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Brazil rejects Vale-BHP’s bid due to the 2015 deadly dam collapse

“I cannot but express my outrage at how brazen it is of Vale and BHP to present a settlement proposal for the Mariana humanitarian tragedy that is less adequate than the previous one,” said the country’s Minister of Mines and Energy, Alexandre Silveira, in a statement. interview with Bloomberg in Rome. “We will reject it.”

Read more: BHP and Vale offer Brazil $25.7 billion to cover dam disaster (1)

Silveira said the proposal is technically and economically inappropriate because it reduces the companies’ liabilities and transfers them to the federal government and the states. Brazil’s Public Prosecutor’s Office confirmed in a statement that the proposal had been officially rejected on Friday.

Brazil’s mining and energy chief indicated that the government of President Luiz Inacio Lula da Silva is exploring legal ways to pressure Vale, BHP and Samarco to expedite a settlement, without giving details.

“Vale and BHP enter into an agreement or face the full rigors of the law,” Silveira said.

The state government of Minas Gerais said in a statement that it sees room for adjustments in the companies’ proposal, with a focus on accelerating reparations, adding that progress has been made compared to the previous offer of 8.2 billion dollars (42 billion reais). Planning Secretary Luisa Barreto criticized what she called “a unilateral decision by the federal government” to reject the proposal.

A final settlement in the 2015 Mariana Dam collapse, which killed 19 people and polluted waterways in two Brazilian states, would remove a major legal shadow over the companies and provide a recovery plan for victims of what was the largest Brazil’s environmental disaster.

Silveira said he is concerned that BHP could expand its operations in Brazil before reparations are made to victims of the Samarco dam rupture if a bid to buy rival miner Anglo American Plc is successful. Anglo owns the Minas Rio iron ore mine in Minas Gerais, one of two states directly affected by the collapse of the Samarco dam.