ExxonMobil announces 20 new global projects for next three years; meets with Guyana’s president about drilling offshore…Senate looks into abuse by credit card companies…SYSCO founder dies at age 91…
ExxonMobil said it plans to begin more than 20 new global projects in the next three years. Those investments are expected to add one million oil-equivalent barrels a day to the Irving-based oil company’s volumes. ExxonMobil is the world’s largest publicly traded oil company. It says its project inventory at the end of 2006 has the potential to develop four billion oil-equivalent barrels. Chairman and CEO Rex Tillerson says the company’s capital spending would be about $20 billion a year through at least 2011. The company’s capital spending tab in 2006 was $16.2 billion. Last month, ExxonMobil posted the largest annual profit by a U.S. company of $39.5 billion. That’s despite earnings for the last quarter of 2006 that fell four percent.
A team from ExxonMobil has met with Guyana’s president as oil companies position themselves to begin drilling off the nation’s coast. Still pending is a ruling from a UN body on a border dispute with Suriname. The Irving-based oil giant has the rights to a large concession, but has delayed exploration because of the border feud between the South American nations. The UN convention on the law of the sea is expected to resolve with a ruling around May. The talks held Monday included an Exxon team led by Jim Flannery, the company’s South America area manager.
He owed $3,200 on his credit card. With interest and fees, that debt grew to $10,700. An Ohio man told that story to a Senate panel looking into what it says are confusing billing practices and shifting interest rates on credit cards. But bank officials defended their policies as responsible and well-suited to the needs of consumers. Officials from CitiGroup and Chase Bank USA say they’re eliminating some practices. That includes the one that hit the Ohio man with over-limit fees on his Chase account 47 times, even though he went over his credit limit only three times. Committee Chairman Carl Levin said the interest and fees on Wesley Wannemacher’s account more than tripled his debt, even though he’d made payments averaging $1,000 a year over six years. He said that’s ”clearly” unfair. An official of Chase Card Services apologized to Wannemacher, saying, ”in this case, we simply blew it.” But Levin says an investigation found that ”sky high” interest rates and fees are not uncommon. He threatens legislation to outlaw them. He’s hoping it will persuade the banking industry to make changes voluntarily. Levin and Senator Norm Coleman have denounced practices that bring in tens of millions of dollars to banks issuing credit cards. As an example, there’s so-called double-cycle billing. It eliminates the interest-free period for a consumer who moves from paying his full balance every month to carrying a balance.
An increase in auto loans helped push consumer borrowing higher in January. The Federal Reserve says consumer credit rose at an annual rate of 3.2 percent, compared with the December pace of 2.5 percent. The category that includes auto loans rose at an annual rate of 4.4 percent while revolving credit, which includes credit cards, was up just 1.1 percent. The increased borrowing pushed total consumer debt up by $6.4 billion–to a record $2.41 trillion dollars in January.
Treasury Secretary Henry Paulson is in Beijing. He’s lobbying Chinese officials for action to end Beijing’s controversial currency controls and rein in its massive trade surplus. Minutes after arriving, Paulson started an airport meeting with China’s vice premier. Paulson is scheduled to give a speech at the Futures Exchange in Shanghai. Paulson is on his third visit to China in less than a year as treasury chief. He’s under increasing pressure from members of the Democratic-controlled Congress who say he’s moving too slowly and suggest that Beijing will take action only if it faces sanctions. Congressional leaders blame Chinese imports and a record trade deficit for a loss of American manufacturing jobs and have threatened retaliation.
Some senators say the Bush administration isn’t being aggressive enough in pushing for new fuel-economy standards for passenger cars. They say the standards have been the same for 20 years, and it’s time to make automakers improve the number of miles-per-gallon a car can get. At a Senate Commerce Committee hearing Tuesday, North Dakota Democrat Byron Dorgan said it’s been talked about for years but “nothing has changed.” Maine Republican Olympia Snow says she senses “foot-dragging” and “bureaucratic passivity.” A Bush administration proposal calls for a four-percent annual increase in fuel-economy requirements, as part of a larger plan to boost alternative fuels. Some senators say the plan allows too much flexibility.
An insurance group reports Hurricane Rita resulted in $5.8 billion dollars worth of claims in Texas and Louisiana. The September 2005 storm damaged or destroyed thousands of homes and other property. Rita made landfall at Sabine Pass. The Insurance Council of Texas says the storm resulted in nearly 221,000 claims in the state totaling $2.8 billion. Louisiana had just over 201,000 claims totaling $2.6 billion. The Federal Emergency Management Agency says the number of flood claims for both states was about 14,700–totaling $428 million. Rita killed at least 11 people in the two states. More than 100 people died in the pre-storm evacuation of the Houston area, in accidents and exposure deaths.
The founder of Houston-based SYSCO has died at the age of 91. John Baugh founded Zero Foods to distribute frozen food to restaurants, hospitals, schools and fast-food stores and grocery chains. Zero and eight other companies joined together as SYSCO in 1970, which has grown to a network of 172 locations with 50,000 employees serving a $200 billion market. The company generated $33.9 billion in sales in 2006.