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Friday June 17th, 2005

Gasoline prices continue climbing…Venezuela’s ambassador to the U. S. promotes his country for Houston business leaders…Continental and other airlines again trying to fight rising jet fuel prices with fare hikes… Texas gasoline prices climbed for a second straight week after five straight weeks of declines. The weekly AAA Texas gas price survey released today finds […]

Gasoline prices continue climbing…Venezuela’s ambassador to the U. S. promotes his country for Houston business leaders…Continental and other airlines again trying to fight rising jet fuel prices with fare hikes…

Texas gasoline prices climbed for a second straight week after five straight weeks of declines. The weekly AAA Texas gas price survey released today finds regular unleaded self-serve averaging almost $2.06 per gallon. That’s up a penny from last week and almost 20 cents from a year ago. AAA Texas spokeswoman Rose Rougeau says prices at the pump are climbing along with crude oil prices. That’s despite an OPEC announcement to increase crude oil output. She says $55 barrel crude will continue to translate into gasoline prices above $2 a gallon. Houston’s prices are up more than two cents to average about $2.04 a gallon. The cheapest prices remain in the Corpus Christi area, where they averaged about $1.98 a gallon–up a fraction of a cent from last week. The costliest pump prices continue to be in the Dallas area, where they average over $2.08 per gallon–up nearly two cents. The national prices average about $2.14 per gallon–up about a penny.

Venezuela’s ambassador to the United States met with Houston business leaders to discuss economic relations and business opportunities for oil and gas service and engineering firms. Venezuelan President Hugo Chavez recently raised the income tax rate on international oil companies to 50 percent from 34 percent in April, retroactive to 2001. But Ambassador Bernardo Alvarez Herrera says recent political events in Venezuela should not deter investors.

Ambassador Bernardo Herrera audio

Venezuela says companies operating in Venezuela may owe more than $3 billion in back income taxes. Venezuela’s Energy and Oil Minister says companies like Chevron, Royal Dutch-Shell Group and Houston-based ConocoPhillips must put their operations in order if they expect to stay in the country.

Fort Worth-based American Airlines and Houston-based Continental Airlines have joined the push to raise fares. They–along with United, Northwest and America West Airlines–have matched Delta Air Lines’ fare hike. They’ve all added $10 to fares that had been capped at $499. Delta started the push by raising fares $10 on flights it codeshares with other carriers. Delta spokesman Anthony Black denied that Delta was breaking its “Simplifares” cap of $499 for one-way walk-up fares aimed at business travelers. He says Delta said it would match codeshare fares when it announced Simplifares in January. Higher fuel prices have left airlines struggling. Crude oil prices having been rising to more than $56 a barrel. That’s up more than 50 percent from a year ago.

The rising cost of jet fuel is a big concern for Continental Airlines. The nation’s fifth-largest carrier held its annual meeting yesterday in Houston. CEO Larry Kellner told the audience of mostly Continental employees that the top challenge remains higher fuel prices. Kellner said the good news for Continental is that the “Star Trek” transporter hasn’t been invented. So Kellner says–people need to travel.

Fort Worth-based American Airlines believes it can save $45 million this year by urging pilots and other workers to focus on conservation. American this week launched an international internet site on its “fuel smart” program. American is trying to refuel at airports where fuel is cheapest, reduce fuel burn while jets are parked at gates and haul less water to reduce weight and increase mileage. CEO Gerard Arpey says a more intensive approach to fuel conservation is necessary.

A Southwest Airlines proposal to leave Seattle-Tacoma International Airport is facing some criticism. Dallas-based Southwest is considering whether to move its flights about four miles away to King County, Washington-run Boeing Field. County council members have balked at the plan, citing noise pollution and other concerns. The director of Sea-Tac Airport says a move by Southwest would saddle other airlines with a bigger share of the airport’s renovation project than they’d bargained for. Southwest says it would be paying less to offer service at Boeing Field, which serves private planes, cargo jets and Boeing commercial and military aircraft operations. Spokeswoman Marilee Mcinnis today told the Associated Press that if Southwest didn’t think there would be dramatic savings–the airline wouldn’t have approached the county.

The KBR unit of Halliburton has been given a $30 million contract to build a detention facility and security fence at Guantanamo Bay, Cuba. The Department of Defense project calls for providing a two-story, 220-man facility with day rooms, exercise areas, medical and dental spaces and a security control room. Completion is set for July 2006.

HEB has opened the third of five new walk-in clinics planned for the Houston area at its stores on Tomball Parkway in Tomball, Sawdust Road in Spring and on Beechnut. The RediClinics will be run by Houston-based InterFit Health and staffed with nurse practitioners. Memorial Hermann provides physician oversight for the clinics. Two more clinics are planned for South Gulf Freeway in League City and on Woodridge.

The California State Water Resources Control Board is continuing a stay on cutting trees in two watersheds of a subsidiary of Houston-based Maxxam. Palco says it needs to continue harvesting those lands in order to remain financially stable. Residents downstream from the mills complained that the company’s aggressive timber cutting was causing flooding and adding silt that fouled the river water.

American Electric Power says it plans to install pollution-control equipment at plants in Texas and three other states. That’s part of an ongoing $3.7 billion effort to reduce emissions. The Columbus, Ohio-based utility says it will install scrubbers at coal-fired power plants near Hallsville, Texas; Beverly and Conesville in Ohio; Louisa, Kentucky; and Winfield, West Virginia. The utility says the installations will bring the plants into compliance with the federal Clean Air interstate rule. The law requires most utilities to cut emissions of nitrogen oxides and sulfur dioxide that can pollute across state lines. AEP has more than five million customers in Texas and ten other states.

It’s official–Lockheed Martin and the University of Texas System are teaming to compete for the contract to manage the Los Alamos National Laboratory. Lockheed and UT announced a formal agreement to bid jointly for the job of managing the historic New Mexico lab where the first atomic bombs were assembled. Bids are due July 1st. A decision is expected before December 1st. The University of California has held the contract since the lab’s inception in 1943. The Department of Energy decided to put the contract out to bid–and UC intends to compete to keep it. It has teamed up with Bechtel Corporation, Washington Group International and BWX Technologies. Lockheed Martin and the Texas System also have other partners. Those are the Denver-based engineering and consulting firm CH2M Hill and California-based Fluor Corporation, which is a construction and engineering company.

The U. S. Department of Labor’s Occupational Safety and Health Administration has issued citations and proposed penalties of $70,800 to Cotton Construction of Waller, Texas for safety violations. This follows the investigation of a fatality last January in Houston. A worker fell 25 feet to his death while working on a partially decked rooftop at a North Shepherd worksite.

OSHA has cited Ramos Industries of Houston with $116,500 in proposed penalties from a partial trench collapse that trapped a worker. An employee working in a 17-foot deep trench at a construction site in Palmhurst, Texas was trapped for several hours while rescuers had to shore up lower portions of the trench before they could extract the injured worker. Ramos Industries employs about 254 workers.

Goya Foods is breaking ground on a new packaging and distribution center in west Houston on June 21st, according to the Houston Chronicle, doubling the number of beans that can be packaged in a day by next March. Goya is the leading manufacturer and marketer of Hispanic food products and is making Houston its distribution hub for Texas and surrounding states and northern Mexico. The company has 13 plants, mostly in the United States, packing and distributing more than 1,200 products, including rice, beans, condiments and beverages.

Direct Energy has signed a long-term power purchase agreement with the Virginia-based AES Corporation’s Buffalo Gap Wind Farm for energy and Renewable Energy Credits from its 120-megawatt wind farm near Abilene. The 15-year exclusive deal is for all output. Direct Energy has about 900,000 customers in Texas, meeting about 25 percent of its current peak demand in the state from its own assets.

Time-Warner Cable-Houston is adding the African-American network TV One to its digital line-up. Digital Value package subscribers will find TV One on digital channel 100. Launched nationally in January 2004, TV One offers lifestyle and entertainment-oriented original programming, classic series, movies and music focusing on African-American themes, issues, culture and politics.

Baker Hughes in Houston today reports the number of rigs actively exploring for oil and natural gas in the U. S. jumped by 19 this week–to reach 1,358. One year ago the rig count was 1,171. Texas gained 20 rigs this week.

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