The $300,000 clunker
The Detroit Free Press ferrets out some fascinating details from government data about the recently concluded Cash for Clunkers program. Someone traded in a 1997 Bentley Continental R, which had an original price of more than $300,000, in exchange for no more than $4,500 credit toward a new car.
Some enthusiasts would have paid many thousands of dollars for the rare 1987 Buick GNX destroyed under the program; only 547 were built. The nation’s supply of used Chevrolet Corvettes was thinned by 131, including 34 convertibles, and the program also liberated 22 Americans from the burden of owning a Peugeot.
And this
And 37 people decided to clunk models that were less than a year old.
Don Mecoy
Business Writer
Larry Nichols on CNBC
Devon Energy CEO Larry Nichols appeared on CNBC’s Kudlow Report on Tuesday to talk about the cap-and-trade legislation. Nichols is adept at these kind of spots, but Kudlow’s questions could have been written by Devon’s corporate communications department.
Don Mecoy
Business Writer
A Martian view of U.S. oil industry
This 1956 cartoon created by the American Petroleum Institute, and archived by the Internet Achive, was designed to promote the oil industry. It is surprisingly entertaining. Martians, who already had developed interplanetary travel, needed help from America’s oil industry to understand how petroleum and competition can boost the standard of living for all Martians.
The oil industry information gets going in earnest at about the 7:30 mark. Notice how the oil companies use explosives to search for oil deposits. (via Boing Boing)
Don Mecoy
Business Writer
Pickens tip of the day
Widget link above taken from pickensplan.com
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Since the day it was launched, the Pickens Plan Web site has done a good job of organizing and supporting backers of Boone Pickens’ initiative to boost wind power and natural gas energy. One of the regular features that I have found interesting is the “Fact of the Day.”
A few examples:
– 70% of the oil we import is used for transportation.
– In 1970, we imported 24% of our oil. Today it’s nearly 70% and growing.
– The top five states, in terms of wind power generating capacity, are Texas, Iowa, California, Minnesota and Washington.
– The new wind projects completed in 2008 account for about 42% of the entire new power-producing capacity added nationally last year and will avoid nearly 44 million tons of carbon emissions, the equivalent of taking over 7 million cars off the road.
Don Mecoy
Business Writer
Devon Energy: No layoffs ever
We recently ran a story about several Oklahoma businesses that made Fortune’s list of the “Best 100 Companies to Work For.” As part of Fortune.com’s online coverage, the writer takes note of several large companies that have managed in good times and bad to avoid ever laying off an employee.
Devon Energy, which placed 13th overall in the list of top 100 companies, was featured:
The company has been able to avoid layoffs by making sure it keeps costs low during economic downturns and booms alike. Before the current crisis, Devon chopped its operating budget to match its cash flow from oil and gas production.
Devon also takes a prudent approach to hiring, maintaining an efficient workforce of highly trained employees. Voluntary turnover is a steady 4% a year. And instead of the traditional annual salary review, the company’s compensation process is flexible: In slow years, employees sometimes forego raises, and in good times, they may be rewarded with midyear pay increases.
That has got to make Devon employees feel pretty good, particularly when the company’s earnings reports turn sour.
Don Mecoy
Business Writer
Business Week on SemGroup
John A. Catsimatidis
Business Week magazine this week wrote about the attempts of New York billionaire John A. Catsimatidis to gain control of bankrupt Tulsa energy company SemGroup LP. The supermarket magnate has taken a hard-line approach to acquire SemGroup assets “on the cheap,” Business Week writes.
Catsimatidis, who has obtained several seats on the company’s board, has made broad assurances that he will save jobs, keep the company in Tulsa and restore the business’ strong philanthropic ways. However, SemGroup executives are working with other potential buyers, and Catsimatidis’ methods are making those efforts more difficult.
What’s more, (SemGroup CEO Terry) Ronan says, Catsimatidis’ grandstanding is scaring off bidders for its pipelines, storage tanks, asphalt-mixing operations, and other businesses, potentially lowering their values. According to Ronan, during the holidays one bidder almost backed out of a deal to buy a SemGroup property over worries about the increasingly public fight between Catsimatidis and management. “Fortunately, we were able to convince them that they should continue,” says Ronan. “But [the fight] certainly has delayed things.”
Catsimatidis is expected to unveil his plan in the coming days.
Don Mecoy
Business Writer
Gov. Brad Henry on Pickens Plan
A few days ago, Oklahoma City Mayor Mick Cornett talked to someone from the Pickens Plan Web site about the city’s view of the plan to develop a comprehensive national energy plan. Today, Gov. Brad Henry weighs in.
We are in the process of encouraging, facilitating and incentivising the development of the all-important transmission lines—the grid —to get power from the remote areas of the state into the urban areas that use the power. This is one of the many places where Oklahoma is really exactly in line with the Pickens Plan.
Henry also touts the Oklahoma Bioenergy Center.
(By the way, Gov. Henry, you might want to update that photo gallery on your Web site. Looks like the latest photos, which are of your wife, are at least two years old.)
Don Mecoy
Business Writer
Mayor Mick and T. Boone
Oklahoma City Mayor Mick Cornett discusses alternative energy and T. Boone Pickens’ plan for boosting wind energy and natural gas at pickensplan.com. In the course of the interview, he drops this little teaser:
This morning I had a long conversation with a company that is involved in providing support and services for the wind industry. I don’t want to disclose who we’re talking to, but their business is definitely expanding. We feel like the manufacturing, the assembly, and the corporate headquarters that these growing companies are going to need could be served here in Oklahoma City right alongside the traditional fossil fuel industries that are also based here.
More here.
Don Mecoy
Business Writer
Cheap Gas? Fuel at $2.99 suddenly looks like bargain
The weekend began with a pleasant surprise for me when I saw signs advertising gas prices at $2.99 at local 7-Eleven stores.
Turns out, the news was even better.
I stopped at the Sam’s Club at Memorial Road and Pennsylvania on Friday evening and was able to fill up my car for $2.93, with a 5 cent per gallon discount I got with my Sam’s card. Shades of, what, 2007?
Then I drove over to Fort Smith to visit my parents, and when I fueled up again to return back to Oklahoma City, the price there was $3.15. Downer.
Not sure what fuel prices will be to start the week. I’ll look on my way to work today and report what I see.
UPDATE: My editor, Clytie Bunyan, reported that she filled up for $2.89 a gallon this weekend at a southside station. Fellow reporter Debbie Blossom said that a 7-Eleven at NW 10 and May Ave. was advertising gas prices at $2.89. Fill up and enjoy it while it lasts!
Business Writer
Wall Street Fallout: No Deal for Ethanol Plant
A story in Thursday’s editions of The Oklahoman reported that Oklahoma Sustainable Energy LLC had withdrawn from a $100 million ethanol plant project in Blackwell because of problems obtaining financing by a Sept. 15 deadline.
Terry Detrick, company president, said that it would refund more than $8 million to investors, many of whom are Oklahoma farmers. He wrote an article for an American Farmers and Ranchers publication that used the headline “Wall Street Detours Oklahoma Ethanol.”
But others who reacted to the news weren’t heard in the story. Here are the reactions of David Fleischaker, Oklahoma Energy Secretary, and Shane Frye, executive director for the Blackwell Area Chamber of Commerce and Blackwell Industrial Authority. Plus, a final comment from Detrick:
“It’s sad but understandable. This is a very difficult time for new ethanol projects. The ones that are going to be successful in the near term are the ones that are built and have their construction costs behind them and are generating revenue from production of ethanol.“The ones that were late to the game, they faced increased costs in terms of plant construction costs and increased costs in terms of input costs, and at the same time there was downward (price) pressure on their product because there still are relatively few retail outlets. They are getting pinched at both ends and the results are road kill.”
— David Fleischaker, Oklahoma Energy Secretary
“Major projects all over the country are suffering right now due to the challenges in the investment banking world right now. And this is one of those projects. I know our community here in Blackwell is very committed (to the project). We are in weekly meetings with the folks involved with Oklahoma Ethanol and Chaparral Energy, and they are extremely committed to continue, as well. We are all in a holding pattern to get the clouds out of the way as far as the investment banking scenario right now.”Those folks (Oklahoma Sustainable Energy) were the folks who had the dream and the vision to get the project started, and we are going to continue working with them, and they are part of this deal wehtehr their investment continues or not. We’re proud they put this project forward.”
—Shane Frye, executive director for the Blackwell Area Chamber of Commerce and Blackwell Industrial Authority
“It was an honor to be in a position that we could kind of pull the trigger on the starting gun to introduce a whole new vision and dream and opportunity for Oklahoma,”
— Terry Detrick
Jim Stafford
Business Writer
