BHP Billiton shares have tumbled to a 10-year low as the global miner is hit by a perfect storm in the wake of the Brazilian mine disaster.
Shares in the company fell below $20, dropping 3.4 per cent to $19.91 in morning trade, before staging a slight recovery.
CMC Markets analyst Michael McCarthy said BHP was being hit from all directions because of a confluence of bad news.
"Against the backdrop of weak commodity prices there are concerns, not only about the Brazilian mine disaster and this dispute they're having over Queensland coal royalties, but also concerns that their dividend policy is not sustainable," Mr McCarthy said.
A strengthening Australian dollar and weak oil, copper and iron ore prices were also working against the resources company.
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However, Mr McCarthy said the world's largest miner had a strong balance sheet and good cash flows which helped contain the sell off.
Brazilian President Dilma Rousseff on Thursday announced preliminary fines totalling 250 million real ($A93.81 million) against the Samarco mine in southeastern Brazil, jointly owned by BHP Billiton Ltd and Vale SA, where two dams burst last week, killing at least nine people and leaving 19 people missing.
Federal prosecutors in Brazil also announced plans to work with state prosecutors to investigate possible crimes that could have contributed to the disaster at the mine, with mud and mine waste extending 440 kilometres downstream affecting 11 communities.
BHP and Vale are expected to put in more than $US100 million ($A141.70 million) initially for the relief effort, and have promised more assistance as required.
Deutsche Bank estimates the clean-up bill could cost more than $1 billion.
Around 630 people have been forced from their homes and fears for the safety of a third dam has prompted new evacuations amid worries the sludge could contaminate the water supplies of more than half a million people.
Adding to the company's woes, BHP Billiton is heading to the Queensland Supreme Court to dispute a $288 million tax bill with the Queensland government.
Meanwhile, Resources Minister Josh Frydenberg has warned mining companies to maintain the highest operating standards despite pressure from falling commodity prices.
"It's vital at a time of increased pressure on the budget bottom line for energy and mining companies, that they continue to adhere to the highest standards of safety and environmental standards," he said.
Mr Mackenzie is expected to return to Australia from Brazil next week to attend the company's annual general meeting in Perth where he is likely to face questions about the company's policy to constantly increase its dividend, cuts to production at Samarco and the clean-up costs in Brazil.
A BHP spokeswoman said it was too soon to speculate on the overall costs of the disaster and said it would hold an independent investigation to understand why the events occurred and examine the history of the dams in detail.
BHP shares closed 38 cents, or 1.84 per cent lower, at $20.23.
