(Bloomberg) -- After a year of back and forth, the owners of the idle Samarco iron-ore mine are close to signing a definitive settlement with Brazilian prosecutors that will clear the way for restart preparations and debt talks to begin, according to people briefed on the matter.

Joint venture partners Vale SA and BHP Billiton Ltd. have already secured four court extensions to negotiate the settlement of a multibillion-dollar claim stemming from a fatal tailings dam disaster in 2015.

This time the two sides are on track to meet the deadline, which now stands at June 25, the people said, asking not to be identified because talks are private. Final details probably will be ironed out in the coming days, including a request by prosecutors to have community representatives on the board of a foundation that administers ongoing reparations, the people said.

The prosecutor’s office had no comment, while Vale’s press department didn’t respond to requests for comment. BHP and Samarco declined to comment.

The settlement would bring together two separate claims: 155 billion reais ($41 billion) sought by federal prosecutors and 20 billion reais sought by the southeastern state of Minas Gerais in a civil suit.

Resolving the legal cases will allow talks with creditors to begin as the company starts to draft its long-term business plan, although any restructuring deal would still require a firm restart date, the people said. Vale’s best case is a limited restart in the first half of 2019. Wood Mackenzie predicts 2020.

In a note to clients Wednesday, Exotix reiterated a buy rating on Samarco bonds, predicting a fine that’s in line with the venture’s future ability to pay.

"We expect them to seek not to jeopardize Samarco’s future operations and/or profitability, and allow it to become profitable enough to take care of bondholders and other creditors," wrote Rafael Elias, a director for Latin American research at Exotix.

Samarco notes due 2022 are trading at about 66 cents on the dollar, down from a peak of 80 cents in January. Without a restart, they are worth zero, said Patrik Kauffmann, who helps manage $11 billion in assets at Solitaire Aquila in Zurich.

To contact the reporters on this story: Paula Sambo in Sao Paulo at psambo@bloomberg.net;R.T. Watson in Rio de Janeiro at rwatson71@bloomberg.net

To contact the editors responsible for this story: Courtney Dentch at cdentch1@bloomberg.net, James Attwood, Steven Frank

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