Two more banks settle with Enron…Bureau of Labor Statistics confirms energy and grocery costs up in Houston area…UH Wine and Spirits Management Institute honors benefactors and bestows charitable foundation professorship…
Two more banks have agreed to pay at least $420 million to settle their parts of Enron’s “megaclaims” lawsuit, which alleges the banks “aided and abetted fraud” and could have prevented Enron’s collapse. J. P. Morgan Chase says it will pay $350 million to settle its part of the lawsuit the Houston based energy trader filed against ten banks. Toronto Dominion Bank will pay $70 million. Both banks agree to forego pursuing claims against Enron. The settlements bring total payments in the megaclaims case to $735 million, and Enron says the funds will be used for the ability to pursue others. Several other financial institutions are working to settle, including Barclays, Citigroup, Credit Suisse First Boston, Deutsche Bank and Merrill Lynch.
Energy costs rose 3.5 percent in the Houston area during July, according to the Bureau of Labor Statistics of the U. S. Department of Labor. Energy costs have increased 22.7 percent in the first seven months of the year. Food at home prices are also up 1.5 percent, with increases noted for fresh fruits–particularly apples and citrus fruits–and for fresh vegetables, poultry, bacon and ham. The Consumer Price Index indicates that a typical basket of grocery items priced at $100 in the early 1980’s cost $180.30 last month.
With pump prices approaching $3 a gallon in many parts of the country, the Energy Department is telling motorists to get used to it. Undersecretary David Garman says there’s little that can be done in the short term, made worse by what he calls “thin capacity margins.” Garman says prices will not decline quickly, even though there may be some moderating after the summer driving season. He also says motorists can help themselves by slowing down on the highway. He points out that for each five miles an hour over 60, it’s like paying an additional 15 cents a gallon for gasoline. Garman says frequent tune-ups and tire pressure checks also help mileage.
American motorists aren’t happy about rising gas prices, but it’s not getting in the way of summer vacations, commuting habits or even SUV sales. The latest Energy Department numbers show regular unleaded gasoline is averaging $2.55 a gallon nationwide. That’s more than 67 cents above levels one year ago. But at the same time, daily gasoline demand is up one percent, compared to last year. One motorist in Colorado says she might consider taking the bus, but only if gas hits $3 a gallon. A California man says pump prices would have to top $4 before he’d resort to public transit. Economists admit to being mystified by people’s continued love affair with trucks and SUVs. Ford, Chrysler and GM all reported strong July sales. As one economist sees it, consumers clearly prefer ”large inefficient vehicles.”
The University of Houston Wine and Spirits Management Institute this week honored a corporate sponsor and announced the winner of a charitable foundation professorship. The institute is a collaborative effort of the Conrad Hilton College of Hotel and Restaurant Management and several commercial sponsors. Assistant Professor Glenn Cordua y Cruz says the professorship has been awarded to JeAnna L. Abbott, who teaches hospitality law and ethics.
Dr. Glen Cordua y Cruz audio 1
The owners of Spec’s Wines, Spirits and Finer Foods is one of several founding partners of the institute.
Dr. Glen Cordua y Cruz audio 2
Industry leaders created the program curriculum to meet the needs of the industry.
Washington Group International has established the headquarters for its oil, gas and petrochemicals business in Houston, and is hiring about 200 oil and gas professionals in the next 12 months. The international engineering and construction company’s oil and gas business expects to hire up to 500 people–mostly technical and engineering professionals–within the next three years. Through its Houston, Denver, Romania and Middle East oil and gas operations, Washington Group International is focusing on upstream and midstream, including oil and gas processing, liquified natural gas and gas-to-liquids facilities.
BP has announced a recruiting drive to fill more than 400 positions for its Houston-based exploration and production and gas businesses, and is increasing campus recruiting for college graduates. About 300 jobs are new positions. BP says it is seeking experienced professionals across a range of technical disciplines, including commercial, safety and environmental sciences. Most will work in the E&P businesses on BP’s West Houston campus, although a small number are being recruited for positions in Wyoming, New Mexico, Colorado and Oklahoma, as well as elsewhere in Texas. Applications are being taken online.
Three incidents at the Texas City BP refinery in the past year weighed heavy on the minds of parents sending their children to a nearby school. The plant may have gone unnoticed any other year on the first day of school. But many parents dropping off their children at Franz Kohfeldt Elementary yesterday recalled the deadly explosion in March that forced the school to lock students inside. Kizzie Mason, who was walking with her son T. J. Webb to the first grade, says the last six months have been really scary, saying “you don’t know what to expect; it’s real dangerous for the kids.” Most schools have emergency plans for chemical leaks or plant explosions. And the local school district says it plans to educate parents about what should happen in an emergency situation.
Hahnfeld Witmer Davis has begun construction on a six-acre, 89-unit town home community in Clear Lake. Armandwilde is located on the Armand Bayou near the historic West Mansion.
Houston-based Enfield Properties has purchased Energy Corridor Plaza from Younan Properties of Woodland Hills, California in a $4 million deal, according to the Houston Business Journal. Younan last week sold Houston’s Parkway Medical Plaza for $3 million to the Pomeroy Family Trust in Southern California.
Houston-based foodservice distributor Sysco has chosen Alachua, Florida as the site for the second of what will be a series of nine product redistribution centers. The center will be part of Sysco’s Supply Chain Initiative Project, joining the first redistribution center in Front Royal, Virginia which began shipping products in February. Site selection for a third redistribution center in the midwestern United States is underway.
The third IKEA store in Texas is slated for Round Rock, north of Austin, joining stores in Frisco, Texas and a newly-rebuilt and enlarged store here in Houston. The Swedish home furnishings retailer plans to build four model homes, 50 room settings and a Swedish restaurant at the Round Rock site.
Merck and company rested its defense today in the nation’s first trial of a Vioxx-related personal injury suit. That brings the Brazoria County jury a step closer to deciding the outcome of the five-week trial in Angleton, south of Houston. Closing arguments are expected to begin tomorrow. Jurors heard rebuttal testimony today from a pair of plaintiff’s witnesses. The case has drawn national attention from pharmaceutical companies, lawyers, consumers and analysts as the first of several tests of what lies ahead for Merck. The pharmaceutical company has vowed to fight more than 4,200 state and federal Vioxx-related lawsuits pending nationwide. In this case, the widow of Robert Ernst alleges Vioxx caused his sudden death in May 2001. Merck has denied the allegation. Merck took Vioxx off the market in September 2004 after a study showed it could double heart attack or stroke risks if taken for 18 months or longer.
The government says 51 exploration companies have made 422 bids for 346 Gulf of Mexico tracts. Those sites will be offered tomorrow in the federal government’s sale of offshore leases near the coast of Texas and far western Louisiana. The numbers are nearly identical to the Federal Minerals Management Service lease sale last year in the western Gulf of Mexico. Oil prices have been going up. The leases, which will take years to develop even if development-quality deposits are found, range from five years for shallow leases to ten years for ultra-deepwater development.
Dell has signed a four-year deal to replace and manage desktop and notebook computers at some branches of Swiss Financial Services firm UBS. Dell didn’t disclose an exact figure for the contract, but officials say it’s worth more than $50 million. The deal comes as Round Rock-based personal computer maker seeks to expand its role in technology services. The world’s top direct-sale computer vendor says it’ll provide UBS with various managed services under the deal. Those include installation, hardware support and management of more than 30,000 computers at the firm’s branches in Switzerland and other countries.
Congressman Joe Barton says there’s no need for quick hearings on a bill to lift long-haul restrictions at Dallas Love Field. Barton, who chairs the U. S. House Energy and Commerce Committee, today said he doesn’t see the effort to repeal the Wright Amendment really going anywhere. Any plan to repeal the amendment would probably go through Barton’s committee. The Wright Amendment was enacted in 1979 to bolster Dallas-Fort Worth International Airport in its early years. Southwest Airlines–which calls Love Field home–is pushing for repeal of the Wright Amendment. American Airlines is base at DFW Airport. Barton and some other Texans in Congress spoke to the Greater Dallas Chamber of Commerce. Plano Congressman Sam Johnson says expanding Love Field service would create jobs and help fill empty office space nearby in downtown Dallas.
J. C. Penney posted a sharp second-quarter profit increase today with the help of improved sales across all merchandise divisions. The Plano-based department store chain also offered today an upbeat profit outlook, saying that earnings for the year would beat Wall Street expectations. For the three months ended July 30th, Penney earned $131 million. That’s a big improvement over last year’s second-quarter profit of $1 million. On a continuing operations basis, Penney’s earnings for the quarter rose 79 percent to $122 million. Net sales rose five percent to $3.98 billion–which fell just short of analysts’ consensus target of about $4 billion. Same-store sales grew 4.2 percent.