Despite "Green" Label, Austin a Growing Oil Hub

Subjects like solar panels and smart-grid technologies become a topic of discussion at plenty of Austin happy hours. But when dozens of people gathered at a lakeside bar earlier this month, the talk drifted toward oil prices, shale plays and hydraulic fracturing.

“When you think Austin, you don’t think oil and gas,” said David Tovar, a geoscience technician at Three Rivers, an oil and gas company based in Austin, as he held a pint of Texas brew. The native Texan ended up at Three Rivers after graduating from the University of Texas at Austin with a geological sciences degree.

Despite its “Keep Austin Weird” slogan and passion for clean energy, Austin is increasingly attracting oil and gas companies like Three Rivers, a small firm founded in 2009 that focuses on oil development in West Texas and New Mexico, aided by the high oil prices of recent years. Austin’s oil industry, about 4,000 workers strong, is still dwarfed by Houston and Dallas. But the city’s entrepreneurial bent and reputation as an attractive place to live, along with the top-tier petroleum engineering program at UT, have trumped the fact that Austin is far from the oilfields.

“We’ve seen an amazingly large increase in the number of oil-and-gas-related start-ups,” said Steve Smaha, a clean technology investor who lives in Austin. The projects include purifying water for hydraulic fracturing. “There’s been a shift from clean tech into oil and gas technology support just because that’s where the money is,” Smaha added.

The Austin Chamber of Commerce, noting the uptick in interest, just put together its first brochure listing oil and gas companies in the area, according to Jose Beceiro, the chamber’s director of clean energy. Nonetheless, Beceiro said, the clean energy industry still dwarfs the oil and gas technology industry.

The Chamber puts the number of clean-energy jobs in the Austin metropolitan area at about 16,000, excluding semiconductor companies (which make solar-panel materials) and utilities. That vastly trumps its measure of 4,000 oil and gas industry jobs. An exact comparison is impossible due to the limitations of standard classifications .

Austin’s visibility in the drilling world rose last year, when Statoil, a Norwegian energy giant, bought Austin-based Brigham Exploration, an oil exploration and production company, for $4.7 billion. Statoil now has about 130 employees in Austin, roughly 30 percent more than a year ago, and more growth is expected, according to Ola M. Aanestad, a Statoil spokesman who is based in Houston at the company’s main office in North America.

“Houston is the energy capital of the world, and has a depth and scale as an industry hub that Austin cannot replicate,” Aanestad said in an e-mail. “But we think that having an office in Austin brings many benefits, for instance with recruiting.”

Another Austin company that has attracted buzz is Drillinginfo, which was founded in 1999 to provide information and analysis about oil and gas projects. Allen Gilmer, the chief executive, said the company has added 110 jobs over the past year and is planning to add at least another 150 jobs in the year ahead.

Austin is a “pretty fine city to live in in Texas,” Gilmer said. “So that’s really what brought everybody here — it was a lifestyle choice.”