Speaker 1: Join us. Right now is Bernard Luna, his VPS CEO. Bernard,
Speaker 1: let's walk through what the future there looks like. The
Speaker 1: business is doing well and at the same time we're
Speaker 1: leaning into the transition and investing in the VP of tomorrow.
Speaker 1: Performing while transforming, that's what we call it here. This
Speaker 1: is fundamental change, where ahead of the game. I think
Speaker 1: this direction is unstoppable. I think it's an enormous opportunity.
Speaker 1: We are a good company with good people. I can
Speaker 1: assure you it is not greenwashing. Performing while transforming. I
Speaker 1: know I sound like a broken record that we're preparing
Speaker 1: VP for tomorrow. I think a few people will question
Speaker 1: are resolved to do that? Welcome to calling Bullshit the
Speaker 1: podcast about purpose washing, the gap between what companies say
Speaker 1: they stand for and what they actually do, and what
Speaker 1: they would need to change to practice us what they preach.
Speaker 1: I'm your host time Ontogue, and I've spent over a
Speaker 1: decade helping companies define what they stand for, their purpose
Speaker 1: and then help them to use that purpose to drive
Speaker 1: transformation throughout their business. Unfortunately, at a lot of organizations today,
Speaker 1: there's still a pretty wide gap between word. Indeed, that
Speaker 1: gap has a name. We call it bullshit, But, and
Speaker 1: this is important, we believe that bullshit is a treatable disease.
Speaker 1: So when the BS detector lights up, we're going to
Speaker 1: explore things that a company should do to fix it.
Speaker 1: In this episode, we're gonna look at oil company BP. Recently,
Speaker 1: BP CEO Bernard Looney announced a new purpose to reimagine
Speaker 1: energy for people and our planet. We want to help
Speaker 1: the world reach net zero and improve people's lives. That's
Speaker 1: a pretty big shift for one of the largest current
Speaker 1: and historical producers of c O two in the world.
Speaker 1: But the interesting thing about this story is it's not
Speaker 1: the first time that BP has made a bold claim
Speaker 1: about reimagining energy. Is it possible to drive a car
Speaker 1: and still have a clean environment. We think so. And
Speaker 1: now BP, Amaco Aco and Castrol have come together to
Speaker 1: try Beyond Petroleum BP. That's a commercial from way back
Speaker 1: in two thousand and one that was part of then
Speaker 1: CEO John Brown's bold rebranding of the company, claiming that
Speaker 1: the initials BP would henceforth stand not for British Petroleum
Speaker 1: but for Beyond Petroleum. To understand just how significant the
Speaker 1: idea of beyond petroleum was, we need to take a
Speaker 1: quick trip back in time. B P was born in
Speaker 1: nineteen o eight as the Anglo Persian Oil Company. The
Speaker 1: company first staked claims on oil wells in what is
Speaker 1: now Iran. In the decades to follow, b P expanded
Speaker 1: their oil operations throughout the Middle East, Africa, Latin America,
Speaker 1: Europe and Russia. Along the way, they developed their own
Speaker 1: distinct cowboy culture. B P played hard, and they played
Speaker 1: for keeps. For instance, a struggle for control of the
Speaker 1: company with the government of Iran resulted in the overthrow
Speaker 1: of democratically elected President Mosadek in nineteen fifty three. They
Speaker 1: also became known as the company that took the biggest
Speaker 1: extraction risks and then reaped the biggest financial rewards. As
Speaker 1: a result, they left a trail of environmental and safety
Speaker 1: catastrophes in their wake. At nine p three a m.
Speaker 1: On Saturday, March the eighteenth, the Torry Canyon, one of
Speaker 1: the biggest tank as yet built, was turning the sea
Speaker 1: purple with a fatal cargo. A massive explosion and fire
Speaker 1: erupted at the VP refinery in Texas City, Texas. The
Speaker 1: explosion killed fifteen workers and injured one hundred eighty others,
Speaker 1: many of them seriously. When CEO John Brown took over
Speaker 1: the company in nineteen ninety five, he inherited the biggest
Speaker 1: polluter with the worst safety record of the seven largest
Speaker 1: oil companies in the world, known as the Super Majors.
Speaker 1: But John Brown was a little different from his predecessors
Speaker 1: and peers. A visionary in his own way. He saw
Speaker 1: the perils of climate change, and he understood the oil
Speaker 1: industry's culpability. I believe we've come to an important moment
Speaker 1: in our consideration of the environment. We need to go
Speaker 1: beyond analysis and to seek solutions and to take action.
Speaker 1: It is a moment for change and for rethinking corporate responsibility.
Speaker 1: BPS new CEO had become a vocal advocate for clean energy.
Speaker 1: He committed to reducing the company's greenhouse gas emissions and
Speaker 1: invested in solar power and other alternative energy. Under Brown's watch,
Speaker 1: BP also broke ranks and exited the Global Climate Coalition,
Speaker 1: an oil industry lobbying group of businesses that opposed action
Speaker 1: to reducing greenhouse gas emissions in oil industry terms. BP
Speaker 1: had gone renegade. They had a new progressive story, and
Speaker 1: they had started to make that story real through bold action,
Speaker 1: but bold change in the oil industry makes enemies, in
Speaker 1: some cases, really powerful enemies. In two thousand and six,
Speaker 1: these enemies began a whisper campaign about John Brown's private life.
Speaker 1: Well uh. In two thousand and seven, I was outed
Speaker 1: by the Mail on Sunday as gay, and that was
Speaker 1: a big shock, I think in the way it was done,
Speaker 1: not least to me. The press was relentless and fearing
Speaker 1: being outed, Brown lied under oath about his sexuality and
Speaker 1: was charged with perjury. On May one, two thousand and seven,
Speaker 1: John Brown resigned as CEO. It's sad looking back on
Speaker 1: this from had John taken over only a decade later,
Speaker 1: being gay wouldn't have even been an issue. After Brown's departure,
Speaker 1: the head of oil exploration and Production, Tony Hayward, became
Speaker 1: the new CEO. The company divested itself of its alternative
Speaker 1: energy holdings and diverted that money to radically experimental deep
Speaker 1: water drilling methods, and then on April two thousand and ten,
Speaker 1: disaster struck. You have information now that this this rig
Speaker 1: has gone under, It has gone onto the surface. Overnight,
Speaker 1: a powerful explosion rocked a giant oil rig igniting a
Speaker 1: fire and launching a day long search for eleven work
Speaker 1: early is a mess today because the winds shifted direction,
Speaker 1: blowing this oil, this sludge into the Bayous of southeastern Louisiana.
Speaker 1: The explosion was caused by a natural gas blowout a
Speaker 1: mile down on the seafloor. The fail safe mechanism designed
Speaker 1: to stop the flow malfunctioned, and the equipment needed to
Speaker 1: solve the problem was on the other side of the world.
Speaker 1: Eleven people died and millions of gallons of oil were
Speaker 1: now gushing into the Gulf of Mexico. It was the
Speaker 1: worst oil spill in history, and BP was wildly unprepared
Speaker 1: to respond and to make matters worse, if you can
Speaker 1: imagine that was even possible. BP was actively trying to
Speaker 1: play things down and play the victim. Chairman Tony Hayward,
Speaker 1: speaking to Britain Sky News, I think the environmental impact
Speaker 1: of this disaster is likely to be very modest, and
Speaker 1: a week ago this there's no one who wants this
Speaker 1: thing over more than I have. You know a lot
Speaker 1: my life. Back Crisis managers cringed when they heard that comment.
Speaker 1: Any oil company would have suffered in this situation. But
Speaker 1: there was a special outrage reserve for BP because they
Speaker 1: claimed to be a green energy company and then wound
Speaker 1: up as the culprit in the worst environmental disaster in history.
Speaker 1: Trust in BP was shattered. In retrospect, I'm guessing the
Speaker 1: new CEO, Bernard Looney wishes that John Brown's Beyond Petroleum
Speaker 1: plan had been implemented, BP would have had a twenty
Speaker 1: year head start on their competitors, all of whom have
Speaker 1: recently announced ambitious plans to make their own transitions to
Speaker 1: low carbon sustainable energy. Instead, like the rest of big oil,
Speaker 1: Looney has to make this transition fast, so folks. That
Speaker 1: brings us to the main question. VP is once again
Speaker 1: saying that their purpose is to reimagine energy for people
Speaker 1: and our planet. Is this finally true or is it
Speaker 1: still a bunch of bullshit? Get out your BS detector
Speaker 1: and join me as we drove for answers right after
Speaker 1: this before you head to the break, we'd love to
Speaker 1: hear what you think about the show. Maybe you were
Speaker 1: inspired to take action, maybe you disagree with today's bullshit rating.
Speaker 1: Either way, we want to hear about it. Leave us
Speaker 1: a message at two one two five oh five five
Speaker 1: or send a voice memo to CBS podcast at co
Speaker 1: collective dot com. You might even be featured on an
Speaker 1: upcoming episode Welcome back. To help me get to the
Speaker 1: bottom of BP's renude commitment to cleaner energy for people
Speaker 1: in the planet, I first spoke with Tyson Slocum, an
Speaker 1: expert in the world of petroleum, natural gas, and power markets. Tyson,
Speaker 1: welcome to Calling Bullshit. We're very excited to have you
Speaker 1: on the show. It's my pleasure to be here. I'd
Speaker 1: love it if you could start out by telling us
Speaker 1: a little bit about your background and the work that
Speaker 1: you do. Yes, I'm the Energy program director at Public Citizen.
Speaker 1: Public Citizen is a national consumer advocacy group based in Washington,
Speaker 1: d C. I run all of our energy policy related
Speaker 1: work and that mainly focuses on the oversight and regulation
Speaker 1: of petroleum, natural gas, and electric power markets. Our goal
Speaker 1: at Public Citizen is to promote those policies that provide affordable, reliable,
Speaker 1: and sustainable energy for working families. Fantastic. I love that.
Speaker 1: So let's get into BP. The topic of today is
Speaker 1: their energy transition goals and so just a kind of
Speaker 1: level set how much c O two is BP putting
Speaker 1: into the atmosphere in say an average year, a heck
Speaker 1: of a lot. It's difficult to quantify, but they're one
Speaker 1: of the largest individual emitters just because the scope of
Speaker 1: their operations. They literally have a presence on every single continent.
Speaker 1: They have a massive carbon footprint. And then what's what's
Speaker 1: important here ties also they are a large historical emitter
Speaker 1: because the company has been around for such a long
Speaker 1: time that when you look at its entire leg you
Speaker 1: see footprint it's even larger, and it's going to be
Speaker 1: one of the largest single contributors to climate change. From
Speaker 1: a corporate standpoint, and because of climate change, most of
Speaker 1: these companies have now announced their plans for so called
Speaker 1: energy transition. Your opinion, how serious do you think these
Speaker 1: companies are about making that transition. I think they're very
Speaker 1: serious about it from a public relations standpoint, But when
Speaker 1: you look at the day to day operation and even
Speaker 1: look at their capital expenditure plan going forward the next
Speaker 1: five years, it is dominated by oil and gas. And
Speaker 1: it's important to note here that in BP's own financial results,
Speaker 1: they classify their natural gas production activity in with renewables,
Speaker 1: so they consider natural gas to be a clean source
Speaker 1: of energy when you know it is absolutely not. I
Speaker 1: did not realize that that's crazy. Yeah, so so that's
Speaker 1: the problem. You know, BP isn't alone here, but BP
Speaker 1: is desperately trying to reclassify itself as a clean energy company.
Speaker 1: And again tied, this isn't new. I mean it started
Speaker 1: twenty years ago when they came up with this advertising
Speaker 1: plan to be on petroleum exactly. Yeah. So BP has
Speaker 1: been in this process of reinventing itself from a public
Speaker 1: relations standpoint for a very long time. But in terms
Speaker 1: of its operational standpoint, BP is an oil and gas company. Period. Yeah. So,
Speaker 1: within two weeks of taking the reins as CEO at
Speaker 1: BP in February of Bernard Luny outlined a whole new
Speaker 1: purpose for BP. He says, it is to reimagine energy
Speaker 1: for people and our planet. We want to help the
Speaker 1: world reach net zero and improve people's lives. And then
Speaker 1: down in the details he lays out specific goals for
Speaker 1: getting BP to net zero. He calls them aims, which
Speaker 1: I find kind of a weasily word. How about commitments, Bernard?
Speaker 1: But okay, so he says, our first goal is net
Speaker 1: zero operations are aim one is to be net zero
Speaker 1: across our entire operations on an absolute basis by or sooner.
Speaker 1: This aim relates to Scope one and t G h
Speaker 1: G emissions. So first of all, what does that mean?
Speaker 1: So that just means the emissions footprint of BP and
Speaker 1: its operations, not of how it's fuels are going to
Speaker 1: be consumed and therefore add to climate change. And so
Speaker 1: you know, just from the very get go, their definitions
Speaker 1: of reaching net zero have a massive flaw. Exactly. Okay,
Speaker 1: So so just to to school me up, let's move
Speaker 1: to their aim to our aim too, is to be
Speaker 1: net zero on an absolute basis across the carbon in
Speaker 1: our oil and gas production by sooner. This is our
Speaker 1: Scope three aim and is on a BP equity share
Speaker 1: basis excluding holdings in Rosineft, the Russian company run by
Speaker 1: Putin's number two guy, that they just announced they were
Speaker 1: going to divest of. But staying with what's on their website,
Speaker 1: that Net two goal to be net zero on an
Speaker 1: absolute basis across the carbon and our upstream oil and
Speaker 1: gas production by sooner. What does that mean? So they're
Speaker 1: they're talking about Scope three emissions for their oil and
Speaker 1: gas operations, which appears to be more comprehensive. But still
Speaker 1: this is a goal by and that isn't really that ambitious.
Speaker 1: We're looking at another generation or more of signifigant oil
Speaker 1: and gas extraction opportunities for BP, and so in terms
Speaker 1: of meaningful action to address the climate crisis, I don't
Speaker 1: see the ambition in this, you know, net zero goal
Speaker 1: by as being relevant. So you don't think it's enough
Speaker 1: and and and the timeline is too long? Is that
Speaker 1: sort of your take? Absolutely? And this is this is
Speaker 1: the challenge, right. It seems sort of silly for an
Speaker 1: oil and gas company, especially one as large as VP,
Speaker 1: to be talking about getting to real, meaningful net zero,
Speaker 1: whether we're talking about five years or forty years, because
Speaker 1: you're going to have to transform the fundamentals of the company.
Speaker 1: And I don't see where that is happening yet at BP.
Speaker 1: You know, we're talking about sort of nebulous goals far
Speaker 1: off in the future. I don't see how those long
Speaker 1: term goals are affecting to days operational priorities at BP.
Speaker 1: I still see capital being first and foremost allocated to
Speaker 1: continued oil and gas development and and that's the big challenge.
Speaker 1: And for any large oil major tie there's going to
Speaker 1: be a market challenge to doing a real transition to renewables,
Speaker 1: for example, because during that transition, let's say BP has
Speaker 1: a real meaningful plan which I don't see but just
Speaker 1: for conversation purposes to transition off of oil and towards renewables.
Speaker 1: The market is just gonna want to see BP split
Speaker 1: into separate companies because the market value of a pure
Speaker 1: renewable play is going to be dragged down by the
Speaker 1: continued operations of oil and gas, which the market is
Speaker 1: not going to see as having enough growth. And so
Speaker 1: as long as BP remains an integrated company that is
Speaker 1: trying to get into renewables while still primarily being an
Speaker 1: oil and gas company, those oil and gas operations are
Speaker 1: always going to drag on the value of the renewable investments.
Speaker 1: And so what you would see from Wall Street is
Speaker 1: they would say split up the company. Interestingly, a former CEO,
Speaker 1: John Brown, is recently on record saying he thinks that's
Speaker 1: a good idea to spin out the renewable energy assets
Speaker 1: as a separate company, essentially create BP Future, which is
Speaker 1: rapidly growing, less capital intensive, and valued at a premium
Speaker 1: by investors, and then by default create BP past, which
Speaker 1: is the oil and gas assets, capital intensive, unloved by
Speaker 1: the market, and in decline, and then just let the
Speaker 1: market decide. What do you think about that? I think
Speaker 1: that's how all of these oil and gas companies are
Speaker 1: going to have to go. If if you're going to
Speaker 1: remain a publicly traded company, off ring shares of the public,
Speaker 1: that's the only strategy that makes any sense. And the
Speaker 1: fact that BP hasn't done that split yet shows that
Speaker 1: their financial and capital commitments to renewables aren't yet meaningful
Speaker 1: enough to orchestrate that split. Yeah, Leoney doesn't like the
Speaker 1: idea of splitting up. He actually responded to Brown and
Speaker 1: he said he wants to use the cash of the
Speaker 1: high carbon business to fund the transition. He calls it,
Speaker 1: what is it? He's got a catchphrase for it, performing
Speaker 1: while transforming. That would be believable if that's what was
Speaker 1: actually happening. But when we look at the balance sheet,
Speaker 1: BP is still pouring billions of dollars every year from
Speaker 1: its earnings on oil and gas operations into more capital
Speaker 1: investment for additional oil and gas exploration and production, and
Speaker 1: into dividends. Because the way that these oil companies try
Speaker 1: and keep their stock price attractive because they're being eclipsed,
Speaker 1: all of them by companies like Tesla and renewable energy
Speaker 1: companies that just have way more growth potential. The way
Speaker 1: that BP markets itself to fund advisors and to other
Speaker 1: big institutional investors is the lucrative dividend that they pay
Speaker 1: out in cash every quarter, and so a bunch of
Speaker 1: the profits from their oil and gas operations are just
Speaker 1: going into pumping up their stock price to make it
Speaker 1: continually attractive. And so until we see a deviation from
Speaker 1: big capital investment in oil and gas and the big
Speaker 1: investment in dividends, this is inaccurate. They are not moving
Speaker 1: that profit from today's oil and gas operations into tomorrow's renewables.
Speaker 1: Sticking with the the aims that they have on their website,
Speaker 1: I just want to go through a couple more that,
Speaker 1: frankly I just don't understand. Aim three is to cut
Speaker 1: the carbon intensity of the products that we sell by
Speaker 1: by twenty fifty or sooner. What does carbon intensity? What
Speaker 1: does that mean? So this is talking about the relative
Speaker 1: carbon emissions for energy resources. So a lot of this
Speaker 1: is BP and some of the other majors like Chevron,
Speaker 1: and Shell have been increasing their investments into natural gas,
Speaker 1: and so the way that they measure it is gas
Speaker 1: has a lower carbon intensity than oil. It is not
Speaker 1: a clean resource, right, it is a fossil fuel, but
Speaker 1: compared to oil, and so a lot of this carbon
Speaker 1: intensity talk is really about a shift into natural gas.
Speaker 1: And you know, a lot of that is because they
Speaker 1: see continued market opportunities for gas in the power generation sector,
Speaker 1: in the industrial sector, and in the agricultural sector with
Speaker 1: for utilizers and so forth. So again, this is the challenge.
Speaker 1: They're using these words that sound like they're doing a
Speaker 1: serious pivot into renewables, but it's not. It's just putting
Speaker 1: slightly more investment into gas over oil, and they're able
Speaker 1: to count that as a lower carbon intensity going forward.
Speaker 1: It's not, you know, going to deliver us on a
Speaker 1: path to meaningfully addressing the climate crisis, right, Okay, So
Speaker 1: Aim four is to produce methane. It says our aim
Speaker 1: force to install methane measurement at all of our existing
Speaker 1: major oil and gas processing sites, by published the data,
Speaker 1: and then drive a fifty reduction in methane intensity of
Speaker 1: our operations. So, first of all, why is this important?
Speaker 1: What's special about methane. So, methane is a extremely powerful
Speaker 1: greenhouse gas. It is many many, many times more powerful
Speaker 1: than carbon dioxide. It doesn't last in the atmosphere as
Speaker 1: long as c O two, but methane, for the briefer
Speaker 1: time that it is in the atmosphere after being released,
Speaker 1: is far more potent. And so the Obama administration in
Speaker 1: two thousand twelve introduced sweeping requirements and mandates to control
Speaker 1: methane emissions from oil and gas operations, and BP and
Speaker 1: all the other oil companies successfully fought it off. Now
Speaker 1: we've had a change in heart, and really what what
Speaker 1: changed was in November, a energy company that is partly
Speaker 1: owned by the French government called Energy canceled a major
Speaker 1: liquefied natural gas export deal with a US based l
Speaker 1: en G exporter because of the lack of any meaningful
Speaker 1: methane regulations on US gas production or US gas exports.
Speaker 1: And that cancelation of that seven billion dollar deal was
Speaker 1: a wake up call for oil and gas producers everywhere
Speaker 1: that all of a sudden there was a emphasis on
Speaker 1: controlling and measuring the carbon content of natural gas production.
Speaker 1: And so we have now seen a total one eight
Speaker 1: where BP actually was sending out tweets in support of
Speaker 1: Biden administration efforts to revive federal regulation over methane emissions.
Speaker 1: And so this is BP trying to get out ahead
Speaker 1: of a market trend. Oil companies are uniformly against regulation
Speaker 1: unless that regulation can provide market access opportunities, and in
Speaker 1: this case, regulating methane emissions and documenting your ability to
Speaker 1: limit fugitive emissions is seen as a market opportunity because
Speaker 1: you're able to slap a label of clean methane on
Speaker 1: your natural gas and make it more desirable for export
Speaker 1: and consumption in global markets. So it would have been
Speaker 1: great if BP was making this announcement a decade ago.
Speaker 1: Another point that they make on the website to help
Speaker 1: the world get to net zero is aligning associations. Our
Speaker 1: aim is to set new expectations for our relationships with
Speaker 1: trade organizations around the globe. In September of September, in
Speaker 1: a publication called The Resilience, they point out that VP
Speaker 1: still supports eight anti climate lobbying groups as of that date.
Speaker 1: And you know that's eighteen months after Bernard Looney took
Speaker 1: his job, and they had plenty of time to clean
Speaker 1: that up by September. Are you aware of any issues
Speaker 1: there and what does that make you think about BP? Absolutely,
Speaker 1: this is a huge problem. And just for a second,
Speaker 1: let me just talk about trade associations in general, because
Speaker 1: it's sort of a fascinating, crazy situation that your listeners
Speaker 1: may not be familiar with. So what a trade association.
Speaker 1: Let's take the American Patrolum Institute, which is the largest
Speaker 1: and probably the most successful trade association lobbying group in
Speaker 1: the United States today. It's got an annual budget in
Speaker 1: excess of three million dollars a year. And so what
Speaker 1: API does is it collects dues from BP and Xon
Speaker 1: and all the other companies and allows them all to
Speaker 1: actively collaborate on influencing legislation and regulation. So, while oil
Speaker 1: companies compete in the marketplace, when it comes to influencing
Speaker 1: our politicians and our regulatory structures, they are actively colluding
Speaker 1: because they have a shared common interest. And so you're
Speaker 1: absolutely right that BPS stated commitment to only joining those
Speaker 1: trade associal stations that align with efforts to address the
Speaker 1: climate change do not meet reality because they continue to
Speaker 1: pay millions and millions of dollars in dues to trade
Speaker 1: associations that are actively fighting against climate solutions. Luney has
Speaker 1: also made a few subsequent promises after he rolled out
Speaker 1: this plan. One of them was in August he said
Speaker 1: to investors that VP will reduce oil and gas production
Speaker 1: by within a decade, and that was two years ago,
Speaker 1: so he's got eight years left, and that they would
Speaker 1: stop exploring for oil and gas fields in new countries
Speaker 1: in the same time frame. So I guess do you
Speaker 1: read from that that he's saying he's prepared to leave
Speaker 1: oil in the ground to make this transition work. I
Speaker 1: I don't think that he's realistic about those commitments. I mean,
Speaker 1: these are non binding commitments. First of all, they're just
Speaker 1: public announcements promises, um. So without a binding commitment, the
Speaker 1: company can make whatever adjustments and changes it wants. I
Speaker 1: don't see this as to be very honest and meaningful commitment.
Speaker 1: BP is still committing the vast majority of its capital
Speaker 1: investment into exploration and production, and and that tells me
Speaker 1: that BP remains an oil and gas company period. One
Speaker 1: of the things that we're exploring on this show is
Speaker 1: kind of a an evolved version of capitalism, let's call it.
Speaker 1: That includes some of the externalities that companies really like
Speaker 1: to ignore. So right now, for instance, there are a
Speaker 1: lot of externalities that are not priced into a gallon
Speaker 1: of gas, the costs of climate change, for instance, right,
Speaker 1: and in a way, it keeps the price of a
Speaker 1: gallon of gas artificially low. For example, the New York
Speaker 1: Core of Engineers is proposing a sea wall that will
Speaker 1: cost hundred and nineteen billion dollars to protect the city
Speaker 1: from rising sea levels. Is that cost figured into every
Speaker 1: barrel of oil today? Not at all. In fact, there
Speaker 1: is no federal regulation of carbon emissions from oil and
Speaker 1: gas operations, so they're getting a free pass. And you
Speaker 1: just summed it up correctly that there are large externalities
Speaker 1: with fossil fuel production and consumption that are not reflected
Speaker 1: in the market price, and so all of society has
Speaker 1: to pick up that tab. Look at the infrastructure bill
Speaker 1: that President Biden just signed into law at the end
Speaker 1: of last year. It includes eleven billion dollars of taxpayer
Speaker 1: money to clean up coal mines. You know, why, why
Speaker 1: aren't coal companies doing that? There's also billions of dollars
Speaker 1: in there of taxpayer money to plug up old and
Speaker 1: abandoned oil and gas wells. Some of those were BP's
Speaker 1: old oil and gas wells. So so again, the fossil
Speaker 1: fuel companies enjoy today's profit of extracting these fuels without
Speaker 1: any of the long term financial obligations that their business causes.
Speaker 1: That needs to change. I've read that there are a
Speaker 1: number of cities and towns who have actually started to
Speaker 1: sue fossil fuel companies to try to recover some of
Speaker 1: that money. Have any of these lawsuits succeeded so far.
Speaker 1: They're all moving through the federal and state court systems,
Speaker 1: and they're using very inventive tort law. You know, tort
Speaker 1: is if you sue for damages. I slipped on the
Speaker 1: sidewalk in front of your business because you failed to
Speaker 1: maintain it, and your failure to maintain that cause me
Speaker 1: bodily injury. I am do damages for my pain and suffering.
Speaker 1: So this is sort of the same thing. The oil
Speaker 1: and gas industry new decades ago that their business was
Speaker 1: contributing to climate change, but didn't do anything about it.
Speaker 1: And that's the key from a court decision that they
Speaker 1: knew that their business was creating these harms and they
Speaker 1: did nothing to address them. And we all are suffering
Speaker 1: as a result, and I think that's part of the
Speaker 1: motivation for a company like BP to try and get
Speaker 1: out ahead and to say, listen, we're in favor now
Speaker 1: of federal action to regulate these things so that we
Speaker 1: can try to get out from these tort lawsuits. And
Speaker 1: in fact, there's a plan that's being underwritten by some
Speaker 1: of the major oil companies to establish a carbon tax
Speaker 1: in the United States, and there's a lot of merit
Speaker 1: to that, but when you look at the details of
Speaker 1: their proposal, they want the carbon tax in exchange for
Speaker 1: two big things, one evisceration of climate regulations over their
Speaker 1: business and immunity from tort lawsuits. Very similar, very similar,
Speaker 1: very similar to what the gun manufacturers got. That annoying
Speaker 1: and shades of the tobacco industry as well. You know,
Speaker 1: they deny, deny, deny, deny, deny, and then you know,
Speaker 1: finally events catch up with them. You know, from our
Speaker 1: perspective on this show, we're looking for companies that are
Speaker 1: purpose let These are companies that by and large have
Speaker 1: a conscience. They actually are trying to make the world
Speaker 1: better and when they see a problem, they try and
Speaker 1: solve it. They don't wait for the government to legislate.
Speaker 1: And so when VP says they're trying to take on
Speaker 1: climate change, our perspective is great, you sound like a
Speaker 1: purpose led company, But is their intention pure? Do they
Speaker 1: really mean it? And so one of the things we
Speaker 1: look for is self regulation by agreeing to a carbon tax,
Speaker 1: if they're trying to get out of paying for any
Speaker 1: liability for past harm, that does not clear our bar,
Speaker 1: at least at this show, like we would call bullshit
Speaker 1: on that. So why do you think Looney announced these
Speaker 1: goals again in and why should we trust VP this
Speaker 1: time around? I think the reason that he's making this
Speaker 1: sort of recommitment on a public relations scale is because
Speaker 1: now there is a spotlight from large institutional investors, and
Speaker 1: these institutional investors have really in just the last couple
Speaker 1: of years ratcheted up their pressure on companies to show
Speaker 1: them the money in terms of commitments on climate change.
Speaker 1: And so for an oil and gas company, that's sort
Speaker 1: of hard to do when your business is in fossil fuels.
Speaker 1: And so they're seeking to sort of mollify these institutional
Speaker 1: investors with a very slick public relations campaign that they're
Speaker 1: trying to rebrand BP again and and I don't know
Speaker 1: how many times one company can continually rebrand itself as
Speaker 1: being beyond petroleum, but that's what they're trying to do here.
Speaker 1: It's difficult for them to escape their culture of non
Speaker 1: compliance in terms of safety and environmental record, and they're
Speaker 1: trying desperately to get back into that decision maker seat
Speaker 1: where they are one of the key brokers to try
Speaker 1: and navigate a new climate deal, but their reputation has
Speaker 1: taken such a big hit. I don't know if if
Speaker 1: they're going to be the ones doing it again. What
Speaker 1: is the number one action that you think Bernard Luni
Speaker 1: should take to actually deliver on their stated purpose to
Speaker 1: reimagine energy for people and our planet. First, I would
Speaker 1: exit all fossil fuel trade associations, get out of the
Speaker 1: American Patrol of Institute and all of the others. Second,
Speaker 1: commit to specific legislative climate initiatives. Because all of these
Speaker 1: companies can do their unilateral goals on their websites, but
Speaker 1: without some sort of buy ending operation through national governments,
Speaker 1: we're not going to see the kind of meaningful action
Speaker 1: that's required. And so I want to see BP support
Speaker 1: climate initiatives without the harmful caveats like it's done on
Speaker 1: carbon taxes, where it says we'll support a carbon tax
Speaker 1: if we have immunity from prosecution under tort law. I
Speaker 1: think Looney needs to commit to a specific time frame
Speaker 1: to split off the company. If he's serious about real
Speaker 1: aggressive investments in renewables, then he's got to put his
Speaker 1: money where his mouth is. And and right now, when
Speaker 1: I look at where BPS money is, it's all in
Speaker 1: oil and gas. Tyson, is BP a bullshitter, an absolute bullshitter.
Speaker 1: So just BP, stop the charade your oil and gas.
Speaker 1: Love it? Okay, last question on this show. We have
Speaker 1: a tool that we call the BS scale, and it
Speaker 1: goes from zero to one, zero being the best, zero
Speaker 1: BS being the worst. Total BS. So on a scale
Speaker 1: of one two hundred on the B S scale, where
Speaker 1: would you rate BP. They've got legitimate investments in clean energy,
Speaker 1: it just is minuscule in proportion to their investments in
Speaker 1: oil and gas. So I have to give them credit
Speaker 1: for some of their genuine pivot. It's just not nearly enough.
Speaker 1: So I love it perfect. Tyson Slocum, thank you so
Speaker 1: much for being on the show. I really enjoyed it. Absolutely,
Speaker 1: my pleasure Okay, folks, it's time to make the call.
Speaker 1: Is BP really reimagining energy for people in our planet?
Speaker 1: Based on what I've heard so far, we gotta call bullshit?
Speaker 1: Even if Luney is serious, and that's questionable at this point,
Speaker 1: BP isn't taking some fairly obvious actions that would signal
Speaker 1: that seriousness. But remember, bullshit is a treatable condition. All
Speaker 1: it takes is action. After the break, I'll be joined
Speaker 1: by two experts in the oil business and climate change
Speaker 1: to help us explore the actions BP should take to
Speaker 1: fix it. Stick with us, Welcome back. New CEO Bernard
Speaker 1: Looney is saying a lot of the right things, but
Speaker 1: we've now drilled into it and we struck BS. So
Speaker 1: what are the actions that Bernard and his leadership team
Speaker 1: would have to take to plug this gusher and actually
Speaker 1: win back our trust. I've invited two experts have joined
Speaker 1: me to propose the concrete actions that BP needs to take.
Speaker 1: Jamie hen, Co founder of three fifty dot org and
Speaker 1: director of Fossil Free Media, and Duncan McLaren, Research fellow
Speaker 1: at Lancaster Environmental Center with an in depth expertise in
Speaker 1: climate and energy policy. Jimmie I'd love to start up
Speaker 1: by just having you tell our listeners a little bit
Speaker 1: about your background and the work that you're doing at
Speaker 1: Fossil Free Media. So I started my career in climate
Speaker 1: activism as one of the co founders of three fifty
Speaker 1: dot org, which grew into one of the largest international
Speaker 1: campaigns on climate change, and over the decade of working there,
Speaker 1: worked on a lot of different international mobilizations and projects,
Speaker 1: often wearing the hat of our communications director, and over
Speaker 1: the years, one of the things that I noticed that
Speaker 1: we were trying to raise awareness about the climate crisis
Speaker 1: and push our governments to act, was that every time
Speaker 1: environmental campaigners would try and come out and spur the
Speaker 1: world into action, we would face a massive of backlash
Speaker 1: from the fossil fuel industry, often in the form of
Speaker 1: pr and advertising, and so as I was thinking about
Speaker 1: the next stage of my career at the beginning of
Speaker 1: I started talking with a few other colleagues and friends
Speaker 1: about this idea of seeing if we could set up
Speaker 1: a operation that would both provide good communications support for
Speaker 1: groups who are taking on the fossil fuel industry, but
Speaker 1: also see what we could do to try and throw
Speaker 1: a wrench in the gears of big oils propaganda machine,
Speaker 1: and so out of that fossil free media and a
Speaker 1: campaign that we're running called Clean Creatives were born. And
Speaker 1: through both of those efforts we try and help environmental
Speaker 1: groups do a better job of communicating to the public
Speaker 1: about the energy transition that we need to see, while
Speaker 1: also calling out the work that the fossil fuel industry
Speaker 1: and their allies are doing to try and pollute the
Speaker 1: airwaves just as they pollute the atmosphere. Love that, Professor
Speaker 1: Duncan McLaren. Welcome to calling BS. It's a pleasure to
Speaker 1: be with you. I'd love to have you tell our
Speaker 1: listeners a little bit about your background and your area
Speaker 1: of focus in the energy sector. So thanks. Well, I'm
Speaker 1: sort of on my second career now. My first was
Speaker 1: working for environmental NGOs on a whole range of topics
Speaker 1: from sustainable development to corporate accountability, renewables development, and of
Speaker 1: course climate targets. But in twenty eleven I gave that
Speaker 1: up for family reasons mainly, but embarked on a PhD
Speaker 1: looking at geoengineering technologies in the context of the climate
Speaker 1: justice debate, and that sort of led me into ten
Speaker 1: years of working on particularly carbon removal and more broadly
Speaker 1: what I call the problems of technologies of prevarication, the
Speaker 1: ones that allow us to believe that we are going
Speaker 1: to solve the climate problem in the future with a
Speaker 1: new technology rather than by delivering behavior change and lifestyle
Speaker 1: change today. That's great, great to have you here, So
Speaker 1: let's jump right into some ideas for fixing VP Jamie,
Speaker 1: I'm gonna ask you to go first, in two minutes
Speaker 1: or less. What's the number one thing that you think
Speaker 1: BP should do to win our trust that they really
Speaker 1: mean what they say. Well, I think that there's a
Speaker 1: few different categories of where we need to see action
Speaker 1: from BP, and I'll start with the most obvious, which
Speaker 1: is that they need to stop exploring for new oil
Speaker 1: and gas and fully begin to wind down their existing
Speaker 1: production in line with the Paris Agreement. They've made some
Speaker 1: commitments around that, but it's needless to say they're not
Speaker 1: yet at the pace, the scale, or really the commitment
Speaker 1: that we would need to see if they were serious
Speaker 1: about making that transition. So the nuts and bolts of
Speaker 1: actually doing the work to stop oil and gas production
Speaker 1: that's leading to the carbon going into our atmosphere versus
Speaker 1: making yet more pledges and long term targets is really
Speaker 1: where we need to see action. But I want to
Speaker 1: highlight a couple others in my remaining minute here. First
Speaker 1: off is on the lobbying in political front. You know,
Speaker 1: we've seen a lot of rhetoric, as you said, from
Speaker 1: Bernard Looney and BP about how they want to aid
Speaker 1: the energy transition, but as I speak, they continue to
Speaker 1: remain members of uh big oil trade associations and front
Speaker 1: groups like the American Petroleum Institute, which is the leading
Speaker 1: edge of the industry's attack on climate policy here in
Speaker 1: the United States, and BP over in Europe continues to
Speaker 1: lobby for things like natural gas being included in the
Speaker 1: European Unions standards around investments, which is obviously not renewable
Speaker 1: energy is it's meant to meet the criteria. So stopping
Speaker 1: that lobbying is extremely important. And finally, along with that
Speaker 1: goes stopping the sort of greenwashing and advertising that they're
Speaker 1: doing that is very clearly meant to mislead the public
Speaker 1: into believing that BP is serious about the energy transition
Speaker 1: when the vast majority of its investments are still going
Speaker 1: into oil and gas. Great, those are all very interesting,
Speaker 1: and we will unpack some of those in due course.
Speaker 1: Duncan Europe next in two minutes or less? What is
Speaker 1: the number one thing or things that Bernard Looney should
Speaker 1: do to get vince all of VPS deck orders that
Speaker 1: he actually means what he said. PP needs to set absolute,
Speaker 1: hard and fast production reduction targets, stop messing around with
Speaker 1: intensity targets and scams about which scope of emissions are
Speaker 1: going to be covered. Set targets to reduce the amount
Speaker 1: of oil and gas they produce, and those targets need
Speaker 1: to be matched so that there is reliable, permanent, guaranteed
Speaker 1: carbon removal on a ton for ton basis for any
Speaker 1: residual production that happens let's say after and probably about
Speaker 1: of anything after that would get them in line with
Speaker 1: the Paris requirements. Why do I ask for this, Well,
Speaker 1: it's centrally about a climate justice case. NET zero is
Speaker 1: a great lobal target. It's got a lot of people
Speaker 1: converging around it saying we want to do this, but
Speaker 1: it's ambiguous. It could mean an awful lot of emissions
Speaker 1: matched by an awful lot of removals. Imagine two elephants
Speaker 1: sat on a sea saw as we call it a
Speaker 1: tita totter, as the Americans call it. That's not very
Speaker 1: stable or sustainable. It's likely to break. What we need
Speaker 1: is a narrow convergence where there are only a few
Speaker 1: residual emissions and equal amount of carbon removal. So two
Speaker 1: mice sat on the tita totter. That means. That means
Speaker 1: that you have less impacts from the residual emissions and
Speaker 1: all the things associated with that, the extraction, the oil spills, etcetera.
Speaker 1: These are not just climate impacts when we go digging
Speaker 1: for oil and gas, both of those are great. It's
Speaker 1: my turn now, I submit this humbly looney need to
Speaker 1: do an action that would cause me to suspend my disbelief.
Speaker 1: And when I think about it, my skepticism really comes
Speaker 1: from two things. Obviously, the fact that we've been here before.
Speaker 1: With BP, they talked a huge game about moving in
Speaker 1: quotes beyond petroleum and then turned around and created one
Speaker 1: of the largest environmental disasters in the history of the
Speaker 1: oil business in the Gulf of Mexico. But there's a
Speaker 1: second thing that makes me skeptical that really centers around
Speaker 1: the expectations of existing shareholders. You know, we have this
Speaker 1: financial system where investors are trained to expect quarterly reporting
Speaker 1: and positive quarterly results, and they're also trained to punish
Speaker 1: c e o s who don't deliver them. And this
Speaker 1: obsession with quarterly results is a major impediment to any
Speaker 1: CEO who is serious about transforming a company. And so
Speaker 1: my idea is that Bernard Luney should announce that PP
Speaker 1: is going to discontinue quarterly reporting, and I think he
Speaker 1: should say that his rationale for this is that the
Speaker 1: only way to create long term shareholder value is to
Speaker 1: think and act on behalf of shareholders in the long term.
Speaker 1: And there's precedent for this. Paul Polman did it at
Speaker 1: Unilever more than ten years ago, and Paul also managed
Speaker 1: to deliver outstanding financial results, but those results took time.
Speaker 1: And I think that that's what Looney should do is
Speaker 1: by himself some time by taking that one action, and
Speaker 1: I think that would signal real change at VP. It
Speaker 1: would signal that the board is with him on this
Speaker 1: transformation journey that he has embarked on. It would set
Speaker 1: the stage for a number of additional actions that would
Speaker 1: continue to build trust, for example, publicly tracking the progress
Speaker 1: that they're making toward the goals that they've put forward,
Speaker 1: transparently reporting on problems that they've encountered along the way
Speaker 1: without tanking the stock necessarily. So I'll pause there. What
Speaker 1: are your thoughts on that or any of the ideas
Speaker 1: been moved forward. Well, I think it's interesting that you
Speaker 1: brought up investors because I think a lot of what
Speaker 1: we've seen out of BP is aimed at a few
Speaker 1: different audiences. Right now, marketing and PR is really focused
Speaker 1: on the general public, but a lot of what BP
Speaker 1: has been doing I think is best understood as trying
Speaker 1: to persuade their investors, and not just individual investors, but
Speaker 1: large institutional investors like pension funds and others, that they're
Speaker 1: simultaneously serious about pursuing climate action while also maintaining their
Speaker 1: oil and gas business. VP is trying to do this
Speaker 1: awkward dance where it wants to convince it's more green
Speaker 1: oriented investors that it's serious about climate while also showing
Speaker 1: that it will continue to get high profits from oil
Speaker 1: and gas. And so this dance is what I think
Speaker 1: we continue to see from big oil majors. Is on
Speaker 1: the one hand, trying to market themselves to concerned investors
Speaker 1: and regulators in the public as being serious about climate action,
Speaker 1: while also turning around to some of their other shareholders saying,
Speaker 1: don't worry about all of that. We're still serious about
Speaker 1: oil and gas and we're going to drill, baby, drill
Speaker 1: until the very last second. He's got a name for it,
Speaker 1: performing while transforming, and that just to me, reeks of bullshit. Duncan.
Speaker 1: What do you think about it? Yeah, Yeah, to turn
Speaker 1: to your suggestion, ty though, of discontinuing quarterly reporting. So
Speaker 1: quarterly reports they instill a short term is um in
Speaker 1: corporations that goes against all we want to achieve on
Speaker 1: the environmental and sustainability front. But at the same time,
Speaker 1: it's the over long termism of targets like net zero
Speaker 1: by that is allowing the exploitative attitude. We need action
Speaker 1: now that cuts in missions dramatically in the next decade
Speaker 1: if we're going to be compliant with PARIS. So I
Speaker 1: think stopping quarterly reporting could be a component of what
Speaker 1: BP should do. They would also clearly need to improve
Speaker 1: the nature of a reporting so that it's properly consistent
Speaker 1: with the different impacts they're having and to be accountable
Speaker 1: to stakeholders outside of the shareholders themselves. Yeah, and and
Speaker 1: I heard you both in your ideas essentially say that
Speaker 1: the aims that VP has put forward are soft. Even
Speaker 1: for instance, net zero by can be achieved in a
Speaker 1: lot of different ways. And I don't want to put
Speaker 1: words into your mouths, but it's you can do it
Speaker 1: by planting a lot of trees and offsetting, or you
Speaker 1: can do it by actually not pumping oil out of
Speaker 1: the ground. And you are advocating for the ladder rather
Speaker 1: than the former. Is that correct. I'm definitely saying that
Speaker 1: VP cannot contribute to net zero if it goes on
Speaker 1: increasing its production and emissions and believes that it can
Speaker 1: offset all of that. So at the moment we in
Speaker 1: b people fifty thousand tons of carbon offsets, it was
Speaker 1: responsible for around one point six giga tons of emissions.
Speaker 1: So you've got to be cutting emissions. You can't just
Speaker 1: be offsetting what is left that you might offset in
Speaker 1: some way. You have to offset through balancing it with
Speaker 1: things that actually remove carbon dioxide from the atmosphere, and
Speaker 1: they have to remove carbon permanently or durably. Can you
Speaker 1: explain some of those permanent carbon removal technologies? Most of
Speaker 1: them are currently quite speculative. There are technologies though, that
Speaker 1: use renewable energy to capture carbon dioxide from the atmosphere
Speaker 1: with a chemical agent of some sort. To expose this
Speaker 1: chemical agent to the atmosphere, it absorbs some CEO who
Speaker 1: You then put it in an enclosed chamber, expose it
Speaker 1: to heat or pressure. The CEO two comes off. You
Speaker 1: can pipe it off, compress it and inject it underground,
Speaker 1: and as long as you do that in somewhere like
Speaker 1: a say line aquifer, it will almost certainly stay underground
Speaker 1: for thousands of years. Another very permanent form of carbon
Speaker 1: removal is called enhanced weathering. Again, you need some renewable energy.
Speaker 1: You grind up basalt or other reactive rocks quite finely,
Speaker 1: spread it on the land surface, and as the rain
Speaker 1: flows through it, it removes or effectively the calm dark
Speaker 1: side in the rainwater reacts with the rock goes off
Speaker 1: in the runoff, and at least in theory, ends up
Speaker 1: in the oceans, where it ends up as carbonate, and
Speaker 1: that's where our limestone comes from. So that's that's millions
Speaker 1: of years. So there's a lot of these techniques. None
Speaker 1: of them are perfect, none of them would be scalable infinitely,
Speaker 1: but where scientists are hopeful, let's say that maybe somewhere
Speaker 1: between two and five gigatons a year could be removed
Speaker 1: using these technologies in the latter half of the century
Speaker 1: once once they've been developed. So it sounds like once
Speaker 1: again they just need to stop producing oil. I want
Speaker 1: to pivot to Jamie. A big part of the BP story,
Speaker 1: Jamie relates directly to your thesis at Fossil Free Media
Speaker 1: that AD agencies and PR companies are some of big
Speaker 1: oils or maybe big carbons, not so secret weapons. How
Speaker 1: big a problem is the marketing industry in this equation.
Speaker 1: I think it's a huge problem, and I think that
Speaker 1: PR and advertising and marketing have been one of the
Speaker 1: largest barriers to climate action that just because it's in
Speaker 1: such plain sight, we often don't see it. And BP
Speaker 1: is a really interesting case study because I think that
Speaker 1: of all the oil majors, they have always been the
Speaker 1: most attuned to their public image. But it's worth remembering that,
Speaker 1: as you mentioned earlier, it was all the way back
Speaker 1: in that the previous CEO of BP was making announcements
Speaker 1: about how they were going to become a new type
Speaker 1: of energy company, and that led to then the rebrand
Speaker 1: in two thousand of BP two Beyond Petroleum. Yeah, John Brown,
Speaker 1: I mean that was twenty years ago that they made
Speaker 1: this beyond Petroleum rebrand. They're not beyond petroleum twenty years later.
Speaker 1: And I think that we should take that lens towards
Speaker 1: the commitments that they're making today, that maybe there's a
Speaker 1: higher degree of seriousness, there's more political pressure, but BP
Speaker 1: hasn't shown in the past that it was serious about
Speaker 1: any of these claims. There's a fascinating example of this
Speaker 1: from the current era, which is actually a leaked presentation
Speaker 1: that came out at the beginning of which is right
Speaker 1: when Bernard Looney, the new CEO, is taking on BP
Speaker 1: and wanted to restructure the company. And the presentation was
Speaker 1: done for BP by the ad agency w P P,
Speaker 1: which is the world's largest kind of advertising conglomerate. And
Speaker 1: this was an effort holding company, and this was an
Speaker 1: effort by w PP to kind of bring together some
Speaker 1: of its top people and say we're going to kind
Speaker 1: of do a first stab at what a new brand,
Speaker 1: a new image, a new marketing approach for BP could
Speaker 1: look like that they would then use in all the
Speaker 1: advertising and all the advertising relationships that they have. And
Speaker 1: it's really a fascinating document because it basically walks through
Speaker 1: the fact that yes, BPS, you know core businesses oil
Speaker 1: and gas, and we're going to be expanding upstream production YadA,
Speaker 1: YadA YadA. But also, you know, we need to convince
Speaker 1: the public that quote, we get it on climate change, um.
Speaker 1: And they run through this incredible series of slides about
Speaker 1: how the world changed in because of the global climate
Speaker 1: strikes in Grettith Thunberg and everything that had happened, and
Speaker 1: BP was wasn't trusted on this important issue of climate
Speaker 1: change that the public cared about. So they needed to
Speaker 1: do something to signal that they got it on climate change.
Speaker 1: It could be part of the energy transition. Of course,
Speaker 1: nothing in the presentation was actually about concrete things that
Speaker 1: they would do, like stopping gas production. It was all
Speaker 1: about the ways that they would remark it themselves. And
Speaker 1: so I think it's worth all of us, you know,
Speaker 1: being able to see that stuff is what it is,
Speaker 1: which is propaganda. It seems clear that the economics of
Speaker 1: wind and solar have gotten much much better, very compelling
Speaker 1: these days. Isn't there a strong argument for BP just
Speaker 1: being a responsible steward for their shareholders money, investing more
Speaker 1: money in those technologies and you know, leaving some oil
Speaker 1: in the ground. I think the problem is that from
Speaker 1: the shareholder perspective, from the workings of contemporary capitalism perspective,
Speaker 1: BAPY has these huge assets that are reserves of oil
Speaker 1: and gas in the ground, and their corporate valuation reflects
Speaker 1: that their ability to pay dividends or if it's that,
Speaker 1: and as soon as they start saying, oh, we're going
Speaker 1: to leave some of that in the ground, then yes,
Speaker 1: they are managing a financial decline. And in a sense
Speaker 1: it means that that certainly my challenge to to burn
Speaker 1: a Lney to say, set targets for reducing production is
Speaker 1: going to be very hard as a businessman for him
Speaker 1: to take. I just, yeah, I want to zero in
Speaker 1: on this point DU's making because I think it's so critical.
Speaker 1: I think the BP and other oil majors want to
Speaker 1: convince the public that their key to the energy transition.
Speaker 1: The reality of it is that, yes, there is money
Speaker 1: to be made in clean energy. Maybe big oil companies
Speaker 1: aren't the best suited to do that. You know that
Speaker 1: there are clean energy companies that should be doing that,
Speaker 1: and I think it raises a question for us, do
Speaker 1: you really want BP to be controlling the energy of
Speaker 1: the future. This is the company that has for decades
Speaker 1: run over communities, violated international human rights laws, billed oil
Speaker 1: into the Gulf of Mexico, failed to clean it up,
Speaker 1: failed to hate the money that it was owed. I
Speaker 1: don't want BP running the clean energy of the future.
Speaker 1: I'd much prefer that it's managed publicly, that it's in
Speaker 1: smaller cooperatives, and we have that choice right now. To
Speaker 1: make that transition into Duncan's point. What we need for
Speaker 1: BP they should be held accountable for the damage that
Speaker 1: they've gone and the ill begotten profits that they've made
Speaker 1: during a period in which we knew, and they knew
Speaker 1: from their own science, that every barrel of oil they
Speaker 1: dug out of the ground was furthering a planetary catastrophe.
Speaker 1: They knew that last quarter when they made record profits.
Speaker 1: So why should they and their shareholders who also knew
Speaker 1: that and have decided to stick with BP, why should
Speaker 1: they be rewarded for that? So, if I may, what
Speaker 1: I'd like to emphasize about that is how the dynamic
Speaker 1: of oil companies wanting to maintain the value of their reserves,
Speaker 1: and oil companies doing political lobbying and marketing to position
Speaker 1: themselves as part of the energy transition are both about
Speaker 1: the modern face of climate denial. The modern face of
Speaker 1: climate denial is about delay. It's to say, oh, yeah,
Speaker 1: of course, now we're we're happily accept that climate change
Speaker 1: is happening. We understand this is a problem. But if
Speaker 1: we move too quickly, then we cause all sorts of
Speaker 1: other problems, and those things all converge around them extracting
Speaker 1: the most profit from their asset base and continuing to
Speaker 1: prolong the climate crisis. I want to ask you both
Speaker 1: to suspend your disbelief for a minute, because in this
Speaker 1: part of the show, I do want to explore actual ideas,
Speaker 1: like if we're going to take them seriously and say, okay,
Speaker 1: they really Meanwhile, they're really trying to do this, what
Speaker 1: should they do? So so let me run a couple
Speaker 1: of ideas past both of you and just get your
Speaker 1: get your take. So, first of all, John Brown, the
Speaker 1: former CEO of EP who actually initiated the Beyond Petroleum
Speaker 1: rebrand and and began what I believe was at the
Speaker 1: time a genuine attempt at a transition to being a
Speaker 1: sustainable energy company. He recently said that he thinks that
Speaker 1: the company should be split into to spin out the
Speaker 1: renewable energy assets the company has as a separate company,
Speaker 1: essentially create VP Future, which is rapidly growing, less capital
Speaker 1: intensive and valued at a premium by investors, and BP
Speaker 1: passed the oil assets, which are capital intensive, unloved by
Speaker 1: the market and in decline, and then just let the
Speaker 1: market decide. So this is a former CEO saying this,
Speaker 1: what's your take on that? Yeah, that would be interesting
Speaker 1: if PP moved in that direction. The one thing I'd
Speaker 1: raise on it as a challenge. I know we're trying
Speaker 1: to be a bit more optimistic here, but since Duck
Speaker 1: and I are good skeptics, it's okay. Is that the
Speaker 1: liability issue. If if BP has known for decades that
Speaker 1: their products were causing climate change, like Big Tobacco new
Speaker 1: that its product was addictive and causing health impacts, what
Speaker 1: sort of responsibility do they have to help pay for
Speaker 1: the damage that those products have cost. And so when
Speaker 1: we talk about BP being able to spin off a company,
Speaker 1: you know that's often what companies do to avoid liability.
Speaker 1: And so I think the question would be making sure
Speaker 1: that um, you know, they're not able to kind of
Speaker 1: dodge their social responsibility by creating a dirty version of
Speaker 1: their industry and then hiding the assets there. But maybe
Speaker 1: to embroider the thoughts of what would be p do
Speaker 1: if they were admitting some liability, what would be the
Speaker 1: sort of investments or spending they should do. And here
Speaker 1: I think that the idea of a just transition and
Speaker 1: energy transition that actually pays attention to social justice in
Speaker 1: terms of consumer need and worker need would be helpful.
Speaker 1: And you may know there's been extinction rebellion spinoff campaign
Speaker 1: in the UK recently called Insulate Britain. Well, I think
Speaker 1: that's what BP should do. That they should actually do
Speaker 1: the program of retrofitting good insulation in the homes of
Speaker 1: people in fuel poverty, particularly the homes of people who
Speaker 1: are in fuel poverty because of the rising gas prices.
Speaker 1: And they should go a step further, of course, which
Speaker 1: is go around all those homes and install heat pumps
Speaker 1: instead of gas boilers, so that they could then cut
Speaker 1: the demand for the product that they've been selling and
Speaker 1: profiting from the cost of climate change. I mean, that's
Speaker 1: a really important point, and I think Duncan raises another
Speaker 1: piece of this which is interesting, which is that for
Speaker 1: the transition to take place, we also have to deal
Speaker 1: with all of the oil and gas infrastructure that currently exists.
Speaker 1: You know, you can't just turn it off and then
Speaker 1: leave it. They're spewing methane for decades to come, and
Speaker 1: so there's an incredible amount of work that BP could
Speaker 1: be doing, and it could be engaging probably more people
Speaker 1: that are currently employs to deal with all of the
Speaker 1: various oil and gas wells and infrastructure that has left behind.
Speaker 1: These in many ways, are forever liabilities that we're gonna
Speaker 1: have to deal with. It's not quite so simple as
Speaker 1: plugging a well and hoping that it never admits methane again.
Speaker 1: You need people to go back and check it and
Speaker 1: verify that it's been done right, and then you know,
Speaker 1: manage that process going forward. And so there there is
Speaker 1: a role in a way to kind of reimagine energy
Speaker 1: companies of the past, these oil and gas giants playing
Speaker 1: a role, as Duncan was saying, and helping kind of
Speaker 1: do the retrofits and transition we need to move to
Speaker 1: clean energy, but also taking some responsibility for managing the
Speaker 1: damage that they've done and making sure that over the
Speaker 1: decades to come, we're not having big blowouts of you know,
Speaker 1: c O two that's been pumped somewhere, or numerous oil
Speaker 1: and gas wells continuing to leak methane and push us
Speaker 1: past global limits. Now tie to your question about shareholders,
Speaker 1: this may require us rethinking some of these says when
Speaker 1: it comes to capitalism, or beginning to at least put
Speaker 1: in some interesting government incentives and doing the finance work
Speaker 1: to do that. And so I think that campaigners over
Speaker 1: the last few years have really begun to focus on
Speaker 1: finance as a key target, pressuring folks like Black Rock, JP,
Speaker 1: Morgan Chase, you know, others to play a larger role here.
Speaker 1: We need those players to come in. BP might not
Speaker 1: be able to do this loan. They're big, but maybe
Speaker 1: they're not quite big enough to manage this, and so
Speaker 1: figuring out the ways to structure their debts and get
Speaker 1: government regulators involved in financed this whole transition is a
Speaker 1: really interesting process that we need people to start thinking about.
Speaker 1: Pent Look, we're we're big fans of the notion of
Speaker 1: rethinking capitalism on this show, but I want to follow
Speaker 1: that thread because you mentioned black Rock, and we've done
Speaker 1: enough that black Rock, and we spoke with Taric Fancy,
Speaker 1: who's the former head of sustainable investing at black Rock
Speaker 1: and left because he just ultimately felt like he was
Speaker 1: engaged in greenwashing there. And his take on the problem
Speaker 1: is that it is I don't want to put words
Speaker 1: in his mouth, but his basic thesis was that it's
Speaker 1: hopelessly naive to expect companies to essentially self regulate, and
Speaker 1: he thinks that regulation, specifically a carbon tax, is the
Speaker 1: only medicine that will solve the problem of climate change.
Speaker 1: What are the two of you think about That a
Speaker 1: carbon tax could be a very helpful tool, It alone
Speaker 1: is unlikely to solve the problem because simply what we've
Speaker 1: seen in the past is that the generic incentive that
Speaker 1: a carbon tax or equivalent gives is rarely enough to
Speaker 1: bring about the transformation and technologies. So I think, yeah,
Speaker 1: carbon tax good can help, not the single answer. Of course,
Speaker 1: when we're when we're talking about carbon taxes as the answer,
Speaker 1: we have to remember that that BP spent thirteen million
Speaker 1: dollars in eighteen blocking a carbon tax in a divin
Speaker 1: Washington State, and then afterwards just said, oh, well, it
Speaker 1: wasn't the right carbon tax initiative. And my experience going
Speaker 1: back over the years is that this is a common narrative.
Speaker 1: When companies are offered taxes, they say the taxes aren't
Speaker 1: quite right and they weren't voluntary measures. When they're offered
Speaker 1: voluntary measures, they say, well, then we'll get undercut by
Speaker 1: the cowboys, so we need regulatory measures. And when they're
Speaker 1: offered regulatory measures, they say, well, this isn't really the
Speaker 1: free market. Why don't we have taxes. Yeah, we have
Speaker 1: a word for that. We call it bullshit. Which brings
Speaker 1: me to my final question for both of you on
Speaker 1: calling BS. We have something called the BS index or
Speaker 1: the BS scale, and it goes from zero to one,
Speaker 1: zero being the best score zero BS and a hundred
Speaker 1: being the worst total BS. I want to ask both
Speaker 1: of you to read be e P on the B
Speaker 1: S scale. I'll start with you, Duncan. That's that's interesting.
Speaker 1: I'm gonna throw them a bone and give them only
Speaker 1: a writing. Okay, you're in a good mood today. Um,
Speaker 1: all right, thank you for that, Duncan and Jamie, Well,
Speaker 1: I'm glad Duncan said a high bar. You know, I
Speaker 1: was thinking about this in two ways. One is sort
Speaker 1: of the only standard that really matters, which is the
Speaker 1: kind of standard of physics and chemistry and the climate,
Speaker 1: in which case, you know, maybe we'll give BP a
Speaker 1: score that relates to the amount of money they're still
Speaker 1: investing of their capex and in oil and gas, which
Speaker 1: is something like a ninety six percent um, And you know,
Speaker 1: maybe that's a good way to do it now, to
Speaker 1: throw them a bit of a bone, as Duncan did,
Speaker 1: and we're trying to be charitable. I would say that
Speaker 1: BP is ahead of the other oil companies, and so
Speaker 1: maybe we'll drop it down to a nineties Nan was saying,
Speaker 1: because I think two bps credit. They have been the
Speaker 1: only one to really say that they do need to
Speaker 1: reduce production. They did right off seventeen billion dollars of
Speaker 1: oil and gas assets by saying that those were stranded
Speaker 1: and needed to be kept in the ground. And they
Speaker 1: have talked about sort of the larger need for this
Speaker 1: transition to happen. And so you know, again, if anybody
Speaker 1: feels like we're being a little too harsh on them,
Speaker 1: just remember that they rebranded back into Fast and here
Speaker 1: we are today, and so I would take everything they
Speaker 1: do with a bit of skepticism, but at the very least,
Speaker 1: it's good to see them beginning to move agreed. Okay,
Speaker 1: listen this this was a great conversation. I could have
Speaker 1: spent the rest of the afternoon talking with both of you.
Speaker 1: I really appreciate it. So, folks, it's time to give
Speaker 1: BP our official BS score. The companies saying all the
Speaker 1: right things, but they lost massive amounts of trust when
Speaker 1: they did this to us the first time, and as
Speaker 1: all of our experts have pointed out today, their actions
Speaker 1: so far are inadequate and incoherent at best. Based on
Speaker 1: what I've heard today, I'm going to give BP a
Speaker 1: ninety five. To bring that score down, they're gonna need
Speaker 1: to make some big changes. To weigh in with your
Speaker 1: own score, visit our website Calling Bullshit Podcast dot com.
Speaker 1: We'll track BP's behavior over time to see if they
Speaker 1: can bring it down. You'll also be able to see
Speaker 1: where BP ranks on BS compared to the other companies
Speaker 1: and organizations we feature on this show. And if you're
Speaker 1: starting a purpose led business or you're thinking of beginning
Speaker 1: the journey of transformation to become one Here are three
Speaker 1: things that you should take away from this episode. One,
Speaker 1: Transparency and coherence build trust. It comes up over and
Speaker 1: over again this season. BPS saying that they're pivoting to
Speaker 1: become a sustainable energy company but then also trying to
Speaker 1: convince the world that natural gas is a sustainable, renewable
Speaker 1: energy resource is just ludicrous, as is claiming that you're
Speaker 1: taking on climate change while at the same time remaining
Speaker 1: a dues paying member of an industry trade group that's
Speaker 1: spreading misinformation about climate change. If your words and deeds
Speaker 1: lack coherence, then anything you say, even if it's true,
Speaker 1: will seem ridiculous. Two, show me the money. It's all
Speaker 1: about action. If VP means it, they need to prove
Speaker 1: it through action. Today we've talked about important actions like
Speaker 1: cutting support for industry lobbying groups that are climate change deniers,
Speaker 1: or discontinuing any misleading pr or advertising, and potentially seismic
Speaker 1: actions like actually breaking the company into to make it
Speaker 1: really clear that there is a dirty fossil fuel VP
Speaker 1: of the past at a clean VP of the renewable
Speaker 1: and sustainable energy future, and then letting investors choose which
Speaker 1: one they want to invest in. Your actions would undoubtedly
Speaker 1: be different, but the point is doing is always believing. Three.
Speaker 1: Let's forget about the oil for a minute. There's gold
Speaker 1: in this episode for purpose led entrepreneurs who want to
Speaker 1: create the BPS of tomorrow. As Jamie and Duncan both said,
Speaker 1: Big Oil has dragged its feet for so long that
Speaker 1: BP and the other super majors may not be savable,
Speaker 1: and that's fine. Sometimes companies just need to go away.
Speaker 1: But there's an opportunity here to start a green energy
Speaker 1: company that isn't weighed down by legacy investments in fossil fuel.
Speaker 1: If nothing else, I hope this episode inspires somebody to
Speaker 1: just go make that happen. And Bernard Looney, CEO of BP,
Speaker 1: if you, whoever want to come on the show and
Speaker 1: talk about any of the ideas or topics that we
Speaker 1: touch on in this episode, I want you to know
Speaker 1: you have an open invitation. I'd like to thank everyone
Speaker 1: who joined us today, Tyson Slocum, Jamie Hen and Duncan McLaren.
Speaker 1: You can learn more about them in our show notes.
Speaker 1: And if you have ideas for companies or organizations we
Speaker 1: should consider for future episodes, you can submit them on
Speaker 1: our website calling Bullshit podcast dot com and if we
Speaker 1: performed while transforming you today, please let us know by
Speaker 1: rating and reviewing us on the I Heart Radio app,
Speaker 1: Apple Podcasts, or wherever you get your podcasts. And thanks
Speaker 1: to our production team Hannah Beal, Amanda Ginsburg, Andy Kim
Speaker 1: d s Moss, Hailey Pascalites, MICHAELA. Reid, Parker, Silzer based
Speaker 1: Soaper and me John Zulu. Calling Bullshit was created by
Speaker 1: co Collective and is hosted by Me Time onto you.
Speaker 1: Thanks for listening. Before you go, we'd love to hear
Speaker 1: what you think about the show. Maybe you were inspired
Speaker 1: to take action, maybe you disagree with today's bullshit rating.
Speaker 1: Either way, we want to hear about it. Leave us
Speaker 1: a message at two one two five oh five to
Speaker 1: Zo five, or send a voice memo to CBS podcast
Speaker 1: at co collective dot com. You might even be featured
Speaker 1: on an upcoming episode.