BP Nearing Multi Billion Dollar Gulf Settlement

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By Martin Baccardax | November 15, 2012 7:09 PM EST

The fatal explosion at the Macondo well which killed 11 employees and spilled 4.9m barrels of oil into the Gulf of Mexico.

BP could reach a deal with American authorities to settle criminal charges linked to the fatal Gulf of Mexico disaster that sparked one of the worst environmental disasters in US history.

Reuters news agency first reported a deal between BP and the US Department of Justice could be announced as soon as Thursday and will likely be the single largest corporate penalty ever paid. Depending on the nature of the settlement, the agreement could at the very least draw a line under BP criminal liability for the April 2010 explosion on the Deepwater Horizion rig that killed 11 workers and spilled nearly 5 million barrels of oil into the Gulf over the following 87 days.

However, BP will still face litigation risk from private criminal prosecution attempts as well as civil liability under the US Clean Water Act that could reach as high as $21 billion according to some estimates.

BP has already set aside around $7.8bn to compensate some 100,00 private claims of loss, injuries and property damage in and around the Gulf coast as a result of the fatal disaster.

BP's partners in the Deepwater project, oil services firms Transocean and Halliburton, will not be part of the settlement reached with the DOJ  

Shares in the group rose around 1 percent by mid-day in London to change hands at 429.75 pence each. The shares have given back around 8.1 percent so far this year. 

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