By Jonathan Davies

BP will pay $18.7 billion (£12bn) over the huge oil spill in the Gulf of Mexico in 2010, after reaching a settlement with the US Department of Justice (DoJ).

The settlement is the single largest paid by one company in US history. It comes after 125 million gallons of oil spilled into the sea when Deepwater Horizon rig exploded.

The oil giant has already paid $4.5bn to individuals and businesses for loss of earnings.

The settlement is a separate process from criminal and environmental proceedings. It means BP could face a much higher bill.

Even without a fine from the Clear Water Act, BP said the oil spill has cost it $43bn.

US Attorney General Loretta E Lynch said: "If approved by the court, this settlement would be the largest settlement with a single entity in American history; it would help repair the damage done to the Gulf economy, fisheries, wetlands and wildlife; and it would bring lasting benefits to the Gulf region for generations to come."

BP chief executive Bob Dudley said: "For BP, this agreement will resolve the largest liabilities remaining from the tragic accident and enable BP to focus on safely delivering the energy the world needs.

"For the United States and the Gulf in particular, this agreement will deliver a significant income stream over many years for further restoration of natural resources and for losses related to the spill."