BP is nearing completion of a relief well to seal once and for all the Deepwater Horizon spill site in the Gulf of Mexico.  Upon completion, BP will begin its “bottom kill” operation to plug the leaking well with mud and cement.  The well has been provisionally sealed with a containment cap since July 15th.

“They are closing in on the last 30-40 feet,” said retired Coast Guard Admiral Thad Allen, the government’s lead point person on the scene.  He expects to intercept the remaining space between the well shaft and the surrounding rock  “sometime before the end of the week,” depending upon the path of a developing tropical storm moving across the Florida peninsula.

Carol Browner, the energy and climate change adviser to President Obama, says approximately three-fourths of the spilled oil has been recovered from the Gulf of Mexico waters. Deliberate burning, skimming and direct recovery accounted for about 25%, while natural evaporation, dispersion and other processes took care of about 50% of the volume.  The remaining oil has either congealed into tarballs, been embedded into sediment, or remains as a sheen on the water’s surface.  “The good news is that the vast majority of the oil appears to be gone,” Browner said during a recent television appearance.

So far, BP has spent $6.1 billion dealing with fallout from the Gulf spill, the worst in United States history.  BP has already paid $319 million in compensation to businesses and individuals that have been affected by the spill, and will likely continue to face high costs as it continues environmental cleanup operations in the afflicted region.

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The Gulf of Mexico spill is a “wake-up call” for the entire offshore drilling industry, says Bob Dudley, the new replacement for embattled BP CEO Tony Hayward.  In the face of harsh public criticism and Congressional scrutiny, Dudley has promised to make safety his number one concern – a change in direction for the company, which has a reputation for risk-taking.

Clean up and other associated costs related to the spill, the largest in U.S. history, may reach as high as $30 billion.  Since the rig explosion in April which broke open the deep-sea well, estimates say over 5 million barrels of oil have spilled into the Gulf of Mexico, endangering marine life and resulting in major closures of fishing waters and tourist beaches along the Gulf coastline.

The U.S. House of Representatives took up debate today on a bill to reform off-shore drilling practices in the wake of the spill.  The Senate, the SEC and the Department of Justice have also launched their own investigations, and private lawsuits against BP have piled up as well.  The combined effect of these developments has knocked nearly 40% of BP’s market value since the explosion.

BP says it could begin its “static kill” drilling operations to seal the leaking well shut once and for all by this weekend, ahead of schedule.  Still, retired Coast Guard Admiral Thad Allen, the government’s main representative in the region, says conclusive clean up of the region will be both costly and time-consuming, requiring many more millions, many more years and much more effort from BP over the long-term.

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After 85 days, BP has finally succeeded in containing the gushing oil spill in the Gulf of Mexico waters.  After closing valves and vents on the containment cap during a test on Thursday, the well has stayed in place for two full days.

Although this is a very positive sign, both BP and the White House have warned that the containment cap does not represent a permanent fix – there is still much more work to do to seal the well shut for good, and to clean up the hundreds of millions of spilled oil.  “We’re encouraged by this development, but this isn’t over,” said the U.S. government’s lead contact in the region, retired Coast Guard Admiral Thad Allen.

BP will likely release the flow of oil again, siphoning it up to ships on the surface as it continues to drill a relief well to permanently shut the well with mud and cement.  The well is expected to be ready in early August.

Investors welcomed news of the containment caps success, sending BP shares higher in trading today.  However, since the rig explosion in April nearly $65 billion has been knocked off BP’s market value.

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In the wake of the catastrophic oil spill in the Gulf of Mexico, the Obama administration moved last week to ban all offshore drilling operations in the Gulf region for six months until further investigation into the cause of the BP gusher, which has been spilling oil into the ocean since April.

However, a judge in New Orleans struck down the ruling, calling it “rash and heavy-handed.”  The Obama administration appealed immediately, saying that continued drilling poses a danger to oil workers and to the environment that “the president does not believe we can afford.”

It is a contentious issue that has even brought in Abdalla Salem El Badri, the Secretary General of OPEC.  After meeting with European ministers in Brussels, Mr. El-Badri urged the United States to reconsider its ban on offshore drilling, warning that a six month hiatus would hold back oil supplies.  “We should not really ban it and we should not jump to conclusions,” he told reporters.

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A recent well explosion in Pennsylvania which blew contaminated gas and water 75 ft in the air has renewed awareness, and in some cases anxiety, over the highly productive yet controversial natural gas drilling technique known as hydraulic fracturing, or “fracking.”

Conventional gas drilling processes use approximately 80,000 gallons of water per well.  However,  the new method of horizontal drilling combined with “fracking” uses millions of gallons of water that has been laced with a cocktail of sometimes toxic chemicals.  These new techniques have opened up gas resources in many previously inaccessible areas, and dramatically increased U.S. natural gas production.

However, environmental pollution concerns have steadily increased in New York, Pennsylvania, Ohio, and West Virginia, across which spans the giant Marcellus Shale formation.  New York has already limited drilling in certain areas because of fears of possible groundwater contamination in watershed regions.   It is likely that similar regulations will soon be put in place to ensure protection of the environment as fracking drilling expands.

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Norway and Indonesia have signed a $1 billion agreement designed to curb rapid deforestation in vulnerable forests and peatlands.  In return for Norway’s significant investment, Indonesia will impose a 2 year moratorium on all new concessions of peat and natural forest lands for clearing.

Part of Norway’s $1 billion investment will go towards creating and monitoring new projects under the U.N.-baked forest conservation scheme, called Reduced Emissions from Deforestation and Degradation (REDD).  The Indonesia-based Center for International Forestry Research said this new deal could be “a game-changer in the drive to make REDD a reality.”

Norway and Indonesia’s landmark deal was supported by another notable investor – billionaire George Soros.  In advance of the deal-signing, Soros said he would personally guarantee $50 million to help slow global deforestation, which he believes is of the utmost importance in the struggle to reduce emissions.  ”If you can stop the eradication of the forest before it happens, its much easier than to reclaim the degraded land.  That is why I think quick action is so important.”

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According to an Ernst & Young global survey of 300 corporate executives, 70% of global firms with revenues of $1 billion or more say they will be increasing spending on climate change initiatives over the next two years.

Energy efficiency investments emerged as a major theme from the survey results.   More than 82% of respondents expected to make energy efficiency investments over the next year, and 92% of those polled said energy costs would be high on the list of priorities over that time period.

Melanie Steiner of Ernst & Young said these results show that despite uncertainty over climate change, “companies are really taking action anyway, because they’re seeing that this is a business issue and an opportunity to generate new revenue.”

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Grappling with skyrocketing energy demand, high pollution levels and international pressure to reduce greenhouse gas emissions, reports indicate China may consider instituting taxes on carbon or other resources to boost support for low-carbon energy technologies.

Experts from the Energy Research Institute under the National Development and Reform Commission – a Cabinet department focused on mid- and long- term domestic development – say if it is deemed beneficial, a carbon tax is likely to be levied during the 12th Five-year plan (2011-2015).

Jian Kejun, a senior researcher with the Institute, reaffirmed China’s commitment to reducing its carbon intensity 40-45% by 2020 in recent remarks to the newpaper China Daily.  To reach this target, the government is prepared to pursue “tougher measures” over the next five years, including subsidies and incentives for low-carbon technologies in addition to a potential tax.

Increasing support for scientific research is another top priority in China.  Right now, China’s investment in scientific clean energy research is only one-sixth that of the United States.  However by 2025, China’s investment in this area may overtake that of the United States.  ”If this comes true,” Jing said, “we can start to dream of becoming a low-carbon technology leader in the world.”

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The amount of water used to produce food and goods imported by developed countries is worsening water shortages in the developing world, a report says.

The report, focusing on the UK, says two-thirds of the water used to make UK imports is used outside its borders.

The Engineering the Future alliance of professional engineering bodies says this is unsustainable, given population growth and climate change.

It says countries such as the UK must help poorer nations curb water use.

“We must take account of how our water footprint is impacting on the rest of the world,” said Professor Roger Falconer, director of the Hydro-Environmental Research Centre at Cardiff University and a member of the report’s steering committee.

“If we are to prevent the ‘perfect storm’, urgent action is necessary.”

The term perfect storm was used last year by the UK government’s chief scientist, Professor John Beddington, to describe future shortages of energy, food and water.

Forecasts suggest that when the world’s population soars beyond 8bn in 20 years time, the global demand for food and energy will jump by 50%, with the need for fresh water rising by 30%.

But developing countries are already using significant proportions of their water to grow food and produce goods for consumption in the West, the report says.

“The burgeoning demand from developed countries is putting severe pressure on areas that are already short of water,” said Professor Peter Guthrie, head of the Centre for Sustainable Development at Cambridge University, who chaired the steering group.

“If the water crisis becomes critical, it will pose a serious threat to the UK’s future development because of the impact it would have on our access to vital resources.”

Key to the report is the concept of “embedded water” – the water used to grow food and make things.

Embedded in a pint of beer, for example, is about 130 pints (74 litres) of water – the total amount needed to grow the ingredients and run all the processes that make the pint of beer.

A cup of coffee embeds about 140 litres (246 pints) of water, a cotton T-shirt about 2,000 litres, and a kilogram of steak 15,000 litres.

The average UK consumer uses about 150 litres per day, the size of a large bath.

Ten times as much is embedded in the British-made goods bought by the average UK consumer; but that represents only about one-third of the total water embedded in all the average consumer’s food and goods, with the remainder coming from imports.

The UK is not unique in this – the same pattern is seen in most developed countries.

The engineering institutions say it means nations such as the UK have a duty to help curb water use in the developing world, where about one billion people already do not have sufficient access to clean drinking water.

UK-funded aid projects should have water conservation as a central tenet, the report recommends, while companies should examine their supply chains and reduce the water used in them.

This could lead to difficult questions being asked, such as whether it is right for the UK to import beans and flowers from water-stressed countries such as Kenya.

While growing crops such as these uses water, selling them brings foreign exchange into poor nations.

In the West, the report suggests, concerns over water could eventually lead to goods carrying a label denoting their embedded water content, in the same way as electrical goods now sport information about their energy consumption.

The Engineering the Future alliance includes the Institution of Civil Engineers (ICE), the Royal Academy of Engineering (RAE) and the Chartered Institute of Water and Environmental Management (CIWEM).

A veritable environmental catastrophe is developing in the Gulf waters around the Louisiana coastline following a fatal explosion on an offshore BP oil rig.

Last week’s incident left eleven workers missing and presumed dead,  and broke open a deep-sea pipe, which is currently leaking an estimated 5,000 barrels a day into the ocean.  Coordinated efforts from the U.S. Coast Guard and BP – which as leaser of the rig is responsible for all clean-up costs – have not succeeded in containing the oil slick.  Today’s reports indicate that strong winds are pushing the oil towards the shoreline, which is home to a variety of sensitive ecosystems and species that would all be in danger if the oil were to reach land.

The consequences of this major spill could spell disaster for President Obama’s proposal to expand offshore drilling in the United States, which he was offering as a way to encourage bipartisan support for a more far-reaching climate bill.  The President has ceased issuing new offshore drilling leases until a deeper investigation into this explosion is conducted.

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Recent estimates expect the global automobile fleet to double over the next 20 years – growing from 800m today to over 1.6bn in 2030.  This massive growth is occurring as developing powers like China and India increase levels of individual car ownership.  However, the extra emissions resulting from millions upon millions more vehicles on the world’s roadways could be dramatic, and adversely affect global efforts to limit greenhouse gas emissions.

The European Commission has launched a “green transport” initiative in an effort to reach their emissions reductions goals.  By 2050, the EU is aiming for an 80 to 95% decrease in transport-related emissions.  The Commission believes widespread deployment of green transportation options, such as electric vehicles, public transportation and low-carbon and sustainable fuels will go a long way to achieving this goal.

The initiative calls for, among other things, Europe-wide standards for electric vehicle charging by 2011, continued research into low-carbon and energy efficient methods of transportation, financial incentives to encourage consumers and will work with the European Investment Bank to catalyze funding for green vehicle infrastructure and services.

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Climate change could spark more ”hazardous” geological events such as volcanoes, earthquakes and landslides, scientists have warned

In papers published by the Royal Society, researchers warned that melting ice, sea level rises and even increasingly heavy storms and rainfall – predicted consequences of rising temperatures – could affect the Earth’s crust.

Even small changes in the environment could trigger activity such as earthquakes and tsunamis

And some evidence suggests the consequences of climate change were already having an impact on geological activity in places such as Alaska, researchers writing in the journal the Philosophical Transactions of the Royal Society A said.

Bill McGuire, of the Aon Benfield UCL Hazard Research Centre at University College London, and the author of a review in the journal of research in the area, said warming temperatures melted ice from ice sheets and glaciers and increased the amount of water in the oceans.

As the land ”rebounds” back up once the weight of the ice has been removed – which could be by as much as a kilometre in places such as Greenland and Antarctica – then if, in the worst case scenario, all the ice were to melt – it could trigger earthquakes.

The increase in seismic activity could, in turn, cause underwater landslides that spark tsunamis.

A potential additional risk is from ”ice-quakes” generated when the ice sheets break up, causing tsunamis which could threaten places such as New Zealand, Newfoundland in Canada and Chile.

The reduction in the ice could also stimulate volcanic eruptions, according to the research.

And the greater weight of the water in the oceans where sea level has risen as ice melts can ”bend” the Earth’s crust. This produces magma and causes volcanic and seismic activity in coastal or island areas – where the majority of 550 volcanoes whose eruptions have been historically documented are found.

Increased volcanic activity could cause more landslides, and have impacts well beyond the area where the volcano is situated – for example by releasing sulphur clouds into the atmosphere or by affecting air travel.

Prof McGuire said the changes could occur in the coming decades or over centuries, rather than thousands of years, depending on factors such as how quickly sea levels rose.

And he warned: ”The rise you may need may be much smaller than we expect. Looking ahead at climate change, we may not need massive changes.

”One of the worries is that tiny environmental changes could have these effects.”

His review said there was ”mounting evidence” of seismic, volcanic and landslide activity being triggered or affected by small changes in the environment – even specific weather events such as typhoons or torrential rain.

Prof McGuire said that in Taiwan the lower air pressure generated by typhoons was enough to ”unload” the crust by a small amount and trigger earthquakes.

Other impacts of rising temperatures include glacial lakes bursting out through rock dams and causing flash flooding in mountain regions such as the Himalayas, as well as rock, ice and landslides as permafrost melts.

And he said there may be ”tipping points” in the geological systems, where the crust reaches a threshold that causes a step-change in the frequency of such events – but it was not clear where those thresholds might lie.

At times in the past climate change has been seen to have links with enhanced levels of potentially hazardous geological activity – for example after the end of the last ice age.

But they have not been fully considered as potential impacts of the rapid changes in the climate expected in the future and there was a great deal of uncertainty about what might happen in coming years.

Prof McGuire called for a programme of research focusing on the potential geological hazards that global warming could bring, with the leading body on global warming, the Intergovernmental Panel on Climate Change (IPCC), addressing the issue directly in its future assessments.