exas
is the world’s pre-eminent oil state. If you’re in oil and
working in the US, it often makes sense to have an office in Houston,
Texas, if only because more or less everybody else does. It makes it
easier to do business within the industry – or, of course, to keep
an eye on what the competition is up to.
More
than 5,000 firms involved in the energy sector are located in Houston,
including more than 200 of the best-known oil and natural gas exploration
and production companies and more than 50 important pipeline companies.
About a quarter of all jobs in petroleum and natural gas production
in the US are in Houston, along with a fifth of those involved in servicing
production fields. Many of the other jobs in the city are in manufacturing
and engineering industries related to the oil sector.
Oil
fields in the Texas Gulf Coast region account for a fifth of all output
in the US, and oil refining capacity totals 3.3 million barrels a day.
Almost half of the US petrochemical industry is also located in the
Lone Star State, employing over 40,000 people, many of them in and around
Houston.
“We consider Houston to be the home of the world oil industry,”
says Archie Dunham, chairman of Conoco, a leading US oil company. “It
is important to be where you can interact with other energy companies
and chief executive officers. Texas is a good place to be.”
Oil dominates the culture and business community of the city and, to
an extent, the rest of Texas. “Historically, Texas has been a place
where trust is important, where integrity is really important, and where
your word is your bond, or your contract,” says Mr Dunham.
“In
this part of the US, the verbal commitment is very important for personal
as well as business transactions,” he adds. “That culture
still exists in this part of the country, and especially in Texas.”
The company is very conscious of the industry’s impact on the societies
in which it works, and of the need to preserve and protect the environment.
Conoco has a policy of setting up advisory committees to ensure that
local communities are aware of what the company is doing.
“We want them to trust us,” says Mr Dunham. “We have
to really let them understand everything that is going on in a refinery,
gas plant or upstream operation.”
Conoco started life as Continental Oil and Transportation in Utah in
1875. Some years later, it moved to Oklahoma, then made its home variously
in Houston, New York, Connecticut and Delaware before ending up in Houston
once again. The name Conoco was adopted in 1979.
Apart
from its operations in oil and gas production and marketing in the US
and the Gulf of Mexico, Conoco has operations in the North Sea, Indonesia,
Malaysia, Ecuador and Venezuela. Last year, it began exploring for oil
in waters off the coast of Vietnam.
The company has also been on the takeover trail, acquiring big natural
gas reserves when it bought Gulf Canada Resources earlier this year.
Since then, Conoco has itself been at the centre of a huge merger after
it announced in November that it was joining forces with Phillips Petroleum.
The new entity, ConocoPhillips, has a market value of around $35 billion.
Working out just who is who, and who owns who, in the US oil sector
has become increasingly confusing after a spate of mergers and consolidations.
BP and Amoco merged and then took over Atlantic Richfield. Exxon and
Mobil got together in 1999, while Chevron teamed up with Texaco in a
$38.7 billion deal last year.