1. Strictly Houston. Strictly Business.
Vol. 43 No. 8 Week of July 6-12, 2012 | www.houstonbusinessjournal.com 44 Pages | $3.50
CLEARING SMALL BUSINESS GUIDE FROM TUXEDOS
HURDLES TO HEALTH CARE REFORM TO SUNDRESSES
How competitive equestrian What small businesses should know Men’s Wearhouse CFO talks
sports help a Houston about the Affordable Care Act about his new gig
executive in her day job at Francesca’s
PAGE 19 PAGE 2 PAGE 2
More litigation
in the pipeline
Taking a patient approach
M.D. Anderson embarks on $198M construction project in Texas Medical Center
over shale plays BY JENNIFER DAWSON
The expansion project, shown in this
HOUSTON BUSINESS JOURNAL
BY SANFORD NOWLIN rendering, includes 185,000 square feet
of new construction.
RENDERING COURTESY OF THE UNIVERSITY OF TEXAS M.D. ANDERSON CANCER CENTER
SPECIAL TO HOUSTON BUSINESS JOURNAL The University of Texas M.D. Anderson
Cancer Center will spend $198 million on a
The recent $162 million South Tex- hospital expansion and renovation that will
as jury award made in an Eagle Ford add 185,000 square feet to the massive Texas
Shale-related business dispute may be Medical Center health care provider.
just the first rumblings of a gusher of While project details are coming to light
litigation. in the wake of the U.S. Supreme Court’s June
Texas lawyers say they’re expecting a 28 ruling that upheld most of the Affordable
flood of lawsuits as energy companies, Care Act, the two events are not related. In-
property owners and anyone else with deed, one real estate expert who specializes
a vested interest in the red-hot petro- in health care said M.D. Anderson’s expan-
leum formation wrangle for a cut of its sion is a rarity rather than
escalating revenues. the start of a new trend.
James Summers, a longtime San The expansion project
Antonio oil-and-gas lawyer, is litigat- includes the new construc-
ing three Eagle Ford-related cases this tion, which will cost ap-
year. Last year, he litigated none. proximately $102 million,
“There’s just too much money churn- and the renovation of ap-
ing in the marketplace for there not to proximately 110,000 square department. The projects were approved in ion. The eight-story facility and basement
be a major increase in litigation,” said feet of existing hospital May by the UT board of regents, she said. will be built at the corner of Bertner Avenue
Summers, partner with Fulbright & Sisolak space, which will use the The new construction is referred to as a and Bates Street, in place of an existing ro-
Jaworski LLP, which is based in Hous- remaining $96 million, said horizontal expansion of the existing Alkek tunda, which will be demolished.
ton. “I think the volume will clearly in- Janet Sisolak, project director in M.D. An- hospital, although it will actually be a free-
crease.” derson’s capital planning and management standing building next to it called the Pavil- SEE HOSPITAL, PAGE 42
The Eagle Ford has emerged as one
of the state’s prime economic genera-
tors as major energy firms drill across
the 24-county swath of South Texas.
Last year, the state issued nearly 3,000
drilling permits in the region, with that
Tech firm expands with booming energy sector
activity contributing $25 billion to its BY DEON DAUGHERTY industry accounts for about 85 percent of Ome- Øyvind Vik,
total economic output, according to a HOUSTON BUSINESS JOURNAL ga’s work. president
recent study by The University of Texas Omega has in recent years ranked in the top of Omega
at San Antonio. Spurred by the same forces that are growing many half of the Houston Business Journal’s largest Project
As energy companies drill, they businesses on the periphery of the oil and gas industry, Houston-area Information Technology Con- Solutions
the Houston office of consulting and project manage- sultants business lists. Currently, Omega is the Inc.
SEE SHALE, PAGE 39 ment software company Omega Project Solutions Inc. 13th-largest tech consulting firm in Hous-
expects to double its staff within the next 12 months. ton (see page 16). In 2011, the company
This week, the company is completing its move into also ranked as the 48th-fastest growing
INDEX a larger space to accommodate that growth, said Øy- technology company in Houston on
vind Vik, president of the Norwegian company’s U.S. HBJ’s Fast Tech 50 list.
STRATEGIES ................... 13 FOR THE RECORD ............. 26
headquarters in Houston. Omega’s Project Information Man-
H-TOWN........................ 19 CLASSIFIED .................... 32
“The oil and gas industry has been booming, and it’s agement System is used by com-
FOCUS .......................... 21 OPINION ....................... 40
our primary market target,” Vik said, adding that the
PEOPLE ON THE MOVE....... 24 THE LIST ...................... 16 SEE OMEGA, PAGE 39
Planning for the Worst
How H t ’ b i
Houston’s businesses prepare f th unexpected
for the
h
PAGE 21

2. Week of July 6-12, 2012 houston.bizjournals.com 39
OMEGA: Growing shift from natural gas to oil boost for project management firms
FROM PAGE 1 of work needed to be done in the area of national Energy Inc. (NYSE: CIE). Morris
managing changes, documentation and Architects designed the new space, and
panies such as Norway-based oil giant proper records. This shift has also worked CBRE Group Inc. (NYSE: CBR) represented
Statoil ASA (NYSE: STO) and London’s BP in Omega’s favor. Omega in the deal.
Plc (NYSE: BP), which has its U.S. head- With the January hiring of Mark Brand as Martin Lindenberg, a partner in the
quarters in Houston, Vik said. In addition vice president for staffing services, plus the Houston office of the executive advising
to the software, Omega also provides the addition of three other employees on that firm Newport Board Group, and a found- U.S. HQ: Houston
experts to implement the technology for side of the business, Omega’s current Hous- ing member of the Houston Technology REVENUE: $3.7 million in 2011
optimal project management. ton headcount is 25. During the last 10 years, Center, said the volatility of the oil and gas TOP EXEC: Øyvind Vik, president
“The thing is, as an oil and gas company, globally the company has grown about 30 industry makes it one that requires solid EMPLOYEES: 25
you can have the greatest strategies and percent per year, every year, Vik said. project management. FOUNDED: 2002
the best thoughts, but if you don’t have the Growth in the Houston office has been Movement in the industry provides op- INDUSTRY: Project management
organizational capability to get to where less consistent, he said. portunities for companies like Omega, OWNERSHIP: Private
you want, it doesn’t do any good,” Vik said. “When you establish a new office, it Lindenberg said. Producers are moving WEB: omega.no
Oil and gas companies are selling com- takes a while to get a real foothold and for projects from natural gas fields, where
modities, and there’s little they can do to people to see the value of what you’re do- commodity prices have dropped to record
impact those costs, Vik said. Consequent- ing. That has taken us some time, but now lows, and instead are focused on liquids- O l f i
ware, Omega can now supply profession-
ly, efficiency and keeping expenses down we feel we’ve reached a good size. We’ve rich fields, which is generating additional als to implement it.
by even 2 or 3 percent can save companies got contracts with major oil companies project management work. “That appears to be a driver in the way
millions. here, and we’re now ready for a lot of ex- Also, an expected exodus of many retir- this company has grown,” he said. ■
Vik explained that one of the legacies of pansion.” ing oil and gas executives creates open-
the 2010 Macondo well disaster, in which The company is moving from its 2,000 ings for companies to fill with outsourced DEON DAUGHERTY covers energy and law for the
the Deepwater Horizon oil rig exploded in square feet of space in west Houston’s Park project managers. Omega appears to have Houston Business Journal. Reach her at deondaugherty@
the Gulf of Mexico, killing 11 workers and Ten to a 4,000-square-foot site in the Co- a strong position in this niche market, Lin- bizjournals.com, 713-395-9627 or twitter.com/
spilling almost 5 million barrels of oil, is balt Center, a building in west Houston denberg said. Not only has it developed HBJDaugherty. Follow her “Drilling Down” blog through-
energy producers’ recognition that a lot named for its anchor tenant, Cobalt Inter- widely used project management soft- out the week at houstonbusinessjournal.com.
SHALE: ‘Some of the honeymoon has worn off between landowners and operators’
FROM PAGE 1 “A venture that receives a lot of notori- Texas District Court in Zavala County that landowners are now expiring, and that’s
ety, like shale exploration, tends to attract two Longview Energy corporate direc- caused some to take a long hard look at
must negotiate royalty agreements, often all types, including a lot of charlatans who tors abused their authority and defrauded their payouts.
involving multiple family members, said may solicit (uninformed) investors who’ve the Dallas company, keeping millions for “I think this play has matured to the
Jeffrey Webb, senior associate with Ful- heard a lot about (shale). Often, it’s hard themselves. point where some of the honeymoon has
bright. That leaves the possibility for inter- to tell who is legitimate and who’s not,” he Lawyers say the size of the Longview worn off between landowners and opera-
family squabbles, driller- said. “It also tends to draw a lot of lawyers.” Energy case’s payout is likely an anoma- tors,” Ray said.
landowner disputes and, Zavitsanos added that if the price of ly. However, it could hint that other big As long as the petroleum profits continue
in some case, outright crude oil drops below $80 per barrel, Texas awards are yet to come. to flow, Fulbright’s Summers said, so will
fraud. could see a new wave of litigation. “There are going to be some significant the lawsuits. The complexity of the arrange-
“We’re probably on the “Shale is a little more expensive to extract, cases coming out of this from a monetary ments between landowners and oil and gas
front end of all this litiga- so returns are not going to be there, which standpoint,” said Jon Ray, partner at San companies practically guarantees it.
tion,” he said. may mean allegations that there were mis- Antonio-based law firm Cox Smith Mat- “It’s amazing how many people get paid
John Zavitsanos, a part- representations made about rate of returns” thews Inc. “There also will be some signifi- something for each well,” Summers said.
ner in the Houston law that lead to the courthouse, he said. cant case law coming out of this and other “The more splintered the ownership gets,
firm of Ahmad, Zavit- Zavitsanos The $162 million jury verdict San An- shale plays in terms of horizontal drilling.” the more ripe it is for disputes to arise.” ■
sanos, Anaipakos, Alavi & tonio law firm Watts Guerra Craft LLP Oil and gas litigation for Cox Smith is up
Mensing PC, said so far there has not been won in June for Longview Energy Co. is 25 percent from last year, and Ray said he SANFORD NOWLIN is a reporter with San Antonio Busi-
a large number of shale-related cases mak- believed to be the largest yet awarded expects the growth to continue. ness Journal, an affiliated publication. DEON DAUGH-
ing it to court, but many expect an uptick over the shale’s development. In that case, Many of the three-year leases origi- ERTY of Houston Business Journal contributed to this
in activity. Watts Guerra Craft argued successfully in nally signed between oil companies and article.
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