By Brazil Stock Guide – Braskem S.A. (B3: BRKM3, BRKM5, BRKM6; NYSE: BAK) has signed a landmark settlement with the State of Alagoas to resolve liabilities stemming from the geological event that forced the evacuation of parts of Maceió in 2018. The agreement, worth R$1.2 billion ($212 million), provides full release from state-level claims and marks a significant step toward closing one of Brazil’s longest-running corporate-environmental disputes.
The disaster was linked to Braskem’s rock salt mining operations in urban areas of Maceió, where the company extracted salgema — a form of salt used in the production of chlorine and caustic soda. Over decades of underground extraction, the geological layers beneath several neighborhoods became unstable, leading to soil subsidence, cracks in streets and homes, and the eventual evacuation of more than 50,000 residents from five affected districts.
Under the new settlement, R$139 million has already been paid, with the remaining balance to be settled in 10 annual installments, mainly after 2030, reflecting Braskem’s cash flow capacity. The petrochemical company had previously provisioned R$467 million related to compensation for patrimonial damages. The deal still requires judicial ratification to take effect before becoming fully binding.
“This agreement represents a significant and important advance for the company regarding the impacts of the geological event in Alagoas,” said Felipe Montoro Jens, Braskem’s CFO and Investor Relations Officer. The settlement extinguishes the state’s lawsuit and covers all patrimonial and non-patrimonial damages, ensuring comprehensive reparation for public losses.
The accord adds another milestone to Braskem’s multi-front effort to contain financial and reputational fallout from the Alagoas subsidence crisis, which has already cost the company almost R$14 billion in provisions and compensation.