Friday PM September 15th, 2006
by: Ed Mayberry, September 15, 2006 5:09:00 am
Former Enron assistant treasurer Timothy Despain was sentenced today to four years probation and a $10,000 fine for lying to credit rating agencies, making Enron appear more financially healthy. Despain pleaded guilty nearly two years ago to a single charge of conspiracy to commit securities fraud. U.S. District Judge Ewing Werlein could have imposed up to a five-year prison term and a $250,000 fine under federal sentencing guidelines. But the judge said he was impressed by Despain's level of cooperation with federal prosecutors. Despain testified against former Enron executives Ken Lay and Jeff Skilling in their trial last spring. He apologized in a brief statement to the judge, saying he would like to go back and change everything if he could. Enron collapsed into bankruptcy in December 2001.
Retail gasoline prices fell for the sixth week in a row this week as lower demand and a calm hurricane season continues to translate into lower pump prices. The weekly AAA Texas gas price survey shows the retail price of regular, self-serve gasoline averages $2.44 per gallon statewide. That's down 13 cents from last week. Houston's average is at $2.37, down 15.5 cents. Nationally, the average price fell 13 cents to $2.58 per gallon. Auto club spokeswoman Rose Rougeau says several factors contributed to the price fall. Among them, she says, are lower demand after the end of the summer driving season, the calmer tropics and a steep fall in crude oil prices. Rougeau points out that crude prices fell below $64 a barrel this week after topping $78 in mid-July. The state's cheapest gas was reported in Corpus Christi, where the price averaged $2.23 per gallon. That was after the state's steepest price fall of 16 cents per gallon. The most expensive gas remains in El Paso, where the price averages $2.64 per gallon--despite a ten-cent decrease.
BP today announced plans for a $250 million expansion at its Houston campus to accommodate 2,000 new workers. Houston is the largest single location for the company, which has 96,000 employees worldwide. The expansion includes adding a seven-story, 390,000-square-foot building for its gas and power trading business. The company recently added 50 acres to its west Houston campus. The new jobs are expected to be added by 2010. They will be split between the North American exploration and production businesses and the trading and marketing unit, which are both based in Houston. BP director of Exploration and Production Technology David Eyton tells the Houston Chronicle the company is committed to developing and sustaining our presence here in Houston.''
State Farm has announced that it will not renew coverage for 6,000 personal and commercial policyholders along the Texas coast. The state's largest insurer says the move applies to properties within 2,500 feet of coastal waters or bays, on barrier islands or peninsulas. The cancellations will start next year and customers will receive 60 days notice. State Farm spokeswoman Sophie Harbert says reducing waterfront exposure will allow the company "to meet the needs of more customers elsewhere in the coastal market.'' Texas Department of Insurance spokesman Jim Hurley says the agency will carefully review State Farm's move. Among those affected by the change will be about 3,200 policyholders in Galveston County, 780 in Harris County, 90 in Jefferson County and 79 in Chambers County. Other insurers have also cut back on their coastal policies on the storm-prone Gulf Coast.
The Texas unemployment rate slipped to 5.1 percent in August after two straight months of small increases. The state's jobless rate in July was 5.2 percent. The Texas Workforce Commission today reports the state added jobs for the 23rd consecutive month--gaining about 22,600 for a total of 234,800 over the past year. Workforce commissioner Ron Lehman says business expansion statewide has been steady. He says that's supported economic growth in many different sectors. Midland had the lowest unemployment rate, with a non-seasonally adjusted figure of 3.8percent. The highest was El Paso and McAllen-Edinburg-Mission at 7.1 percent.
Houston-based power generator Dynegy today agreed to acquire plant developer LS Power Group. It's a $2.3 billion cash and stock deal. Two-thirds of Dynegy's shareholders must approve the transaction for it to go through. The combination will create a new company to be called Dynegy and headed by Dynegy chief executive Bruce Williamson. New Jersey-based LS Power will get three of 11 board seats and hold 40 percent of the new company. The company will own 20,000 megawatts of generating capacity--concentrated in the Midwest, Northeast and California. The companies also will form a joint venture to develop new power projects.
Several key figures in Hewlett-Packard's possibly illegal investigation of media leaks have been asked to testify before a congressional panel. A House committee has requested that HP chairwoman Patricia Dunn and general counsel Ann Baskins appear at a September 28th hearing. A company spokesman says HP is fully cooperating with all ongoing investigations and inquiries. But he did not say whether either would testify. Also today, a shareholder lawsuit was filed in a California state court. It alleges "substantial expense and damage'' to the company from the investigators' use of a controversial ruse known as pretexting. Dunn acknowledges authorizing private investigators to impersonate company directors, employees and journalists, in order to access their personal information. As HP's staff attorney, Baskins allegedly oversaw the leaks investigation and declared it to be legal.