Flop flop flop. The sound of a bird's wings batting futilely against the gloopy blanket of black oil echoes across the quarry. Then there is silence. A pigeon has crashed into this dark pool, 100 metres from the turquoise sea on the west coast of Guernsey. It sinks within seconds, resurfaces for a final flap, then joins the other small carcasses lying face down in the swirls of black slime. Since 1967, this deadly, oil-filled crater on the Chouet headland has acquired a new name: Torrey Canyon quarry.

On the morning of Saturday 18 March 1967, the Torrey Canyon ran aground on Pollard's Rock between Land's End and the Isles of Scilly. Over the following days, every drop of the 119,328 tonnes of crude oil borne by this 300m-long supertanker seeped into the Atlantic. Thousands of tonnes despoiled the beaches of Cornwall – and thousands more were propelled by winds and currents across the channel towards France.

At the time it was the biggest oil spill ever, and the first involving a new generation of supertankers. Looking back, the echoes of the BP disaster unfolding in the Gulf of Mexico are loud and eerie. The slick imperilled a beautiful and popular tourist region. Inertia and dithering were worsened by the buck-passing of multinational companies implicated in the mess. And no one knew what to do. Even BP was involved: British Petroleum chartered the vessel to bring crude to the oil refinery in Milford Haven, Wales. But the Torrey Canyon disaster is not just a history lesson; it is living proof that big oil spills plague ecosystems for decades. Forty-three years on, the crude from the Torrey Canyon is still killing wildlife on a daily basis.

The Italian captain of the Liberian-registered Torrey Canyon was blamed for stranding the tanker on a well-known set of reefs. By nightfall, an eight-mile slick had slipped from its punctured tanks. The following day it was 20 miles long. In the past, tiny coastal oil spills had been cleaned up by mixtures of solvents and emulsifiers. These were called detergents, a deceptively cosy, domestic term for what were highly toxic chemicals. Within 12 hours of the spill, the navy tried to tackle it with them. Handily for BP, it manufactured these chemicals. The government warned that the stricken ship was "a bomb" and BP, as one man involved in the clean-up operation put it, "were making a bomb, literally, both ways". More charitably, the Guardian reported: "British Petroleum, which has the Torrey Canyon on charter but does not own her (and therefore disclaims any responsibility for the oil pollution) has sent all the detergent it can lay hands on."

Torrey Canyon quarry, Guernsey. Photograph: Graeme Robertson

The "sluggish black smear on the Atlantic" was an eyesore but Dutch experts dispatched by the ship's owners, the Bahamas-based Barracuda Tanker Corporation, itself part-owned by the American Union Oil company, insisted the ship could be salvaged. The government agreed, and its man in charge of the crisis, Maurice Foley, undersecretary for defence (navy) – a title that did not suggest the spill was a top priority – insisted there was "no question" of deliberately destroying the supertanker.

Dennis Barker, now 81 and still writing for the Guardian, was dispatched to report on the spill. "It was the first of those ecological disasters. Nobody knew what to expect. All that sunk in was that a boat was stuck on the rocks. The implications were slow to filter through," he says. Barker intercepted Harold Wilson, the prime minister, on the railway platform at Penzance. Wilson had been due to spend his Easter holidays on the Scilly Isles. "He rather liked to be at the scene of the action but it all seemed a bit slow by the standards of today," says Barker.

Like everyone, Barker most vividly recalls the smell. He leaned out of a helicopter to inspect "the greeny, browny gunge" in the sea below. "Suddenly I felt decidedly ill and I thought I was going to vomit over the Sun photographer. The stench was indescribable," he says. This "abominable smell of oil" – as the Guardian reported – could be smelt at Land's End on Good Friday. Waves of oil broke on the shores near St Just the following morning, a week after the shipwreck.

On Easter Monday, the tanker broke into two pieces. The oil, Barker noted in his reports, was winning. Using detergents to break up slabs of oil on the ocean was "like trying to pick up quicksilver with boxing gloves", he wrote: "There is this constant feeling that the government has fluffed the issue, and that an early political decision might have worked." The government continued to insist it was right to leave salvage attempts to the companies involved. "Clearly we have no responsibility in law for what has happened," observed Foley.

Les Hosking from Marazion, Cornwall, remembers the moment the government began bombing the tanker in an attempt to sink it and some of its deadly cargo, and burn off the slick. "We saw the Buccaneer bombers coming in. They dropped bombs and that didn't do anything," says Hosking. The press was critical because a quarter of the 42 bombs missed the target. Other methods also failed. Foam booms to contain the oil slick took ages to assemble and broke up in rough seas. Attempts to burn off the oil by dropping aviation fuel on it also foundered when high tides put the fires out. So, extraordinarily, the authorities dropped Napalm on the slick. "When that came in there was a sheet of flames," remembers Hosking. "I've never seen anything like it. The smoke went up into the sky for what seemed like miles."

The slick contaminated 120 miles of Cornish coastline. An estimated 15,000 birds were killed. Seals and other marine life also perished. An awareness of the environmental damage caused by oil "hadn't reached anywhere near the public consciousness that it has now," says Barker today. "It could have been an emergency from the last war. In an emergency you are not terribly worried about the pigeons."

Local residents fretted about their livelihoods in fishing and tourism, but were they angry? "Obviously there was a lot of anger and distress and then we thought, 'Let's just get this stuff off our shores'," says Hosking. Although the government got a kicking in the press, the attitude towards the implicated oil companies was strikingly mild compared with today's blame game. "If Wilson had been going on at the people responsible like Obama is, he would have been regarded as a bit eccentric or out of order," says Barker. In 1967, BP chartered the vessel but was widely exonerated. There was little hostility towards the ship's captain. "Today there would have been a lynch mob after him," observes Barker.

Residents of Cornwall did not realise it but they got off lightly. A freakish absence of prevailing south-westerlies in the weeks after the disaster kept much of the oil from hitting the mainland. The oil washed up on Britain's shores amounted to just 15% of the total that leaked from the Torrey Canyon. The vicissitudes of wind and current deposited more oil on the distant coastline of Brittany.

Nineteen days after the disaster, a huge slick hit western Guernsey. The oil lay so thick that 3,000 tonnes could be pumped directly into sewage tankers. "It was, 'We've got to clear our beaches, we're a tourist destination, right, there's a quarry, let's put it there.' It was a decision that had to be made very quickly," says Rob Roussel of Guernsey's public services department. Roussel remembers the oil on the island's beaches as a boy; he is now in charge of cleaning up Torrey Canyon quarry.

Moving oil to the quarry was a solution that created another problem. This dirty legacy of the Torrey Canyon has refused to disappear. "It stinks. It absolutely honks. Everybody's known about it but no one has wanted to do anything about it," says Jayne Le Cras, director of operations at the Guernsey Society for the Prevention of Cruelty to Animals. "Because of its thickness and stillness birds see it as a solid surface, they land on it and then the weight of the oil holds them down. I would hate to know how many are underneath it."

A family of kestrels is nesting in the quarry wall and short-eared owls breed in adjacent pines trees. When passing walkers hear the flapping of stranded birds they alert the GSPCA but staff can't always reach the quarry quickly enough to rescue birds. Last autumn, a GSPCA officer filmed a pigeon struggling in the oil on his phone and posted it on Facebook. The resulting furore helped prompt the authorities into action again.

Guernsey's government says it has spent thousands trying to clean up the quarry. It was cleared in the 80s; more recently, 160,000 litres were taken to a processing plant in Hull. But each time the oil has been removed more has seeped from the sediment below, which cannot be dug out because the quarry was a German armaments dump when they occupied the island during the second world war. Last year, the water level rose and the changing pressure released more crude from the bottom. "The company that was responsible for the Torrey Canyon should be paying for it under the polluter-pays principle but the international laws weren't in place back then," says Roussel.

In 1967, as the cost of the clean-up grew, the British government sought £3m compensation from the ship's slippery owners. Eventually, the Torrey Canyon's sister ship, Lake Palourde, was "arrested" when it docked at Singapore. Legend has it that a young British lawyer was only able to board the ship to attach a writ to its mast because the crew believed he was a whisky salesman. The French, also seeking compensation, continued to pursue the company – and its ships – for many more months.

Meanwhile, long after the disaster had slipped off the front pages, Hosking remembers balls of oil, like giant Maltesers, washing up on Marazion's beach: "At the time we thought, 'This is it.' This is Cornwall messed up for the rest of our days. My first thought was, how the hell are they going to get rid of this lot? Mother nature is a very powerful thing. Eventually, I expect nature did most of it."

In fact it turned out that human ingenuity was not just powerless against the oil slick; it made it much worse. Three days after the ship ran aground, Anthony Tucker, then science correspondent of the Guardian, warned that no toxicity tests had been carried out on the detergents being sprayed on the oil and their effect on marine life had never been studied. "There may be little point in spending many millions of pounds simply to convert an unpleasant but visible marine poison into another kind of poison that is insidious and entirely unknown in its effects," he presciently wrote.

In the event, the use of detergents turned out to be "the worst thing possible", according to Dr Gerald Boalch, a marine biologist with 52 years' service for the Marine Biological Association of the United Kingdom. After the spill, the MBA's staff devoted all their days to studying it. At first, the chemical sprays seemed to work. "The detergents made it look good," says Boalch. "We thought at the time it was doing a good job because the oil was disappearing." But colleagues conducted lab tests "and it was realised that it was making the oil more toxic because it was accessible to organisms". At sea, the oil was made soluble by the detergents, which then meant it was taken in by more living organisms. On shore, the chemicals destroyed lichens and other beach-life probably for ever, says Boalch. A year after Torrey Canyon, the MBA published its conclusions: it was scathing about the disastrous use of detergents, applied by methods "that were largely ineffective, uneconomic, and wasteful of effort".

The Torrey Canyon disaster did have some beneficial consequences. International maritime regulations on pollution were created. A charismatic young botanist called David Bellamy was asked to comment on the disaster and became a television star; he, and the oil slick, helped raise awareness of pollution. If our growing addiction to oil was not questioned, our methods for tackling spills were. When the supertanker Cadiz spilt crude oil off Brittany in 1978, Boalch "insisted" the authorities should not use detergents. "They didn't and it recovered much quicker," says Boalch now. But the French had already proved wiser than the British when cleaning up Torrey Canyon crude. Rather than bombard the slick with Napalm or toxic detergents in 1967, they used powdered craie de Champagne – humble chalk, which sunk the oil more effectively than expensive, toxic British detergents. "It would seem that the French were successful in preventing the bulk of this very large oil mass from coming ashore," the MBA researchers concluded.

In Guernsey, in 2010, the authorities are also now trying to remove the last of the Torrey Canyon oil in an environmentally friendly way. Last month, they began to pump micro-organisms into the oily water, which is aerated by a small generator running 24 hours a day. This process of "bioaugmentation" uses naturally occurring bacteria for whom oil is a food source to break down the oil. The government predicts that the rapidly multiplying micro-organisms will have eaten the oil by the end of the year. Does Le Cras think it will work? "Proof is in the pudding, isn't it?" she says. "I hope everything they say comes true. It will be a great day for us when it happens."