Three sources, who spoke with reporters on condition of anonymity, revealed that the oil company would plead guilty in exchange for a waiver of future prosecution on the charges.
The London-based oil giant confirmed it was in talks with the DoJ and the Securities & Exchange Commission (SEC), Reuters reports.
The “advanced discussions” were devoted to “proposed resolutions of all U.S. federal government criminal and SEC claims against BP in connection with the Deepwater Horizon incident,” it said in a statement on Thursday, but added that no final agreements had been reached.
But the company revealed that the proposed settlement would not include civil claims under the Clean Water Act and other laws, pending private civil claims and state claims for economic loss, CBS News writes.
“A further announcement will be made if and when final agreements are reached. Until final agreements are reached, there can be no certainty any such resolutions will be entered into,” it said.
BP has been in long-time negotiations with the U.S. government to settle billions of dollars of potential civil and criminal liability claims resulting from the April 20, 2010, explosion aboard the Deepwater Horizon rig.
The explosion on April 20, 2010 took away lives of 11 workers and set off a spill that continued for 87 days, fouling large areas of the southern coast of the United States.
The oil giant has already booked provisions of $38.1 billion to cover its liabilities from the incident, but BP says final cost remained highly uncertain.
The company also recently revealed that it intends to make the final payment to a $20 billion trust fund to cover damage from the blowout.
However, the amount of BP’s payment is unknown, but sources suggest it would be the largest criminal penalty in U.S. history.
That record now belongs to Pfizer Inc, which paid a $1.3 billion fine in 2009 for marketing fraud related to its Bextra pain medicine.
The expected settlement, which comes soon after the U.S. presidential election, could raise talks in Congress about how funds would be shared with Gulf Coast states, depending on how the deal is structured.
Congress passed a law last year that would earmark 80 percent of BP penalties paid under the Clean Water Act to the damaged U.S. states of Louisiana, Mississippi, Alabama, Florida and Texas.
Bearing in mind that the deal will not resolve the civil charges brought by the Justice Department, it is also can’t be predicted how large a financial penalty BP might pay to resolve the charges, or other punishments that BP might face.
The list of the unsolved issues also includes potential liability faced by Transocean Ltd, owner of the Deepwater Horizon vessel, and Halliburton Co, which provided cementing work on the well that, according to investigators, was flawed.
The Justice Department suggests that BP and Transocean’s errors in deciphering a pressure test of the Macondo well indicate gross negligence.
“That such a simple, yet fundamental and safety-critical test could have been so stunningly, blindingly botched in so many ways, by so many people, demonstrates gross negligence,” the government said in its August filing.