The British oil company BP faces fines up to $5 billion and the arrest of some staff members on criminal charges under a deal with U.S. agencies over the Gulf of Mexico well blowout two years ago, according to a source familiar with the case.
Attorney General Eric Holder was scheduled to join federal and local officials in New Orleans later Thursday for an announcement on the terms of the settlement, CNN reported, quoting Justice Department officials.
There have been various media reports on the terms of the settlement. The Associated Press, quoting a person familiar with the deal, as saying two BP staff members would face manslaughter charges over the 2010 blowout that killed 11 people and poured oil into the Gulf of Mexico for 87 days.
The BBC reported that up to four BP employees could face arrest as part of an agreement that would settle criminal and other claims with the U.S. government.
BBC business editor Robert Preston reported that BP is "thought to be relieved" that it had reached a settlement because the potential liability was unlimited.
NBC News reported that Department of Justice officials confirmed that a deal had been reached, but did not elaborate except to say that it would involve a large fine and criminal charges.
The reported settlement would dwarf the largest previous corporate criminal penalty assessed by the Department of Justice - the $1.2 billion fine imposed on drug maker Pfizer in 2009.
The explosion and fire aboard the Deepwater Horizon rig on April 20, 2010, killed 11 workers and set off a spill which continued for 87 days, fouling large areas of the southern coast of the United States.
The rig sank and an estimated 200 million gallons of crude oil gushed out of the well, fouling extensive areas of the southern U.S. coast and disrupting tourism and commercial fishing
In advance of an expected settlement, BP said in a statement that "no final agreement has yet been reached" and that any such deal would still be subject to court approvals, the Associated Press reported.
In its earlier statement, BP said any proposed settlement would not include civil claims under the Clean Water Act and other legislation, pending private civil claims and state claims for economic loss.
BP has booked provisions of $38.1 billion to cover its liabilities from the incident, but the company has said the final cost remained highly uncertain. BP also recently announced that it expects to make the final payment this year to a $20 billion trust fund to cover damage from the blowout.
In March, BP announced a settlement estimated at $7.8 billion with more than 100,000 individuals and businesses for medical and economic losses.
In January 2011, a U.S. presidential commission found that the spill was caused by time-saving, cost-cutting decisions by BP, rig owner Transocean and cement contractor Halliburton.
In September last year, a team of Coast Guard officials and federal regulators concluded BP bears ultimate responsibility. Their report found BP violated U.S. regulations, ignored crucial warnings and made bad decisions during the cementing of the well a mile beneath the Gulf of Mexico.