Two Houston companies have been awarded more than $300 million in military contracts for the Defense Energy Support Center in Fort Belvoir, Virginia, according to the Houston Business Journal. Houston-based Shell Oil Products won a $254.2 million contract to provide JP8 turbine fuel for the DESC, which supports and manages energy sources for the U.S. military. The center also awarded Marathon Alaska Natural Gas a $51.2-million contract to provide natural gas for the Army, Air Force and federal civilian agencies.
Houston-based Dynegy has signed energy supply agreements with Ameren Corporation to deliver up to 1,200 megawatts of electricity daily to customers in Illinois. Dynegy operates nine facilities in Illinois with a net generating capacity of more than 4,000 megawatts. St. Louis-based Ameren provides electricity to about 215,000 customers in east and central Illinois.
Hewlett-Packard wraps up its 2006 Technology Forum today at the George R. Brown Convention Center, meeting with more than 6,000 customers and HP certification-seekers. The company's Jane McMillan says HP remains committed to a Houston presence.
"Well, just recently we announced that we're going to be doing consolidation of data centers, down to six data centers, and one of those data centers, or two, are going to be located in Houston. So we do have the data center operations here. We also have the HP Halo Room, which is the conferencing capabilities that we have. The Customer Solutions Center is located in Houston, the Blades Lab is here, and we also have our Factory Express and some distribution from the Houston office. So it is a very active campus."
Forum attendees include customers, technology partners and employees of HP.
"This is our premiere conference in which they're going to be able to get educated and trained on all of our newest and latest technology, so we're happy to see so many come. This is certainly a boon for Houston. I mean, we were talking with the Convention Bureau and they were saying it's about $8 million of revenue to Houston during the four days that our conference is going to be here. And we're happy to bring that revenue to Houston and we're hoping that everyone will enjoy Houston and will want to come back and visit."
HP faces inquiries by federal and state officials on whether investigators hired to find the source of boardroom leaks violated the law by impersonating employees and journalists. The Justice Department and Congress are investigating whether private security firms violated the law.
Southwest Airlines and American Airlines are starting contract talks this week with its pilots. The two North Texas-based carriers are looking to control costs by having more flexibility in work scheduling. American's pilots, meanwhile, seek to reverse losses from 2003. Southwest said it began negotiations yesterday with the union that represents its 5,000 pilots. The two sides last negotiated a contract in 1994--a 10-year deal that was extended in 2004. Southwest says its pilots are the best-paid Boeing 737 captains in the industry. No other carriers are believed to pay more to employees who fly bigger jets.
A research alliance between the University of Texas M.D. Anderson Cancer Center and Baylor College of Medicine could lead to new treatments for asthma and other diseases. The Texas Medical Center Asthma and Allergic Diseases Cooperative Research Center will research the molecular "master switch" that could trigger the inflammatory immune response. The research is funded by a $5.6 million, five-year grant from the National Institute of Allergy and Infectious Diseases.
The Federal Reserve has decided at a second straight meeting to leave a key interest rate unchanged—the result of inflationary pressures being eased by falling energy prices. In the statement announcing the decision, the central bank continued to signal concerns about inflation, repeating a phrase it had used last time that the Fed's rate-setting panel "judges that some inflation risks remain.'' That decision means the federal funds rate, the interest that banks charge each other, stays at 5.25 percent. The prime lending rate for banks, the benchmark for millions of consumer and business loans, will stay at 8.25 percent. Before the Fed started raising rates in June of 2004, the funds rate stood at a 46-year low of one percent, while the prime was at four percent. The Fed voted at last month's meeting to leave rates unchanged after raising them for 17 consecutive times over the past two years, the longest string of rate increases in Fed history. Fed officials said at that time that they were ready to raise rates further should the need arise.
The outlook for ethanol IPOs grew dimmer this week. Hawkeye Holdings was scheduled to sell as much as $366 million in common shares on the New York Stock Exchange through an initial public offering this week. But now Iowa-based Hawkeye says it's temporarily delayed the deal due to market conditions. Earlier this month, Dallas-based ASAlliances Biofuels registered with the Securities and Exchange Commission to sell as much as $300 million in stock through its own IPO. ASAlliances is building ethanol plants in order to become a producer of the alternative fuel by next year. Details are in its preliminary prospectus that was filed on Friday. Both Hawkeye and ASAlliances have short operating histories and are owned by private equity shops. No date has been set for the ASAlliances offering.
Kimberly-Clark said today it's cutting 350 administrative jobs in Neenah, Wisconsin as part of its restructuring plan. The Irving-based paper products company says the positions are in information technology, human resources and supply management. Kimberly-Clark plans to outsource some of those functions. It says some of the affected employees will have the opportunity to move to new positions at the new service providers. Kimberly-Clark says individual employees will be notified about their status over the coming months as it selects service providers. The maker of Kleenex, Scott and Huggies announced earlier this year that it plans to close or sell its Neenah plant as part of a plan to trim corporate payroll by ten percent--or 6,000 jobs by 2008. By the end of next year, the company expects to close its Lakeview Mill and Distribution Center in the town of Menasha, where about 500 people are employed.
Congressional investigators say regulators need to do a better job explaining potential risks of interest-only and other nontraditional mortgages to consumers. Exotic home loans were once mostly the domain of the wealthy, especially interest-only mortgages and option adjustable-rate mortgages. But they've exploded in popularity in recent years, in some cases accounting for nearly a-third of new mortgages, concentrated along the east and west coasts. It happened as consumers stretched to buy high-priced homes during the housing boom. The government accountability office says borrowers could eventually face ''payment shock.'' Borrowers, and even lenders with such mortgages, could get hurt if housing prices drop or if interest rates were to shoot up. Interest-only mortgages require that the homeowner initially pay only the interest on the loan for a set period. Option arms give the homeowner flexibility to decide how much to pay each month. One of the options is a minimum payment that covers only a portion of the monthly interest.