Shares of offshore oil and gas driller Transocean (NYSE:RIG) shot up as much as 6.6 percent shortly after 11:00 a.m. after reports circulated suggesting that the company will reach a final settlement with the United States Department of Justice for its role in the Deepwater Horizon disaster.
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People familiar with the talks between Transocean and the DoJ tell the Wall Street Journal that the company is expected to pay fines of $1.4 billion, on the lower-end of expectations. The company had put aside $2 billion in reserve for Deepwater claims.
BP (NYSE:BP) has been slogging through its own, messy settlement process for years and an end is at least within telescoping distance. In November, BP settled all criminal and civil charges related to the disaster for $4.5 billion, but still faces violations under the Clean Water Act, which could cost as much as $20 billion.
With the weight of liability being removed, Transocean is free to focus on how it will move forward with the rapidly-changing oil and gas market.
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