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Shale Industry Helps Make Houston a Great Place to Invest in Business

The Houston Business Journal reported recently that compared to other cities within the United States, Houston is a great place to invest in a business. In fact, Houston never suffered the same losses as other areas around the country. And although we might like to attribute this to being especially lucky, analysts say this is largely due to the presence of oil and gas companies. And now that things have really begun to heat up here in the last six months, Houston Entrepreneurs Organization board member Mark Martin remarked that “overall job growth is being fueled by the energy industry. The shale plays in South Texas keep everyone spinning.”

HBJ asked Entrance president, Nate Richards to weigh in on the topic. “For us, the shale boom and domestic energy exploration is a big driver. Shale production is so new that the old technology for drilling does not fit that well. This creates a need for us to fill, and that is driving growth.”

This growth hasn’t just affected Entrance. The oil and natural gas industry currently supports more than 9.2 million U.S. jobs. With increased domestic shale development, this number could increase by as many as 317,000 American jobs by 2015. Even better, Goldman Sachs is predicting that the United States will be the number one oil producing country in the world by the year 2017.

As much of a business driver as shale has been, unconventional assets are at a crossroads at the moment. Natural gas prices are at a low, which makes the economic viability of plays difficult. In fact, based on a recent presentation by Raoul LeBlanc of PFC Energy at the Rice E&C forum, only the top quintile of wells drilled in gas-rich plays are currently profitable. While industry leaders look to drive demand for natural gas, hoping to increase prices, Raoul stated that choosing the right wells to keep is essential to winning or losing. And those decisions require accurate and integrated data. After years of under-investing in their information assets, companies will need to play catch-up. The question for everybody in the industry will be, are we prepared to take on the challenge?

Luckily, with so many jobs on the line, the energy industry is really stepping up to the plate. “I think we are starting to turn the corner on optimism,” said Richards. “During those years of the recession there was a wait and see mentality. But for us, we do software modernization, and these projects can’t sit on the shelf forever. Now there is a fundamental shift in business computing and a need to catch up, modernize the applications we have built.”

Here in Houston as business grows at an even faster pace, a true business case can be made for making an investment in software modernization. It can only make everyone’s jobs easier and more efficient, with the added benefit that the outlook is good for a healthy business in the future. Richards chimed in about this as well, “I know that in Houston, I feel a lot more comfortable making investments than in other cities. Other local economies are not as robust.”

Not sure where you would start with modernizing your own company’s software? Let our president fill you in a bit more here.

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