The David Rubenstein Show: Mike Wirth

Summary

In this interview, Chevron CEO Mike Worth discusses the oil industry's cyclical nature, the impact of war in Ukraine on energy markets, and Chevron's strategy to transition to renewable energy. He addresses the misconception of energy companies being price-makers, the importance of a balanced approach to energy focusing on affordability, reliability, and environmental protection, and shares his vision for Chevron's future in a sustainable energy landscape.

Takeaways

• 📈 The energy industry, particularly oil companies, has been experiencing record profits and revenues, which has led to discussions about implementing a windfall profits tax.
• 💼 Mike Worth, CEO of Chevron, emphasizes that the industry is cyclical and a windfall profits tax could deter investment, potentially leading to less energy production and higher prices.
• 🌐 Chevron, under Worth's leadership, is focused on operating in a way that is mindful of the environment while also meeting the energy demands of a growing global population.
• 🔍 Worth discusses the importance of engaging with regulators and legislators to educate them on the economic realities and potential consequences of their decisions on the energy sector.
• 🚫 Chevron, like other energy companies, is often criticized for price gouging, but Worth counters this by stating that they are price takers in a global market and that the industry's returns on capital are modest.
• ⛽ The war in Ukraine has had a significant impact on energy markets, causing oil prices to rise. Worth suggests that once the conflict ends, market uncertainties and risks to supply will decrease, which could lead to lower energy prices.
• 🌿 Chevron is investing in renewable energy and lower carbon technologies as part of its strategy to transition towards a more sustainable energy future.
• 🌟 Worth highlights Chevron's acquisition of Renewable Energy Group, a leading producer of biodiesel and renewable diesel, as a strategic move to strengthen its renewable energy business.
• 🛑 The safety of offshore drilling has improved significantly, with Chevron and the industry as a whole working hard to prevent environmental disasters like past oil spills.
• 🏆 If Worth were to retire, he would hope to be remembered for strengthening Chevron's culture, prioritizing safety, and leaving the company in a better state than when he joined.

Q & A

What is the current state of the oil industry according to the interview?

The oil industry is experiencing cyclical nature with record profits and revenues, which has led to suggestions of a windfall profits tax. However, the industry is also dealing with the impact of the war in Ukraine and the transition towards renewable energy.

Why did Chevron's CEO, Mike Worth, oppose the idea of a windfall profits tax?

Mike Worth believes that a windfall profits tax would not encourage more supply and could potentially increase prices, as it did when President Carter tried to implement it in 1980. It resulted in less investment and production.

How does Chevron's CEO view his role when interacting with Washington regulators and legislators?

Mike Worth sees his role as providing objective input to help regulators understand the potential consequences of their decisions, aiming to avoid unintended outcomes and assist in achieving their goals.

What is Chevron's stance on being labeled as 'gouging' by the U.S. President?

Mike Worth disagrees with the characterization of energy companies as 'gouging'. He explains that the industry is one of price takers, not price makers, and that global commodity markets dictate prices.

How has the war in Ukraine affected Chevron and the energy market?

The war has impacted energy markets by creating uncertainty and risk to supply, which has tightened the market. However, the industry was already facing challenges due to reduced investment levels during the pandemic and subsequent demand recovery.

What is Chevron's strategy for the future in terms of energy production?

Chevron is focused on leveraging its strengths to deliver lower carbon energy. This includes reducing emissions from current oil and gas operations and investing in inherently lower carbon energy businesses like renewable fuels, hydrogen, carbon capture, and storage, and geothermal.

Why did Chevron acquire Renewable Energy Group, and what does it mean for the company's renewable strategy?

Chevron acquired Renewable Energy Group to strengthen its renewable fuels business by combining their expertise in feedstock sourcing and manufacturing with Chevron's market positions and brand strength, especially in states that encourage renewable energy.

What is Chevron's position on the safety of offshore drilling and how has it improved over time?

Chevron considers safety and environmental protection as top priorities. Offshore drilling safety has significantly improved due to better operating practices, equipment, and strict adherence to high regulatory standards.

How does Chevron's CEO perceive the public's view of energy companies, and what can be done to improve this image?

Mike Worth acknowledges the challenge of being a large energy company and suggests engaging in a balanced conversation about the benefits of energy and the industry's efforts to reduce carbon impact while meeting the world's energy needs.

What are Mike Worth's personal ambitions and how does he view his legacy as Chevron's CEO?

Mike Worth is committed to Chevron and the energy industry, with no ambitions outside of his current role. He hopes his legacy will be one of strengthening the company's culture, ensuring safety, and leaving the company in a better state than when he joined.

Outlines

00:00

💼 Insights on Leadership and Chevron's CEO Role

The paragraph introduces an investor's perspective on private equity and leadership, highlighting an interview with Chevron's CEO, Mike Worth. Worth discusses his journey from a young college graduate to the CEO of one of the world's largest energy companies, addressing the cyclical nature of the oil industry and the implications of a windfall profits tax. He also shares his views on engaging with regulators and legislators in Washington, emphasizing the importance of providing objective input to help them understand the consequences of their decisions.

05:03

🌐 Chevron's Global Impact and Energy Market Dynamics

This section delves into the state of the oil world, with a focus on Chevron's operations and the challenges faced by energy companies. Mike Worth explains how the industry is affected by factors like the war in Ukraine and the need for a balance between energy affordability, reliability, and environmental protection. He discusses Chevron's role in the global energy market, its production levels, and the company's strategy for dealing with market fluctuations and geopolitical issues.

10:03

🏭 Historical Milestones and Chevron's Evolution

The paragraph traces Chevron's history back to its founding in 1879 and its evolution through significant milestones, including the first commercial oil discovery in California and its expansion into the Middle East. It also covers the company's transformation over the years, reflecting on its long-standing presence in California and its contributions to the energy industry. The discussion highlights Chevron's commitment to innovation and its approach to meeting the world's energy needs.

15:05

🔧 Chevron's CEO Shares Personal and Professional Journey

In this segment, Mike Worth shares his personal background, from his birth in Los Alamos to his education in chemical engineering at the University of Colorado. He discusses his career path at Chevron, starting as a design engineer and moving through various roles, including marketing and operations, before becoming the CEO. Worth also talks about the support he receives from his predecessors and how their experiences and advice have been valuable to him, especially during crises like the COVID-19 pandemic.

20:06

🌱 Chevron's Commitment to Renewable Energy and Environmental Safety

The final paragraph focuses on Chevron's efforts to transition towards renewable energy and reduce its carbon footprint. Worth discusses the company's investments in renewable fuels, hydrogen, carbon capture, and storage, and geothermal energy. He also addresses the safety measures and technological advancements in offshore drilling to prevent environmental damages. Worth reflects on the public perception of energy companies and the importance of balancing energy affordability, reliability, and environmental protection. He concludes with his personal ambitions and what he hopes to achieve as Chevron's CEO, emphasizing safety, culture, and company improvement.

Keywords

💡Private Equity

Private equity refers to an alternative investment class consisting of capital that is not listed on a public exchange. In the script, the speaker initially held the view that private equity was the 'highest calling of mankind,' suggesting a belief in its potential for significant financial returns and business influence. This concept is central to understanding the speaker's perspective on investment and business strategy.

💡Due Diligence

Due diligence is the process of investigating and verifying a business or individual's background and financial records before entering into a transaction or agreement. The script mentions an instance where the speaker did 'no due diligence,' highlighting a non-traditional approach to business transactions and possibly emphasizing trust or a calculated risk in that particular situation.

💡Windfall Profits Tax

A windfall profits tax is a tax levied on businesses that experience an unusually high level of profitability, often due to factors beyond their control. In the script, the discussion around the oil industry's profits and the suggestion of a windfall profits tax by some politicians is a key point of debate. The speaker argues against such a tax, suggesting it would not encourage more supply or reduce prices, thereby illustrating the complexities of energy economics and policy.

💡Energy Security

Energy security encompasses the reliable and affordable supply of energy to meet a country's needs. The script connects energy security with national security, emphasizing the importance of a stable energy supply for both economic prosperity and national defense. The speaker's role as an energy executive involves navigating these issues to ensure the company contributes positively to energy security.

💡Carbon Energy

Carbon energy refers to energy sources that produce carbon emissions, such as fossil fuels like oil, coal, and natural gas. The script discusses the oil industry's profitability and the challenges it faces in the context of environmental concerns and the transition to renewable energy. The term is central to understanding the industry's impact and the speaker's perspective on balancing profitability with sustainability.

💡Renewable Energy

Renewable energy sources are those that can be replenished naturally and sustainably, such as wind, solar, and hydroelectric power. The script highlights the company's efforts to invest in renewable energy technologies as part of its strategy to transition towards a lower carbon future. This reflects the broader industry trend towards integrating renewables into the energy mix.

💡CEO

A CEO, or Chief Executive Officer, is the highest-ranking executive in an organization and is responsible for making major corporate decisions, managing the overall operations and resources of a company. The script provides insights into the speaker's journey to becoming the CEO of Chevron, his responsibilities, and his perspective on leadership within the energy sector.

💡Permian Basin

The Permian Basin is one of the largest oil-producing regions in the United States. In the script, the Permian Basin is mentioned as an area where technological advancements have enabled the production of oil and gas from dense rock formations, which was not economically viable previously. This example illustrates the importance of technological innovation in the energy industry.

💡Gulf of Mexico

The Gulf of Mexico is a region rich in oil and gas reserves and is a significant area for offshore drilling. The script discusses deepwater drilling in the Gulf of Mexico, indicating the technological advancements that have allowed for the extraction of resources from extreme depths. This highlights the challenges and opportunities in offshore energy exploration.

💡National Lab

A national laboratory is a research institution funded by the government to conduct a broad range of scientific and technological research. The script mentions the speaker's father working at the National Lab, providing a personal connection to the scientific community and possibly influencing the speaker's interest in the energy industry and technological innovation.

💡Renewable Fuels

Renewable fuels are liquid or gaseous fuels produced from renewable sources, such as biomass or waste materials. The script discusses Chevron's acquisition of a renewable energy company that specializes in renewable fuels, indicating the company's strategic move towards diversifying its energy offerings and investing in lower carbon solutions.

Highlights

The interviewee has been an investor for three decades and shares insights on leadership and success.

Discussion on the current state of the oil industry, with large oil companies experiencing record profits.

Mike Worth shares his journey from a young college graduate to becoming the CEO of Chevron.

The impact of the war in Ukraine on oil prices and the energy market is analyzed.

Chevron's stance on the proposed windfall profits tax and its potential effects on energy production.

The importance of engaging with regulators and legislators to understand the energy industry's economics.

Chevron's global presence with about 36,000 employees across a hundred different countries.

The company's daily oil production and its contribution to the United States' total oil production.

The role of technology in discovering new oil reserves and the exploration of the Gulf of Mexico.

Chevron's history, starting in 1879, and its evolution as a significant player in the energy sector.

The interviewee's personal career growth at Chevron, from design engineer to CEO.

Chevron's strategy to balance its traditional energy business with investments in renewable energy.

The acquisition of Renewable Energy Group and its alignment with Chevron's renewable fuels business.

The safety measures and precautions taken in offshore drilling to prevent environmental damage.

The challenges faced by energy companies in terms of public perception and the need for a balanced energy conversation.

The interviewee's personal interests and how he spends his time outside of work, emphasizing family activities.

The interviewee's reflections on his achievements as CEO and the legacy he hopes to leave at Chevron.

Transcripts

[Music]

this is uh my kitchen table and also my

filing system

over much of the past three decades I've

been an investor the highest calling of

mankind I've often thought was Private

equity and then I started interviewing

while I watch your interview because I

know how to do something I've learned in

doing my interviews how leaders make it

to the top I asked him how much he

wanted he said 250 I said fine I didn't

negotiate with him I did no due

diligence do I have something I'd like

to sell and how they stay there you

don't feel inadequate now because being

only the second wealthiest man in the

world is that right

[Applause]

about 40 years ago a young college

graduate Mike worth joined Chevron then

and now one of the largest energy

companies in the world today Mike worth

is the CEO of Chevron and dealing with

the multiple issues that an energy

companies have to deal with today

including renewable energy I sat down

with Mike Worth to talk about what it's

like to run Chevron today in the current

environment

[Music]

so tell me about the state of the oil

world right now it seems as if the large

oil companies are energy carbon energy

companies are doing quite well they have

record profits record revenues and as a

result of that some people in the white

house and other places have suggested a

windfall profit stack so is the industry

in such great shape that it can afford a

windfall profits tax well it's a

cyclical industry David we see prices go

up we see prices go down a windfall

profits tax is is not going to encourage

more Supply it's not likely to reduce

prices in fact it could do quite the

opposite President Carter try to win

fall profits tax in 1980 it was

rescinded several years later had

collected a lot less Revenue than was

expected and didn't result in more

investment it resulted in less

investment and less production so

normally if you want less of something

you tend to put more taxes on it you

want less smoking you tax cigarettes if

we want more energy production little

more Supply to bring prices down putting

taxes on on energy production is

probably not a good idea your current

job do you have to go to Washington to

talk to regulators and legislators and

do you find that an uplifting experience

to do that I do have to go to Washington

um uplifting is probably not the first

word that comes to mind I mean they're

they're detailed discussions and uh and

we need to help Regulators understand

the potential consequences of some of

the things they consider so we just say

that Washington by and large doesn't

really understand the economics of the

energy industry or they could learn a

little bit more than they know now

well I have empathy for people that sit

in these roles they have often broad

responsibilities and they may not have

personal expertise and depth in some of

the areas they're responsible for so I

view my job is to come in and try to

provide objective input and help them

understand the consequences of things

they're considering to avoid unintended

consequences and help achieve the goals

that they're looking to achieve so when

the president United States says energy

companies are gouging American people

you get to be used to this when you're

an energy executive more or less I

assume

uh you know don't like it but you

probably are accepting of it I I

disagree with uh that characterization I

don't think it's accurate

um this is a you know we're an industry

of price takers not price makers these

are global commodity markets and um and

prices go up prices come down uh we

allocate billions of dollars to Capital

our company does every year uh just two

years ago we were losing billions of

dollars uh as prices plummeted uh and so

uh through the cycle it's an industry

that generates the kind of 10 ish

Returns on Capital employed uh which is

uh I think by the standards of many

other Industries a pretty modest return

the war in Ukraine has driven oil prices

up I think it's fair to say um do you

think that that is a principal reason

why the major energy companies are doing

quite well because the supply has been

reduced because of the war in Ukraine

and do you think that when that war does

end eventually it will I assume uh it'll

have an impact on reducing Energy prices

in carbon areas

well the the war and the associated

actions have uh definitely had an impact

on energy markets but if you step back

uh and look at the the broader context

in 2020 uh we saw demand collapse with

the pandemic when the world uh really

locked down in fact companies in our

industry uh had to shut in Wells and

stop producing because there was no

place to store the oil that wasn't

needed by the market so investment

levels came down and that is the uh and

nobody knew how long this would last as

the economy recovered post the pandemic

we had vaccines demand returned

the industry's been struggling to keep

up with the rate of growth once again

and so the market was already in a

pretty tight situation before this War

Began I do think uh when eventually it's

resolved in all conflicts eventually are

resolved I think that uncertainty and

the risk to supply from one of the

world's largest suppliers will be

reduced and I think we'll see markets

reflect that a number of years ago oil

prices went as low as I think twenty

dollars a barrel

and when it was that low major oil

companies like I think Chevron and

others said we can't afford to drill

anymore in either let's say in Alaska

the North Sea other places because we

need to have oil at seventy dollars a

barrel to make drilling uh affordable

and profitable has that come back now

that oil prices are up are people now

Drilling in major projects around the

world to kind of get oil that's going to

take four or five or ten years to build

and and drill or is that not happening

again we're seeing some of that happen

again certainly what has really changed

in the last decade David is the uh what

we see in the US and the Permian Basin

but also in some other parts of this

country and in other countries now is

the ability to produce oil and gas from

a rock that is very very dense very hard

and historically has not been very

productive but with directional drilling

and the ability to to fracture these

formations now we're seeing the ability

to produce from areas that we couldn't

before and at prices that are are lower

than some of these very complex

difficult projects and so the need for

the uh the ultra deep water the Arctic

has been reduced as we see these other

resources come in at a lower cost so how

many employees does Chevron have about

36 000 in about a hundred different

countries and how much oil do you

produce a day a little bit over three

million barrels of oil equivalent per

day so mostly oil some gas and we

convert the units on the gas to give you

the energy equivalents about three

million barrels the United States

produces 10 million barrels a day or

something like that closer to 12. well

okay so you're producing about 25

percent of the oil produced in the

United States more or less as a company

you could say that our U.S production is

about 1.2 million barrels a day so we're

we're less than 10 percent of of U.S

production so right now the United

States is more or less energy sufficient

compared to let's say the 1960s or 7

these when we import a lot of oil I

think we produce we probably consume 10

to 12 million barrels a day closer to

20. we can we consume 20 million barrels

a day and we produce roughly your

sanctuell so we're importing the

equivalent of about eight million

barrels a day which is better than it

used to be where are we mostly importing

that from is it from OPEC countries

Canada

our neighbors are the are the largest uh

you know suppliers of oil I mean you

know you heard all remember all the

countries around the Keystone Pipeline

we're a big customer of Canada who's a a

large resource country right now how do

you get that oil down here there are

other pipelines that have been built uh

in in Years Gone by and sometimes it

flows by Rail and so it comes by ship

you can bring it down through pipelines

into ports along the west coast for

instance or into the Atlantic based and

bring it by ship so Canada is the

largest supplier and then other people

in the region and we we still bring some

oil to this country from the Middle East

but much less than we did back now so I

think there's much oil to be found in

the lower 48 at this point or even in

let's say Alaska as well or mostly we

know where all the oil is and there's no

more big Permian Basin kind of deposits

anywhere people have said that over time

and then we've always been surprised and

so the US has been explored more than

any other other place in the world I

think the industry has a good idea uh

but technology allows you sometimes to

recover things that you you haven't been

able to before that's the story of shale

uh the other one that continues to be a

positive story is uh Deepwater Gulf of

Mexico where we'll go out and drill in a

mile or more of water depth and then go

down several more miles six seven eight

miles into the Earth and uh and find

large large fields and the the Gulf of

Mexico is still relatively underexplored

compared to the onshore so I think

there's still room for for more

discoveries so when you're starting

there 40 years ago did you say I might

be the CEO someday or did you not think

that was realistic no I just hoped I

would last to the next two weeks to get

my next paycheck that would never give a

game plan foreign

[Music]

itself what is the roots of Chevron when

was Chevron created when did it start

founded in 1879 in Southern California

began as a company called Pacific Coast

oil company made the first commercial

Discovery in California in Pico canyon

in in Southern California

became part of the Rockefeller Standard

Oil trust in the latter part of the

1800s and then became standard role of

California when the Standard Oil trust

was broken up our headquarters and home

has always been in California we've been

around for 143 years and really a part

of the world's history made the first

discovery in the Middle East first

discovery of oil in Saudi Arabia among

other milestones and a long history of

of the world really reflected in our

company so if I go to a gasoline station

and want to get gasoline from my car is

there really a difference between the

oil that Chevron might be produced that

lays in the gasoline and one of your

competitors that gasoline is pretty much

all the same there are specifications

minimum standards that have to be met

for for the products and then what you

find is that different companies either

exceed those by more or less than others

and also we have special additives so we

have a wholly owned additive company

that manufacture is an additive called

Techron that has a very special

chemistry to keep engine parts clean and

as engines get more sophisticated as the

tolerances get thinner you can have

carbon deposits that can affect

performance in your cylinders your

injectors

Techron cleans that up better so if

you're driving along and you need gas

will you stop at an Exxon station or

you've got to keep going until you can

see in a Chevron station keep going

until I see a Chevron station let's talk

about your own background so how does

one become the CEO of Chevron tell us

where were you born

I was born in Los Alamos New Mexico my

dad worked at the National Lab and I

grew up in Colorado Golden Colorado and

you went to college where University of

Colorado and Boulder studied chemical

engineering and you said I want to work

in the energy world

I at the time uh you know chemical

Engineers could work in a number of

different Industries I had a summer

internship where I worked in a refinery

in the Denver area found the work

interesting I found the people

interesting and and had an offer to come

to the West Coast and work for standard

of California and it looked like a a fun

place to live and uh

place where I could do interesting work

basically this is the your only employer

since she graduated from college more or

less for 40 years the only employer so

when you're starting there 40 years ago

did you say I might be the CEO someday

or did you not think that was realistic

no I just hoped I would last to the next

two weeks to get my next paycheck that

would never give a game plan so what did

you do did you move around the world uh

over the course of your 40 years at

Chevron what did you do to kind of rise

up were you an uh operations person or

an expiration person A administrative

person started out as a design engineer

and worked on big projects so an oil

shale project not the type that we

developed today but the other kind of

oil shell you used to hear about

um

built a plant that you can't find any

trace of today worked on a facility in

California to help bring in oil from

offshore sold for pennies on the dollar

eventually a project in Africa that

never happened because of a civil war so

I began by specializing in spectacularly

unsuccessful projects and at some point

I said this doesn't look like a great

career path and so I moved into our

marketing business where I built gas

stations and replaced underground tanks

that were made of steel with ones that

were made of fiberglass so they wouldn't

leak and you you and I remember the old

Clickety clackety wheels that would spin

around on a gasoline pump I used to put

in the first electronic pumps back in

the day so these were smaller projects

but I could see the beginning the end I

started to understand the Commerce and

how the business worked and from there a

variety of roles primarily operating

roles across different businesses and

around the world when did you become the

CEO five years ago in 2018. now some

people might say that God looks

favorably upon the CEOs of energy

companies because he lets them live a

long time and a number of your

predecessors have lived quite a while

and and some of them you live in your

same area that you live in now does they

call you with advice all the time

actually I'm really fortunate David the

the three people have done my job

immediately preceding me each for

roughly a decade the the 1990s the 2000s

and the in the 20 teens uh live within a

few miles of where I live I see them

regularly we have lunch together and um

that's a plus in other words uh don't

they tell you you're doing this wrong or

doing that wrong that doesn't come up

well I get a lot of good advice and and

and you asked earlier about advice these

are people who have actually done my job

so I really I'm interested in their

advice they've lived through uh Wars uh

the fall of the Soviet Union terrorist

attacks Financial crises they've seen

oil markets go through gyration as

they've dealt with geopolitical surprise

cases and so their advice is really

valuable during covet the first first

thing I did was call each one of them

and say what lessons did you learn

during the crises you faced how do you

think I should handle things as we have

this pandemic unfolding so we have a

great relationship and I see them

regularly so you're still by my

standards very young and you've been the

CEO for five years so you could do it

for quite a while and still be young but

do you have any ambition to go into the

federal government as a Cabinet officer

or anything like that no

and to do anything other than the energy

industry would you have any other career

Ambitions or this is what you want to do

you know I love what I do I love the

company I work for and the people that I

work with and I don't have any ambition

to do anything other than a good job so

what do you do for relaxation

generally anything that involves family

so I have four children they're very

active in outdoor activities my wife is

a good golfer a good skier so you'll

find me on a golf course skiing scuba

diving fly fishing with family when I'm

not at work and any of your children in

the energy world no not even close okay

so are you a good golfer there's some of

you that if you have a low handicap

that's not good for being a CO because

it means you're spending too much time

on the golf course but I don't know

whether that's fair or not but are you a

scratch handicap golfer far from it my

wife is almost a scratch handicap golfer

I caddy for her in in big tournaments I

actually sometimes will take a couple of

vacation days and carry her golf bag so

that tells you who the better golfer is

in my house

[Music]

[Applause]

[Music]

[Applause]

[Music]

[Applause]

[Music]

[Applause]

[Music]

[Applause]

thank you

large carbon energy companies seem to me

have a difficulty are they producing

large amounts of carbon energy which

people like to consume or are they

supposed to transition to being

renewable energy companies and what are

you doing for example to transition

yourself a bit to be on renewable

company well we're we're focused on

leveraging our strengths to deliver

lower carbon energy to a growing world

and what that means is in the near term

we can find ways and we are finding ways

to reduce the greenhouse gas impact of

the energy the world uses today so we're

reducing the emissions associated with

oil and gas that the world needs today

needs very very desperately and at the

same time we're building new lower

inherently lower carbon energy

businesses for tomorrow so things like

renewable fuels hydrogen carbon capture

and storage geothermal are all

Technologies we're investing in

businesses were growing that will play a

bigger role tomorrow and we're going to

need many solutions there is no one

there is no one ocean for this so in

2022 you bought a renewable energy

company for roughly I think three

billion dollars what was that about why

did you want to do that well we had a we

had a renewal renewable fuels business

ourselves uh this company Renewable

Energy group was one of the leading

producers of biodiesel and soon to be

renewable diesel in the United States

and they have

great capabilities in the feedstock

sourcing area and so in any fuels

business raw materials are a very

important part of the overall value

chain traditional petroleum products we

have deep expertise in the raw materials

sourcing for that in these products uh

you're talking about raw materials

they're like used cooking oil something

called distillers corn oil various Bean

oils from soybean and other agricultural

products these are markets that we don't

have a lot of experience in the Quality

Logistics commercial dimensions of those

markets are things that rural Energy

Group is very good at they have

manufacturing facilities and some

marketing we have big Market positions

and brand positions particularly in

States like California that encourage

this so the combination of the two makes

a more powerful renewable energy

business and today in renewable area

which is obviously a growth area do you

think that if you were going to make

more Acquisitions without giving away

inside information you're likely to do

more in the renewable area or in the

carbon area

you know it's an active field of

opportunity in both

for us it's really driven by strategy

asset quality value I mean the typical

things you would look at when you do a

deal but as I said over the last two

years we've done a big traditional

energy deal we've done a big renewable

acquisition I think in the years ahead

we'll probably do Acquisitions in both

of those spaces when President Nixon

took office shortly thereafter there was

an oil spill in Santa Barbara

and then under President Obama there was

an oil spill in the Gulf Horizon it was

I think a British Petroleum right now

when you're drilling offshore how safe

is it uh to be able to avoid those kind

of environmental damages and much better

than it used to be or greater

precautions than there used to be yeah

absolutely and um and and I think you

know the industry has uh continually

improved operating practices equipment

uh certainly The Regulators in the US

have very high standards very closely

with The Regulators on that in the

Advent of newer technologies have

continually made this safer and so these

are these are challenging difficult

operations in those kinds of pressures

water depths and environments but the

industry has a has a strong track record

today and you know there have been some

notable incidents over time but every

company in this industry works really

hard to to prevent those so um today do

you not worry about that kind of

offshore

drilling problems anymore because the

safety is pretty good compared to what

it used to be you know every day I get

up and I worry about safety and

protecting the environment are people

working a demanding business and it's a

highly technical activity we have very

talented people we've got very strict

protocols and standards to keep people

safe and keep the environment safe but

you can never take it for granted why do

you think it is that people love energy

but they don't love energy companies in

other words people in the United States

around the world consume enormous

amounts of oil and gas and the people

that's provided like Chevron don't seem

to be so popular why is that you know um

I don't know exactly why it is

um you know we're a big company the the

numbers are big uh sometimes big isn't

popular big energy big governments big

Tech maybe big private equities uh an

exception to that uh but you know they

were a big company we represent uh less

than two percent of global oil

production and so in the schema things

it's a very competitive market and we're

a relatively small player and I think uh

you know what's important uh to remember

is we need to have a balanced approach

to energy and that means we have to

focus on affordability because

affordable energy is really essential

for economic prosperity

uh reliable supply for National Security

because energy security and National

Security are linked and then protecting

the environment and I think as prices

get high and it gets less affordable you

find people that are upset and part of

that is because we we really haven't

necessarily been able to find the right

balance among those three and to improve

the overall image of the energy industry

is there something you think that the

CEOs or the companies can do to improve

the image so that people when they walk

down the street say wow Chevron has done

a great job for America today how is

that possible or just energy companies

just don't have that kind of likely

Public Image that's going to be so good

well I think what would help David is to

engage in this more balanced

conversation about the benefits of

energy we are a lot of people that have

um you know views on what some of the

consequences are of the use of energy

but as you say they've had made

advancements in the quality of life uh

uh you know possible that we wouldn't

have imagined uh you know two centuries

ago and um and I think as we go forward

it's absolutely likely that we find ways

to meet the needs of a growing world and

reduce the the carbon impact let's

suppose tomorrow you decided to retire

become a cabinet officer or something or

do something else what would you say you

have achieved as the CEO of Chevron that

you're most proud of

well I I would hope that um people would

say he he thought of others first he

strengthened the culture of our company

he kept people safe and made the company

a better company when he left than it

was when he found it

foreign