September 18: BP has confirmed that production at its Thunder Horse field in the Gulf of Mexico will be delayed until at least mid-2008. This follows enquiries earlier today by the Financial Times and comes after our scoop this morning that the group is to launch a root and branch review of its global operations in response to last year’s Texas City refinery blast, which killed 15 people. The pressure that Lord Browne was under, already significant, now looks enormous. Last week we reported that big shareholders want assurances from top executives and board members that recent problems in the US are not symptoms of a systemic failure. It so happens also that the first of the civil cases after the Texas blast begins today with jury selection. As Sheila McNulty explained on Saturday, there are roughly 550 outstanding death, injury and damage cases against BP, which has settled about 650 cases.
Among the bloggers, an old favourite of mine, Alaskan Abroad, has some useful stuff on proposed new rules on pigging plus updates on congressional hearings. The blog’s author, Robert Dillon, writes: “Some interesting numbers came out of Wednesday’s hearing: The cost of sending a scrubber pig through a pipeline is about $1,000 a mile. The cost of sending a smart pig through a pipeline is between $6,000 to $8,000 a mile. Cost of doing an internal inspection on the transit line that caused the partial shutdown of Prudhoe Bay – about $176,000, according to the quick math of some committee members. BP plans to replace 16 miles of questionable line at an estimated cost of $150 million, Marshall said.”
Royal Dutch Shell is also having difficulties today. The Russian ministry of natural resources has revoked environmental permits allow its consortium to proceed with the development of the Sakhalin-2 gas project. Lex says Russia is trying to secure a greater role for Gazprom.
We’ll also do more today on Norma Cohen’s excellent interview with Paul Reichmann about his plans to come out of retirement. Having been to see the 76-year-old magnate yesterday, she has more to tell us and Jim Pickard will look at whether he has got his timing right. You have to fear not.
John Young, the pugnacious chairman of Young & Co, the brewer, has died aged 85. His death comes in the same week that Young’s calls time on beer production at its Ram Brewery in Wandsworth, south-west London.
Debenhams says it’s beginning to see signs of improving trading conditions and expects to benefit from a new fashion for the “femme fatale” look, popularised most recently by Scarlett Johansson in Black Dahlia (not Frances Barber in Antony & Cleopatra).
Very interesting story from CSR. The maker of Bluetooth wireless chips cut its revenue forecasts after weaker-than-expected second-half demand. The stock fell by a quarter but it will be interesting to know more about the group’s problems reflects broader problems for Bluetooth, or whether the issue is more company-specific. Amusingly, a blog called thealarmclock.com last week published “Tips On Creating A Billion Dollar Startup Or How To Be CSR”. The blog cites tips from CSR’s chief executive, John Hodgson, published in Scottish Equity Partners’ Venturer newsletter.