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Mike Wirth · The David Rubenstein Show

• 0:02
  Speaker 1: About forty years ago, a young college graduate, Mike Worth,
• 0:06
  Speaker 1: joined Chevron then and now one of the largest energy
• 0:08
  Speaker 1: companies in the world. Today, Mike Worth is the CEO
• 0:11
  Speaker 1: of Chevron and dealing with the multiple issues that energy
• 0:14
  Speaker 1: companies have to deal with today, including renewable energy. I
• 0:18
  Speaker 1: sat down with Mike Worth to talk about what it's
• 0:20
  Speaker 1: like to run Chevron today in the current environment. So
• 0:24
  Speaker 1: tell me about the state of the oil world right now.
• 0:27
  Speaker 1: It seems as if the large oil companies or energy
• 0:30
  Speaker 1: carbon energy companies are doing quite well. They have record profits,
• 0:33
  Speaker 1: record revenues, and as a result of that, some people
• 0:36
  Speaker 1: in the White House and other places have suggested a
• 0:39
  Speaker 1: windfall profits tax. So is the industry in such great
• 0:42
  Speaker 1: shape that it can afford a windfall profits tax. Well,
• 0:46
  Speaker 1: it's a cyclical industry, David. We see prices go up,
• 0:49
  Speaker 1: we see prices go down. A windfall profits tax is
• 0:53
  Speaker 1: u is not going to encourage more supply. It's not
• 0:56
  Speaker 1: likely to reduce prices. In fact, it could do quite
• 0:59
  Speaker 1: the opposite. President Carter try to windfall profits tax in Uh.
• 1:05
  Speaker 1: It was rescinded several years later, had collected a lot
• 1:08
  Speaker 1: less revenue than was expected and didn't result in more investments.
• 1:12
  Speaker 1: It results in the less investment and less productions. So normally,
• 1:15
  Speaker 1: if you want less of something, you tend to put
• 1:17
  Speaker 1: more taxes on it, you know, ut less smoking tax cigarettes. Uh.
• 1:21
  Speaker 1: If we want more energy production, will more supply to
• 1:24
  Speaker 1: bring prices down, putting taxes on energy productions probably not
• 1:29
  Speaker 1: a good idea. In your current job, do you have
• 1:31
  Speaker 1: to go to Washington to talk to regulators and legislators
• 1:34
  Speaker 1: and do you find that an uplifting experience to do that,
• 1:37
  Speaker 1: I do have to go to Washington. UM uplifting is
• 1:40
  Speaker 1: probably not the first word that comes to mind. I mean,
• 1:42
  Speaker 1: their their detailed discussions and uh, and we need to
• 1:45
  Speaker 1: help regulators understand the potential consequences of some of the
• 1:49
  Speaker 1: things they consider. So would you say that Washington by
• 1:53
  Speaker 1: and large doesn't really understand the economics of the energy
• 1:56
  Speaker 1: industry or they could learn a little bit more than
• 1:58
  Speaker 1: they know now. Well. I have empathy for people that
• 2:01
  Speaker 1: sit in these roles. They have often broad responsibilities and
• 2:06
  Speaker 1: they may not have UM personal expertise in depth in
• 2:10
  Speaker 1: some of the areas that are responsible for So I
• 2:12
  Speaker 1: view my job is to come in and try to
• 2:14
  Speaker 1: provide objective input and help them understand the consequences of
• 2:18
  Speaker 1: things they're considering, to avoid unintended consequences, and help achieve
• 2:22
  Speaker 1: the goals that they're looking to achieve. So when the
• 2:25
  Speaker 1: President United States says energy companies are gouging American people,
• 2:30
  Speaker 1: you get to be used to this when you're an
• 2:32
  Speaker 1: energy executive. More or less. I assume, uh, you know,
• 2:35
  Speaker 1: I don't like it, but you probably are accepting. And
• 2:38
  Speaker 1: I disagree with that characterization. I don't think it's accurate. Um,
• 2:44
  Speaker 1: this is a you know, we're an industry at price takers,
• 2:46
  Speaker 1: not price makers. These are global commodity markets, and um,
• 2:50
  Speaker 1: and prices go up, prices come down. We allocate billions
• 2:55
  Speaker 1: of dollars of capital our company does every year. Just
• 2:58
  Speaker 1: two years ago, we were losing billions of dollars as
• 3:01
  Speaker 1: prices plummeted. Uh. And so through the cycle. It's an
• 3:05
  Speaker 1: industry that generates kind of returns on capital employed, which
• 3:12
  Speaker 1: is I think, by the standards of many other industries,
• 3:15
  Speaker 1: pretty modest return. The war in Ukraine has driven oil
• 3:20
  Speaker 1: prices up. I think it's fair to say, Um, do
• 3:22
  Speaker 1: you think that that is a principal reason why the
• 3:25
  Speaker 1: major energy companies are going quite well because the supply
• 3:28
  Speaker 1: has been reduced because of the war in Ukraine. And
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  Speaker 1: do you think that when that war does, and eventually
• 3:33
  Speaker 1: it will, I assume, uh, you know, have an impact
• 3:36
  Speaker 1: on reducing energy prices in carbon areas well. The war
• 3:40
  Speaker 1: and the associated actions have definitely had an impact on
• 3:44
  Speaker 1: energy markets. But if you step back and look at
• 3:48
  Speaker 1: the broader context, we saw demand collapse with the pandemic
• 3:53
  Speaker 1: when the world really locked down. In fact, companies in
• 3:57
  Speaker 1: our industry had to shut in wells and stop producing
• 4:00
  Speaker 1: because there was no place to store the oil that
• 4:02
  Speaker 1: wasn't needed by the market. So investment levels came down.
• 4:07
  Speaker 1: And then as the and nobody knew how long this
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  Speaker 1: would last. Is the economy recovered post the pandemic, we
• 4:12
  Speaker 1: get vaccines, demand returned um, the industry has been struggling
• 4:18
  Speaker 1: to keep up with the rate of growth once again,
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  Speaker 1: and so the market was already in a in a
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  Speaker 1: pretty tight situation before this war began. I do think, uh,
• 4:27
  Speaker 1: when eventually it's resolved and all conflicts eventually are resolved,
• 4:32
  Speaker 1: I think that uncertainty and the risk to supply from
• 4:35
  Speaker 1: one of the world's largest suppliers will be reduced, and
• 4:38
  Speaker 1: I think we'll see markets reflect that a number of
• 4:41
  Speaker 1: years ago, oil prices went as low as I think
• 4:44
  Speaker 1: twenty a barrel. And when it was that low, major
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  Speaker 1: oil companies like I think Chevron and others said we
• 4:51
  Speaker 1: can't afford to drill anymore in either let's say that Alaska,
• 4:55
  Speaker 1: the North Sea, other places, because we need to have
• 4:57
  Speaker 1: oil at seventy dollars a barrel to make drilling affordable
• 5:01
  Speaker 1: and profitable. Has that come back now that oil prices
• 5:04
  Speaker 1: are offer people now drilling in major projects around the world,
• 5:07
  Speaker 1: they kind of get oil that's gonna take four or
• 5:09
  Speaker 1: five or ten years to build and and drill. Or
• 5:12
  Speaker 1: is that not happening again? We're seeing some of that
• 5:15
  Speaker 1: happen again. Certainly. What has really changed in the last decade, David,
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  Speaker 1: is the what we see in the US and the
• 5:22
  Speaker 1: Permian Basin, but also in some other parts of this
• 5:25
  Speaker 1: country and in other countries now is uh the ability
• 5:28
  Speaker 1: to produce oil and gas from rock that is very
• 5:33
  Speaker 1: very dense, very hard, and historically has not been very productive.
• 5:38
  Speaker 1: But with directional drilling and the ability to to fracture
• 5:41
  Speaker 1: these formations, now we're seeing the ability to produce from
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  Speaker 1: areas that we couldn't before edit prices that are are
• 5:48
  Speaker 1: lower than some of these very complex, difficult projects, and
• 5:51
  Speaker 1: so the need for the ultra deep water the Arctic
• 5:56
  Speaker 1: has been reduced as we see these other resources come
• 5:59
  Speaker 1: in at at a lower cost. So how many employees
• 6:02
  Speaker 1: does Chevron have? About thirty six in about a hundred
• 6:06
  Speaker 1: different countries. And how much oil do you produce a day?
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  Speaker 1: A little bit over three million barrels of oil equivalent
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  Speaker 1: per day, so mostly oil, some gas, and we convert
• 6:16
  Speaker 1: the units on the gas to give you the energy equivalents.
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  Speaker 1: About three million barrels. The United States produces ten million
• 6:22
  Speaker 1: barrels a day or something like that, closer to twelve. Well, okay,
• 6:25
  Speaker 1: so you're producing about of the oil producing in the
• 6:29
  Speaker 1: United States more or less. As a company, you could
• 6:31
  Speaker 1: say that our US production is about one point two
• 6:35
  Speaker 1: million barrels a day, so we're less than ten percent
• 6:38
  Speaker 1: of US production. So right now the United States is
• 6:42
  Speaker 1: more or less energy sufficient compared to let's say the
• 6:44
  Speaker 1: nineteen sixties or seventies, when we import a lot of
• 6:47
  Speaker 1: oil I think we produce we probably consume ten to
• 6:51
  Speaker 1: twelve million barrels a day closer to wen. We consume
• 6:54
  Speaker 1: twenty million barllars a day and we produced roughly you're
• 6:57
  Speaker 1: saying twelve. So we're importing the equip about eight million
• 7:00
  Speaker 1: barrels a day, which is better than it used to be.
• 7:03
  Speaker 1: Where are we mostly importing that from? Is it from
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  Speaker 1: OPEC countries? Canada, our neighbors are the are the largest, uh,
• 7:11
  Speaker 1: you know, suppliers of oil. I mean you know you
• 7:13
  Speaker 1: heard all remember all the countries around the Keystone Pipeline.
• 7:16
  Speaker 1: We're a big customer of Canada, who's a large resource
• 7:20
  Speaker 1: country right now. To get that oil down here. There
• 7:22
  Speaker 1: are other pipelines that have been built in years gone by,
• 7:26
  Speaker 1: and sometimes it flows by rail, uh, and so it
• 7:29
  Speaker 1: comes by ship. You can bring it down through pipelines
• 7:31
  Speaker 1: into ports along the West Coast, for instance, or into
• 7:34
  Speaker 1: the Atlantic based and bring it by ship. So Canada
• 7:37
  Speaker 1: is the largest supplier, and then other people in the region.
• 7:40
  Speaker 1: And we we still bring some oil to this country
• 7:43
  Speaker 1: from the Middle East, but much less than we did
• 7:44
  Speaker 1: back now. So I think there's much oil to be
• 7:47
  Speaker 1: found in the Lower forty eight at this point, or
• 7:50
  Speaker 1: even and let's say Alaska as well, or mostly we
• 7:53
  Speaker 1: know where all the oil is and there's no more
• 7:56
  Speaker 1: big permian basin kind of deposits anywhere. People said that
• 8:00
  Speaker 1: over time, and then we've always been surprised, and so
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  Speaker 1: the US has been explored more than any other other
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  Speaker 1: place in the world. I think the industry has a
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  Speaker 1: good idea, but technology allows you sometimes to recover things
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  Speaker 1: that you haven't been able to before. That's the story
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  Speaker 1: of shale. Uh. The other one that continues to be
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  Speaker 1: a positive story is deep water Gulf of Mexico, where
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  Speaker 1: we'll go out and drill in a mile or more
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  Speaker 1: of water depth and then go down several more miles
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  Speaker 1: six seven, eight miles into the earth and UH and
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  Speaker 1: find a large large fields. And the Gulf of Mexico
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  Speaker 1: is still relatively under explored compared to the onshore, so
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  Speaker 1: I think there's still room for for more discoveries. Let's
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  Speaker 1: talk about Chevron itself. What are the roots of chevern?
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  Speaker 1: When was Chevron created? One that is started founded in
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  Speaker 1: eighteen seventy nine in southern California, began as a company
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  Speaker 1: called Pacific Coast Oil Company, made the first commercial discovering
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  Speaker 1: California in Pico Canyon in southern California. Became part of
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  Speaker 1: the Rockefeller Standard Oil Trust UH in the latter part
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  Speaker 1: of the eighteen hundreds and then became Standard d of
• 9:06
  Speaker 1: California when the Standard Oil Trust was broken up. Our
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  Speaker 1: headquarters at home has always been in California. We've been
• 9:13
  Speaker 1: around for a hundred and forty three years and really
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  Speaker 1: a part of the world's history. Made the first discovery
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  Speaker 1: in the Middle East, first discovery of oil in Saudi Arabia,
• 9:22
  Speaker 1: among other milestones, and a long history of the world
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  Speaker 1: really reflected in our company. So if I go to
• 9:29
  Speaker 1: a gasoline station and want to get gasoline from my car,
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  Speaker 1: is there really a difference between the oil that Chevron
• 9:36
  Speaker 1: might be produced amazing the gasoline and one of your
• 9:38
  Speaker 1: competitors that that gasoline is pretty much all the same.
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  Speaker 1: There are specifications, minimum standards that have to be met
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  Speaker 1: for for the products UH, and then what you find
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  Speaker 1: is that different companies UM either exceed those by more
• 9:51
  Speaker 1: or less than others. And also we have special additives.
• 9:55
  Speaker 1: So we have a wholly owned additive company that manufactures
• 9:59
  Speaker 1: an additive called tech Run that has a very special
• 10:01
  Speaker 1: chemistry to keep engine parts clean. And as engines get
• 10:04
  Speaker 1: more sophisticated, as the tolerances. Get thinner, you're gonna have
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  Speaker 1: carbon deposits that can affect performance in your cylinders. Your
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  Speaker 1: injectors tech run cleans that up better. If you're driving
• 10:15
  Speaker 1: along and you need gas, will you stop at an
• 10:18
  Speaker 1: Exxon station? Or you've got to keep going till you
• 10:21
  Speaker 1: can see a Chevron station. Keep going until I see
• 10:23
  Speaker 1: a Chevron station. Okay, let's talk about your own background.
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  Speaker 1: So how does one become the CEO of Chevron? Tell us?
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  Speaker 1: Where were you born? I was born in Los Alamos,
• 10:32
  Speaker 1: New Mexico. My dad worked at the National Lab UH
• 10:35
  Speaker 1: and uh and I grew up in Colorado, Golden Colorado.
• 10:39
  Speaker 1: And you went to college where University of Colorado and
• 10:42
  Speaker 1: Boulder studied chemical engineering. And you said, I want to
• 10:44
  Speaker 1: work in the energy world. I at the time, you know,
• 10:49
  Speaker 1: chemical engineers could work in a number of different industries.
• 10:52
  Speaker 1: I had a summer internship where I worked in a
• 10:54
  Speaker 1: refinery in the Denver area. Found the work interesting, I
• 10:57
  Speaker 1: found the people interesting, and and had an offer to
• 11:01
  Speaker 1: come to the West Coast and work for Standard of California.
• 11:05
  Speaker 1: And it looked like a fun place to live in
• 11:08
  Speaker 1: a place where I could do interesting work. So basically,
• 11:11
  Speaker 1: this is the only employer since you're gradua from college
• 11:14
  Speaker 1: more or less for forty years, the only employer. So
• 11:17
  Speaker 1: when you're starting there forty years ago, did you say
• 11:19
  Speaker 1: I might be the CEO someday or did you not
• 11:21
  Speaker 1: think that was realistic? No? I just hoped I would
• 11:24
  Speaker 1: last to the next two weeks to get my next paycheck.
• 11:26
  Speaker 1: That would never give a game plan. So what did
• 11:28
  Speaker 1: you do? Did you move around the world over the
• 11:31
  Speaker 1: course of your forty years at Chevron? What did you
• 11:33
  Speaker 1: do to kind of rise up where you are an
• 11:36
  Speaker 1: operations person or an expiration person administrative person? Started out
• 11:41
  Speaker 1: as a design engineer and worked on big projects. So
• 11:44
  Speaker 1: UM an oil shale project, not the type that we
• 11:47
  Speaker 1: developed today, but the other kind of oil shale you
• 11:49
  Speaker 1: used to hear about. UM built a plant that you
• 11:53
  Speaker 1: can't find any trace of today. Worked on a facility
• 11:57
  Speaker 1: in California to help bring in oil from offshore, sold
• 12:01
  Speaker 1: for pennies on the dollar. Eventually, UM a project in
• 12:04
  Speaker 1: Africa that never happened because of civil war. So I
• 12:08
  Speaker 1: began by specializing in spectacularly unsuccessful projects. Uh, And at
• 12:13
  Speaker 1: some point I said, this doesn't look like a great
• 12:16
  Speaker 1: career path. And so I moved into our marketing business,
• 12:19
  Speaker 1: where I built gas stations and replaced underground tanks that
• 12:24
  Speaker 1: were made of steel with ones that were made of fiberglass.
• 12:26
  Speaker 1: They with the leak and um you and I remember
• 12:29
  Speaker 1: the old clickitty clackity wheels that would spin around on
• 12:32
  Speaker 1: a gasoline pump. I used to put in the first
• 12:35
  Speaker 1: electronic pumps back in the day. So these were smaller projects,
• 12:39
  Speaker 1: but I could see the beginning of the end. I
• 12:41
  Speaker 1: start to understand the commerce and how the business worked,
• 12:44
  Speaker 1: and from there are a variety of roles, primarily operating
• 12:47
  Speaker 1: roles across different businesses and around the world. When did
• 12:50
  Speaker 1: you become the CEO five years ago? Some people might
• 12:55
  Speaker 1: say that God looks favorably upon the CEO of energy
• 12:57
  Speaker 1: companies because he lets them live a long time. And
• 13:00
  Speaker 1: a number of your predecessors have lived quite a while,
• 13:03
  Speaker 1: and some of them you're living in your same area
• 13:05
  Speaker 1: that you're living out is they call you with advice
• 13:07
  Speaker 1: all the time. Actually, I'm really fortunate, David. The three
• 13:10
  Speaker 1: people have done my job immediately preceding me, each for
• 13:14
  Speaker 1: roughly a decade the nineteen nineties, the two thousands in
• 13:18
  Speaker 1: the in the teens. Uh live within a few miles
• 13:22
  Speaker 1: of where I live. I see them regularly, we have
• 13:25
  Speaker 1: lunch together. And um, that's a plus. Other words, Uh,
• 13:29
  Speaker 1: don't they tell you you're doing this wrong or doing
• 13:31
  Speaker 1: that wrong? That doesn't come up? Well, I get a
• 13:33
  Speaker 1: lot of good advice and and and um you asked
• 13:35
  Speaker 1: earlier about advice. These are people who have actually done
• 13:38
  Speaker 1: my job, so I really I'm interested in their advice.
• 13:40
  Speaker 1: They've lived through UH wars, the fall of the Soviet Union,
• 13:44
  Speaker 1: terrorist attacks, financial crises, they've seen oil markets go through gyration,
• 13:49
  Speaker 1: as they've dealt with geopolitical surprises, and so their advice
• 13:53
  Speaker 1: is really valuable. During COVID, the first first thing I
• 13:56
  Speaker 1: did was call each one of them and say, what
• 13:58
  Speaker 1: lessons did you learn during the I see as you faced.
• 14:01
  Speaker 1: How do you think I should handle things as we
• 14:03
  Speaker 1: have this pandemic unfolding. Uh. So we have a great
• 14:06
  Speaker 1: relationship and I see them regularly. So you're still, by
• 14:09
  Speaker 1: my standards, very young. And you've been the CEO for
• 14:12
  Speaker 1: five years, so you could do it for quite a
• 14:14
  Speaker 1: while and still be young. But do you have any
• 14:16
  Speaker 1: ambition to go into the federal government as a cabinet
• 14:19
  Speaker 1: officer or anything like that, and to do anything other
• 14:23
  Speaker 1: than the energy industry. Would you have any other career
• 14:25
  Speaker 1: ambitions or this is what you want to do? You know,
• 14:27
  Speaker 1: I love what I do, I love the company I
• 14:29
  Speaker 1: work for, the people that I work with, and um,
• 14:31
  Speaker 1: I don't have any ambition to do anything other than
• 14:34
  Speaker 1: a good job. So what do you do for relaxation?
• 14:38
  Speaker 1: Generally anything that involves family? Uh So? I have four children.
• 14:41
  Speaker 1: Uh they're very active in outdoor activities. My wife is
• 14:45
  Speaker 1: uh a good golfer, good skier. Uh So you'll find
• 14:49
  Speaker 1: me on a golf course, skiing, scuba diving, fly fishing
• 14:53
  Speaker 1: with family when I'm not at work. And any of
• 14:55
  Speaker 1: your children in the energy world. No, not even close. Okay,
• 14:59
  Speaker 1: So are you a good for this? Of you that?
• 15:01
  Speaker 1: If you have a low handicap, that's not good for
• 15:03
  Speaker 1: being a CEO because it means you're spending too much
• 15:05
  Speaker 1: time on the golf course. But I don't know what
• 15:08
  Speaker 1: that's fair or not. But are you a scratch handicap golfer?
• 15:11
  Speaker 1: Far from it. My wife is almost a scratch handicap golfer.
• 15:15
  Speaker 1: I caddy for her in in big tournaments. Actually, sometimes
• 15:19
  Speaker 1: will take a couple of vacation days and carry her
• 15:21
  Speaker 1: golf bag. So that tells you who the better golfer
• 15:24
  Speaker 1: is in my house. What are you most proud of
• 15:25
  Speaker 1: having achieved so far? Other than being the CEO? What
• 15:28
  Speaker 1: do you think is that your your record of accomplishment
• 15:31
  Speaker 1: so far that you're most proud of. Well, the last
• 15:33
  Speaker 1: five years have been an interesting five years for people
• 15:36
  Speaker 1: in just about any business and UM and so you know,
• 15:39
  Speaker 1: when the pandemic hit, we have people in ships, we
• 15:41
  Speaker 1: have people on offshore platforms with people around the world, UH,
• 15:45
  Speaker 1: in developed countries and in developing countries. UH. Navigating that,
• 15:50
  Speaker 1: keeping people safe, keeping our business running, keeping the world
• 15:53
  Speaker 1: supplied with energy has been no small task. It's been
• 15:56
  Speaker 1: the most challenging things I've I've ever confronted. And during
• 16:00
  Speaker 1: that same time, we've done a massive restructuring of our business.
• 16:03
  Speaker 1: We've made a couple of acquisitions and integrated them to
• 16:05
  Speaker 1: make the company stronger or better companies today we were
• 16:08
  Speaker 1: a few years ago. And I'm proud of the progress
• 16:11
  Speaker 1: that our people have made during this challenging, in tumultuous time.
• 16:15
  Speaker 1: But it's just a career path you would recommend to
• 16:17
  Speaker 1: young people. Let's say, young people are watching and they say, well,
• 16:20
  Speaker 1: maybe I should go into the energy world. Would you
• 16:22
  Speaker 1: recommend this to young people? There's never been a better
• 16:24
  Speaker 1: time to come into the energy world. We're faced with
• 16:27
  Speaker 1: this incredible challenge of meeting the demands of the world
• 16:31
  Speaker 1: today in building a lower carbon energy system for tomorrow.
• 16:34
  Speaker 1: The technology that's available to us, the innovation that's available
• 16:37
  Speaker 1: to us, is greater than it's ever been, and the
• 16:40
  Speaker 1: chance to make a difference is enormous. If I were
• 16:43
  Speaker 1: my younger self looking for a job, I would absolutely
• 16:46
  Speaker 1: come into this industry. Large carbon energy companies seem to
• 16:50
  Speaker 1: me have a difficulty. Are they producing large amounts of
• 16:53
  Speaker 1: carbon energy which people like to consume, or are they
• 16:56
  Speaker 1: supposed to transition to being renewable energy companies? And what
• 16:59
  Speaker 1: are you going? For example, they're transitioning yourself a bit
• 17:02
  Speaker 1: to be unrenewable company. Well, we're we're focused on leveraging
• 17:06
  Speaker 1: our strength to deliver lower carbon energy to a growing world.
• 17:11
  Speaker 1: And what that means is in the near term, we
• 17:13
  Speaker 1: can find ways and we are finding ways to reduce
• 17:16
  Speaker 1: the greenhouse gas impact of the energy the world uses today.
• 17:20
  Speaker 1: So we're reducing the emissions associated with oil and gas
• 17:24
  Speaker 1: that the world needs today, needs very very desperately. And
• 17:28
  Speaker 1: at the same time, we're building new lower car inherently
• 17:31
  Speaker 1: lower carbon energy businesses for tomorrow. So things like renewable fuels, hydrogen,
• 17:37
  Speaker 1: carbon capturing storage, geothermal are all technologies were investing in,
• 17:41
  Speaker 1: businesses were growing that will play a bigger role tomorrow,
• 17:44
  Speaker 1: and we're gonna need many solutions. There is no one
• 17:46
  Speaker 1: there is no one solution for this. So in two
• 17:49
  Speaker 1: thousand twenty two, you bought a renewable energy company for
• 17:53
  Speaker 1: roughly I think three billion dollars. What was that about.
• 17:55
  Speaker 1: Why did you want to do that? Well, we had
• 17:58
  Speaker 1: a we had a renewal renewable fuels business ourselves. Uh,
• 18:02
  Speaker 1: this company, Renewable Energy Group, was one of the leading
• 18:05
  Speaker 1: producers of biodiesel and soon to be renewable diesel in
• 18:09
  Speaker 1: the United States. And they have great capabilities in the
• 18:14
  Speaker 1: feedstock sourcing area, and so in any fuels business. Raw
• 18:19
  Speaker 1: materials are a very important part of the overall value
• 18:23
  Speaker 1: chain traditional petroleum products. We have deep expertise in the
• 18:27
  Speaker 1: raw materials sourcing for that. In these products, you're talking
• 18:32
  Speaker 1: about raw materials that are like used cooking oil, something
• 18:35
  Speaker 1: called distiller's corn oil, various bean oils from soybean and
• 18:38
  Speaker 1: other agricultural products. These are markets that we don't have
• 18:42
  Speaker 1: a lot of experience in. The quality, logistics, commercial dimensions
• 18:47
  Speaker 1: of those markets are things that Rural Energy Group is
• 18:49
  Speaker 1: very good at. They have manufacturing facilities and some marketing.
• 18:53
  Speaker 1: We have big market positions and brand positions, particularly in
• 18:56
  Speaker 1: states like California, that encourage this. So the combination of
• 19:00
  Speaker 1: TOO makes a more powerful renewal energy business, and today
• 19:03
  Speaker 1: UH in renewable area, which is obviously a growth area.
• 19:07
  Speaker 1: UM do you think that if you were going to
• 19:09
  Speaker 1: make more acquisitions without giving away inside information, you're likely
• 19:12
  Speaker 1: to do more in the renewable area or in the
• 19:15
  Speaker 1: carbon area. It's an active field of opportunity in both UH.
• 19:22
  Speaker 1: For US, it's really driven by strategy, asset quality, value,
• 19:26
  Speaker 1: I mean, the typical things you would look at when
• 19:28
  Speaker 1: when you do a deal. But as I said, over
• 19:30
  Speaker 1: the last two years, we've we've done a big traditional
• 19:32
  Speaker 1: energy deal, We've done a big renewal acquisition. I think
• 19:36
  Speaker 1: in the years ahead we'll probably do acquisitions in both
• 19:38
  Speaker 1: of those spaces. When President Nixon took office shortly thereafter,
• 19:42
  Speaker 1: there was an oil spill in Santa Barbara and then
• 19:45
  Speaker 1: under President Obama there was an oil spill in the
• 19:47
  Speaker 1: Gulf Horizon. It was I think of British petroleum right now,
• 19:51
  Speaker 1: when you're drilling off shore, how safe is it uh
• 19:55
  Speaker 1: to be able to avoid those kind of environmental damage?
• 19:57
  Speaker 1: Is it much better than it used to be or
• 19:58
  Speaker 1: greater precautions than there to be? Yeah? Absolutely? And um
• 20:02
  Speaker 1: and I think you know, the industry has continually improved
• 20:06
  Speaker 1: operating practices, equipment. Uh. Certainly the regulators in the US
• 20:11
  Speaker 1: have very high standards, who were very closely with the
• 20:13
  Speaker 1: regulators on that, and the advent of newer technologies have
• 20:17
  Speaker 1: continually made this safer. And so uh, these are these
• 20:21
  Speaker 1: are challenging, difficult operations in those kinds of pressures, water depths,
• 20:26
  Speaker 1: and environments. But the industry has a has a strong
• 20:30
  Speaker 1: track record today. Uh. And you know there have been
• 20:33
  Speaker 1: some notable incidents over time, but every company in this
• 20:36
  Speaker 1: industry works really hard to to prevent those. So, um,
• 20:40
  Speaker 1: today do you not worry about that kind of offshore
• 20:43
  Speaker 1: UH drilling problems anymore? Because of the safety is pretty
• 20:46
  Speaker 1: good compared to what it used to be. You know,
• 20:48
  Speaker 1: every day I get up and I worry about safety
• 20:50
  Speaker 1: and um, protecting the environment. Are people working at demanding
• 20:54
  Speaker 1: business and uh, it's a highly technical activity. We have
• 20:58
  Speaker 1: very talented people. We've got very strict protocols and standards
• 21:02
  Speaker 1: to keep people safe and keep the environment safe. But
• 21:04
  Speaker 1: you can never take it for granted. Why do you
• 21:06
  Speaker 1: think it is that people love energy but they don't
• 21:09
  Speaker 1: love energy companies? In other words, people in the United
• 21:12
  Speaker 1: States around the world consume enormous amounts of oil and gas,
• 21:15
  Speaker 1: and the people that provided, like Chevron, don't seem to
• 21:18
  Speaker 1: be so popular. Why is that? You know? Um, I
• 21:22
  Speaker 1: don't know exactly why it is. Uh. You know, we're
• 21:25
  Speaker 1: a big company. The numbers are big. Sometimes big isn't popular.
• 21:30
  Speaker 1: Are big energy, big government, big tech? Maybe big private
• 21:35
  Speaker 1: equities and exception to that. But you know that we're
• 21:40
  Speaker 1: a big company. We represent less than two percent of
• 21:43
  Speaker 1: global oil production and so in the scheme of things,
• 21:46
  Speaker 1: a very competitive market and we're a relatively small player.
• 21:50
  Speaker 1: And I think you know what's important, uh to remembers
• 21:54
  Speaker 1: we need to have a balanced approach to energy, and
• 21:57
  Speaker 1: that means we have to focus on affordability, because affordable
• 22:00
  Speaker 1: energy is really essential for economic prosperity, reliable supply for
• 22:05
  Speaker 1: national security because energy security and national security are linked.
• 22:10
  Speaker 1: And then protecting the environment, and I think its prices
• 22:12
  Speaker 1: get high and it gets less affordable, you find people
• 22:15
  Speaker 1: that are upset, and part of that is because we
• 22:19
  Speaker 1: really haven't necessarily been able to find the right balance
• 22:23
  Speaker 1: among those three and to improve the overall image of
• 22:27
  Speaker 1: the energy industry. Is there something you think that the
• 22:29
  Speaker 1: CEOs or the companies can do to improve the image
• 22:32
  Speaker 1: so that people when they walk down the streets say, wow,
• 22:35
  Speaker 1: Chevron has done a great job for America today. How
• 22:37
  Speaker 1: how is that possible? Or just energy companies just don't
• 22:40
  Speaker 1: have that kind of likely public image that's going to
• 22:43
  Speaker 1: be so good. Well, I think what would help David
• 22:45
  Speaker 1: is to engage in this more balanced conversation about the
• 22:48
  Speaker 1: benefits of energy. We are a lot of people that have, um,
• 22:52
  Speaker 1: you know, views on what some of the consequences are
• 22:55
  Speaker 1: of the use of energy. But as you say, they
• 22:58
  Speaker 1: they've had made rancements in the quality of life. Uh,
• 23:02
  Speaker 1: you know, possible that we wouldn't have imagined, uh you know,
• 23:06
  Speaker 1: two centuries ago, and um and I think as we
• 23:09
  Speaker 1: go forward, it's absolutely likely that we find ways to
• 23:13
  Speaker 1: meet the needs of a growing world and produce the
• 23:16
  Speaker 1: carbon Impat's supposed Tomorrow you decided to retire and become
• 23:20
  Speaker 1: a cabinet officer or something, or do something else. What
• 23:23
  Speaker 1: would you say you have achieved as the CEO of
• 23:27
  Speaker 1: Chevron that you're most proud of. Well, I would hope
• 23:30
  Speaker 1: that people would say he thought of others first. He
• 23:35
  Speaker 1: strengthened the culture of our company. He kept people safe,
• 23:38
  Speaker 1: and made the company a better company when he left
• 23:41
  Speaker 1: than it was when he founded. Thanks for listening to
• 23:45
  Speaker 1: hear more of my interviews. You can subscribe and download
• 23:47
  Speaker 1: my podcast on Spotify, Apple, or wherever you listen.