Brazil dam bursts: Mining company Samarco to pay compensation

The mud destroyed the school and dozens of houses in Bento Rodrigues earlier this month

Brazil mining company Samarco has agreed to pay at least 1bn reais (£170m; $260m) in compensation for the collapse of two dams it used to hold waste water from iron ore.

The breaches caused rivers of mud to descend on nearby villages in the south-eastern state of Minas Gerais.

Eleven people were killed and 12 are missing, presumed dead.

Samarco is owned by mining giants Vale, from Brazil, and Anglo-Australian company BHP Billiton.

Vale and BHP Billiton "made all possible effort to prioritise the needs of the people who were in the accident area" on 5 November when the dams burst, it said in a statement.

Samarco says the "preliminary commitment" it signed will guarantee payment for "preventive emergency, mitigation, repair or compensation measures".

Protesters spread mud on the facade of the Vale headquarters in Rio de Janeiro

The authorities acknowledge that the amount agreed will not be enough to cover the damage to the environment and to the local population.

"This is only a first instalment," state prosecutor Carlos Eduardo Ferreira Pinto told O Estado de Minas newspaper.

'Worst mining accident'

Last week, Brazilian environmental agency Ibama fined Samarco 250m reais (£43.6m; $66.3m).

Ibama described the dam bursts as "the worst mining accident in Brazil's history".

The village of Bento Rodrigues was totally destroyed. More than 500 people lost their homes there.

Residents of Bento Rodrigues were re-housed in neighbouring villages

Samarco could face even higher fines from environmental regulators for water pollution and damage to local areas.

The mud is being tested for potential toxins from the mine.

The cause of the dam breaches has not yet been determined, but one of the structures was being extended as part of an expansion project at the time.