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Chase Bank Limits Cash Withdrawals, Bans International... Before you read this report, remember to sign up to http://pennystockpaycheck.com for 100% free stock alerts Chase Bank has moved to limit cash withdrawals while banning business customers from sending...

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Richemont chairman Johann Rupert to take 'grey gap... Billionaire 62-year-old to take 12 months off from Cartier and Montblanc luxury goods groupRichemont's chairman and founder Johann Rupert is to take a year off from September, leaving management of the...

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Cambodia: aftermath of fatal shoe factory collapse... Workers clear rubble following the collapse of a shoe factory in Kampong Speu, Cambodia, on Thursday

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Spate of recent shock departures by 50-something CEOs While the rising financial rewards of running a modern multinational have been well publicised, executive recruiters say the pressures of the job have also been ratcheted upOn approaching his 60th birthday...

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UK Uncut loses legal challenge over Goldman Sachs tax... While judge agreed the deal was 'not a glorious episode in the history of the Revenue', he ruled it was not unlawfulCampaign group UK Uncut Legal Action has lost its high court challenge over the legality...

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Standard Life shocks BP AGM with vote against pay and bonuses

Category : Business

One of the City’s biggest institutional investors calls on BP to ‘raise its game’ as it votes against remuneration report

Standard Life, one of the City’s biggest institutional investors, put executive pay back on the public agenda on Thursday when it voted against BP’s remuneration report at the season’s first major annual meeting.

The investment house called on BP to “raise its game” and said it should do more to promote the interests of women and other minority groups.

Standard Life used the oil company’s meeting at the ExCeL centre in London to argue that the targets set by the remuneration committee made it too easy for executives to obtain generous bonuses or other payouts. The investor also voted against reelection of Antony Burgmans, the chairman of the BP remuneration committee.

At the stormy meeting the BP board was criticised by various investors over share buybacks, the Gulf of Mexico spill and even the company logo.

“I should like the [BP] board to note that we have voted against or abstained on remuneration related resolutions at seven out of the last eight AGMs,” said Guy Jubb, global head of governance and stewardship at Standard Life Investments. “We want to see the remuneration committee raise its game and make significant improvements to address our concerns.”

Standard Life holds only 1.3% of the BP share capital but is one of the major investors. Its appearance in front of hundreds of small shareholders was an embarrassment for a company whose reputation is still suffering badly from the Deepwater Horizon spill.

Institutional investors normally take their concerns to a company board in private and rarely turn up to AGMs unless the issue is considered very serious.

Burgmans, who saw 4% vote against his re-election, said high bonuses were on offer at BP but mostly had not been paid because targets had not been met. This showed the system worked, he said.

Executive pay issues have focused on the chief executive, Bob Dudley, who saw a drop in overall remuneration during 2012 but still secured £1.8m in total pay and bonuses plus a £5m injection into his pension pot. That was despite an 18% slump in underlying BP profits to less than £12bn, while his bonus target was in theory 923% of his base salary.

Referring to the bonus for Dudley, Burgmans said: “I admit it is a very high figure but the company would have to fire on all cylinders [for him to get it].”

The attack by Standard Life suggests there could be a repeat of last year’s AGM season, when there were was a series of revolts against excessive executive payouts at Britain’s leading companies during a period of high unemployment and government austerity became known as the “shareholder spring”.

The pensions advisory organisation, Pirc, had already raised the alarm about the BP remuneration report and has also urged shareholders to vote against AGM resolutions at other companies such as temporary power generator Aggreko.

In the end nearly 6% of shareholders voted against the BP remuneration report while a similar level of dissent was recorded against the re-election of the BP chairman, Carl-Henric Svanberg. He has been a lightning rod for wider criticism of BP executives since the Macondo blowout three years ago.

BP said the 94% of shareholders voting in favour was the highest number for seven years and compared well with many other companies in previous years.Svanberg and Dudley gave an upbeat assessment of BP prospects despite continuing civil action in the US courts over the Deepwater Horizon and a $38bn (£24bn) sell-off of assets to raise cash to pay off liabilities emanating from the spill of April 2010.

Svanberg said BP had ended the 2012/13 financial year in good shape. “We have reorganized and restructured. We are resolving the uncertainties facing the company.We have a clear strategy. And more than everything we have great people. We go into a new year with momentum and with confidence.”

Dudley said the settling of many legal actions against in the US and the new deal with Rosneft in Russia were two of many pointers to a strong future. “I hope that you will leave here confident that your company is on the right course – in good shape to safely deliver energy for customers and sustainable growth for our shareholders.

But shareholders at the AGM raised all kinds of concerns, not least the decision to move ahead with $8bn worth of sharebuybacks. One investor, John Farmer, said the repurchasing of a company’s own shares was merely an “act of faith” that it would help boost the share price but often turned out to be pouring “money down the drain”.

Svanberg begged to disagree while Dudley was forced to deny allegations from shareholders based in the US Gulf who accused BP of playing down the health risks of the dispersants it had used to clear up the Gulf spill.

Environmentalists attacked the board over its commitments to high-carbon activities such as the Canadian tar sands but company executives insisted their took climate change sertiously and would only engage in “responsible” activities.

Deepwater Horizon safety was a shared effort, says BP executive

Category : Business

Oil company’s US president at the time of the disaster tells court hearing that managing rig hazards was a team responsibility

Safety at the Deepwater Horizon rig was a shared effort, one of BP’s top executives told a court on the second day of the trial over the 2010 disaster.

Lamar McKay, BP’s US president at the time, is the most senior oil executive yet to testify in court about the fire that killed 11 men and triggered the worst oil spill in US history.

McKay was giving evidence on Tuesday in a case brought by the US justice department, five gulf states affected by the spill and lawyers representing businesses and individuals harmed. Robert Cunningham, an attorney for the plaintiffs, repeatedly pressed McKay to concede that BP bore ultimate responsibility for the blowout. McKay repeatedly insisted that managing the hazards was a “team effort.”

“I think that’s a shared responsibility, to manage the safety and the risk,” said McKay, now chief executive of BP’s upstream unit. “Sometimes contractors manage that risk. Sometimes we do. Most of the time it’s a team effort.”

In combative questioning Cunningham asked whether a company that took “excessive risks” should be “allowed to exist”. McKay said that was a “hypothetical question” adding “I don’t know what context you would put that in.” Cunningham replied: “How about the oil and gas industry?”

“I generally don’t think anything in excess is good but I can’t comment on that. It’s a hypothetical,” countered McKay.

Cunningham asked McKay if he had read the report into BP’s disaster compiled by Bob Bea, a veteran safety expert and professor at the University of California, Berkeley, who testified earlier in the day. Bea said a “classic failure of leadership and management in BP” had caused the spill and that BP had not used its own safety code — known as the operating management system (OMS) — safety framework at the ill-fated rig.

McKay answered that he had not read the report and was unaware of Bea’s consulting work for BP until after the disaster. Cunningham showed McKay an internal report that said “80% of these accidents have their root cause in human organizational factors.” The attorney accused BP of ignoring management’s role in the disaster. “You think this represents failure of men on the rig,” he said. “I don’t draw the conclusions you are drawing,” replied the company executive.

McKay said deepwater drilling was risky but that those risks were managed across a team that included BP’s partners as well. He contradicted Bea’s testimony saying that BP’s OMS included provisions that would allow a rig’s owner — in this case Transocean — to use its own safety systems when appropriate. BP’s OMS “recognises and utilizes contractors’ systems on their facilities,” he said.

“Is there one sentence of criticism about any of those individuals in the Bly report?” asked Cunningham. “I don’t think so no,” said McKay, who is expected back on the stand on Wednesday. He may be followed by Mark Bly, BP head of safety at the time of the disaster.

Government $1bn deal to controversial Petrobras deep-sea oil drilling

Category : Business

Funding to Brazil state-owned company from ECGD department raises environmental concerns from MPs and campaigners

The government has committed $1bn of taxpayer’s funds to support deep-sea drilling in the south Atlantic, despite acknowledging that the controversial project has “significant potential” to damage the environment.

Vince Cable’s export credit guarantee department (ECGD) has agreed a $1bn (£637m) line of credit to help Brazil’s state-owned oil company, Petrobras, drill for oil and gas. This will be in deeper water than the area in the Gulf of Mexico where an explosion on BP’s Deepwater Horizon rig led to 11 deaths and US’s the worst environmental disaster two years ago.

The funding agreement, revealed in the ECGD’s annual report, comes despite the department’s own advisers warning that fresh oil and gas drilling off the coast of Brazil could lead to a marine catastrophe. The government’s experts warned there are “significant potential adverse environmental impacts anticipated, including beyond site boundaries”.

Lisa Nandy, a Labour MP and chair of a parliamentary inquiry into the ECGD, which the Department for Business has renamed UK Export Finance (UKEF), said: “It is a cause of real concern that, despite the coalition commitment to end all export finance for dirty fossil fuels, particularly the risky Atlantic oil drilling, UKEF still funds so many fossil-fuel-related projects and has so far failed to support a single green energy project.”

UKEF, which has been dubbed the “department for dodgy deals” by the Jubilee Debt Campaign, is designed to help British companies obtain insurance and credit to help them export goods overseas when traditional lenders may be afraid to provide financing. But the government was unable to name any British companies that would benefit from the $1bn credit line supplied to Petrobras.

A spokesman for the business department said: “At the time the annual report was published, no exports had been supported under the line of credit. UKEF hopes to be able to announce the first exports supported shortly.”

It is expected that FTSE 100 exploration company BG Group is likely to be one of the main British beneficiaries of the credit line. BG has placed ultra-deepwater drilling off the coast of Brazil at the heart of its ambitious strategy and it is actively developing many sites in partnership with Petrobras. A BG spokesman said the company had not yet received any UKEF financing for its projects in Brazil.

Petrobras, which is controlled by the Brazilian government, is in the midst of a $236.5bn investment plan to exploit the untapped oil and gas reserves in the south Atlantic. The company, which made profits of 77bn reais (£24bn) last year, hopes the new wells will help lift its production to 5.7m barrels a day by 2020.

The funding for Petrobras’s drilling was one of several environmentally questionable global projects that UKEF helped get off the ground last year. While the Petrobras deal was assessed by environmental experts, several funding deals were cleared without any safety checks, including £6m for a Chinese nuclear power plant, £6m for a petrochemical plant in Azerbaijan, £6m for a gas plant in Nigeria and £13.5m towards two Russian coal mines.

Tim Jones, policy officer at the Jubilee Debt Campaign, said: “Whenever the UK government backs loans for exports, it should be assessing what impact those exports will have. Yet Vince Cable is supporting potentially damaging projects such as coal mines and methanol plants without his department showing any interest in how the money and exports will be used.”

Ruth Davis, chief policy adviser for Greenpeace UK, said: “The government’s energy policies are becoming a shambles. They’ve U-turned on their pledge to stop supporting dirty fossil fuel projects overseas, while undermining Britain’s renewables industry through anti-green rhetoric and poorly designed energy market reform proposals.

“It’s time David Cameron and Nick Clegg got a grip, and put their weight behind the low-carbon economy they both backed before the last election.”

The 2010 coalition agreement stated that UKEF would become a champion “for British companies that develop and export innovative green technologies around the world, instead of supporting investment in dirty fossil fuel energy production”.

A spokesman for the business department said: “UK Export Finance applies all applicable OECD agreements that apply to the operation of export credit agencies. These include those that relate to potential environmental, social and human rights impacts. Details of how UK Export Finance will apply the coalition commitment … are expected to be announced by ministers in due course.”

The annual report also revealed that £1.8bn, or 79%, of the total £2.3bn of loans backed by UKEF in the 2010-11 financial year went to support Airbus.

Other deals backed by the government included £680,000 for military vehicles in Turkey, £282,889 to help Libya buy British wallpaper and £504,000 worth of vodka packaging sent to Russia.

A parliamentary inquiry is currently examining ways to radically change the ECGD, which has led to hundreds of millions of pounds of taxpayers’ money being lent to help dictators build arsenals and facilitate environmental and human rights abuses.

BP profits fall further than expected

Category : Business

BP blames tough conditions in refining business and chief executive’s ‘shrink to grow’ policy in wake of Gulf oil spill

Profits at BP have fallen further than expected after the company was forced to sell some of its oil fields to pay for the Gulf of Mexico disaster fund.

Replacement cost profits – which exclude the effect of oil and other price movements – were down $680m, or 14%, to $4.8bn compared with $5.48bn in the same period last year, with bosses admitting profits will continue to fall in the next quarter.

BP blamed tough conditions in its refining business and chief executive Bob Dudley’s “shrink to grow” policy of investing in new projects rather than focusing on more mature areas.

Shares in BP dipped in early trading by 3.38%, down 15p to 430p, but later recovered to 434.7p.

The drop in profits was greater than analysts’ expectations of $5.1bn.

Chief executive Bob Dudley said the results were encouraging: “We have made a good start against our strategic priorities for 2012.”

The price of oil is 12.5% higher than a year ago, at $118.60 a barrel, compared with $105.42 a year earlier.

But like some of its rivals, BP was unable to capitalise on the higher price, with oil and gas production down 6%, excluding its Russian venture TNK-BP, to 2.45m barrels a day.

Keith Bowman at Hargreaves Lansdown said the results were mixed.

He added: “Like rivals Exxon and Chevron, BP has failed to take advantage of the higher oil price. For BP, the Gulf of Mexico accident continues to overhang, with asset sales impacting production.

“On the upside, planned asset sales are 60% complete, new exploration projects continue to be pursued, while the costs, at least for now, for the Macondo accident are reducing.”

BP also revealed it has paid $8.3bn to individuals and businesses in relation to the 2010 Deepwater Horizon disaster which left 11 dead, and its divestment programme to cover its costs from explosion and oil spill now stands at $23bn.

It has so far paid $16.6bn into a trust fund and expects to meet its target of $20bn a year earlier than planned.

A spokesman denied the company was making a more general pullback from the region, saying the disposals reflected a new strategy of churning assets more quickly and focusing on larger, younger projects.

However, it has been suggested that the company is not re-investing quickly enough and may see profits falling further.

The US department of justice is also investigating possible criminal and civil charges against BP that could lead to fines of more than $20bn, although the company expects fines of only around $3.5bn.

Royal Dutch Shell last week reported a 16% rise in underlying profits, while US rival ConocoPhillips reported a 1% drop and industry leader Exxon Mobil reported an 11% fall.

BP to start three new Gulf of Mexico oil rigs

Category : Business

New drilling sites brings number of BP’s Gulf rigs to eight – more than it operated before the Deepwater Horizon disaster

BP is planning to start three new oil drilling rigs in the Gulf of Mexico this year. The launch of the new rigs will bring the number of BP rigs in the Gulf to eight – more than the oil giant had before the devastating Deepwater Horizon disaster three years ago.

Bernard Looney, BP’s executive in charge of new wells, said BP is expecting to spend $4bn (£2.5bn) on new developments in the Gulf of Mexico this year and hopes to “invest at least that much every year over the next decade”.

“After much soul-searching in the fall of 2010, we concluded it would be wrong to walk away [from the Gulf of Mexico],” Looney said at an offshore oil conference in Houston, Texas, on Monday. “We would have been walking away not only from our past, but from a key component of our future.”

He said the Deepwater Horizon disaster, which killed 11 people, had “challenged us to the core”, but said the company has been working hard to help prevent “such an accident from ever happening again”.

While conceding that BP was in “absolutely no position to preach”, he called on the industry to adopt broader safety standards.

Last October US regulators granted BP its first permit to drill a new well since the Deepwater Horizon oil spill, that spewed 4.9m barrels of oil into the fragile Gulf of Mexico ecosystem. The permit, for drilling in BP’s Kaskida field 250 miles south-west of New Orleans, was approved after BP’s well design met more stringent post-spill standards.

Looney did not state where the new rigs will drill, but industry figures said they expect an appraisal well in BP’s “giant” Tiber field 250 miles south-west of New Orleans. BP has long wanted to explore the area it discovered in 2009, but had been banned by regulators.

The company’s next big project, Mad Dog phase 2, is expected to start production towards the end of the decade. Looney said the field, which was discovered in 1998 and first began producing oil in 2005, holds more than 4bn barrels of oil – enough to promote it to the “super-giant” oil field category.

BP under fire at turbulent AGM

Category : Business

One-in-10 investors voted against Bob Dudley’s £4m pay package, while directors were attacked for safety lapses and painting a ‘rosy’ picture of Gulf of Mexico cleanup

An attempt by BP management to move on from the Gulf of Mexico crisis that has dogged it over the last two years was undermined at a turbulent annual meeting when the oil group came under fierce fire from its own shareholders.

More than 10% of investors voted against a £4m pay package secured by chief executive Bob Dudley while directors were attacked for continuing safety lapses and accused of painting an over “rosy” picture of the US cleanup.

The atmosphere among environmentalists at the ExCel Centre in London’s Docklands on Thursday was further poisoned by reports of another oil spill in the Gulf that was attributed to Shell plus the continuing gas leak on Total’s Elgin field in the North Sea.

Bob Dudley, the chief executive who was brought in after the Deepwater Horizon accident to replace the much-pilloried Tony Hayward, thanked shareholders for “sticking with” BP.

He admitted the business had come through a “major crisis” but said it was back on track due to the commitment of its staff, a raft of measures to improve safety across the group and a sell-off of non-core assets.

But a procession of Gulf residents and long-term shareholders berated the besuited men on the podium who preside over a share price that remains heavily depressed compared to pre-spill days.

One shareholder and former BP employee claimed recent North Sea statistics showed his old company spilling more oil than any other. Another shareholder said statistics on leaks in the BP annual report failed to show a true picture of the problems.

The most potent attacks came from Gulf residents who had flown over to the UK and bought shares in the business so they could challenge the management view that it was business as usual in the region.

Derrick Evans, from Gulfport, Mississippi, said he spoke on behalf of “scores of everyday people”. The company had painted a rosy PR picture that “falls short” on the ground, he said, adding that many people in his region faced an ongoing “disaster”, while the cleanup operation was a “fiasco”.

Bryan Parris, a Houston man, demanded to know what chemicals were used in the enormous quantities of dispersants used to try to keep the sticky crude off the beaches.

He said there was an “epidemic of health problems” due to these dispersants among Gulf residents but his complaints were quickly dismissed by Carl-Henric Svanberg, the chairman of BP, who insisted his company had acted responsibly. “We have done everything we possibly can to compensate those with a legitimate claim.”

Shareholders also complained about the company’s involvement in the carbon-heavy tar sands in Canada and its role in adding to global warming while 11% of them voted against the company’s remuneration package. One shareholder said the pay packets suggested executives might have their “snouts in the trough”.

Meanwhile rival Shell was fighting off speculation that it has caused a sheen of oil that was detected in the Gulf and which caused its share price to plunge 5% in early trading and knocked more than $5bn (£3.1bn) off its value.

The Anglo-Dutch company sent a vessel to investigate and later put out a statement saying it was “confident” that the slick, which measured 10 miles by one mile, did not originate from its nearby Mars or Ursa facilities. But Total continues to grapple with a gas leak on the Elgin platform in the UK North Sea which has been continuing for two weeks. Dudley said BP had offered to help.

Exact blame for the fateful night of April 20, 2010, when an explosion on board the drilling rig, Deepwater Horizon, caused the deaths of 11 oil workers and triggered an environmental crisis on the beaches around the Gulf of Mexico, has yet to be apportioned by the Department of Justice, which is still considering whether to press criminal charges.

In the intervening time the London-based oil group – and operator of the well – has forked out $14bn in an oil spill response operation and a further $8bn in compensation to some of those fishermen and residents whose livelihoods were devastated.

BP under fire at turbulent AGM

Category : Business

One-in-10 investors voted against Bob Dudley’s £4m pay package, while directors were attacked for safety lapses and painting a ‘rosy’ picture of Gulf of Mexico cleanup

An attempt by BP management to move on from the Gulf of Mexico crisis that has dogged it over the last two years was undermined at a turbulent annual meeting when the oil group came under fierce fire from its own shareholders.

More than 10% of investors voted against a £4m pay package secured by chief executive Bob Dudley while directors were attacked for continuing safety lapses and accused of painting an over “rosy” picture of the US cleanup.

The atmosphere among environmentalists at the ExCel Centre in London’s Docklands on Thursday was further poisoned by reports of another oil spill in the Gulf that was attributed to Shell plus the continuing gas leak on Total’s Elgin field in the North Sea.

Bob Dudley, the chief executive who was brought in after the Deepwater Horizon accident to replace the much-pilloried Tony Hayward, thanked shareholders for “sticking with” BP.

He admitted the business had come through a “major crisis” but said it was back on track due to the commitment of its staff, a raft of measures to improve safety across the group and a sell-off of non-core assets.

But a procession of Gulf residents and long-term shareholders berated the besuited men on the podium who preside over a share price that remains heavily depressed compared to pre-spill days.

One shareholder and former BP employee claimed recent North Sea statistics showed his old company spilling more oil than any other. Another shareholder said statistics on leaks in the BP annual report failed to show a true picture of the problems.

The most potent attacks came from Gulf residents who had flown over to the UK and bought shares in the business so they could challenge the management view that it was business as usual in the region.

Derrick Evans, from Gulfport, Mississippi, said he spoke on behalf of “scores of everyday people”. The company had painted a rosy PR picture that “falls short” on the ground, he said, adding that many people in his region faced an ongoing “disaster”, while the cleanup operation was a “fiasco”.

Bryan Parris, a Houston man, demanded to know what chemicals were used in the enormous quantities of dispersants used to try to keep the sticky crude off the beaches.

He said there was an “epidemic of health problems” due to these dispersants among Gulf residents but his complaints were quickly dismissed by Carl-Henric Svanberg, the chairman of BP, who insisted his company had acted responsibly. “We have done everything we possibly can to compensate those with a legitimate claim.”

Shareholders also complained about the company’s involvement in the carbon-heavy tar sands in Canada and its role in adding to global warming while 11% of them voted against the company’s remuneration package. One shareholder said the pay packets suggested executives might have their “snouts in the trough”.

Meanwhile rival Shell was fighting off speculation that it has caused a sheen of oil that was detected in the Gulf and which caused its share price to plunge 5% in early trading and knocked more than $5bn (£3.1bn) off its value.

The Anglo-Dutch company sent a vessel to investigate and later put out a statement saying it was “confident” that the slick, which measured 10 miles by one mile, did not originate from its nearby Mars or Ursa facilities. But Total continues to grapple with a gas leak on the Elgin platform in the UK North Sea which has been continuing for two weeks. Dudley said BP had offered to help.

Exact blame for the fateful night of April 20, 2010, when an explosion on board the drilling rig, Deepwater Horizon, caused the deaths of 11 oil workers and triggered an environmental crisis on the beaches around the Gulf of Mexico, has yet to be apportioned by the Department of Justice, which is still considering whether to press criminal charges.

In the intervening time the London-based oil group – and operator of the well – has forked out $14bn in an oil spill response operation and a further $8bn in compensation to some of those fishermen and residents whose livelihoods were devastated.

Gulf’s dolphins pay heavy price for Deepwater oil spill

Category : Business

New studies show impact of BP’s Deepwater Horizon disaster on dolphins and other marine wildlife may be far worse than feared

A new study of dolphins living close to the site of North America’s worst ever oil spill – the BP Deepwater Horizon catastrophe two years ago – has established serious health problems afflicting the marine mammals.

The report, commissioned by the National Oceanic and Atmospheric Administration [NOAA], found that many of the 32 dolphins studied were underweight, anaemic and suffering from lung and liver disease, while nearly half had low levels of a hormone that helps the mammals deal with stress as well as regulating their metabolism and immune systems.

More than 200m gallons of crude oil flowed from the well after a series of explosions on 20 April 2010, which killed 11 workers. The spill contaminated the Gulf of Mexico and its coastline in what President Barack Obama called America’s worst environmental disaster.

The research follows the publication of several scientific studies into insect populations on the nearby Gulf coastline and into the health of deepwater coral populations, which all suggest that the environmental impact of the five-month long spill may have been far worse than previously appreciated.

Another study confirmed that zooplankton – the microscopic organisms at the bottom of the ocean food chain – had also been contaminated with oil. Indeed, photographs issued last month of wetland coastal areas show continued contamination, with some areas still devoid of vegetation.

The study of the dolphins in Barataria Bay, off the coast of Louisiana, followed two years in which the number of dead dolphins found stranded on the coast close to the spill had dramatically increased. Although all but one of the 32 dolphins were still alive when the study ended, lead researcher Lori Schwacke said survival prospects for many were grim, adding that the hormone deficiency – while not definitively linked to the oil spill – was “consistent with oil exposure to other mammals”.

Schwacke told a Colorado based-publication last week: “This was truly an unprecedented event – there was little existing data that would indicate what effects might be seen specifically in dolphins – or other cetaceans – exposed to oil for a prolonged period of time.”

The NOAA study has been reported at the same time as two other studies suggesting that the long-term environmental effects of the Deepwater Horizon spill may have been far more profound than previously thought.

A study of deep ocean corals seven miles from the spill source jointly funded by the NOAA and BP has found dead and dying corals coated “in brown gunk”. Deepwater corals are not usually affected in oil spills, but the depth and temperatures involved in the spill appear to have been responsible for creating plumes of oil particles deep under the ocean surface, which are blamed for the unprecedented damage.

Charles Fisher, one of the scientists who jointly described the impact as unprecedented, said he believed the colony had been contaminated by a plume from the ruptured well which would have affected other organisms. “The corals are long-living and don’t move. That is why we were able to identify the damage but you would have expected it to have had an impact on other larger animals that were exposed to it.”

Chemical analysis of oil found on the dying coral showed that it came from the Deepwater Horizon spill.

The latest surveys of the damage to the marine environment come amid continued legal wrangling between the US and BP over the bill for the clean-up. BP said the US government was withholding evidence that would show the oil spill from the well in the Gulf of Mexico was smaller than claimed. Last week BP, which has set aside $37bn (£23bn) to pay for costs associated with the disaster, went to court in Louisiana to demand access to thousands of documents that it says the Obama administration is suppressing.

The US government is still pursuing a case against BP despite a deal the company reached at the beginning of March with the largest group of private claimants. That $7.8bn deal, however, does not address “significant damages” to the environment after the spill for which BP has not admitted liability. And it has not only been the immediate marine environment that has been affected. A study of insect populations in the coastal marshes affected by the catastrophe has also identified significant impact.

Linda Hooper-Bui of Louisiana State University found that some kinds of insect and spider were far less numerous than before. “Every single time we go out there, the Pollyanna part of me thinks, ‘Now we’re going to measure recovery’,” she said. “Then I get out there and say: ‘Whaaat?’”

She had expected that one group of arthropods might be hit hard while others recovered, but her work, still incomplete, shows a large downturn among many kinds. “We never thought it would be this big, this widespread,” she said.

For its part BP has claimed in a recent statement that it has worked hard to fulfil its responsibility to clean up after the spill. “From the beginning, BP stepped up to meet our obligations to the communities in the Gulf Coast region, and we’ve worked hard to deliver on that commitment for nearly two years,” BP chief executive Bob Dudley declared recently.

BP oil spill seriously harmed deep-sea corals, scientists warn

Category : Business

Evidence ‘compelling’ that explosion at Deepwater Horizon drilling rig in 2010 badly damaged colonies in the Gulf of Mexico

Deep sea corals appear to have been seriously harmed by the Deepwater Horizon oil spill, according to scientists.

A survey of one site near the well in the Gulf of Mexico uncovered “compelling evidence” of pollution damage. Coral communities more than 1,220 metres (4,000ft) below the surface of the ocean appeared stressed and discoloured.

Tests showed that oil from the site bore Deepwater Horizon’s chemical “fingerprint”.

Determining the impact of oil spills at the bottom of the ocean can be difficult because oil seeps naturally from cracks in sea floor.

The explosion, in April 2010, poured an estimated 405m litres (160m gallons) of oil into the Gulf, causing a major environmental disaster.

Scientists looked at 11 deep-water coral sites three to four months after the well head was capped.

Healthy coral was found at all locations more than 12 miles from the Macondo oil prospecting site, where the blowout occurred. But at one site, seven miles south-west of the well, coral colonies presented “widespread signs of stress”, including bleaching and tissue loss. Almost half of the 43 corals observed at that site showed evidence of impact.

The US scientists used an automated submersible, Sentry, and a manned robotic-armed vehicle, Alvin, to obtain images and samples at a depth of more than 1,300 metres. Their findings are published in the journal Proceedings of the National Academy of Sciences.

Professor Charles Fisher, from Pennsylvania State University, took part in the initial dive, by a remotely operated vehicle (ROV), which identified the site.

He said: “We discovered the site during the last dive of the three-week cruise.

“As soon as the ROV got close enough to the community for the corals to come into clear view, it was clear to me that something was wrong at this site. I think it was too much white and brown, and not enough colour on the corals, and brittle stars.

“Once we were close enough to zoom in on a few colonies, there was no doubt that this was something I had not seen anywhere else in the Gulf: an abundance of stressed corals, showing clear signs of a recent impact. This is exactly what we had been on the lookout for during all dives, but hoping not to see anywhere.”

A second, more detailed look, including six dives by Alvin, confirmed the findings.

An advanced “fingerprinting” technique called comprehensive two-dimensional gas chromatography was used to determine the source of the oil.

The scientists wrote: “The presence of recently damaged and deceased corals beneath the path of a previously documented plume emanating from the Macondo well provides compelling evidence that the oil impacted deep-water ecosystems.”

Dogs take lead in sniffing out Arctic oil

Category : Business

Shell has been training a dachshund and two border collies to detect oil spills beneath snow and ice

When it comes to drilling for oil in the harsh and unpredictable Arctic, Shell has gone to the dogs, it seems. A dachshund and two border collies to be specific.

The dogs’ ability to sniff out oil spills beneath snow and ice has been tested and paid for by Shell – and other oil companies and government research organisations – in preparation for the industry’s entry into the forbidding Arctic terrain. The company hopes to begin drilling for oil off the north-west coast of Alaska in June.

The project, conducted by independent Norwegian researchers Sintef off the Svalbard archipelago in northern Norway in 2009, set out to find a low-tech fix to a nightmare scenario for Arctic drilling: how to clean up a spill in remote waters?

The technology for detecting and tracking spilled oil in the Arctic is still in the early stages. To make clean-up even more challenging, the areas in the Chukchi Sea to be drilled are 1,000 miles from the nearest coastguard base.

As the study itself notes: “Today, no proven operational system exists for detecting oil spill covered by snow and/or ice or hidden under beach sediments.” The remote and challenging Arctic environment made it difficult to rely on sensitive technological equipment, it added.

However, the campaign group Greenpeace said dachshund sniffer dogs were not the answer.

“The idea that small dogs can track leaking oil deep under the Arctic pack ice in the middle of winter is absurd,” said Ben Ayliffe, Arctic campaigner for Greenpeace. “The fact that they are paying good money to seriously use this as an option shows how much they are scrabbling around for a solution.”

Others said the study should be an embarrassment to the industry. “This is another example of how we do not have adequate science and technology yet to drill in the Arctic Ocean – particularly in ice,” Marilyn Heiman, the director of the US Arctic Programme for the Pew Environment Group said in an email.

“It is embarrassing that using dogs to sniff out oil is the best technology we have to track oil under ice. Industry needs to invest in research to determine how to track oil under ice, as well as significantly improve spill response capability in ice, before [being] allowed to drill in ice conditions.”

A spokesman for Shell said the company had done additional research on oil-sniffing dogs since the 2009 study but “nothing major”. Curtis Smith, the spokesman, said Shell has no plans to deploy the dogs in Alaska.

The company’s oil spill response plan, approved by the interior department last month, calls for a fleet of vessels to be on standby at all times, as well as for the construction of a special capping system that would be able to capture and store up to 80,000 barrels of oil a day.

“Shell and others are looking mainly at technology like advanced radars [and] satellite to detect oil under ice,” Smith wrote in an email.

The absence of canine participation is in no way the dogs’ fault. The dogs – border collies Jippi and Blues, and dachshund Tara – were able to pick up the scent of oil up to 5km downwind of a spill, the researchers found.

They held up well to long flights, -40C temperatures, and bumpy snowmobile journeys. They were also able to focus on their mission – and did not go tearing off after polar bear or seals, the study said.

“This gives us future possibilities in using specially trained dogs to search large areas covered with snow and ice to detect possible oil spills,” the study added.