Boeing 2Q profit tops expectations; boosts outlook

Boeing posted a bigger-than-expected second-quarter profit as it ramped up deliveries of commercial planes like its 737 and 787.

The company also raised its full-year earnings guidance, and its shares rose nearly 2 percent in premarket trading.

Boeing is in the midst of a boom in airplane orders as airlines in Asia and Latin America expand. It is speeding up production of its 737 as well as the new 787. Deliveries of all commercial planes rose 13 percent to 169 planes during the quarter.

Deliveries of the 787 were temporarily halted earlier this year when the plane was grounded because of battery problems. But they resumed in May and Boeing delivered 16 of the jets during the quarter. It said it still expects to deliver at least 60 of the 787s this year — the same goal it had before the battery problems surfaced in January.

Boeing's net income rose 13 percent to $1.09 billion, or $1.41 per share. During the same period last year it earned $967 million, or $1.27 per share. Revenue rose 9 percent to $21.82 billion.

The results include costs from pensions. On that basis, analysts surveyed by FactSet had been expecting a profit of $1.30 per share with revenue of $20.79 billion.

Boeing Co. shares rose $1.94, or 1.8 percent, to $109.73 in premarket trading.

Boeing raised its full-year profit guidance to $6.20 to $6.40 per share — a dime higher than its old guidance. Once it pays for pension expenses it will earn $5.10 to $5.30 per share. On that basis, analysts are expecting $5.34 per share.

The company now expects revenue of $83 billion to $86 billion, which is $1 billion more than it previously predicted. Analysts were expecting $84 billion.

Revenue from commercial planes rose 15 percent to $13.62 billion, and profits in that segment jumped 20 percent to $1.45 billion. The 787s actually hurt profit margins because they costs more to build than Boeing is collecting, but delivering the planes brings in more revenue.

Things are slower at Boeing's defense arm. Revenue there was flat at about $8.19 billion, although operating profits rose 4 percent to $776 million. Boeing and other defense contractors have had to cope with the automatic federal spending cuts that took effect in the spring.

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Caterpillar 2Q profit falls 43 pct; cuts outlook

PEORIA, Illinois — Second-quarter earnings at Caterpillar fell 43 percent as dealers cut inventories more than the company expected. The world's largest maker of construction and mining equipment cut its profit and revenue outlook for the year.

Caterpillar reported earnings of $960 million, or $1.45 per share, compared with $1.7 billion, or $2.54 per share a year ago. Revenue slid 15.8 percent to $14.63 billion.

That's well short of Wall Street's expectations. Analysts surveyed by FactSet had expected a profit of $1.69 per share on revenue of $15.09 billion.

The Peoria, Ill., company said dealers cut inventories by $1 billion as the global mining industry slowed due to reduced growth in China.

Shares of Caterpillar Inc. fell $2.40, or 2.8 percent, to $83.12 in morning trading.

Caterpillar also said it had currency translation and hedging losses during the quarter.

CEO Doug Oberhelman predicted improved profits during the second half of the year as the company takes further cost-cutting measures.

Caterpillar still cut its full-year profit outlook from about $7 per share to $6.50. And revenue is now expected to come in between $56 billion and $58 billion, down from previous guidance of $57 billion to $61 billion.

Dealers, Oberhelman said, used inventory from Caterpillar's product distribution during the quarter rather than stocking their own businesses. Company inventory also dropped by $1.2 billion.

"With the sharp reduction in dealer inventory and the decline in mining, 2013 is turning out to be a tough year," Oberhelman said in a statement.

Dealers are positioned to cut inventory even further, and the company expects it to fall by $1.5 billion to $2 billion in the second half, Oberhelman said.

"That means we are underselling end-user demand this year, and it sets us up for better sales in 2014," he said.

He said the company already has temporarily closed factories and had rolling layoffs. "We've taken significant action already, and we will be taking additional cost reduction measures in the second half of 2013," he said.

Caterpillar cut its global full-time work force by more than 10,000 people compared with the second quarter of last year. The company had 122,402 employees at the end of June. The temporary work force also dropped by 9,633 during the quarter.

Profits fell in each of Caterpillar's big divisions. Operating profit fell 61 percent to $550 million in resource industries, which includes mining. It was down 47 percent to $362 million for construction equipment, and down 3 percent to $955 million in power systems, which makes items including large electrical generators and locomotive engines.

The company also said it repurchased $1 billion worth of stock in the second quarter, and based on strong cash flow, it expects to buy another $1 billion worth in the third quarter.

Commodity prices have fallen due to economic turmoil in Europe and slowing growth in China, forcing miners to become more conservative with spending.

Prices for copper, aluminum, and gold have all fallen sharply this year.

A new Citi survey of spending plans by mining and construction companies found a 16 percent decline expected spending on mining equipment this year compared with 2012. The weakness is notable across all types of equipment and all types of commodities, Citi wrote.

Mining companies are turning away from growth and re-focusing on costs and returns. "We believe the consequence will likely be a multi-year decline in capital spending," the Citi report said.

Meanwhile Citi's survey also shows a continuing decline in expected construction spending — down 8.1 percent over the next 12 months. Pricing is expected to decline by 3 percent.

Caterpillar said Tuesday that global sales of its heavy equipment fell 8 percent for the three-month period that ended in June, hurt by a steep drop in demand from Asia.

That followed a 7 percent decrease for the three months that ended in May and a 9 percent slide for the three months that ended in April, the company said in a Securities and Exchange Commission filing.

Sales in Caterpillar's Asia region dropped 21 percent in the most recent period, while North American sales fell 10 percent.

The only region to post an increase was Latin America, where sales rose 9 percent.

The figures are based on unit sales as reported by Caterpillar's dealers.

During the second quarter, Caterpillar announced that it would pay $135 million less for a Chinese mining equipment company after uncovering dodgy accounting practices that inflated its value. But its impact on earnings was offset by currency fluctuations and the inventory reductions.

The company acquired ERA Mining Machinery Ltd. and its subsidiary Zhengzhou Siwei Mechanical & Electrical Manufacturing Co. Ltd. last year and then found the accounting problems. The settlement cut Caterpillar's obligations to $29.5 million, from $164.5 million.

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Ford raises profit forecast on strong 2Q results

DEARBORN, Mich. — Ford Motor Co. reported better-than-expected earnings for the second quarter and raised its profit and sales forecasts for the year as strong U.S. pickup truck demand and growing sales in China offset persistent — but narrowing — losses in Europe.

Its shares rose 3.7 percent to $17.57 in morning trading Wednesday. That's the highest intraday price since Jan. 28, 2011.

Ford earned $1.23 billion in the April-June period, up 18.5 percent from a year ago.

The company's results were propelled by a $2.3 billion profit in North America, a second-quarter record for that region. Pickup truck sales are booming in the U.S., where construction companies and other businesses are rapidly replacing the fleets they held onto during the recession. Sales of Ford's F-Series pickup — which has long been the best-selling vehicle in the U.S. — jumped 26 percent in the second quarter, or more than three times the average industry increase.

Ford's total U.S. sales rose 15 percent during the quarter, according to Kelley Blue Book.

Ford also reported a best-ever profit of $177 million in Asia. Ford's sales jumped 47 percent in China the first six months of this year, compared with total industry sales growth of 17 percent, as the company introduced new vehicles like the EcoSport and Kuga SUVs.

Asia had previously been a drag on Ford's earnings. The company has poured money into new factories and product development there as it tries to catch up to others such as General Motors and Volkswagen that appreciated the region's potential sooner. Chief Financial Officer Bob Shanks said Asia will be a bigger contributor to earnings over the next few years.

"You're starting to see what's possible," Shanks told media at the company's Dearborn, Mich., headquarters Wednesday morning.

Ford now expects full-year pretax profit to be equal to or better than the $8 billion it reported a year ago. Previously the company had expected to match that profit.

Ford also expects sales in the U.S., Europe and China to be at the upper end of its previous forecasts.

In Europe, Ford narrowed its expected full-year loss to $1.8 billion from $2 billion. The company lost $348 million in Europe in the second quarter, a $56 million improvement over last year's second quarter. Shanks noted that Ford gained market share despite the troubled economy with new vehicles like the Fiesta subcompact and Ranger small pickup.

Ford's earnings amounted to 30 cents per share in the latest quarter, the same as a year ago. Without one-time items, including separation payments in Europe, where Ford is closing several plants, the company earned 45 cents per share. That surpassed analysts' forecast of 37 cents, according to FactSet.

Revenue was up 14 percent to $38.1 billion, beating analysts' forecasts of $34.9 billion.

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Probe links lithium battery to Dubai UPS crash

DUBAI, United Arab Emirates — A fast-moving fire that began in cargo containing lithium batteries turned the inside of a United Parcel Service plane into a "catastrophic" chain reaction of flames and smoke before a crash three years ago in the desert outside Dubai, according to a report released Wednesday.

The 322-page investigation into the crash, which killed both pilots, backed up preliminary probes pointing to the lithium batteries as the possible cause of the blaze and drew further attention to the potential risks of the batteries in aviation.

Lithium batteries have been the subject of fire-related probes on the Boeing 787 "Dreamliner." The entire 787 fleet was grounded for about three months earlier this year after a fire in a battery on a Japan Airlines 787 parked at Boston's Logan International Airport, and a smoking battery that led to an emergency landing by an All Nippon Airways 787 in Japan.

The United Arab Emirates' report said investigators for General Civil Aviation Authority found "with reasonable certainty" that the fire aboard the UPS Boeing 747-400 crash began in cargo containing thousands of lithium batteries of various designs. The chain-reaction fire quickly filled the cockpit with smoke before the plane went down on Sept. 3, 2010, about an hour into the flight to Cologne, Germany.

The report noted that investigators could not cannot pinpoint the factors that started the fire, but noted a phenomenon called "thermal runaway."

This is an uncontrolled chemical reaction that leads to progressively hotter temperatures. Lithium batteries are sensitive to temperature. If the batteries are exposed to excessive heat, they can short circuit and experience thermal runaway. If one battery experiences thermal runaway or catches fire, it can cause other nearby batteries short-circuit and ignite.

At a meeting in Washington last week, the director of the Air Line Pilots Association's dangerous goods program, Mark Rogers, said the UPS plane was carrying between 80,000 to 90,000 lithium ion and lithium metal batteries as cargo and in equipment.

The report described the fire as a "chain reaction which spread to the available combustible material" and apparently was not spotted by smoke detectors in its early moments.

"The fire escalated rapidly into a catastrophic, uncontained" blaze, the report said.

The report included more than 35 recommendations, including better early-warning systems in cargo holds to detect fires, and adding equipment that could aid pilot visibility in smoky conditions.

It added that shippers of some of the lithium battery cargo loaded onto the plane in Hong Kong "did not properly declare these shipments" and did not provide battery test reports recommended under U.N. aviation guidelines.

Before publication of the report, UPS had begun implementing new systems to improve pilot vision and protocols to quickly use full-face oxygen masks when needed, said a statement from the Independent Pilots Association in Louisville, Kentucky.

Atlanta-based UPS has ordered 1,821 fiber-reinforced plastic shipping containers designed to withstand intense fires for four hours or longer, giving "pilots more time to safely land their planes in an emergency," said a company spokesman, Malcolm Berkley.

In November, the National Transportation Safety Board in Washington urged that fire-suppression systems be installed in all cargo containers or compartments of planes to prevent in-flight blazes that have killed four cargo pilots since 2006, including the two who perished in Dubai.

"Nearly three years following this tragic accident, UPS pilots welcome the release of this final report," said the Independent Pilots Association president, Robert Travis, who added that the group has worked with UPS on a system that could suppress and contain a fire for up to four hours.

This month the U.S. Federal Aviation Administration urged that Boeing inspect all emergency locator transmitters on all 787s following a fire aboard one of the airliners that was parked at London's Heathrow Airport. As part of the inspection, the transmitter's lithium battery compartment would be checked for heat or moisture.

The 787 is the first airliner to make extensive use of rechargeable lithium ion batteries.

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Associated Press writer Joan Lowy in Washington contributed to this report.

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PepsiCo beats expectations, stands by portfolio

NEW YORK — PepsiCo Inc. reported a better-than-expected quarterly profit on Wednesday and said its mixed portfolio played a role, underscoring its resistance to splitting up its drinks and snacks businesses.

The company, which makes Gatorade, Tropicana, Quaker and Frito-Lay chips, said higher prices helped lift revenue for its Americas food division. Volume also rose 2 percent for the unit, its biggest division by sales.

Revenue in Europe, Asia, the Middle East and Africa also saw gains, helped by stronger volumes.

Its Americas beverage unit remained a drag, however. Revenue slipped as price hikes failed to offset a 3.5 percent decline in volume. Sodas in North America fell in the mid-single digits, while non-carbonated drinks declined in the low-single digits.

"The fact remains that the beverage category in the U.S. has its challenges, especially carbonated soft drinks," CEO Indra Nooyi said in a call with analysts. But she said productivity in the unit is improving and alluded to the company's work in trying to find a way to reduce calories in sodas while using natural sweeteners.

The results come a week after investor Nelson Peltz said he wants PepsiCo to split its beverage and food businesses and buy Oreo cookie maker Mondelez to create a major global snacks company. Peltz says PepsiCo's snacks unit is being overshadowed by its underperforming drinks unit.

The company, based in Purchase, N.Y., is often compared unfavorably to Coca-Cola Co., particularly as it has lost market share to Coca-Cola in recent years. But unlike Coca-Cola, which is focused entirely on drinks, PepsiCo now gets about half its revenue from its snacks and other food, such as oatmeal and yogurt.

In an interview on CNBC, Chief Financial Officer Hugh Johnston said that the company's variety of products helped it deliver strong results despite bad weather during the period.

For example, he noted that Gatorade sales increase when it's hot, and that Quaker and Tropicana sales increase when it's cold or when people have the flu.

"The portfolio is what enables you to power through these things," Johnston said.

Last week, Coca-Cola Co. had blamed unusually cold, wet weather for its disappointing results, saying such conditions aren't good for sales of soda and other drinks.

In an apparent dig, Johnston also noted that the deal being proposed by Peltz would benefit Mondelez shareholders; Peltz owned a $1.23 billion stake in Mondelez as of March 31, according to a filing with the Securities and Exchange Commission.

In addition to higher prices for its drinks and snacks, PepsiCo, based in Purchase, N.Y., noted that its improved productivity also helped lift operating profit during the period. It stood by its outlook for year, with core earnings per share expected to grow 7 percent.

Its stock was up 1 percent at $87.20 in premarket trading. Over the past year, it's up 25 percent.

PepsiCo has repeatedly stressed that it plans to move forward as a combined snack and drink company, and that it's not interested in any major deals. The CEO of investment firm BlackRock, which owns a 5 percent stake in PepsiCo, has said that he backs the company and disagrees with Peltz's plan.

Besides, PepsiCo is already reviewing some options that could quiet investors.

The company is considering a restructuring for its North American beverage unit, including a possible spinoff. That would mean that the company would still sell its beverages in others parts of the world, such as China and India, where the business is faring far better.

"All of the options are on the table," Johnston said in a call with reporters.

An update on that review isn't expected until early next year.

A spinoff of just the North American beverages is one of the alternative options outlined in a white paper by Peltz's Trian Fund Management.

For the quarter ended June 15, PepsiCo said it earned $2.01 billion, or $1.28 per share. That's up from $1.49 billion, or 94 cents per share, in the year-ago period when its results were hit by one-time charges as a result of a deal to expand distribution in China.

Not including one-time items, it earned $1.31 per share, above the $1.19 analysts expected.

Revenue rose 2 percent to $16.81 billion, more than the $16.79 billion forecast by Wall Street.

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US new-home sales jump to highest level in 5 years

WASHINGTON — Americans snapped up new homes in June at the fastest pace in five years, a sign the housing recovery is strengthening.

Sales of newly built homes rose 8.3 percent last month to a seasonally adjusted annual rate of 497,000, the Commerce Department said Wednesday. That's the highest since May 2008 and up from an annual rate of 459,000 in May, which was revised lower.

While sales are still below the 700,000 pace consistent with healthy markets, they have risen 38 percent in the past 12 months. That's the biggest annual gain since January 1992.

"There's an awful lot of headroom for more gains in new-home sales once the job market recovers more fully," Jonathan Basile, an economist at Credit Suisse, said in a note to clients.

Home sales and prices have climbed since early last year, buoyed by solid hiring and low mortgage rates. Housing has helped drive economic growth this year at a time when other parts of the economy have languished, such as manufacturing and business investment.

New-home sales make up only a small part of the market. But they have an outsize impact on the economy. Each home built creates an average of three new jobs and generates about $90,000 in tax revenue, according to data from the National Association of Home Builders.

One concern is that rising mortgage rates could slow sales in the coming months. The average rate on the 30-year fixed was 4.37 percent last week — a full percentage point higher than in early May. At the same time, mortgage applications to purchase homes have fallen in the past few weeks.

Rates surged after Chairman Ben Bernanke said the Federal Reserve could slow its bond-buying program later this year if the economy continues to improve. The Fed's bond purchases have kept long-term interest rates low, encouraging more borrowing and spending.

Economists noted that new-home sales reflect contract signings, rather than completed purchases, and don't necessarily include completed mortgage applications. As a result, last month's increase could reflect efforts by some purchasers to buy homes before rates rise further.

"The U.S. housing market appears to be shrugging off the recent jump in mortgage rates," said Sal Guatieri, an economist at BMO Capital Markets.

Rising demand and a tight supply of available homes for sale have pushed up prices. The median price of a new home in June was $249,700, up 7.4 percent from a year ago.

The number of new homes available for sale at the end of June was 161,000. That's only slightly higher than May's level and 11 percent above year-ago levels. At the current sales pace, it would take only 3.9 months to exhaust the supply of new homes on the market — matching a nine-year low. A supply of six months is typical in healthy markets.

Limited homes on the market have kept sales from rising even faster. Still, higher prices, growing sales and the tight supply have made builders more optimistic about their prospects. That's led many to ramp up construction and add jobs.

Builder confidence rose in July to the highest level in seven years, according to a NAHB survey. And customer traffic and builders' outlook for single-family home sales over the next six months are at the highest levels since the housing bubble burst in 2006.

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Gov't needs $95.51 per share to break even on GM

DETROIT — General Motors stock would have to sell for $95.51 per share for taxpayers to break even on bailing out the company, according to a government watchdog's report released Wednesday.

That price is about three times what GM shares are selling for now, even after a 25 percent increase in the price so far this year.

"There's no question that Treasury, the taxpayers, are going to lose money on the GM investment," Special Inspector General Christy Romero, author of the July quarterly report to Congress, said in an interview.

GM needed the $49.5 billion bailout to survive its trip through bankruptcy restructuring in 2009. Since emerging from bankruptcy, the restructured company has piled up $17.2 billion in profits. In exchange for the bailout, the government got 61 percent of GM's stock. It cut that to 33 percent in GM's November 2010 initial public offering.

The government has gradually been selling off the rest of the stock, with the goal of exiting the investment by April of next year. As of June 6, it still owned 189 million shares, or about 14 percent of the company, according to the report.

Taxpayers are still $18.1 billion in the hole on the $49.5 billion bailout, including interest and dividends, according to the report.

If the government sells its remaining shares of GM for the current stock price of $36.61, it would get just over $6.9 billion, meaning taxpayers would lose about $11.2 billion on the bailout.

When GM was bailed out in 2008 and 2009, the government said it was necessary to stop the industrial Midwest economy from collapsing. Chrysler was bailed out for $12.5 billion at the same time. Taxpayers wound up losing $2.9 billion on that bailout, Romero's report said.

The report says that taxpayers still are owed $14.6 billion for bailing out Ally Financial Inc., which once was GM's auto lending arm. Treasury still owns 74 percent of the company, plus $5.9 billion worth of preferred stock.

Ally has made one principal payment of $2.5 billion since the bailout 4 ½ years ago. It also has paid the government $3.4 billion in dividends, according to the report.

Residential Capital LLC, or ResCap, Ally's troubled mortgage arm, filed for bankruptcy protection last year. Romero criticized Treasury for having no clear plan to deal with mortgage liabilities, which he said is preventing the government from selling its stock.

"We really want to see what's the plan here. How are taxpayers going to recoup our money? Are we taking a loss?" Romero asked.

A Treasury spokesman said the department sent Romero's office a plan in January.

Overall, the government allocated $474.8 billion to the TARP program to bail out banks, insurers, auto companies and others during the financial crisis. Taxpayers are still owed $57.6 billion, the report stated. Of that, the Treasury Department has written off losses of $29.6 billion, leaving a balance of $28.6 billion outstanding. Treasury, however, says it has lost only about $2 billion on TARP to date, spending $420.3 billion and recovering $418.2 billion.

The figures exclude $8.6 billion spent on the government's bailout program for struggling homeowners. That money is designated as government subsidies and no repayment is expected, the report said. Romero said Treasury has yet to spend $29.9 billion available for the housing program.

Her report also cited continuing problems with the mortgage aid program, which has been criticized for years for failing to help enough homeowners at risk of foreclosure. The program allows modifications of mortgages for eligible homeowners. The report says the longer homeowners have stayed in the program, the greater their chance of missing payments and defaulting on their modified mortgages.

It says the oldest modifications, from the third and fourth quarters of 2009, have an average default rate of 46 percent, compared with modifications granted in 2010, which have an average rate of 38 percent. About 306,000 homeowners have defaulted of a total 865,000 or so in the program. The original goal was to help 3 million to 4 million struggling homeowners, in a program based on banks participating and reworking mortgages for borrowers — including some with weak credit histories.

Treasury said there will always be a risk of defaults in such a program. But Treasury contends that the homeowners remain in the program, the more likely they are to keep up payments and avoid default.

Treasury has taken steps to improve its ability to give "as many struggling homeowners as possible the chance to keep their home while recognizing that not all will succeed," said Mark McArdle, the acting chief of homeownership preservation, in a post on the department's website. For example, he said, the program established eligibility rules so that mortgage aid would go to those homeowners most in need, and standards to make the modifications provided sustainable for homeowners.

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AP Business Writer Marcy Gordon in Washington contributed to this report.

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La. flood board sues oil companies over erosion

NEW ORLEANS — The oil and gas industry has cost Louisiana hundreds of acres of coastal land that serve as a natural buffer against flooding from hurricanes, officials in charge of New Orleans-area flood protection say in a lawsuit seeking to hold dozens of companies responsible.

Corrosive saltwater from a network of oil and gas access and pipeline canals has killed vegetation and swept away mountains of soil, the Southeast Louisiana Flood Protection Authority-East's board of commissioners claims in the lawsuit, which it filed Wednesday in Orleans Parish Civil District Court. The wetlands are considered a crucial buffer against hurricanes because they can help keep floodwaters from storm surge at bay.

"What remains of these coastal lands is so seriously diseased that if nothing is done, it will slip into the Gulf of Mexico by the end of this century, if not sooner," the lawsuit says.

The board says it will have to bear many of the costs associated with the need for increased flood protection. The lawsuit, a draft of which was provided to The Associated Press before it was filed, seeks unspecified damages.

"Even the industry recognizes they are responsible for some of the land lost, and it's not an insignificant amount," said board vice president John Barry, author of "Rising Tide: The Great Mississippi Flood of 1927 and How It Changed America."

About 100 companies are named as defendants in the lawsuit, including Apache Corp., BP America Production Co., Chevron USA Inc., ConocoPhillips Co., Exxon Mobil Corp., Shell Oil Co. and The Pickens Co. Inc.

The board covers most of the New Orleans area, governing the Orleans Levee District, the Lake Borgne Basin Levee District and the East Jefferson Levee District.

"I think this is the first time that an entity like the authority has brought a suit like this," said Gladstone Jones, an attorney representing the board.

A protective buffer that took 6,000 years to form "has been brought to the brink of destruction over the course of a single human lifetime," the draft of the suit alleges.

"Unless immediate action is taken to reverse these losses and restore the region's natural defense, many of Louisiana's coastal communities will vanish into the sea," it says. "Meanwhile, inland cities and towns that once were well insulated from the sea will be left to face the ever-rising tide at their doorsteps."

The suit says the U.S. Geological Survey has determined that "altered hydrology" associated with oil and gas activities is one of the primary causes of coastal land loss.

"The increased storm surge risk resulting from the extensive and continuing land loss in southeast Louisiana ... has required, and will continue to require, increased flood protection at increasingly high cost," the suit says.

Local levee districts will bear increasing responsibility for the operation and maintenance of the multibillion-dollar system of gates, walls and armored levees that the U.S. Army Corps of Engineers has built following Hurricane Katrina in 2005, according to the suit.

"The reality is that despite the new system, New Orleans is going to be increasingly vulnerable as the coast continues to erode," Barry said. "You cannot build levees high enough to protect against the storms that are coming."

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Owner of burning Gulf rig considers relief well

NEW ORLEANS — The owner of a drilling rig that's ablaze in the Gulf of Mexico says it may drill a relief well as part of a plan to control the natural gas well that blew wild.

A news release from Hercules Offshore Inc. says the relief well is among the options being considered.

It says it's also trying to find out why the well blew and then caught fire, but its first focus is cutting off the flow of natural gas.

Officials stressed that Tuesday's blowout won't be nearly as damaging as the 2010 BP oil spill. Hercules says all 44 workers on the jackup rig were rescued without injury.

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Live Nation grooving to local grub at its concerts

This just might be music to foodies' ears. One of the nation's premier concert promoters is overhauling its concessions to serve only local produce and humanely-raised meats.

Live Nation announced Wednesday that starting this week all produce served at its 38 amphitheaters around the country will be sourced from within about a 100-mile radius of each venue. Additionally, all meats — some 285,000 burgers, 260,000 hot dogs and 280,000 chicken tender meals per year — will carry either Certified Humane, Global Animal Partnership or Animal Welfare Approved certification.

The change will cost the company about an extra $1 million a year, but concertgoers won't see that reflected in food or ticket prices, says Live Nation CEO Michael Rapino. He believes the good will generated by serving better food and supporting local farms will be compensation enough. "That's good for business in the long run, and good for the environment and the animals in the short run," he says.

Additionally, the company has brought on celebrity chef Hugh Acheson as a consultant to help guide the changes. Acheson, an outspoken proponent of local and sustainable agriculture, is best known for appearances on Bravo's "Top Chef" and "Top Chef Masters." He says he is fascinated by the challenge of providing ethically sourced food on such a large scale.

The overhaul was triggered when Live Nation officials decided to offer a vegetarian option at their amphitheaters. "As we dug into it, what came second to us was that what's important isn't just what's on the menu, but the supply chain behind it," Rapino says. "And if it's going to be local and we're going to look at the supply chain, let's make sure we're doing the right thing and make sure the animals are treated well before they get to market."

The vegetarian option — a rice bowl with vegetables and possibly tofu being developed by Acheson — will be added to menus later this summer. Healthier choices are being planned, as well.

The move comes as sports arenas around the country continue to overhaul their own food offerings to better appeal to America's growing appetite for good grub. For several years now, ballparks and other stadiums have been touting their own healthier and gourmet choices, from sushi to fine wines to artisanal sausages and Dungeness crab salad.

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