Thursday PM April 26th, 2007
by: Ed Mayberry, April 26, 2007 5:04:00 am
Four major oil companies have agreed to cede control of Venezuela's last remaining privately run oil projects to President Hugo Chavez's government. Officials from Chevron, Britain's BP, France's Total and Norway's Statoil companies signed memorandums of understanding. They agree to give state oil company Petroleos de Venezuela a majority stake in three of the projects. Irving-based ExxonMobil signed earlier in private. But Houston-based ConocoPhillips is resisting, prompting warnings that its fields could be taken over outright. The companies pump and process heavy oil in the Orinoco River Basin. Markets have waited to see if they'd remain as minority partners after Chavez decreed last month that their fields be nationalized on May 1st. The four projects are considered Venezuela's most lucrative. ConocoPhillips spokesman Charlie Rowton says discussions are ongoing.
The number of laid-off workers filing first-time claims for unemployment benefits fell last week by the largest amount in nearly two months. It is yet another indication that the job market remains firm despite other signs of a sluggish economy. The Labor Department says new applications for jobless benefits totaled 321,000 last week, down 20,000 from the previous week. The four-week average, which is less volatile, rose by more than 2,700 to 332,000.
Mortgage rates are little-changed but nonetheless a tad lower this week. Freddie Mac says the average for a 30-year fixed-rate mortgage is 6.16 percent, down one basis point. The 15-year loan is averaging 5.87 percent, compared with 5.89 percent a week ago. Freddie Mac vice president and chief economist Frank Nothaft says what amounts to a pause is the result of weaker existing home sales last month, coupled with lower consumer confidence in April.
A judge ordered BP to identify the allegedly toxic substance released at its Texas City plant last week. The substance sent about 100 employees to the hospital. U.S. District Court Judge Samuel Kent also ordered BP to preserve all evidence related to the leak. A spokesman for the company says BP found no evidence of a leak or contamination. The refinery is about 30 miles southeast of Houston. It was the site of a 2005 explosion that killed 15 people and injured 170--the worst U.S. industrial accident since 1990.
Halliburton said its first-quarter profit rose 13 percent. The Houston-based oilfield services conglomerate credits the boost largely on increased business in the Middle East that helped offset lower commodity prices in the United States. Halliburton reports net income of $552 million. Excluding results from its former KBR military contracting subsidiary, income from continuing operations was reported at $529 million. Revenue in the January-March period rose 17 percent to $3.4 billion. Halliburton announced in March that it would split its corporate headquarters between Houston and Dubai to be nearer important markets in the Middle East and Asia.
ExxonMobil says its net income grew ten percent in the first quarter. The Irving-based oil giant credits higher refining, marketing and chemical profit margins overcame lower crude oil and natural gas prices. The world's largest publicly traded oil company says net income rose to $9.3 billion for the January-March period. Revenue fell almost two percent to $87.2 billion. Like other major oil companies, Exxon was hurt by lower oil and natural gas prices to start 2007 compared with a year ago.
Valero Energy reports that its first-quarter profit jumped 35 percent on the back of stronger gasoline and distillate margins. The San Antonio-based largest independent oil refiner in the nation says its net income rose to a first-quarter record $1.14 billion dollars. Quarterly revenue fell 5.9 percent to $19.7 billion.
Attorneys have asked the North Carolina Court of Appeals to reinstate a lawsuit against the state and Dell. The attorneys are challenging more than $300 million in incentives for the Round Rock-based computer maker to build in Winston-Salem, North Carolina. Several individual taxpayers sued state and local governments and Dell, contending the state and U.S. constitutions prohibit tax breaks for individual companies. A trial judge threw out the lawsuit, saying the legality of these incentives was settled by the State Supreme Court ten years ago. The individuals appealed. Their lawyer, Bob Orr, told the three-judge panel his clients have legal standing to sue and that the incentives don't serve a public purpose. An attorney representing Dell, Burley Mitchell, told the judges the incentives are legal and the issue of tax breaks is a public policy question left for the general assembly to determine. An appeals court panel usually takes months before issuing a written opinion.
A historic hotel in Wheeling, West Virginia, is changing owners again. Bayview Financial is selling the McClure House and Conference Center to Fran Garey of Houston. Al Cross owns of Giant Hospitality Group, which is brokering the deal. He says the sale is expected to be finalized at a price of more than $2 million. Bayview Financial foreclosed on the property last year. That's after the previous owner, Wheeling City Center Hotel, failed to pay on $2.5 million mortgage. Cross says Garey has been in the hotel and hospitality industry for 35 years. She plans to remodel and upgrade the building and retain the existing staff. The downtown Wheeling hotel was built in 1851 and was where Senator Joseph McCarthy of Wisconsin launched McCarthyism in a 1950 speech to a Republican women's fundraiser. He spoke of communists in the State Department and started a crusade against communism that ended four years later with his censure by the Senate.