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09/06/2005:
"One city's tragedy may be another's boon"
HOUSTON No one would accuse this city of being timid in the scramble to profit from the aftermath of Hurricane Katrina.Oil services companies based here are already racing to carry out repairs to damaged offshore platforms in the Gulf of Mexico, and the promise of plenty of work to do sent shares in two large companies, Halliburton and Baker Hughes, soaring to record levels last week. The Port of Houston is preparing for an increase in traffic as shippers divert cargo away from the damaged ports of New Orleans and Pascagoula, Mississippi.
With brio that might make an ambulance-chaser proud, one company, National Realty Investments is offering special financing deals "for hurricane survivors only," with no down payments and discounted closing costs.
"It feels like the only things left in south Louisiana are snakes and alligators," said John Olson, co-manager of Houston Energy Partners, a hedge fund that operates out of a skyscraper in the city center. "Houston is positioned for a boom."
Perhaps no city in the United States is in a better spot to turn Katrina's tragedy into opportunity. Long known for its commercial fervor, Houston, the largest city in the South with a metropolitan population of more than four million, has one of the busiest ports in the United States and remains unrivaled as a center for the energy industry.
Halliburton moved its headquarters to Houston from Dallas in 2003, joining dozens of companies based here that provide services for oil and natural gas producers.
Halliburton differs from many oil services companies in that it also does significant business with the federal government. Halliburton has a contract with the U.S. Navy, similar to its contracts in Iraq, that has already kept it busy after Hurricane Katrina. The company's Kellogg, Brown & Root unit was doing repairs and cleanup at three naval facilities in Mississippi last week.
Executives at other Houston companies said they were wasting little time in carrying out repairs in the Gulf of Mexico, where at least 20 offshore rigs and platforms are believed to be damaged or destroyed. Tetra Technologies, which repairs old platforms in the Gulf of Mexico or decommissions them, had employees in a helicopter the day after the storm passed to survey the damage.
"I always hate to talk about positives in a situation like this, but this is certainly a growth business over the next 6 to 12 months," said Geoffrey Hertel, the chief executive of Tetra. By Friday, Tetra had been able to send an 800-ton derrick barge it owns, the Arapaho, to the gulf to be used for platform repairs, Hertel said.
...The displacement of companies to Houston from New Orleans is an abrupt acceleration of a trend that has been going on for decades. Many large companies, particularly those in the energy business, have made that move over the years, leaving New Orleans more dependent on tourism and other service industries.
A surge of business activity in Houston might lift the fortunes of a city that is still struggling to recover from the collapse of Enron and two decades of job cuts in the energy industry.
Rising oil and natural gas prices in the last two years have strengthened the finances of Houston's largest energy companies, but have done little to improve job prospects in the city, where the unemployment rate was 5.5 percent in July, compared with 5 percent nationally. During the last oil boom, in the 1970s, 150,000 jobs were created in the business of oilfield equipment, according to Barton Smith, director of the Institute for Regional Forecasting at the University of Houston.
But since the 1980s, about 130,000 of those jobs have been lost as oil and natural gas exploration moved away, largely to West Africa, the Middle East and Asia, and companies were able to produce oilfield equipment more cheaply abroad.
One company that has exchanged New Orleans for Houston is Whitney Holding, the parent company of Whitney National Bank, founded in 1883 and the oldest operating bank in New Orleans. Another New Orleans oil exploration company, Energy Partners, said in a statement last week that it was also making Houston its temporary headquarters. Other companies are following suit, according to real estate brokers.
"It's exploding," said Steve Duplantis, senior managing director at CB Richard Ellis. "When I talk to owners of office buildings, they say people are not even negotiating. As tragic as it is for New Orleans, it is a boon for Houston."
iht.com
Nice
San Antonio Times Editorial
Nothing could compare to the differences between the hip-hop celebrities at the MTV Video Music Awards recently and the masses of people wading through the chaos of New Orleans in the days that followed.
On one side, you had some of the best-coiffed, best-dressed and richest-fed beautiful people on the planet. On the other, you see people who haven't looked in a mirror in days — and could care less because they may not have eaten in the same time.
...The disaster in New Orleans is bringing out all the normal complaints that the government could have done this or it should have done that. Why weren't we better prepared for this storm? Why didn't we build stronger levees? Why aren't we doing more to help evacuees?
The short answer is that we could have done each of the things suggested. But contrary to the beliefs of some utopians and those who think that somehow this storm was part of a Halliburton conspiracy, we can't take risk out of life. And we don't have unlimited cash to prevent every potential disaster.
You want a stronger levee? Fine. Unfortunately, to pay for that, we will have to forgo rebuilding public schools. That's not acceptable? Then I guess we could postpone that sports arena you needed to attract a major league team. Not good either? Well, I guess we need to "increase revenues," which means raising taxes, which will slow down the economic growth that the city needs to create jobs.
So you make compromises.
BUSH MOM: EVERYONE WANTS TO MOVE TO TEXAS
"Almost everyone I’ve talked to says we're going to move to Houston," Barbara Bush told NPR.
"What I’m hearing is they all want to stay in Texas. Everyone is so overwhelmed by the hospitality.
"And so many of the people in the arena here, you know, were underprivileged anyway, so this --this is working very well for them."
O yes. Very well indeed.
