Tuesday PM August 22nd, 2006

BP pulling back from planned LNG plant on Pelican Island...Number of properties sold and average sales price drop modestly, but Houston home sales were best ever for July... Galveston Wal-Mart cashiers ask federal judge to end threats to employees who join unpaid wages lawsuit...

BP has tabled its plans to build a $650 million liquified natural gas plant on Pelican Island on the eastern tip of Galveston Island, according to Reuters. The company has told the City of Galveston and the Port of Galveston that it is pulling back because of changing market conditions. BP renewed the third and final year of a three-year lease option with the Port of Galveston, but says it has no plans to submit an application to the Federal Energy RegulatoryξCommission for necessary approval. The project had been sited on 185 acres onshore and offshore next to the Houston Ship Channel, about five miles from the center of Galveston and five miles from BP's Texas City refinery. Some 45 LNG terminal projects have been submitted to FERC, including more than a dozen along the Texas-Louisiana Gulf Coast.

BP is denying allegations that it manipulated data from inspections of Alaska pipelines that were partially shut down earlier this month because of corrosion problems. The Financial Times reported that the U.S. Environmental Protection Agency is probing the allegations that data was manipulated to avoid replacing pipelines in Prudhoe Bay, Alaska.


Houston home sales figures for July were the best ever for the month, although the number of properties sold and the average sales price dropped modestly from the previous month. The Houston Association of Realtors says total property sales reached nearly $1.6 billion—a more than ten percent increase compared to the same month last year. The average single-family home price topped $200,000 for the third month in a row, hitting $206,045—a seven percent increase over last year. The overall median price of $155,890 is an all-time record, and still 32.7 percent less that the national median price of $231,500 in June.


Cashiers at Wal-Mart in Galveston have asked U.S. District Judge Samuel Kent to order the company to stop threatening to fire Texas employees who join a lawsuit claiming unpaid wages. A hearing on the request is set for tomorrow, according to the Houston Chronicle. Attorneys sent notices in early August to more than 100,000 current and former Wal-Mart and Sam's Club cashiers in Texas inviting them to join the litigation. Court papers allege that Wal-Mart managers asked employees to turn over the notices and sign statements that they never worked off the clock as the suit claims. Wal-Mart says the claims have no merit.


Exxon Mobil's chief executive told a Norwegian conference today that technological advances will help quench the world's thirst for oil for decades to come. Rex Tillerson spoke at an oil and natural gas conference in the Norwegian port city of Stavanger. He says new technology has increased production from oil wells and pushes the frontier for new oil exploration. Exxon Mobil is world's biggest publicly traded oil company. Tillerson took over as head of the Irving-based company eight months ago. He says technology allowing oil companies to drill deeper and also would ensure that consumers will have no shortage of supplies. He says people constantly underestimate the potential of technology. Norwegian Prime Minister Jens Stoltenberg also noted the changing estimates of oil supply. Norway and many oil companies are now looking to the Arctic waters of the Barents Sea for new supplies. Tillerson says the Norwegian sector of the sea, which is shared with Russia, could contain one-third of Norway's undiscovered resources. Norway is now the world's third-largest oil exporter--but four decades ago few believed the waters off its coast would have any oil. The Offshore Northern Seas Conference runs through Friday.


Sacramento-based Tower Records has again filed for Chapter 11 bankruptcy protection—its second such filing in less than three years. Tower emerged from a Chapter 11 case in 2004. Legal music download retailers like iTunes are blamed for displacing traditional retailers, with digital downloads growing 200 percent in 2005, while album sales fell 7.8 percent. Tower operates 89 stores in 20 states, including outlets in Dallas.


Houston is part of the expanded Concentra workers' compensation health care network just approved by the Texas Department of Insurance. Concentra Health Care Network is now available in 149 Texas counties. Addison-based Concentra HCN was created in response to the passage of House Bill 7, an insurance regulatory reform bill passed by the Texas Legislature that allows worker's comp insurance carriers to contract with or form medical networks that specialize in treating occupational injuries.


Houston-based Dynegy says it is joining with the Illinois Environmental Protection Agency in a plan to significantly reduce mercury emissions, as swell as make further reductions in sulfur dioxide, nitrogen oxides and particulate matter from power plants in Illinois. Dynegy has five coal-fire power generation facilities in that state.


Dallas-based Comstock Resources is buying oil and gas properties in Duval County for $67.2 million, according to the Houston Business Journal. The seller is a partnership led by Houston-based firms Denali Oil & Gas Partners and Stalker Energy. The deal is expected to close in September.


Sunoco Logistics Partners has completed its previously announced acquisition of Sun Pipe Line Company for $65 million. Sun Pipe Line owns a majority interest in Mid-Valley Pipeline Company, a pipeline that stretches almost 1,000 miles from Longview to Samaria, Michigan. Sunoco expects to receive annual dividends of approximately $6.5 million from its ownership interest. Mid-Valley has an operating capacity of 238,000 barrels per day.


Dallas-based equity firm Lone Star Funds is buying the Wichita, Kansas-based Lone Star Steakhouse chain in a $600 million deal. The chain operates four Texas Land & Cattle restaurants and a Sullivan's Steakhouse in the Houston area. The transaction is expected to be finalized by the end of the year.


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