Russia's Energy and Industry Ministry has reaffirmed the total cost of an Exxon Mobil-led oil and gas project off the coast of Russia's far eastern island of Sakhalin. The total budget of the project is $12.8 billion. That includes $6.5 billion in costs for developing the Chayovo oil field. That's the largest field in the area under development. Irving-based Exxon Mobil has a 30 percent interest in Sakhalin 1. Another 30 percent is held by several Japanese companies, while India's ONGC Videsh and Russia's Rosneft have 20 percent each. The neighboring Royal Dutch Shell-led Sakhalin 2 liquefied natural gas development project has asked permission for a doubling of costs to some $22 billion. Analysts say state resistance to approving the budget and a broad environmental probe against the project is aimed at pressuring Shell to hand over control of the project to natural gas monopoly Gazprom. Under the terms of the original agreements, both Shell and Exxon's projects must break even before the government can share profits. That's something which a major cost hike would delay.
The Greater Houston Convention & Visitors Bureau is welcoming 24 conventions, trade shows, meetings and other events to the city in January. GHC&VB President and CEO Jordy Tollett says more than 20,954 attendees will spend an estimated $20.4 million in Houston during the month. Conventions include the World Dance Tour at the Wyndham Greenspoint Hotel January 17th through the 21st. The Society of Cable Telecommunications Engineers will hold their winter meeting January 23rd through the 25th at the Hilton Americas. The Pri-Med Today show will be held January 25th through the 27th at the George r. Brown Convention Center. And the American Association of Professional Landmen hold their North American Prospect Expo at the George R. Brown Convention Center January 31st through February 1st. More than 5,000 delegates are expected at this one, bringing some $4.9 million to the local economy.
The Texas Association of Businesses says it favors a plan to build 19 coal-fired plants in Texas. The group says if these plants are not built in just a few years, Texas will be unable to meet increased energy demands. The association said in August, the state exceeded previous peak demands and parts of Texas were without power in April for up to five hours when record temperatures hit. The TAB also advocates increased use of nuclear power and further development of wind power technologies, as well as more energy conservation.
Meanwhile, San Francisco-based Rainforest Action Network is urging private banks around the world to reject solicitations by TXU for $11 billion in debt and equity to finance 11 coal-fired power plants in Texas. The group says the new plants will result in 78 million tons of new carbon dioxide emissions annually. The project's three lead financial arrangers are Citigroup, Morgan Stanley and Merrill Lynch.
Kinder Morgan Energy Partners plans a $1.3 billion 500-mile natural gas pipeline from Oklahoma to Alabama, in a partnership with Dallas-based Energy Transfer Partners. The Midcontinent Express Pipeline is expected to open in February 2009, and users have already committed to more than half its capacity.
Houston-based Plains all American Pipeline plans to build a $77 million terminal in Illinois. The terminal will include crude oil storage. It may start operating in the second half of 2008.
BP says the Commodity Futures Trading Commission is investigating its oil and gasoline trading operations and may levy civil penalties. BP says the U.S. Attorney for the Northern District of Illinois is also investigating gasoline trading. BP's Houston-based trading operations focus on power and natural gas.
The number of Americans seeking unemployment benefits for the first time has dropped to the lowest level in two months. The Labor Department says new jobless claims dropped sharply for a second straight week, plunging by 20,000 to a total of 304,000. The number of newly laid off workers filing claims for jobless benefits fell by an even bigger 34,000 the previous week. The two straight weeks of big declines pushed claims down to the lowest level since they were at 300,000 in the week of October 14th. The recent decreases bolster the view that even though economic growth has slowed sharply this year, employers are holding on to their existing workforce in anticipation of an economic rebound.
Long term interest rates edged upward this week--the first increase in five weeks. Freddie Mac says the 30-year fixed-rate mortgage averaged 6.12 percent, compared with 6.11 percent a week ago. Last year at this time, the 30-year loan averaged 6.3 percent. The average on the 15-year loan climbed to 5.86 percent this week from 5.84 percent last week. Freddie Mac Vice President and Chief Economist Frank Nothaft says mixed economic news kept mortgage rates from making any drastic changes this week.
Applications for mortgages from major U.S. banks climbed to the highest level in more than a year last week. The Mortgage Bankers Association says applications for loans for both home purchases homes and re-financings shot up 11.4 percent last week. The level of applications was the highest since October of last year. Total applications are up more than 22 percent compared with the same week a year ago. Application volumes had been down by double-digit percentages for most of the year. Analysts credit lower mortgage rates.
Think you need to be a college grad to get a high paying job? While continuing your education is a good idea, the outplacement firm Challenger, Gray and Christmas says it's not necessarily a requirement. The company's 2007 job outlook says the demand for sales workers, support staff in the legal sector, personal trainers and transportation workers in the trucking and rail industries should remain high next year. And, says company CEO John Challenger, some of those occupations can pay more than $100,000 a year. Challenger says some of the best job-growth opportunities next year will be for people with an associate degree or some kind of vocational training.
Blue Cross and Blue Shield of Texas has agreed to suspend its new physician rating system, in response to complaints from the Texas Medical Association. They will meet on Friday to discuss the rating system and other issues. The TMA says the doctor rating system confuses patients, puts profit margins ahead of patient care and there are significant errors in how its data is collected, processed and reported. The TMA says actually the health plans have the most information to hide—which physicians are and are not in their networks, what their plans actually cover and where their premium dollars actually go.
Houston teachers are getting nearly $2.4 million extra in their take-home pay this month in what the district calls a "health insurance premium holiday." The average Houston Independent School District employee will get $114 more this month. The school district changed its schedule to only deduct health insurance premiums from employee paychecks twice a month. When December rolls around, HISD employees need make only one more premium payment to be paid up for the year.
Pier One Imports Chairman Marvin Airouard said he had no update on the company's pursuit of strategic alternatives. That includes finding a possible buyer for the company. Also, during a conference call, Girouard reiterated the company's policy "not to comment on rumors or speculation,'' so he wouldn't address ongoing buyout rumors. Fort Worth-based Pier One has been struggling to appeal to customers in a crowded home decor field. It's opened its books to an Icelandic retailer, but no formal offer has materialized so far. Girouard has said he'll retire in February and said a search continues for his replacement. He says he intends to remain active at the company until the new chief executive comes on board. Earlier today, the retailer of home furnishings and gifts said its third-quarter loss widened tenfold from last year to $72.7 million. Sales dropped almost 12 percent to $402.7 million. Same-store sales fell almost 13 percent.
Houston-based DataCert has contracted with Thomas Miller's Value for Money project in the United Kingdom to provide electronic invoicing services to law firms used worldwide by Thomas Miller's managed mutual insurance companies. The agreement is believed to be a first for the insurance industry outside the United States. Thomas Miller is the world's largest provider of insurance services to the transport industry.
Several Texas A&M University agricultural research projects will get nearly $1 million from the state's Permanent University Fund. School officials say the largest grant went to a newly established nutrition and food sciences laboratory, which got $100,000 for lab equipment. The next biggest went to the Horticultural Sciences Department, which got $36,000 for growth rooms. The Fisheries Science Department got $35,000 to renovate ponds. The funding will also support programs in tissue culture and wheat genomics and go toward purchase of gel documentation systems, an ultrasound console and a silage chopper. The money in the Permanent Fund, created by the legislature 130 years ago, comes from the sale of oil and gas pumped from more than two million acres of state land. It funds programs at the Texas A&M and University of Texas systems.
After a bonanza in 2006, big oil is poised for a slightly less big year in 2007. That's as slowing U.S. economic growth and an expanding global supply cushion may help keep a lid on prices. Analysts say oil prices will continue to hover at historically high levels because of strong demand in China and the Middle East, OPEC efforts to reduce output and instability in petroleum-rich Nigeria and Iraq. However, barring major supply snags, transportation, manufacturing and home-heating fuels should be less expensive than last year. That's thanks to an anticipated production spurt from non-OPEC countries and a calmer outlook for the refining sector. To that end, many analysts are looking for crude-oil futures next year to average more than $60 a barrel but to hover below the 2006 average through November of almost $67 a barrel. Oil peaked above $78 in July. The country's three biggest integrated petroleum companies--Irving-based Exxon Mobil, California-based Chevron and Houston-based ConocoPhillips--are expected to earn more than $68 billion in 2007. That's four percent less than in 2006. In general, analysts say the profit outlook is brighter for independent oil and gas producers and dimmer for independent refiners. Another year of massive profits in the oil patch could make business difficult for airlines, automakers and retailers. It also could arouse scrutiny in Washington, where Democrats will control Congress for the first time in more than a decade.
Got a jar crammed full of coins at home? Turns out they might be worth plenty. That's because the government says metal prices are on the rise--so much so that pennies and nickels are now worth more than their face values. And officials are worried about people melting the coins down. So the U.S. Mint is moving to stop that. They're putting new rules into place that'll ban the melting of nickels and pennies. If you're caught you could wind up paying big money--a $10,000 fine. You could also find yourself spending five years in a federal prison. What's the big deal? First, mint officials say the coins are needed for their normal purpose. Second, it costs money to make them. According to the mint, each nickel costs more than eight cents to produce, while each penny costs 1.73 cents.