Shareholders to quiz BHP over disaster

BHP Billiton shareholders are eager to grill company bosses over the deadly Brazilian mine disaster and the miner's dividend and executive bonuses.

Chief executive Andrew Mackenzie's scheduled appearance at the company's annual general meeting in Perth on Thursday will be his first public outing in Australia since he returned from Brazil last week.

He is expected to feel the heat over his bonus package which includes incentives to boost his $2.4 million base pay by more than 600 per cent.

The BHP boss flew to Brazil to tour the Samarco iron ore mine disaster area following the collapse of two tailings dams on November 5 which left nine people dead and 19 missing.

Mr Mackenzie has been briefing analysts this week after some estimates put the clean-up bill in Brazil at more than $1 billion.

Samarco is jointly owned by BHP Billiton, the world's largest mining company, and Brazil's Vale, the largest iron ore miner.

Mr Mackenzie and chairman Jac Nasser are expected to defend the company's progressive dividend policy and update the market on any changes to production guidance at this week's AGM.

But it comes at a difficult time for the global miner whose shares are trading near 10 year lows amid weak commodities prices.

Australian Shareholders Association (ASA) Director Geoff Bowd said the ASA would join with BHP in expressing concern for the families affected by the tragedy.

"That's a cloud over the AGM," Mr Bowd said.

"It has to be recognised and I've expressed that view to Jac Nasser."

But he said it was not appropriate to speculate on the cause of the disaster or the financial impact on BHP.

While the ASA supports the company's remuneration report, it says the chief executive's potential bonus of 6.4 times base pay is "out of kilter with other companies".

"These incentives are two high," Mr Bowd said.

Mr Mackenzie earned $US4.58 million ($A6.46 million) in the 2015 financial year, down from nearly $US8 million in 2014.

While his salary was held steady at $US1.7 million for the year, his short and long-term incentive payments fell sharply after the company missed its safety targets.

The ASA plans to ask the company whether it can maintain its progressive dividend given pressure on its balance sheet from the recent downturn in commodities prices.

Fat Prophets analyst David Lennox said BHP's progressive dividend could come under pressure but cuts to production at Samarco were unlikely to have a large impact.

BHP could lose around 14,500 million tonnes of production for every year that Samarco remains closed, accounting for around six to seven per cent of total production.

Shareholder activist Stephen Mayne said Mr Nasser had kept a low profile since the mine disaster, the biggest in BHP's history, and the company needed to provide a full account to shareholders.

"Jac Nasser should've been in Brazil," Mr Mayne said.