Brazilian Dam Disaster Could Be This Mining Company’s 'deepwater Horizon' Moment

Thomson Reuters The collapse of a Brazilian tailings dam jointly owned by BHP Billiton and Vale caused the worst environmental disaster in the country's history and could turn into a calamity on par with the Deepwater Horizon oil spill in the Gulf of Mexico. Worse for the miners, their liability for the catastrophe could exceed that faced by the oil drilling rig's owner, BP. At least 19 people were killed, 700 people made homeless, and hundreds of miles of waterways polluted when a tailings dam failed last November. Brazilian prosecutors said the cost of cleanup of the Fundao dam at the Samarco joint venture project in the state of Minas Gerais would likely be just as costly as the cleanup in the Gulf of Mexico, and BHP just warned it can't calculate how bad the bill will be that it might have to pay. A laundry list of damages Earlier this summer BP announced its total tab from the Deepwater Horizon disaster will cost it almost $62 billion when all the claims are finally tallied, but the amount BHP, Vale, and Samarco might be liable for could easily surpass that. In its annual report filed just last week, BHP Billiton detailed what the potential costs are so far: $2.3 billion in civil public actions filed by state prosecutors in Minas Gerais $3.1 billion in damages filed by public defenders in Minas Gerais $620 million in damages filed by state prosecutors in Espirito Santo $6.2 billion in a public civil claim $43 billion for reparations, compensation, and "moral damages" in relation to the Samarco dam failure That totals more than $55 billion, and though some of those claims may overlap, it's possible for the situation to go from bad to worse. Thomson Reuters When it rains, it pours -- literally BHP Billiton noted that work that began immediately after the collapse attempted to reinforce and improve the dam structures to contain the remaining tailings materials at Samarco.