Texas shale gas towns grapple with growth as oil-bust fears fade

A mural depicting oil wells is seen in front of an abandoned building in downtown Midland, Texas, US. (Reuters)
Updated 22 August 2019

Texas shale gas towns grapple with growth as oil-bust fears fade

  • That hesitance is fading fast as oil majors make longer-term commitments to drill in the Permian Basin

ODESSA, Texas: In west Texas, the center of the US oil boom, about 3,800 students at Permian High School are crammed into a campus designed for 2,500.

Officials had expected enrollment to fall after the last oil price crash in 2014, but it kept rising — one sign of a growing resilience in the oil economy as Exxon Mobil, Chevron and others continue investing billions of dollars here.

For most of the last century, oil money has flowed into this region — but residents had enough sense to know it would flow out again when the next bust hit. That cycle has always made people wary of investing during good times.

That hesitance is fading fast as oil majors make longer-term commitments to drill in the Permian Basin and residents grow weary of traffic jams on once-rural roads, long waits for appointments, pricey housing and overcrowded schools. Local government and industry are joining forces to tackle the region’s overwhelmed services.

“When you have more students, you need more teachers,” said Danny Gex, principal at the Odessa school. Texas has a statewide teacher shortage, Gex said, and “when you’re in a desert, it makes it a lot more difficult to find them.”

Housing is also in demand. The median price in Midland, $311,000 in April, was higher than any other Texas city outside Austin.

The world’s biggest oil majors are taking control of the shale business. That means they will need to lure more staff to live permanently with families in cities such as Midland and Odessa, rather than depending on “man camps” for  roughnecks or relying on temporary schemes.

“The mindset is changing,” said Midland Mayor Jerry Morales. “We understand we’re growing and we need these things.”


Japanese officials cautious on prospects for US trade deal

Updated 17 September 2019

Japanese officials cautious on prospects for US trade deal

  • A long-sought trade pact with Japan was scrapped when Donald Trump withdrew the US from a pan-Pacific trade agreement shortly after taking office in 2017
  • Trump said he preferred that Washington and Tokyo strike a bilateral deal

TOKYO: Officials in Japan appeared wary over the prospects for a trade deal with the US after President Donald Trump said he was prepared to sign a pact soon.
Japan’s chief government spokesman, Yoshihide Suga, said Tuesday that the two sides are still finalizing details after reaching a basic agreement in late August on trade in farm products, digital trade and other industries.
Suga said Trump and Prime Minister Shinzo Abe are considering signing a deal in late September when they attend the UN General Assembly in New York.
“We are accelerating the work that still remains,” he said. “But I decline to comment further because we have not reached a formal agreement.”
Trump’s notice to Congress, released by the White House on Monday, did not mention tariffs on autos and parts, long a sticking point between the two countries.
It said his administration was looking forward to collaborating with lawmakers on a deal that would result in “more fair and reciprocal trade” between the two countries.
Toshimitsu Motegi, who became foreign minister last week after negotiating the deal as economy minister, said Japan must watch carefully to prevent Washington from forcing any last-minute changes, Kyodo News agency reported.
The agricultural minister, Taku Eto, cautioned against letting down Tokyo’s guard until the final agreement is reached, it said.
A long-sought trade agreement with Japan was scrapped when Trump withdrew the US from a pan-Pacific trade agreement shortly after taking office in 2017.
Japan and the other 10 remaining members of the trade pact, the Trans-Pacific Partnership, then renegotiated their own deal without the US
Trump said he preferred that Washington and Tokyo strike a bilateral deal.
That resurrected the longtime issue of tariffs on Japanese car and auto parts exports to the US and of stiffer duties on US exports of farm and other products to Japan.