The Chinese government says it is preparing to file a lawsuit against ConocoPhillips China for environmental damage caused by an oil spill off the coast of northern China.

The State Oceanic Administration said Tuesday it will take legal action against the subsidiary of U.S.-based oil giant ConocoPhillips and state-run China National Offshore Corporation , which jointly operate the Bohai Bay oil fields. Bohai Bay is also home to a major fishery.

The agency said it has determined that 840 square kilometers surrounding the oil field have been polluted since the leaks began in June.

The company said last week that up to 2,500 barrels of oil and mud have leaked into the bay so far.