BHP Billiton share price tumbles as miner and Vale face $44bn lawsuit
Shares in BHP Billiton (LON:BLT) have fallen about seven percent in London this morning, with the blue-chip miner and peer Vale facing one of Brazil’s largest ever civil lawsuits over the Samarco disaster in November which killed 19 people and caused severe environmental damage.
As of 10:23 BST, BHP Billiton’s share price had fallen 7.20 percent to stand at 812.30p. The miner’s shares have lost nearly 50 percent of their value over the past year, but are up about seven percent in the year-to-date.
Brazilian prosecutors filed a 155 billion reais ($44 billion) civil suit against against BHP Billiton, Vale, and their iron-ore venture Samarco over the dam rupture in November which killed 19 people and caused environmental damage. Federal prosecutors said yesterday that the value of the damages claim was based on the clean-up costs of the comparable BP (LON:BP) oil spill in the Gulf of Mexico in 2010.
“Preliminary studies show the human, economic and socio-environmental impacts of the collapse of the dam are, at least, equivalent to those verified in the Gulf of Mexico,” prosecutors said in a statement, as quoted by the Financial Times. “It does not seem credible, neither technically nor morally, that the value of the human, cultural and physical environment in Brazil should be worth less than in other countries.”
The lawsuit comes after earlier this year Vale and BHP reached a deal with Brazil’s government to pay up to $2.3 billion to fund a foundation scheme to restore the local environment and communities affected by the Samarco dam failure. The FT noted that Brazil’s independent prosecutors had criticised the government for ‘selling out’ and vowed to seek more compensation.
BHP said in a statement this morning that it had not yet received formal notice of the claim.
“BHP Billiton remains committed to helping Samarco to rebuild the community and restore the environment affected by the failure of the dam,” the Anglo-Australian miner noted in the statement.
As of 10:45 BST, Wednesday, 04 May, BHP Billiton plc share price is 811.60p.