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article image'Substantial progress' on Brazil mine disaster recovery: BHP

By AFP     May 6, 2016 in World

BHP Billiton Friday said it was making "substantial progress" to help communities devastated by a fatal Brazilian mine accident, as the commodities giant's share price strengthened after sinking on the back of a multi-billion-dollar lawsuit.

The November accident, in which 19 people died, destroyed an entire village and cut off water supplies for tens of thousands in what has been called one of the biggest environmental disasters in Brazil's history.

BHP said in a statement that "while considerable work remains over the long term, six months on substantial progress was being made in the response effort".

The Anglo-Australian firm said it had rebuilt or restored more than 60 percent of buildings that were affected and added that 5,200 people were receiving financial support, while areas hit by flooding were being re-vegetated.

"While we cannot bring back the lives that were lost, we continue to focus on ensuring that the families and communities impacted by this tragedy are supported," BHP's chief commercial officer Dean Dalla Valle said in the statement.

The BHP statement added that Samarco was seeking approvals to restart its operations, although BHP did not list an expected date of commencement.

The comments came after a Brazilian court on Wednesday formally approved an agreement reached by the mine's co-owners BHP and Brazilian iron ore leader Vale in March that outlined restoration plans.

BHP shares closed 0.16 percent higher to Aus$18.46 in Sydney on Friday. The share price fell 9.36 percent on Wednesday and a further 1.92 percent on Thursday with traders taken aback by the sheer size of the claim.

On Tuesday, prosecutors in the state of Minas Gerais, where the disaster occurred, filed the lawsuit, estimating "the preliminary value for repairs to be 155 billion reals (US$43 billion)".

The two companies had already agreed to a separate settlement of US$6.2 billion with the Brazilian government in March.

Those funds were ordered to go toward compensating for social and environmental damage and to be paid over 15 years. But the deal was criticised by prosecutors, who said the amount was not calculated realistically.

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