BHP-Vale Brazil mine pays $US260m

Brazilian mining firm Samarco has pledged to pay $US260 million ($A366 million) in damages after a deadly torrent of mud from burst dams killed at least 10 people, flattened a village and polluted a river.

Samarco, which is co-owned by mining behemoths Australia's BHP-Billiton and Brazil's Vale, signed a "preliminary commitment" to "guarantee payment for preventive emergency mitigation, repair or compensation measures", the state prosecution service said.

The November 5 disaster in the southeastern state of Minas Gerais saw a flood of mining waste and muddy water pour from a breached reservoir at Samarco's iron ore mine.

The torrent devastated the local environment, knocked out water supplies in the area, and mostly destroyed the village of Bento Rodrigues.

Some 500km of the River Doce were contaminated.

"We know that the amount of damages could be much greater, but the agreement establishes a firm legal guarantee," prosecutor Carlos Eduardo Ferreira Pinto was quoted as saying on Monday.

A Brazilian court on Friday had already frozen about $US78 million from Samarco's accounts for the future payment of potential damages to victims.

Now, the first $US130 million must be paid within 10 days and the other half in a month.

A government-appointed independent auditor will monitor Samarco's use of the funds, which must "exclusively" target costs related to the tragedy.

On Thursday, Brazilian President Dilma Rousseff announced fines amounting to $US67 million - separate to the damages payouts - and indicated there would be others

BHP Billiton is the world's largest mining company and Brazil's Vale is the largest iron ore miner.

The overall clean-up cost could top $US1 billion, according to Deutsche Bank.

Anger at the sudden catastrophe has been intense, with ordinary people and wildlife the visible victims.

In Rio, about a hundred people demonstrated outside Vale's headquarters, shouting "Vale, you killed me!"