WEBVTT - Mike Wirth 0:00:02.800 --> 0:00:05.800 About forty years ago, a young college graduate, Mike Worth, 0:00:06.080 --> 0:00:08.959 joined Chevron then and now one of the largest energy 0:00:08.960 --> 0:00:11.799 companies in the world. Today, Mike Worth is the CEO 0:00:11.880 --> 0:00:14.880 of Chevron and dealing with the multiple issues that energy 0:00:14.880 --> 0:00:18.479 companies have to deal with today, including renewable energy. I 0:00:18.520 --> 0:00:20.560 sat down with Mike Worth to talk about what it's 0:00:20.600 --> 0:00:23.960 like to run Chevron today in the current environment. So 0:00:24.079 --> 0:00:26.840 tell me about the state of the oil world right now. 0:00:27.320 --> 0:00:30.200 It seems as if the large oil companies or energy 0:00:30.240 --> 0:00:33.199 carbon energy companies are doing quite well. They have record profits, 0:00:33.240 --> 0:00:36.320 record revenues, and as a result of that, some people 0:00:36.760 --> 0:00:39.320 in the White House and other places have suggested a 0:00:39.360 --> 0:00:42.920 windfall profits tax. So is the industry in such great 0:00:42.920 --> 0:00:45.920 shape that it can afford a windfall profits tax. Well, 0:00:46.000 --> 0:00:49.760 it's a cyclical industry, David. We see prices go up, 0:00:49.800 --> 0:00:53.479 we see prices go down. A windfall profits tax is 0:00:53.800 --> 0:00:56.800 u is not going to encourage more supply. It's not 0:00:56.960 --> 0:00:59.440 likely to reduce prices. In fact, it could do quite 0:00:59.440 --> 0:01:05.000 the opposite. President Carter try to windfall profits tax in Uh. 0:01:05.040 --> 0:01:07.920 It was rescinded several years later, had collected a lot 0:01:08.000 --> 0:01:12.280 less revenue than was expected and didn't result in more investments. 0:01:12.440 --> 0:01:15.440 It results in the less investment and less productions. So normally, 0:01:15.920 --> 0:01:17.560 if you want less of something, you tend to put 0:01:17.600 --> 0:01:21.319 more taxes on it, you know, ut less smoking tax cigarettes. Uh. 0:01:21.360 --> 0:01:24.720 If we want more energy production, will more supply to 0:01:24.760 --> 0:01:29.360 bring prices down, putting taxes on energy productions probably not 0:01:29.400 --> 0:01:31.399 a good idea. In your current job, do you have 0:01:31.440 --> 0:01:34.240 to go to Washington to talk to regulators and legislators 0:01:34.280 --> 0:01:36.720 and do you find that an uplifting experience to do that, 0:01:37.319 --> 0:01:40.280 I do have to go to Washington. UM uplifting is 0:01:40.280 --> 0:01:42.240 probably not the first word that comes to mind. I mean, 0:01:42.280 --> 0:01:45.679 their their detailed discussions and uh, and we need to 0:01:45.720 --> 0:01:49.600 help regulators understand the potential consequences of some of the 0:01:49.600 --> 0:01:53.280 things they consider. So would you say that Washington by 0:01:53.320 --> 0:01:55.960 and large doesn't really understand the economics of the energy 0:01:56.000 --> 0:01:58.240 industry or they could learn a little bit more than 0:01:58.240 --> 0:02:01.560 they know now. Well. I have empathy for people that 0:02:01.640 --> 0:02:06.600 sit in these roles. They have often broad responsibilities and 0:02:06.640 --> 0:02:10.520 they may not have UM personal expertise in depth in 0:02:10.600 --> 0:02:12.280 some of the areas that are responsible for So I 0:02:12.400 --> 0:02:14.440 view my job is to come in and try to 0:02:14.480 --> 0:02:18.320 provide objective input and help them understand the consequences of 0:02:18.400 --> 0:02:22.600 things they're considering, to avoid unintended consequences, and help achieve 0:02:22.600 --> 0:02:25.080 the goals that they're looking to achieve. So when the 0:02:25.120 --> 0:02:29.400 President United States says energy companies are gouging American people, 0:02:30.280 --> 0:02:31.920 you get to be used to this when you're an 0:02:32.000 --> 0:02:35.840 energy executive. More or less. I assume, uh, you know, 0:02:35.919 --> 0:02:38.640 I don't like it, but you probably are accepting. And 0:02:38.680 --> 0:02:44.399 I disagree with that characterization. I don't think it's accurate. Um, 0:02:44.440 --> 0:02:46.680 this is a you know, we're an industry at price takers, 0:02:46.840 --> 0:02:50.680 not price makers. These are global commodity markets, and um, 0:02:50.760 --> 0:02:55.440 and prices go up, prices come down. We allocate billions 0:02:55.440 --> 0:02:58.680 of dollars of capital our company does every year. Just 0:02:58.720 --> 0:03:01.799 two years ago, we were losing billions of dollars as 0:03:01.840 --> 0:03:05.640 prices plummeted. Uh. And so through the cycle. It's an 0:03:05.680 --> 0:03:12.040 industry that generates kind of returns on capital employed, which 0:03:12.120 --> 0:03:15.120 is I think, by the standards of many other industries, 0:03:15.760 --> 0:03:20.120 pretty modest return. The war in Ukraine has driven oil 0:03:20.160 --> 0:03:22.400 prices up. I think it's fair to say, Um, do 0:03:22.480 --> 0:03:25.280 you think that that is a principal reason why the 0:03:25.520 --> 0:03:28.120 major energy companies are going quite well because the supply 0:03:28.240 --> 0:03:31.880 has been reduced because of the war in Ukraine. And 0:03:31.919 --> 0:03:33.920 do you think that when that war does, and eventually 0:03:33.919 --> 0:03:36.360 it will, I assume, uh, you know, have an impact 0:03:36.400 --> 0:03:40.880 on reducing energy prices in carbon areas well. The war 0:03:40.920 --> 0:03:44.600 and the associated actions have definitely had an impact on 0:03:44.760 --> 0:03:48.160 energy markets. But if you step back and look at 0:03:48.200 --> 0:03:53.160 the broader context, we saw demand collapse with the pandemic 0:03:53.200 --> 0:03:57.040 when the world really locked down. In fact, companies in 0:03:57.040 --> 0:04:00.360 our industry had to shut in wells and stop producing 0:04:00.400 --> 0:04:02.520 because there was no place to store the oil that 0:04:02.640 --> 0:04:06.760 wasn't needed by the market. So investment levels came down. 0:04:07.160 --> 0:04:09.080 And then as the and nobody knew how long this 0:04:09.120 --> 0:04:12.320 would last. Is the economy recovered post the pandemic, we 0:04:12.360 --> 0:04:18.039 get vaccines, demand returned um, the industry has been struggling 0:04:18.040 --> 0:04:20.240 to keep up with the rate of growth once again, 0:04:20.640 --> 0:04:22.640 and so the market was already in a in a 0:04:22.680 --> 0:04:27.440 pretty tight situation before this war began. I do think, uh, 0:04:27.480 --> 0:04:31.760 when eventually it's resolved and all conflicts eventually are resolved, 0:04:32.080 --> 0:04:35.520 I think that uncertainty and the risk to supply from 0:04:35.680 --> 0:04:38.919 one of the world's largest suppliers will be reduced, and 0:04:38.960 --> 0:04:41.839 I think we'll see markets reflect that a number of 0:04:41.880 --> 0:04:44.279 years ago, oil prices went as low as I think 0:04:44.279 --> 0:04:48.119 twenty a barrel. And when it was that low, major 0:04:48.160 --> 0:04:51.080 oil companies like I think Chevron and others said we 0:04:51.120 --> 0:04:55.240 can't afford to drill anymore in either let's say that Alaska, 0:04:55.279 --> 0:04:57.840 the North Sea, other places, because we need to have 0:04:57.920 --> 0:05:01.400 oil at seventy dollars a barrel to make drilling affordable 0:05:01.440 --> 0:05:04.679 and profitable. Has that come back now that oil prices 0:05:04.680 --> 0:05:07.880 are offer people now drilling in major projects around the world, 0:05:07.920 --> 0:05:09.840 they kind of get oil that's gonna take four or 0:05:09.880 --> 0:05:12.440 five or ten years to build and and drill. Or 0:05:12.600 --> 0:05:15.120 is that not happening again? We're seeing some of that 0:05:15.200 --> 0:05:19.880 happen again. Certainly. What has really changed in the last decade, David, 0:05:20.160 --> 0:05:22.320 is the what we see in the US and the 0:05:22.360 --> 0:05:25.120 Permian Basin, but also in some other parts of this 0:05:25.200 --> 0:05:28.839 country and in other countries now is uh the ability 0:05:28.880 --> 0:05:33.320 to produce oil and gas from rock that is very 0:05:33.400 --> 0:05:37.880 very dense, very hard, and historically has not been very productive. 0:05:38.000 --> 0:05:41.080 But with directional drilling and the ability to to fracture 0:05:41.160 --> 0:05:44.720 these formations, now we're seeing the ability to produce from 0:05:44.800 --> 0:05:48.360 areas that we couldn't before edit prices that are are 0:05:48.400 --> 0:05:51.800 lower than some of these very complex, difficult projects, and 0:05:51.880 --> 0:05:55.799 so the need for the ultra deep water the Arctic 0:05:56.760 --> 0:05:59.760 has been reduced as we see these other resources come 0:05:59.800 --> 0:06:02.440 in at at a lower cost. So how many employees 0:06:02.480 --> 0:06:06.159 does Chevron have? About thirty six in about a hundred 0:06:06.160 --> 0:06:09.039 different countries. And how much oil do you produce a day? 0:06:10.160 --> 0:06:12.880 A little bit over three million barrels of oil equivalent 0:06:13.000 --> 0:06:16.520 per day, so mostly oil, some gas, and we convert 0:06:16.560 --> 0:06:18.800 the units on the gas to give you the energy equivalents. 0:06:18.800 --> 0:06:22.000 About three million barrels. The United States produces ten million 0:06:22.000 --> 0:06:25.440 barrels a day or something like that, closer to twelve. Well, okay, 0:06:25.480 --> 0:06:29.400 so you're producing about of the oil producing in the 0:06:29.440 --> 0:06:31.479 United States more or less. As a company, you could 0:06:31.560 --> 0:06:35.039 say that our US production is about one point two 0:06:35.080 --> 0:06:38.040 million barrels a day, so we're less than ten percent 0:06:38.160 --> 0:06:41.960 of US production. So right now the United States is 0:06:42.040 --> 0:06:44.599 more or less energy sufficient compared to let's say the 0:06:44.640 --> 0:06:47.080 nineteen sixties or seventies, when we import a lot of 0:06:47.080 --> 0:06:50.840 oil I think we produce we probably consume ten to 0:06:51.160 --> 0:06:54.680 twelve million barrels a day closer to wen. We consume 0:06:54.760 --> 0:06:57.600 twenty million barllars a day and we produced roughly you're 0:06:57.600 --> 0:07:00.839 saying twelve. So we're importing the equip about eight million 0:07:00.839 --> 0:07:03.000 barrels a day, which is better than it used to be. 0:07:03.560 --> 0:07:05.800 Where are we mostly importing that from? Is it from 0:07:05.880 --> 0:07:11.520 OPEC countries? Canada, our neighbors are the are the largest, uh, 0:07:11.560 --> 0:07:13.560 you know, suppliers of oil. I mean you know you 0:07:13.680 --> 0:07:16.280 heard all remember all the countries around the Keystone Pipeline. 0:07:16.280 --> 0:07:20.400 We're a big customer of Canada, who's a large resource 0:07:20.440 --> 0:07:22.840 country right now. To get that oil down here. There 0:07:22.840 --> 0:07:26.400 are other pipelines that have been built in years gone by, 0:07:26.440 --> 0:07:29.040 and sometimes it flows by rail, uh, and so it 0:07:29.080 --> 0:07:31.920 comes by ship. You can bring it down through pipelines 0:07:31.960 --> 0:07:34.200 into ports along the West Coast, for instance, or into 0:07:34.240 --> 0:07:37.520 the Atlantic based and bring it by ship. So Canada 0:07:37.600 --> 0:07:40.240 is the largest supplier, and then other people in the region. 0:07:40.480 --> 0:07:43.160 And we we still bring some oil to this country 0:07:43.160 --> 0:07:44.840 from the Middle East, but much less than we did 0:07:44.840 --> 0:07:47.600 back now. So I think there's much oil to be 0:07:47.680 --> 0:07:50.080 found in the Lower forty eight at this point, or 0:07:50.080 --> 0:07:53.040 even and let's say Alaska as well, or mostly we 0:07:53.120 --> 0:07:55.920 know where all the oil is and there's no more 0:07:56.440 --> 0:08:00.400 big permian basin kind of deposits anywhere. People said that 0:08:00.520 --> 0:08:04.400 over time, and then we've always been surprised, and so 0:08:04.680 --> 0:08:06.880 the US has been explored more than any other other 0:08:06.920 --> 0:08:09.000 place in the world. I think the industry has a 0:08:09.040 --> 0:08:13.240 good idea, but technology allows you sometimes to recover things 0:08:13.280 --> 0:08:15.480 that you haven't been able to before. That's the story 0:08:15.520 --> 0:08:18.360 of shale. Uh. The other one that continues to be 0:08:18.400 --> 0:08:21.520 a positive story is deep water Gulf of Mexico, where 0:08:21.880 --> 0:08:24.760 we'll go out and drill in a mile or more 0:08:24.880 --> 0:08:27.520 of water depth and then go down several more miles 0:08:27.560 --> 0:08:31.120 six seven, eight miles into the earth and UH and 0:08:31.160 --> 0:08:34.680 find a large large fields. And the Gulf of Mexico 0:08:34.760 --> 0:08:37.920 is still relatively under explored compared to the onshore, so 0:08:38.200 --> 0:08:40.680 I think there's still room for for more discoveries. Let's 0:08:40.679 --> 0:08:43.320 talk about Chevron itself. What are the roots of chevern? 0:08:43.320 --> 0:08:46.160 When was Chevron created? One that is started founded in 0:08:46.280 --> 0:08:50.679 eighteen seventy nine in southern California, began as a company 0:08:50.720 --> 0:08:55.320 called Pacific Coast Oil Company, made the first commercial discovering 0:08:55.360 --> 0:08:59.680 California in Pico Canyon in southern California. Became part of 0:08:59.720 --> 0:09:03.920 the Rockefeller Standard Oil Trust UH in the latter part 0:09:03.960 --> 0:09:06.840 of the eighteen hundreds and then became Standard d of 0:09:06.880 --> 0:09:10.319 California when the Standard Oil Trust was broken up. Our 0:09:10.400 --> 0:09:13.600 headquarters at home has always been in California. We've been 0:09:13.600 --> 0:09:15.960 around for a hundred and forty three years and really 0:09:16.000 --> 0:09:19.040 a part of the world's history. Made the first discovery 0:09:19.040 --> 0:09:21.640 in the Middle East, first discovery of oil in Saudi Arabia, 0:09:22.240 --> 0:09:27.360 among other milestones, and a long history of the world 0:09:27.480 --> 0:09:29.840 really reflected in our company. So if I go to 0:09:29.840 --> 0:09:32.560 a gasoline station and want to get gasoline from my car, 0:09:33.240 --> 0:09:36.040 is there really a difference between the oil that Chevron 0:09:36.120 --> 0:09:38.840 might be produced amazing the gasoline and one of your 0:09:38.840 --> 0:09:41.000 competitors that that gasoline is pretty much all the same. 0:09:41.679 --> 0:09:45.040 There are specifications, minimum standards that have to be met 0:09:45.120 --> 0:09:47.800 for for the products UH, and then what you find 0:09:48.080 --> 0:09:51.360 is that different companies UM either exceed those by more 0:09:51.480 --> 0:09:55.440 or less than others. And also we have special additives. 0:09:55.480 --> 0:09:59.080 So we have a wholly owned additive company that manufactures 0:09:59.080 --> 0:10:01.200 an additive called tech Run that has a very special 0:10:01.320 --> 0:10:04.440 chemistry to keep engine parts clean. And as engines get 0:10:04.440 --> 0:10:07.720 more sophisticated, as the tolerances. Get thinner, you're gonna have 0:10:07.720 --> 0:10:11.679 carbon deposits that can affect performance in your cylinders. Your 0:10:11.679 --> 0:10:15.720 injectors tech run cleans that up better. If you're driving 0:10:15.720 --> 0:10:18.840 along and you need gas, will you stop at an 0:10:18.840 --> 0:10:21.160 Exxon station? Or you've got to keep going till you 0:10:21.200 --> 0:10:23.400 can see a Chevron station. Keep going until I see 0:10:23.400 --> 0:10:26.319 a Chevron station. Okay, let's talk about your own background. 0:10:26.400 --> 0:10:29.400 So how does one become the CEO of Chevron? Tell us? 0:10:29.520 --> 0:10:32.480 Where were you born? I was born in Los Alamos, 0:10:32.559 --> 0:10:35.520 New Mexico. My dad worked at the National Lab UH 0:10:35.559 --> 0:10:38.760 and uh and I grew up in Colorado, Golden Colorado. 0:10:39.240 --> 0:10:42.120 And you went to college where University of Colorado and 0:10:42.160 --> 0:10:44.880 Boulder studied chemical engineering. And you said, I want to 0:10:44.920 --> 0:10:49.040 work in the energy world. I at the time, you know, 0:10:49.120 --> 0:10:52.520 chemical engineers could work in a number of different industries. 0:10:52.640 --> 0:10:54.760 I had a summer internship where I worked in a 0:10:54.800 --> 0:10:57.599 refinery in the Denver area. Found the work interesting, I 0:10:57.640 --> 0:11:01.640 found the people interesting, and and had an offer to 0:11:01.720 --> 0:11:05.120 come to the West Coast and work for Standard of California. 0:11:05.280 --> 0:11:08.320 And it looked like a fun place to live in 0:11:08.400 --> 0:11:11.720 a place where I could do interesting work. So basically, 0:11:11.760 --> 0:11:14.360 this is the only employer since you're gradua from college 0:11:14.400 --> 0:11:17.080 more or less for forty years, the only employer. So 0:11:17.200 --> 0:11:19.360 when you're starting there forty years ago, did you say 0:11:19.400 --> 0:11:21.560 I might be the CEO someday or did you not 0:11:21.720 --> 0:11:24.080 think that was realistic? No? I just hoped I would 0:11:24.160 --> 0:11:26.440 last to the next two weeks to get my next paycheck. 0:11:26.640 --> 0:11:28.520 That would never give a game plan. So what did 0:11:28.559 --> 0:11:31.240 you do? Did you move around the world over the 0:11:31.280 --> 0:11:33.960 course of your forty years at Chevron? What did you 0:11:33.960 --> 0:11:36.240 do to kind of rise up where you are an 0:11:36.280 --> 0:11:41.120 operations person or an expiration person administrative person? Started out 0:11:41.120 --> 0:11:44.520 as a design engineer and worked on big projects. So 0:11:44.720 --> 0:11:46.920 UM an oil shale project, not the type that we 0:11:47.240 --> 0:11:49.160 developed today, but the other kind of oil shale you 0:11:49.240 --> 0:11:53.040 used to hear about. UM built a plant that you 0:11:53.040 --> 0:11:57.319 can't find any trace of today. Worked on a facility 0:11:57.360 --> 0:12:01.320 in California to help bring in oil from offshore, sold 0:12:01.400 --> 0:12:04.320 for pennies on the dollar. Eventually, UM a project in 0:12:04.360 --> 0:12:08.120 Africa that never happened because of civil war. So I 0:12:08.160 --> 0:12:13.880 began by specializing in spectacularly unsuccessful projects. Uh, And at 0:12:13.920 --> 0:12:16.000 some point I said, this doesn't look like a great 0:12:16.040 --> 0:12:19.480 career path. And so I moved into our marketing business, 0:12:19.480 --> 0:12:24.080 where I built gas stations and replaced underground tanks that 0:12:24.120 --> 0:12:26.240 were made of steel with ones that were made of fiberglass. 0:12:26.360 --> 0:12:29.640 They with the leak and um you and I remember 0:12:29.679 --> 0:12:32.240 the old clickitty clackity wheels that would spin around on 0:12:32.240 --> 0:12:35.120 a gasoline pump. I used to put in the first 0:12:35.160 --> 0:12:39.400 electronic pumps back in the day. So these were smaller projects, 0:12:39.679 --> 0:12:41.200 but I could see the beginning of the end. I 0:12:41.200 --> 0:12:43.920 start to understand the commerce and how the business worked, 0:12:44.360 --> 0:12:46.960 and from there are a variety of roles, primarily operating 0:12:47.040 --> 0:12:50.959 roles across different businesses and around the world. When did 0:12:50.960 --> 0:12:55.040 you become the CEO five years ago? Some people might 0:12:55.040 --> 0:12:57.920 say that God looks favorably upon the CEO of energy 0:12:57.960 --> 0:13:00.440 companies because he lets them live a long time. And 0:13:00.520 --> 0:13:03.240 a number of your predecessors have lived quite a while, 0:13:03.280 --> 0:13:05.600 and some of them you're living in your same area 0:13:05.679 --> 0:13:07.600 that you're living out is they call you with advice 0:13:07.640 --> 0:13:10.960 all the time. Actually, I'm really fortunate, David. The three 0:13:10.960 --> 0:13:14.439 people have done my job immediately preceding me, each for 0:13:14.600 --> 0:13:17.960 roughly a decade the nineteen nineties, the two thousands in 0:13:18.000 --> 0:13:22.200 the in the teens. Uh live within a few miles 0:13:22.240 --> 0:13:25.000 of where I live. I see them regularly, we have 0:13:25.120 --> 0:13:28.880 lunch together. And um, that's a plus. Other words, Uh, 0:13:29.040 --> 0:13:31.080 don't they tell you you're doing this wrong or doing 0:13:31.120 --> 0:13:33.360 that wrong? That doesn't come up? Well, I get a 0:13:33.400 --> 0:13:35.880 lot of good advice and and and um you asked 0:13:35.880 --> 0:13:38.000 earlier about advice. These are people who have actually done 0:13:38.000 --> 0:13:40.600 my job, so I really I'm interested in their advice. 0:13:40.640 --> 0:13:44.800 They've lived through UH wars, the fall of the Soviet Union, 0:13:44.960 --> 0:13:49.800 terrorist attacks, financial crises, they've seen oil markets go through gyration, 0:13:49.840 --> 0:13:53.720 as they've dealt with geopolitical surprises, and so their advice 0:13:53.920 --> 0:13:56.400 is really valuable. During COVID, the first first thing I 0:13:56.440 --> 0:13:58.560 did was call each one of them and say, what 0:13:58.640 --> 0:14:00.880 lessons did you learn during the I see as you faced. 0:14:01.280 --> 0:14:03.679 How do you think I should handle things as we 0:14:03.760 --> 0:14:06.840 have this pandemic unfolding. Uh. So we have a great 0:14:06.840 --> 0:14:09.600 relationship and I see them regularly. So you're still, by 0:14:09.600 --> 0:14:12.520 my standards, very young. And you've been the CEO for 0:14:12.600 --> 0:14:14.880 five years, so you could do it for quite a 0:14:14.880 --> 0:14:16.840 while and still be young. But do you have any 0:14:16.840 --> 0:14:19.120 ambition to go into the federal government as a cabinet 0:14:19.160 --> 0:14:23.000 officer or anything like that, and to do anything other 0:14:23.040 --> 0:14:25.760 than the energy industry. Would you have any other career 0:14:25.800 --> 0:14:27.640 ambitions or this is what you want to do? You know, 0:14:27.680 --> 0:14:29.200 I love what I do, I love the company I 0:14:29.240 --> 0:14:31.520 work for, the people that I work with, and um, 0:14:31.680 --> 0:14:34.400 I don't have any ambition to do anything other than 0:14:34.440 --> 0:14:37.240 a good job. So what do you do for relaxation? 0:14:38.360 --> 0:14:41.600 Generally anything that involves family? Uh So? I have four children. 0:14:41.840 --> 0:14:45.160 Uh they're very active in outdoor activities. My wife is 0:14:45.360 --> 0:14:49.480 uh a good golfer, good skier. Uh So you'll find 0:14:49.520 --> 0:14:52.800 me on a golf course, skiing, scuba diving, fly fishing 0:14:53.480 --> 0:14:55.440 with family when I'm not at work. And any of 0:14:55.440 --> 0:14:58.960 your children in the energy world. No, not even close. Okay, 0:14:59.040 --> 0:15:01.040 So are you a good for this? Of you that? 0:15:01.400 --> 0:15:03.440 If you have a low handicap, that's not good for 0:15:03.480 --> 0:15:05.440 being a CEO because it means you're spending too much 0:15:05.440 --> 0:15:08.080 time on the golf course. But I don't know what 0:15:08.200 --> 0:15:11.360 that's fair or not. But are you a scratch handicap golfer? 0:15:11.440 --> 0:15:14.840 Far from it. My wife is almost a scratch handicap golfer. 0:15:15.360 --> 0:15:19.560 I caddy for her in in big tournaments. Actually, sometimes 0:15:19.560 --> 0:15:21.600 will take a couple of vacation days and carry her 0:15:21.600 --> 0:15:24.000 golf bag. So that tells you who the better golfer 0:15:24.040 --> 0:15:25.880 is in my house. What are you most proud of 0:15:25.920 --> 0:15:28.520 having achieved so far? Other than being the CEO? What 0:15:28.560 --> 0:15:31.120 do you think is that your your record of accomplishment 0:15:31.200 --> 0:15:33.880 so far that you're most proud of. Well, the last 0:15:33.960 --> 0:15:36.520 five years have been an interesting five years for people 0:15:36.560 --> 0:15:39.640 in just about any business and UM and so you know, 0:15:39.720 --> 0:15:41.880 when the pandemic hit, we have people in ships, we 0:15:41.920 --> 0:15:45.400 have people on offshore platforms with people around the world, UH, 0:15:45.400 --> 0:15:49.800 in developed countries and in developing countries. UH. Navigating that, 0:15:50.280 --> 0:15:53.320 keeping people safe, keeping our business running, keeping the world 0:15:53.360 --> 0:15:56.720 supplied with energy has been no small task. It's been 0:15:56.880 --> 0:16:00.800 the most challenging things I've I've ever confronted. And during 0:16:00.840 --> 0:16:03.320 that same time, we've done a massive restructuring of our business. 0:16:03.360 --> 0:16:05.760 We've made a couple of acquisitions and integrated them to 0:16:05.800 --> 0:16:08.680 make the company stronger or better companies today we were 0:16:08.680 --> 0:16:10.960 a few years ago. And I'm proud of the progress 0:16:11.000 --> 0:16:15.200 that our people have made during this challenging, in tumultuous time. 0:16:15.240 --> 0:16:17.440 But it's just a career path you would recommend to 0:16:17.480 --> 0:16:20.160 young people. Let's say, young people are watching and they say, well, 0:16:20.200 --> 0:16:22.200 maybe I should go into the energy world. Would you 0:16:22.240 --> 0:16:24.800 recommend this to young people? There's never been a better 0:16:24.880 --> 0:16:27.480 time to come into the energy world. We're faced with 0:16:27.520 --> 0:16:31.200 this incredible challenge of meeting the demands of the world 0:16:31.240 --> 0:16:34.640 today in building a lower carbon energy system for tomorrow. 0:16:34.680 --> 0:16:37.760 The technology that's available to us, the innovation that's available 0:16:37.800 --> 0:16:39.920 to us, is greater than it's ever been, and the 0:16:40.040 --> 0:16:42.960 chance to make a difference is enormous. If I were 0:16:43.400 --> 0:16:46.880 my younger self looking for a job, I would absolutely 0:16:46.960 --> 0:16:50.560 come into this industry. Large carbon energy companies seem to 0:16:50.600 --> 0:16:53.360 me have a difficulty. Are they producing large amounts of 0:16:53.360 --> 0:16:56.000 carbon energy which people like to consume, or are they 0:16:56.040 --> 0:16:59.560 supposed to transition to being renewable energy companies? And what 0:16:59.600 --> 0:17:02.480 are you going? For example, they're transitioning yourself a bit 0:17:02.520 --> 0:17:06.760 to be unrenewable company. Well, we're we're focused on leveraging 0:17:06.760 --> 0:17:10.600 our strength to deliver lower carbon energy to a growing world. 0:17:11.240 --> 0:17:13.800 And what that means is in the near term, we 0:17:13.840 --> 0:17:16.200 can find ways and we are finding ways to reduce 0:17:16.320 --> 0:17:20.359 the greenhouse gas impact of the energy the world uses today. 0:17:20.400 --> 0:17:23.800 So we're reducing the emissions associated with oil and gas 0:17:24.400 --> 0:17:28.119 that the world needs today, needs very very desperately. And 0:17:28.160 --> 0:17:31.440 at the same time, we're building new lower car inherently 0:17:31.480 --> 0:17:36.639 lower carbon energy businesses for tomorrow. So things like renewable fuels, hydrogen, 0:17:37.119 --> 0:17:40.840 carbon capturing storage, geothermal are all technologies were investing in, 0:17:41.280 --> 0:17:44.399 businesses were growing that will play a bigger role tomorrow, 0:17:44.400 --> 0:17:46.640 and we're gonna need many solutions. There is no one 0:17:46.760 --> 0:17:49.520 there is no one solution for this. So in two 0:17:49.600 --> 0:17:53.119 thousand twenty two, you bought a renewable energy company for 0:17:53.359 --> 0:17:55.920 roughly I think three billion dollars. What was that about. 0:17:55.960 --> 0:17:58.120 Why did you want to do that? Well, we had 0:17:58.119 --> 0:18:02.200 a we had a renewal renewable fuels business ourselves. Uh, 0:18:02.240 --> 0:18:05.200 this company, Renewable Energy Group, was one of the leading 0:18:05.480 --> 0:18:09.240 producers of biodiesel and soon to be renewable diesel in 0:18:09.280 --> 0:18:14.720 the United States. And they have great capabilities in the 0:18:14.760 --> 0:18:19.760 feedstock sourcing area, and so in any fuels business. Raw 0:18:19.840 --> 0:18:22.960 materials are a very important part of the overall value 0:18:23.000 --> 0:18:27.800 chain traditional petroleum products. We have deep expertise in the 0:18:27.880 --> 0:18:32.200 raw materials sourcing for that. In these products, you're talking 0:18:32.200 --> 0:18:35.320 about raw materials that are like used cooking oil, something 0:18:35.320 --> 0:18:38.760 called distiller's corn oil, various bean oils from soybean and 0:18:38.840 --> 0:18:42.280 other agricultural products. These are markets that we don't have 0:18:42.320 --> 0:18:47.400 a lot of experience in. The quality, logistics, commercial dimensions 0:18:47.400 --> 0:18:49.720 of those markets are things that Rural Energy Group is 0:18:49.800 --> 0:18:53.720 very good at. They have manufacturing facilities and some marketing. 0:18:53.760 --> 0:18:56.760 We have big market positions and brand positions, particularly in 0:18:56.800 --> 0:18:59.920 states like California, that encourage this. So the combination of 0:19:00.080 --> 0:19:03.120 TOO makes a more powerful renewal energy business, and today 0:19:03.400 --> 0:19:06.520 UH in renewable area, which is obviously a growth area. 0:19:07.160 --> 0:19:08.960 UM do you think that if you were going to 0:19:09.040 --> 0:19:12.920 make more acquisitions without giving away inside information, you're likely 0:19:12.960 --> 0:19:15.919 to do more in the renewable area or in the 0:19:15.960 --> 0:19:21.840 carbon area. It's an active field of opportunity in both UH. 0:19:22.000 --> 0:19:26.360 For US, it's really driven by strategy, asset quality, value, 0:19:26.400 --> 0:19:27.919 I mean, the typical things you would look at when 0:19:28.000 --> 0:19:30.440 when you do a deal. But as I said, over 0:19:30.440 --> 0:19:32.720 the last two years, we've we've done a big traditional 0:19:32.840 --> 0:19:36.280 energy deal, We've done a big renewal acquisition. I think 0:19:36.280 --> 0:19:38.600 in the years ahead we'll probably do acquisitions in both 0:19:38.600 --> 0:19:42.080 of those spaces. When President Nixon took office shortly thereafter, 0:19:42.119 --> 0:19:45.280 there was an oil spill in Santa Barbara and then 0:19:45.400 --> 0:19:47.639 under President Obama there was an oil spill in the 0:19:47.680 --> 0:19:51.720 Gulf Horizon. It was I think of British petroleum right now, 0:19:51.800 --> 0:19:55.080 when you're drilling off shore, how safe is it uh 0:19:55.119 --> 0:19:57.320 to be able to avoid those kind of environmental damage? 0:19:57.320 --> 0:19:58.680 Is it much better than it used to be or 0:19:58.800 --> 0:20:02.840 greater precautions than there to be? Yeah? Absolutely? And um 0:20:02.880 --> 0:20:06.600 and I think you know, the industry has continually improved 0:20:06.840 --> 0:20:11.720 operating practices, equipment. Uh. Certainly the regulators in the US 0:20:11.800 --> 0:20:13.879 have very high standards, who were very closely with the 0:20:13.920 --> 0:20:17.520 regulators on that, and the advent of newer technologies have 0:20:17.960 --> 0:20:21.560 continually made this safer. And so uh, these are these 0:20:21.560 --> 0:20:26.040 are challenging, difficult operations in those kinds of pressures, water depths, 0:20:26.119 --> 0:20:30.119 and environments. But the industry has a has a strong 0:20:30.320 --> 0:20:33.560 track record today. Uh. And you know there have been 0:20:33.600 --> 0:20:36.480 some notable incidents over time, but every company in this 0:20:36.520 --> 0:20:40.119 industry works really hard to to prevent those. So, um, 0:20:40.160 --> 0:20:42.960 today do you not worry about that kind of offshore 0:20:43.640 --> 0:20:46.600 UH drilling problems anymore? Because of the safety is pretty 0:20:46.640 --> 0:20:48.399 good compared to what it used to be. You know, 0:20:48.440 --> 0:20:50.520 every day I get up and I worry about safety 0:20:50.640 --> 0:20:54.440 and um, protecting the environment. Are people working at demanding 0:20:54.480 --> 0:20:58.199 business and uh, it's a highly technical activity. We have 0:20:58.480 --> 0:21:02.200 very talented people. We've got very strict protocols and standards 0:21:02.280 --> 0:21:04.399 to keep people safe and keep the environment safe. But 0:21:04.440 --> 0:21:06.399 you can never take it for granted. Why do you 0:21:06.440 --> 0:21:09.720 think it is that people love energy but they don't 0:21:09.760 --> 0:21:12.520 love energy companies? In other words, people in the United 0:21:12.560 --> 0:21:15.359 States around the world consume enormous amounts of oil and gas, 0:21:15.760 --> 0:21:18.480 and the people that provided, like Chevron, don't seem to 0:21:18.520 --> 0:21:22.520 be so popular. Why is that? You know? Um, I 0:21:22.560 --> 0:21:25.480 don't know exactly why it is. Uh. You know, we're 0:21:25.480 --> 0:21:30.040 a big company. The numbers are big. Sometimes big isn't popular. 0:21:30.080 --> 0:21:35.639 Are big energy, big government, big tech? Maybe big private 0:21:35.640 --> 0:21:40.119 equities and exception to that. But you know that we're 0:21:40.119 --> 0:21:43.480