The mining giants had already been ordered to pay 250m reais after a dam burst at their jointly owned Samarco mine on 5 November.

Twelve people remain missing following the incident in southern Brazil that set off a deadly mudslide.

The fine will provide aid to the victims and fund environmental repairs.

The head of Brazil's environmental agency Ibama has described it as the worst mining accident in the country's history.

Prosecutors in the Brazilian state of Minas Gerais said the preliminary payment would cover the clean-up costs and compensation.

"We know that the amount of damages could be much greater, but the agreement establishes a firm legal guarantee," prosecutor Carlos Eduardo Ferreira Pinto said in the statement.

Brazilian miner Vale's chief financial officer Luciano Siani earlier refused to speculate on the level the clean-up costs and fines could ultimately reach.

State prosecutors are also considering whether to pursue criminal charges.

President Dilma Rousseff said the country was "committed to blame those who are responsible."

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

Mr Siani said he didn't yet know when the mine would reopen.

The incident is expected to affect Vale's production next year, and the firm has said it will give a new forecast for 2016 production in December.

Mining is Brazil's third largest industry.

Source: BBC