Following the press release dated October 18, 2024, Vale informs that Samarco, BHP Billiton Brasil and Vale, together with the Brazilian Federal Government, the State Governments of Minas Gerais and Espírito Santo, the Federal and State Public Prosecutors’ and Public Defenders’ Offices and other Brazilian public entities reached today a definitive and substantial settlement (Definitive Settlement) of claims related to the Fundão dam collapse in Mariana, Minas Gerais, Brazil, on November 5, 2015.

"The Definitive Settlement enabled a mutually beneficial resolution for all Parties under fair and effective terms, while creating definitiveness and legal certainty. It is the result of a high-level mediation process conducted by the Brazilian Federal Court of Appeals of the 6th Region, with open dialogue and transparency. The engagement of Brazilian authorities and public entities ensured legitimacy to the settlement, which was supported by social, environmental and technical criteria. This important agreement also reinforces our commitment to Brazilian society and to a better future for the people, communities and the environment." said Gustavo Pimenta, Vale's CEO.

The final and definitive settlement documentation was approved by all Parties, including Vale’s Board of Directors, and signed today. The Definitive Agreement addresses all demands involving the signatory Brazilian public authorities, related to the collapse of Samarco's Fundão dam, including all socio-environmental damages and all collective and diffuse socioeconomic damages resulting from the rupture.

Key financial commitments
The Definitive Settlement provides for a total financial value of approximately R$ 170 billion¹, comprising past and future obligations, to serve the people, communities and the environment impacted by the dam failure. It sets three main lines of obligations.

Obligations to pay
Funds will support several compensation fronts, ensuring substantial resources for improvements in health, sanitation, fishing activities and community funding, and a dedicated approach to indigenous and traditional communities, and municipalities.

Obligations to perform
Samarco will execute certain obligations, including a voluntary-based, simplified individual indemnification system, measures towards the Doce River environmental recovery and the completion of community resettlements, which already reached around 94% of total cases to be delivered as of September 30, 2024. Hence, part of the Renova Foundation’s 42 programs will be gradually transferred to Samarco or the authorities, while the remaining programs will be closed. The Renova Foundation’s governance body will cease on signing.

Vale’s provision and cash outflow expectation
Vale reaffirms its commitments to supporting Samarco in repairing the damage caused by the Fundão dam collapse and to the shareholders' previously agreed obligation to finance, up to a 50% share, the amounts that Samarco may eventually fail to fund as the primary obligor. Vale’s provision recorded for those obligations is US$ 4.7 billion as of September 30, 2024, and includes estimates of Samarco’s contributions. The estimated timeline for cash disbursement is presented below.

Parties’ legitimacy
A high-level mediation process by the Brazilian Federal Court of Appeals of the 6th Region and the engagement of Brazilian public institutions, playing their Constitutional role as authentic representatives of the affected people, have ensured transparency and legitimacy to the settlement process.


¹ Future financial obligations are presented on a real, undiscounted basis and will accrue inflation at Brazilian inflation index IPCA
² Adjusted by the Brazilian inflation index IPCA.
³ Future financial obligations are presented on a real, undiscounted basis and will accrue inflation at IPCA inflation rate.
⁴ Average annual payments between 2031 and 2043.
⁵ As per previous framework agreements.
⁶ Considering an average exchange rate of 5.4481 as of September 30,2024.