incident is expected to affect Vale’s production next year, and the firm has said it will give a new forecast for 2016 production in December.

BHP rose 0.9 percent, the most since November 4, to A$20.27 at 10.19am in Sydney trading, as rivals Rio Tinto Group advanced 1.2 percent and Fortescue Metals Group rose 2 percent.