The settlement means compensation payments to relatives of the 19 people who died in the disaster can begin, almost three years after the incident.
The hundreds of others who lost homes and other properties will also start to receive their compensation. No financial details of the deal were given.
Brazil’s worst ever environmental catastrophe happened when two dams designed to hold back mine waste from the Samarco iron pellets operation in Mariana, eastern Brazil collapsed.
It left a trail of destruction for hundreds of kilometres in the states of Minas Gerais and Espírito Santo.
Toxic mining waste polluted rivers and beaches while villages were flooded, forcing hundreds to flee their homes.
The settlement means that BHP and Vale might be able to prepare to resume operations in the region and Vale has said that it hoped to re-open the mine later this year or early next, although it has pushed forecasts back several times.
BHP shares were down 0.6% to 1,689p.