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BHP BILLITON PLC - Samarco Update

Release Date: 30/06/2017 08:42
Code(s): BIL     PDF:  
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Samarco Update

BHP Billiton Plc
Registration number 3196209
Registered in England and Wales
Share code: BIL
ISIN: GB0000566504


NEWS RELEASE

Release Time       IMMEDIATE
Date               30 June 2017
Release Number     18/17



SAMARCO UPDATE

Financial Support

BHP has approved a total of US$250 million (BHP Billiton Brasil Ltda (BHP Billiton
Brasil) share) in financial support for the Renova Foundation and Samarco
Mineração S.A. (Samarco) until 31 December 2017.

The amount of US$174 million will be used to fund the Renova Foundation for
remediation and compensation programs identified under the Framework Agreement
(described in the Note below) (Programs). This amount will be offset against the
Group’s provision for the Samarco dam failure.

A short-term facility of up to US$76 million (BHP Billiton Brasil’s share) will be made
available to Samarco to carry out remediation and stablisation work and to support
Samarco’s operations. Funds will be released to Samarco only as required, and
subject to achievement of key milestones.

Preliminary Agreement

On 18 January 2017, Samarco and its shareholders, Vale S.A. (Vale) and BHP
Billiton Brasil entered into a preliminary agreement with the Federal Prosecutors’
Office in Brazil (Federal Prosecutors) in relation to the Samarco dam failure
(Preliminary Agreement).

The Preliminary Agreement outlines the process and timeline for negotiation of a
settlement of the BRL 155 billion (approximately US$47.5 billion) and BRL 20 billion
(approximately US$6.1 billion) Public Civil Claims relating to the dam failure. The
Preliminary Agreement also provides for the appointment of experts to advise the
Federal Prosecutors in relation to environmental and socioeconomic impact
assessment and review of the Programs being implemented by the Renova
Foundation under the terms of the Framework Agreement.




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The Court has extended the final date for negotiation of a settlement until 30 October
2017, allowing for the continuation of the interim security arrangements provided to
the Court on 24 January 2017 and the provision of ongoing expert advice to the
Federal Prosecutors in respect of the Programs.

Restart

A restart of operations at Samarco is subject to obtaining separate regulatory
approvals and will occur only if safe, economically viable and has the support of the
community. Resuming operations would also require government approvals, the
granting of licenses by state authorities and the restructure of Samarco’s debt.
Accordingly, operations at Samarco are unlikely to restart in CY2017.

Further information on BHP can be found at: bhp.com


Sponsor: UBS South Africa (Pty) Limited

Note:

Samarco Mineração S.A. is jointly owned by BHP Billiton Brasil Ltda and Vale S.A. Our 50
per cent interest is accounted for as an equity accounted investment.

BRL 20 billion Civil Claim

On 30 November 2015, a public civil claim was commenced by the Federal Government of
Brazil, the states of Espirito Santo and Minas Gerais and other public authorities (Brazilian
Authorities) seeking the establishment of a fund of up to BRL 20 billion (approximately
US$6.1 billion) in aggregate for clean-up costs and damages related to the Samarco dam
failure (BRL 20 billion Civil Claim). On 18 December 2015, an injunction was granted to,
among other things, order Samarco to deposit BRL 2 billion (approximately US$0.6 billion)
for community and environmental rehabilitation.

On 2 March 2016, Samarco, Vale, BHP Billiton Brasil and the Brazilian Authorities entered
into the Framework Agreement that provides for settlement of the BRL 20 billion Civil Claim
by establishing a fund for clean-up costs and remediation and compensation of impacts
relating to the Fundão tailings dam failure.

Ratification of the Framework Agreement on 5 May 2016 suspended the BRL 20 billion Civil
Claim and the corresponding injunction. Subsequently, on 30 June 2016, both the BRL 20
billion Civil Claim and the injunction were reinstated by the Superior Court of Justice in Brazil.
A final decision by the Court on the issue of ratification is pending.

The injunction remains the subject of litigation before Federal Courts. On 17 August 2016,
the Federal Court of Appeals confirmed the BRL 2 billion injunction. This decision has been
appealed. On 4 November 2016, the 12th Federal Court of Belo Horizonte reduced the BRL
2 billion injunction to BRL 1.2 billion (approximately US$0.4 billion).

BRL 155 billion Civil Claim




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On 3 May 2016, the Federal Prosecutors commenced proceedings against Samarco, Vale
and BHP Billiton Brasil for BRL 155 billion (approximately US$47.5 billion) for social,
environmental and economic compensation relating to the Samarco dam failure (BRL 155
billion Civil Claim).

The claim includes the Federal Prosecutors seeking an injunction order that Samarco, Vale
and BHP Billiton Brasil deposit BRL 7.7 billion (approximately US$2.4 billion) into a special
company account. The 12th Federal Court of Belo Horizonte has not yet decided on any
injunction in the BRL 155 billion Civil Claim.

Effect of the BRL 2.2 billion Interim Security under the Preliminary Agreement

Under the Preliminary Agreement, the parties have agreed to suspend the Federal
Prosecutor’s BRL 7.7 billion injunction application in the BRL 155 billion Civil Claim and to
request that the 12th Federal Court of Belo Horizonte replace the BRL 1.2 billion injunction in
the BRL 20 billion Civil Claim with the Interim Security of BRL 2.2 billion (approximately
US$675 million). The parties have also agreed under the Preliminary Agreement to suspend
the BRL 20 billion asset freezing order application made by the Federal Prosecutors in the
criminal charges against Samarco, Vale and BHP Billiton Brasil, and certain individuals in
relation to the dam failure.

Media Relations                                    Investor Relations

Australia and Asia                                 Australia and Asia

Ben Pratt                                          Tara Dines
Tel: +61 3 9609 3672 Mobile: +61 419 968 734       Tel: +61 3 9609 2222 Mobile: +61 499 249 005
Email: Ben.Pratt@bhpbilliton.com                   Email: Tara.Dines@bhpbilliton.com

Paul Hitchins                                      Andrew Gunn
Tel: +61 3 9609 2592 Mobile: +61 419 315 001       Tel: +61 3 9609 3575 Mobile: +61 402 087 354
Email: Paul.Hitchins@bhpbilliton.com               Email: Andrew.Gunn@bhpbilliton.com

Fiona Hadley                                       United Kingdom and South Africa
Tel: +61 3 9609 2211 Mobile: +61 427 777 908
Email: Fiona.Hadley@bhpbilliton.com                Rob Clifford
                                                   Tel: +44 20 7802 4131 Mobile: +44 7788 308 844
Amanda Saunders                                    Email: Rob.Clifford@bhpbilliton.com
Tel: +61 3 9609 3985 Mobile: +61 417 487 973
Email: Amanda.Saunders@bhpbilliton.com             Elisa Morniroli
                                                   Tel: +44 20 7802 7611 Mobile: +44 7825 926 646
Kester Hubbard                                     Email: Elisa.Morniroli@bhpbilliton.com
Tel: +61 7 3227 5671 Mobile: +61 408 727 261
Email: Kester.Hubbard@bhpbilliton.com              Americas

United Kingdom and South Africa                    James Wear
                                                   Tel: +1 212 310 1421 Mobile: +1 347 882 3011
Neil Burrows                                       Email: James.Wear@bhpbilliton.com
Tel: +44 207 802 7484
Email: Neil.Burrows@bhpbilliton.com                Cristian Coloma
                                                   Tel: +1 713 235 8902 Mobile: +1 346 234 8483
North America                                      Email: Cristian.CA.Coloma@bhpbilliton.com

Bronwyn Wilkinson
Mobile: +1 604 340 8753
Email: Bronwyn.Wilkinson@bhpbilliton.com




BHP Billiton Limited ABN 49 004 028 077            BHP Billiton Plc Registration number 3196209
LEI WZE1WSENV6JSZFK0JC28                           LEI 549300C116EOWV835768




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Registered in Australia                           Registered in England and Wales
Registered Office: Level 18, 171 Collins Street   Registered Office: Nova South, 160 Victoria Street
Melbourne Victoria 3000 Australia                 London SW1E 5LB United Kingdom
Tel +61 1300 55 4757 Fax +61 3 9609 3015          Tel +44 20 7802 4000 Fax +44 20 7802 4111




Members of the BHP Billiton Group which is
headquartered in Australia

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