Tuesday PM August 29th, 2006

Tropical Storm Ernesto apparently becoming less threatening to offshore oil and natural gas facilities...Port of Houston Authority Commission approves $1 million cost increase for Bayport cruise terminal...Dallas-based Chili's owner to buy back up to 11.7 million stock shares...

Falling energy prices and growing investor optimism about a series of major economic reports due out this week have been helping stock prices. Analysts say the belief among investors that lower oil prices will help consumer spending has been sending retail and transportation stocks higher. They add that the decline of nearly $2 a barrel also eased concerns that this week's data on consumer confidence, job growth, and manufacturing show the economy is slowing faster than expected. The growing likelihood that Tropical Storm Ernesto is becoming less of a threat to offshore oil and natural gas facilities in the Gulf of Mexico sent oil futures plunging on Monday. The decline to a two-month low came as forecasters said the storm appeared to be tracking a course that would avoid Gulf of Mexico oil installations. There have been some worries that storms could hurt offshore platforms in the Gulf, which last year saw widespread damage caused by Hurricane Katrina and Hurricane Rita.


Houston-based Shell Oil says Shell stations located along evacuation routes in south Florida, where Ernesto could make landfall by early Wednesday morning, are a priority for deliveries. Strategic locations have been identified by emergency response authorities. Shell and Motiva have generators staged in areas away from the projected path of the storm. Should evacuations be called for in areas where Motiva maintains product terminals, tanker trucks will be pre-filled before shutting distribution terminals. Employees at terminals and station operators in areas targeted by Ernesto are taking safety precautions and have been securing facilities.


The Port of Houston Authority Commission has approved increasing the total cost of the Bayport cruise terminal by nearly $1 million to pay for more site preparation. The initial assessment of dredge fill for the site was not accurate. The fill material has to be stabilized to ensure adequate strength before the road and parking area are constructed. The change order for Zachry Construction adds $945,731 to the original contract of about $15.3 million. The first phase of the cruise terminal is set for completion by next summer. Commissioners also approved amending a tariff of $40 per container terminal use and security fee, for cargo that moves through the port terminal without being loaded or unloaded. They will also allow freight handlers to assess a fuel surcharge.


Brinker International, which franchises and operates several restaurant chains including Chili's, said today it plans to buy back up to 11.7 million shares of its common stock. The Dallas-based company says its board authorized up to $450 million more for the deal. It hopes to buy back what represents about 14 percent of its outstanding shares as of August 17th. The offer, which involves a modified "Dutch auction,'' is to begin today and continue through September 26th. Brinker said in a news release late today that its board had approved the $450 million increase in the repurchase plan for a total of $532 million. The company says it will offer to buy back the stock for $35.25 to $38.50 a share. Shareholders will be able to specify how many shares and at what price in that range they wish to tender.


Bio photo of Ed Mayberry

Ed Mayberry

Local Anchor, All Things Considered

Ed Mayberry has worked in radio since 1971, with many of those years spent on the rock 'n' roll disc jockey side of the business...