A Review of the Nigerian Energy Industry

Houston: An energetic city on the move

Houston info21 September 2013 – Restaurants in every direction; some of the most affordable real estate of any major city in the United States; a bazillion trees that often shock out-of-towners expecting sand, cactus and tumbleweeds; a laid-back atmosphere that makes newcomers soon feel welcome; permanent resident performers in all four professional level performing arts; the largest concentration of healthcare facilities on the planet; several professional sports teams; a port that is first in the nation in international waterborne tonnage; a home to more Fortune 500 company headquarters than any city outside of New York, NY… Houston.

One could go on and on and not cover all the attributes of Houston, Texas – the fourth-largest city and the heart of the fifth-largest metropolitan area in the United States. Forbes Magazine has called Houston “the coolest city,” and “America’s next great global city.”

Houston has developed into a global powerhouse with an entrepreneurial spirit second to none. And as an oil and gas city, Houston is worthy of consideration, along with the group of cities mentioned in the 2013 OTC Career Guide.

Energy Impact
Houston, named after General Sam Houston in 1836 and incorporated in 1837, was far from an instant success. During its early days, the city was rough around the edges, and was considered by many to be a backwater of sorts. Its early economy was dependent on sugar and cotton plantations near Houston, and on shipping, particularly cotton, lumber and manufacturing items. However, three disparate events in the early years of the 20th century combined to put Houston on the path to becoming a global city, and made black gold the new cash crop.

The first was the tragic Hurricane of 1900 that hit Galveston, Texas in September 1900 and turned what had been Texas’ leading city into a place of rebuilding and restructuring for decades. A year later, oil was discovered at Spindletop just down the road from Houston near Beaumont, Texas. And in 1902, a project called the Houston Ship Channel was approved. All the pieces were in place.

Although it did not happen overnight, Houston was off and running. It would grow from being a small commercial city at the turn of the century to the largest city in Texas by 1930, and seemingly went from strength to strength.

The oil discoveries near Beaumont in 1901 transformed Texas into a leading energy state. Its yearly production went from 836,000 barrels in 1900 to more than 17 million barrels two years later, helping propel Texas into a select group of leading oil producing states, along with California and Oklahoma.

The Texas government created an oil production tax a few years after the Spindletop discovery. That revenue from the oil production tax removed the need for a state income tax, which would prove to be a boon to the state’s economic growth in the decades to come.

There would be other discoveries, including the East Texas Oil Field in 1930, which was at the time the largest oil discovery ever made. Other strikes in the state made Texas the dominant oil producer in the country by 1940.

During this early Texas oil boom, Houston – with its Houston Ship Channel and its Port of Houston – was the primary beneficiary; soon, petrochemical plants and oil refineries sprung up. In addition to its port, Houston was also a hub for rail and road traffic. As Houston’s oil and gas sector grew, so did the city as a whole. Today, it is home to more Fortune 500 companies than any city in the nation except for New York City, and a number of those Fortune 500 companies are energy or energy-related companies.

Many of the institutions that Houston residents benefit from today, such as the University of Houston, the Museum of Fine Arts, Hermann Park and the nearby Houston Zoo. The Houston Symphony Orchestra came as a result of the city’s energy-led growth, according to authors Fran Dressman (“Gus Wortham: Portrait of a Leader”) and Richard H. Kraemer (“Texas Politics”).

Also thanks to the energy industry, the Houston–Sugar Land–Baytown area became the top exporter in the nation in 2012, according to the U.S. Department of Commerce in a recent report. Increased shipments of petroleum products drove the rise in exports, which increased by nearly 6 percent from 2011, putting Houston over New York City. Houston has come full circle from those early days when cotton and lumber made it an important shipping center.

Houston has led the nation in job creation since the recession, and much of the job growth has been provided by the energy industry. There were fewer energy sector layoffs during the recession than there had been during recessionary times in the 1980s, according to Patrick Jankowski, an economist and vice president of research at the Greater Houston Partnership.

Today, oil and gas companies too numerous to mention are headquartered in Houston. Several are currently planning or already building new headquarters in or near Houston, making the building crane the new state bird.

Among the new facilities are Exxon Mobil Corp.’s new, 385-acre office campus in The Woodlands, where about 10,000 people are expected to be working by 2015. Shell Oil Co. is building two 12-story office buildings in West Houston that will offer 672,000 square feet of office space, and which will supplement its existing headquarters in downtown Houston. Phillips 66 is searching for property along the Energy Corridor – a business district with a high concentration of oil and gas companies located about 15 miles west of downtown Houston – to build a new headquarters building on ahead of the split with ConocoPhillips into two separate companies. And Chevron Corp. is planning a new, 50-story office tower in downtown Houston, where more than 1,700 new workers will join about 9,000 employees and contractors already working in the city.

And if being the nation’s energy industry leader isn’t enough, Houston is among the leaders in biomedical research and aerospace, and is the world’s largest petrochemical manufacturing area.

City Highlights
The sprawling, 600 square-mile Houston metro area once took a back seat to Galveston, both as the major city in the state, and as a regional destination. Following the Hurricane of 1900, however, with its port, Houston became a natural heir to Galveston’s previous dominance. It was full speed ahead for H-town from that time on, and today, Houston ranks high on the list of cities with worldwide importance.

For a major southern city, Houston is quirky and eclectic, and does not take itself too seriously. In an ad campaign that began in 2004, 17 negative aspects of the city were listed, followed by the slogan, “Houston. It’s worth it.” For more than two million city residents in the city and six million residents in the metro area who call Houston home, it was – and is – worth it.

While known more as a city in which to do business, or to hold conferences, than as a destination, Houston offers a large number of attractions. It has several professional sports teams, including not only the Houston Astros, the Houston Dynamos, the Houston Rockets and the Houston Texans, but also the women’s South Select soccer team, and the Energy, Cyclones and Power women’s football teams.

Is highbrow culture more your thing? Houston’s got you covered; it’s one of the few cities with every major performing arts discipline – ballet, music, opera and theater. The world-class Museum District, located near Rice University and the Texas Medical Center a few miles south of Downtown Houston, is visited by more than 7 million people each year, according to the Greater Houston Convention and Visitors Bureau, and includes The Museum of Fine Arts, Houston Museum of Natural Science, the Contemporary Arts Museum Houston, the Station Museum of Contemporary Art, the Holocaust Museum Houston and the Houston Zoo. The Byzantine Fresco Chapel Museum, the Menil Collection and the Rothko Chapel are nearby.

A short drive west of the downtown area is Bayou Bend, a 14-acre facility of the Museum of Fine Arts, which contains one of the best collections of decorative art, furniture and paintings seen in the United States.

Head south and drive a short distance from Houston to the National Aeronautics and Space Administration (NASA), the agency of the federal government that oversees the civilian space program, as well as aeronautics and aerospace research. It’s also a reminder that the first spoken word on a heavenly body other than Earth was “Houston.”

Houston has one of the lowest overall costs of living among 29 metropolitan areas that have more than 2 million residents, according to the Third Quarter 2012 Council for Community Economic Research (C2er) Cost of Living Index. Because of comparatively low housing costs, and no state income taxes, Houston living costs after taxes are more than 9 percent lower than the national average, C2ER said. The 2012 annual average price for a new 2,400 square-foot house in Houston was about $215,000, according to the C2ER. By comparison, the average in Los Angeles was just over $605,000, while in Phoenix, the average was about $360,000.

For those with a sense of history, there is the San Jacinto Monument near the Houston Ship Channel. Rising more than 567 feet high – more than 10 feet taller than the Washington Monument – the San Jacinto Monument commemorates the decisive battle of the Texas Revolution, the Battle of San Jacinto.

For those looking for after-hours entertainment downtown, there is the 17-block Theater District, which provides a variety of entertainment, including movies, restaurants, plays and parks, including Discovery Green. And for those more comfortable on two wheels than two legs, the City of Houston Bikeway Program offers a 345-mile network of interconnected bike lanes.
*Gene Lockard, Rigzone

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