Mining giants BHP and Vale have signed a deal with Brazil's government to pay nearly US$30 billion in damages for a 2015 dam collapse that triggered the country's worst environmental disaster.

President Luiz Inacio Lula da Silva attended the signing of the deal over the November 5, 2015 collapse of a tailings dam at a mine in the southeastern town of Mariana, which triggered a giant mudslide.

The river of mud swamped villages, rivers and rainforest, killing 19 people on its way to the sea.

"I hope the mining companies have learned their lesson: it would have cost them less to prevent (the disaster), much less," Lula said at the ceremony attended by representatives of Brazil's Vale and Australia's BHP, co-owners of the Brazilian company Samarco that operated the iron mine.

The agreement, which Lula declared to be the biggest environmental payout in modern history, comes on the fifth day of a separate mega-trial in London over BHP's role in the dam's failure.

More than 620,000 complainants, including 46 Brazilian municipalities and several Indigenous communities, are seeking an estimated 36 billion pounds (US$47 million) in damages in the civil trial.

BHP denies responsibility.

The company said on Friday that the agreement reached in Brasilia did not end the lawsuits pending against the companies, nor prevent others being taken.

The dam's failure released a torrent of over 40 million cubic meters of highly toxic sludge, the equivalent of 12,000 Olympic swimming pools, which coursed through the Doce River all the way to the Atlantic Ocean, over 600 kilometres away.

Over 600 people were left homeless.

Scientists say the mouth of the Doce River and parts of the southeast Atlantic coastline are still contaminated with metals from the spill, affecting the area's population of fish, birds, turtles, porpoises and whales.

BHP and Vale had already agreed in 2016 to pay 20 billion reais (about US$3.5 billion at today's rate) in damages, but the negotiations were reopened in 2021 due to what the government called their "non-compliance" and the slow progress of Brazil's justice system in resolving the dispute.

Friday's agreement in Brazil, which is subject to approval by the country's Supreme Court, covers the companies' past and future obligations to assist people, communities and ecosystems affected by the disaster. (AFP)