Vale and BHP Billiton are facing one of Brazil's largest-ever civil lawsuits after prosecutors demanded R$155 billion ($44 billion) in damages for the deadly dam collapse at their mine last year that unleashed a tsunami of waste-filled mud across two states.
Federal prosecutors in Minas Gerais, where the companies' joint mining venture Samarco is based, and neighboring Espírito Santo state, said on Tuesday that the value of the damages claim was based on the clean-up costs of the comparable 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.
"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 suit comes as a blow to Brazil's Vale and Anglo-Australian miner BHP, which settled a R$20 billion lawsuit over Samarco's dam collapse with the federal and state governments in March.
While investors had hoped that agreement would draw a line under all claims, Brazil's independent prosecutors criticized the government for "selling out" and vowed to seek more compensation.
Vale's shares slumped more than 6 per cent in São Paulo late on Tuesday while the company's American depository receipts in New York were later down almost 8 per cent. BHP ADRs were down more than 5 per cent, and the company's Sydney-listed stock was down 7.2 per cent on Wednesday morning.
Vale declined to comment, saying that it had not been notified of the lawsuit.
BHP said it had not yet received any formal notice of the legal claim. In a statement the company said it "remains committed to helping Samarco to rebuild the community and restore the environment affected by the failure of the dam".
In their 359-page suit, prosecutors demanded that Vale, BHP and Samarco deposit an initial sum of R$7.7 billion into an independently managed fund within the next 30 days. A judge must now decide whether to proceed with the case.
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While Brazil's prosecutors have a history of seeking vast compensation payments for environmental disasters — as they did against Chevron following its 2011 oil spill off the coast of Rio de Janeiro, such cases are normally settled for much lower amounts.
Separately, Brazilian police have charged the former chief executive of Samarco and six others with homicide over the collapse of Samarco's dam in November last year that killed at least 17 people and left more than 700 homeless. They have said they may file further criminal charges after the conclusion of their investigation.
Only three weeks after the dam's collapse — considered to be the country's worst-ever environmental disaster — Brazil's attorney-general sued Samarco for R$20 billion, settling the case in March in a deal that was expected to cost the companies as little as R$10 billion.
At the time, analysts questioned whether the unusually swift resolution of the crisis was an attempt by President Dilma Rousseff to show political leadership as her government strained under the weight of the corruption scandal at state-oil company Petrobras.
However, Brazil's prosecutors, who have played an ever more active role in the Latin American country after their independence was guaranteed by the 1988 constitution, were enraged by the government's actions.
In February, federal prosecutor José Adércio Leite Sampaio, who has led investigations into the dam failure, told the Financial Times that he planned further lawsuits against the miners, using the BP Deepwater Horizon oil spill as a parameter.