1
00:00:00,560 --> 00:00:19,960
Speaker 1: Welcome to zero. I am Akshatrati Today Egxon at COP thirty.

2
00:00:20,960 --> 00:00:23,280
Speaker 1: It's been a year of bad news for climate policies.

3
00:00:23,680 --> 00:00:27,280
Speaker 1: The biggest force has been Donald Trump, who, in his

4
00:00:27,320 --> 00:00:31,640
Speaker 1: second term as US president, has systematically dismantled climate action

5
00:00:31,840 --> 00:00:36,320
Speaker 1: at home and made concerted efforts to attack climate initiatives abroad.

6
00:00:37,200 --> 00:00:40,840
Speaker 1: He has championed fossil fuels and single handedly slowed down

7
00:00:40,920 --> 00:00:45,440
Speaker 1: the energy transition, at least in the US. Trump's actions

8
00:00:45,600 --> 00:00:49,280
Speaker 1: have also given license to many to ignore and deny

9
00:00:49,320 --> 00:00:54,000
Speaker 1: climate change. But the CEO of Exon Mobile, Darren Woods,

10
00:00:54,400 --> 00:00:58,800
Speaker 1: isn't quite following suit. Darren spears the CEOs of other

11
00:00:58,920 --> 00:01:02,400
Speaker 1: international oil companies have stopped coming to COP climate summits,

12
00:01:02,960 --> 00:01:06,040
Speaker 1: but Darren came to a side event here at COP thirty,

13
00:01:06,720 --> 00:01:11,039
Speaker 1: his third COP in a row. For context, Egxon is

14
00:01:11,120 --> 00:01:13,920
Speaker 1: one of the world's largest oil and gas companies, and

15
00:01:14,040 --> 00:01:17,200
Speaker 1: Darren is in charge of overseeing its operations and what

16
00:01:17,319 --> 00:01:21,479
Speaker 1: areas of the energy transition the company pursues or ignores.

17
00:01:22,560 --> 00:01:24,840
Speaker 1: Last year, at COP twenty nine in Baku, I got

18
00:01:24,840 --> 00:01:27,720
Speaker 1: a chance to ask him questions about how Egxon, which

19
00:01:27,800 --> 00:01:30,600
Speaker 1: has a long history of sowing doubt about climate science

20
00:01:30,920 --> 00:01:34,119
Speaker 1: can be trusted to now be acting in good faith

21
00:01:34,280 --> 00:01:37,959
Speaker 1: to tackle climate change. I quized him on Exon's lobbying

22
00:01:37,959 --> 00:01:41,920
Speaker 1: efforts on the oil industry's favorite climate solution, carbon capture.

23
00:01:42,360 --> 00:01:44,560
Speaker 1: I also talked to him about the millions of dollars

24
00:01:44,560 --> 00:01:48,400
Speaker 1: Exon spent advertising algaebio fuels without ever scaling up the

25
00:01:48,440 --> 00:01:52,400
Speaker 1: technology for commercial use. If you haven't listened to that conversation,

26
00:01:52,600 --> 00:01:55,400
Speaker 1: I recommend that you do. We link the episode in

27
00:01:55,440 --> 00:01:58,520
Speaker 1: the show notes because this year I wanted to ask

28
00:01:58,600 --> 00:02:01,080
Speaker 1: him different questions and follow up on some of the

29
00:02:01,120 --> 00:02:04,640
Speaker 1: answers he gave me last year. Why is EGXON backing

30
00:02:04,680 --> 00:02:08,520
Speaker 1: a new carbon accounting idea which many climate advocates worry

31
00:02:08,680 --> 00:02:12,440
Speaker 1: is yet another delay tactic. What is his plan now

32
00:02:12,480 --> 00:02:15,080
Speaker 1: that many of the tax credits under the Inflation Reduction

33
00:02:15,200 --> 00:02:18,720
Speaker 1: Act for low carbon solutions have been gutted? And how

34
00:02:18,800 --> 00:02:21,320
Speaker 1: is he planning to deal with the tactics that Trump

35
00:02:21,480 --> 00:02:25,000
Speaker 1: is using to go after businesses, the same tactics that

36
00:02:25,080 --> 00:02:29,040
Speaker 1: could be weaponized against his industry by a future administration.

37
00:02:30,440 --> 00:02:32,760
Speaker 1: As you will hear, it was a good conversation with

38
00:02:32,840 --> 00:02:35,680
Speaker 1: a healthy amount of disagreement. These are the kinds of

39
00:02:35,720 --> 00:02:39,800
Speaker 1: conversation I'd like to see happen more often where we

40
00:02:39,840 --> 00:02:43,200
Speaker 1: aren't questioning the accepted science of climate change, but debating

41
00:02:43,200 --> 00:02:51,200
Speaker 1: the ways in which we should act quickly. Welcome back

42
00:02:51,200 --> 00:02:51,880
Speaker 1: to zero, Darren.

43
00:02:51,960 --> 00:02:52,840
Speaker 2: It's good to be back.

44
00:02:53,200 --> 00:02:53,280
Speaker 3: So.

45
00:02:53,800 --> 00:02:55,640
Speaker 1: I know your schedule is always very tight.

46
00:02:55,840 --> 00:02:57,360
Speaker 2: Yeah, but you are in Brazil.

47
00:02:57,720 --> 00:02:59,760
Speaker 1: Have you been to the Amazon ever before? Have you

48
00:02:59,800 --> 00:03:01,120
Speaker 1: been to a rainforest before?

49
00:03:01,400 --> 00:03:03,600
Speaker 2: I've been to a rainforest before, but not the Amazon.

50
00:03:04,320 --> 00:03:06,520
Speaker 2: Maybe next time, maybe, next time. Yeah, I like that.

51
00:03:06,919 --> 00:03:11,119
Speaker 1: So it's been a year since Donald Trump's election. He's

52
00:03:11,160 --> 00:03:13,720
Speaker 1: been in office for ten months and there's been a

53
00:03:13,840 --> 00:03:18,480
Speaker 1: radical shift in policies, obviously in the US, away from

54
00:03:18,600 --> 00:03:23,000
Speaker 1: climate action and in favor of fossil fields. What changes

55
00:03:23,000 --> 00:03:23,560
Speaker 1: have you liked?

56
00:03:23,800 --> 00:03:26,720
Speaker 3: Well, I think, to me, what I focus on is

57
00:03:27,680 --> 00:03:30,280
Speaker 3: the dialogue that's occurring in the fact that there's a

58
00:03:30,320 --> 00:03:33,640
Speaker 3: debate and I'd say a challenge to some of the

59
00:03:33,680 --> 00:03:35,960
Speaker 3: paradigms that have been established as to how best to

60
00:03:36,200 --> 00:03:39,880
Speaker 3: accomplish this objective. If you think about the whole effort

61
00:03:39,960 --> 00:03:43,320
Speaker 3: in this space, it's been defined, frankly by a set

62
00:03:43,320 --> 00:03:46,160
Speaker 3: of solutions that have been proposed by a lot of

63
00:03:46,200 --> 00:03:49,400
Speaker 3: ideologues primarily on the left, that this is the way

64
00:03:49,440 --> 00:03:51,640
Speaker 3: we're going to solve the problem with this set of solutions.

65
00:03:52,080 --> 00:03:54,800
Speaker 3: And I think unfortunately the problem and the challenge of

66
00:03:54,840 --> 00:03:57,839
Speaker 3: climate change has then been defined by this solution set,

67
00:03:57,880 --> 00:04:00,800
Speaker 3: and either you're for these solutions or against. And I

68
00:04:00,840 --> 00:04:03,560
Speaker 3: think what we need to do is focus less on

69
00:04:03,960 --> 00:04:08,160
Speaker 3: the proposed solutions. Some of them are valid and have merit,

70
00:04:08,240 --> 00:04:10,240
Speaker 3: and they're necessary, but they're not sufficient.

71
00:04:10,320 --> 00:04:13,200
Speaker 2: We need a broader aperture, and so less.

72
00:04:13,040 --> 00:04:16,000
Speaker 3: Focus on that set of solutions, more focused on the

73
00:04:16,040 --> 00:04:19,320
Speaker 3: opportunity to address the real challenge here, which is emissions.

74
00:04:19,320 --> 00:04:21,719
Speaker 3: And so I actually like the fact there's a debate

75
00:04:21,800 --> 00:04:24,359
Speaker 3: going on both sides of the argument. And I think

76
00:04:25,040 --> 00:04:28,760
Speaker 3: generally speaking, when you have people debating about how best

77
00:04:28,800 --> 00:04:33,839
Speaker 3: to achieve an outcome or to balance one challenge or

78
00:04:33,880 --> 00:04:37,240
Speaker 3: issue with the other challenges and issues, that's an important

79
00:04:37,240 --> 00:04:38,360
Speaker 3: dialogue and debate to have.

80
00:04:38,440 --> 00:04:40,559
Speaker 2: And I feel more that's happening today in the US

81
00:04:40,560 --> 00:04:41,240
Speaker 2: and in the past.

82
00:04:41,560 --> 00:04:43,560
Speaker 1: Well, there are ideologues on the left, but there are

83
00:04:43,640 --> 00:04:45,599
Speaker 1: idea logues on the right too, because.

84
00:04:45,440 --> 00:04:47,520
Speaker 2: Are on both sides. Absolutely many of.

85
00:04:47,440 --> 00:04:49,880
Speaker 1: The things that have happened under the Trump administration are

86
00:04:49,920 --> 00:04:52,040
Speaker 1: things that the oil and gas industry as a whole

87
00:04:52,080 --> 00:04:55,279
Speaker 1: doesn't like. You know, the API came out in support

88
00:04:55,320 --> 00:04:58,520
Speaker 1: of keeping the greenhouse gas reporting, which the EPA wants

89
00:04:58,520 --> 00:05:01,159
Speaker 1: to get rid of, for example. But you told me

90
00:05:01,240 --> 00:05:03,479
Speaker 1: last year that you liked a lot of what was

91
00:05:03,480 --> 00:05:07,240
Speaker 1: there in the Inflation Reduction Act, and obviously under the

92
00:05:07,279 --> 00:05:10,520
Speaker 1: Trump administration that's been gutted, almost all of the incentives

93
00:05:10,560 --> 00:05:14,760
Speaker 1: that were there are gone. Does that change your thesis

94
00:05:14,800 --> 00:05:17,640
Speaker 1: on the investments that you were looking forward to making

95
00:05:17,720 --> 00:05:21,200
Speaker 1: and all sorts of low carbon solutions like carbon capture,

96
00:05:21,279 --> 00:05:21,960
Speaker 1: like hydrogen.

97
00:05:22,120 --> 00:05:23,840
Speaker 3: So I think what we talked about last year is

98
00:05:24,040 --> 00:05:26,040
Speaker 3: what we've been very focused on is how can we

99
00:05:26,080 --> 00:05:30,000
Speaker 3: contribute to the challenge of emissions and reducing emissions based

100
00:05:30,040 --> 00:05:33,920
Speaker 3: on our capabilities and our core competitive advantages. And that's

101
00:05:34,040 --> 00:05:36,239
Speaker 3: very much focused on the molecule side of the equation,

102
00:05:36,400 --> 00:05:40,040
Speaker 3: so carbon capture and storage, low carbon or virtually carbon

103
00:05:40,080 --> 00:05:44,160
Speaker 3: free hydrogen, biofuels. We ended up moving into lithium based

104
00:05:44,240 --> 00:05:49,000
Speaker 3: on our ability to process produced water, brine water, all those. Frankly,

105
00:05:49,040 --> 00:05:51,240
Speaker 3: if you look at the changes the Trump administration is

106
00:05:51,240 --> 00:05:54,479
Speaker 3: made to the IRA have not reduced the incentives for

107
00:05:54,520 --> 00:05:56,960
Speaker 3: those but I will tell you that as you look

108
00:05:57,000 --> 00:06:00,600
Speaker 3: at those different areas that were focused on, always said

109
00:06:00,600 --> 00:06:02,880
Speaker 3: that our investment in the space was a function of

110
00:06:03,600 --> 00:06:07,000
Speaker 3: good policy policy that incentivizes that in the short term,

111
00:06:07,440 --> 00:06:10,800
Speaker 3: but very importantly for markets developing and for there to

112
00:06:10,880 --> 00:06:13,640
Speaker 3: be a customer demand, because ultimately any of these policies

113
00:06:13,960 --> 00:06:17,200
Speaker 3: to be successful are going to have to evolve into

114
00:06:17,320 --> 00:06:22,000
Speaker 3: market driven forces. Government can afford to subsidize these solutions

115
00:06:22,000 --> 00:06:25,520
Speaker 3: in perpetuity, and so markets have to develop, and technology

116
00:06:25,560 --> 00:06:27,360
Speaker 3: needs to evolve so that we can get the cost down,

117
00:06:27,440 --> 00:06:30,720
Speaker 3: because today in some of these areas the cost are

118
00:06:30,760 --> 00:06:33,200
Speaker 3: too high for the long term, and so those three

119
00:06:33,240 --> 00:06:35,760
Speaker 3: things have to happen. They have to improve, and we're

120
00:06:35,800 --> 00:06:38,440
Speaker 3: going to pace the investments associated with what we see

121
00:06:38,440 --> 00:06:41,599
Speaker 3: in the development there. Frankly, with our largest project, the

122
00:06:41,600 --> 00:06:44,880
Speaker 3: Baytown Blue Hydrogen project, one of the big challenges there

123
00:06:44,960 --> 00:06:48,360
Speaker 3: is customers buying the product, and so we are potentially

124
00:06:48,400 --> 00:06:50,880
Speaker 3: going to pace that based on our ability to sign

125
00:06:50,920 --> 00:06:54,080
Speaker 3: customers up, much less a policy issued in that case.

126
00:06:54,520 --> 00:06:57,360
Speaker 1: But you started by saying, in terms of getting climate

127
00:06:57,400 --> 00:07:01,839
Speaker 1: solutions or solutions that would reduce a missions being technology neutral,

128
00:07:02,600 --> 00:07:06,719
Speaker 1: starting point having policies is helpful. In the US, you

129
00:07:06,800 --> 00:07:08,800
Speaker 1: get this swing to the left and to the right.

130
00:07:09,480 --> 00:07:11,320
Speaker 1: How much does that war do you well?

131
00:07:11,360 --> 00:07:14,360
Speaker 3: Your point about their ideologues on either side of the

132
00:07:14,640 --> 00:07:16,920
Speaker 3: aisle is I definitely agree with that. That's why we

133
00:07:16,920 --> 00:07:21,280
Speaker 3: shouldn't be trying to solve this problem through ideology. I mean,

134
00:07:21,360 --> 00:07:23,360
Speaker 3: ideology only takes you so far and then you hit

135
00:07:23,400 --> 00:07:25,320
Speaker 3: the reality of the real world and need to practical

136
00:07:25,440 --> 00:07:27,920
Speaker 3: constraints and how you manage through those. And I think

137
00:07:28,080 --> 00:07:30,560
Speaker 3: from our perspective, we're trying to keep a very clear

138
00:07:30,640 --> 00:07:33,040
Speaker 3: view on what is the problem statement, which is trying

139
00:07:33,040 --> 00:07:36,760
Speaker 3: to find ways to productively reduce emissions that don't slow

140
00:07:36,800 --> 00:07:40,640
Speaker 3: economic growth, they don't impact people's standards of living, find

141
00:07:40,680 --> 00:07:42,760
Speaker 3: ways to do that based on what we're good at

142
00:07:43,160 --> 00:07:45,760
Speaker 3: and achieve both. We refer to it as the end equation,

143
00:07:45,880 --> 00:07:48,440
Speaker 3: and we're absolutely convinced that we can do that. And

144
00:07:48,600 --> 00:07:50,640
Speaker 3: that dialogue that I have and the work that we're

145
00:07:50,680 --> 00:07:54,840
Speaker 3: doing is consistent whether it's you know, a left administration

146
00:07:54,960 --> 00:07:57,160
Speaker 3: or a right administration, or whether it's an ideologue or

147
00:07:57,160 --> 00:08:01,320
Speaker 3: somebody who center. The foundational fundamental of how we address

148
00:08:01,400 --> 00:08:04,920
Speaker 3: this issue over time do not change with political cycles

149
00:08:05,200 --> 00:08:06,120
Speaker 3: or who get selected.

150
00:08:06,280 --> 00:08:08,600
Speaker 1: You told me last year that given the scale of

151
00:08:08,600 --> 00:08:13,560
Speaker 1: the energy transition, no single president in any country can

152
00:08:13,600 --> 00:08:17,160
Speaker 1: do much to detail or to accelerate the energy transition.

153
00:08:18,400 --> 00:08:22,080
Speaker 1: Do you still feel the same given how effective Trump

154
00:08:22,160 --> 00:08:26,280
Speaker 1: has been at stifling clean energy projects. This is not

155
00:08:26,520 --> 00:08:30,440
Speaker 1: just clean hydrogen projects, but also carbon capture projects. Obviously

156
00:08:30,560 --> 00:08:34,080
Speaker 1: lots and lots of offshore wind projects that were canceled.

157
00:08:35,480 --> 00:08:39,240
Speaker 1: Are you still of the same view that one president

158
00:08:39,320 --> 00:08:42,160
Speaker 1: cannot shift the pace of the energy transition?

159
00:08:42,240 --> 00:08:45,679
Speaker 3: What I would say is the energy industry, the basis

160
00:08:45,679 --> 00:08:48,600
Speaker 3: on which we make decisions, the time frame that those

161
00:08:48,640 --> 00:08:53,520
Speaker 3: decisions play themselves out, and the duration of those investments

162
00:08:53,520 --> 00:08:56,720
Speaker 3: exceed any political cycle. So my point is that we

163
00:08:56,840 --> 00:08:59,640
Speaker 3: have to look beyond the political cycle in terms of

164
00:08:59,640 --> 00:09:02,600
Speaker 3: making these decisions. I think one of the things the

165
00:09:02,600 --> 00:09:07,560
Speaker 3: Trump administration is challenging is a parameter that frankly has

166
00:09:07,600 --> 00:09:09,600
Speaker 3: not been given the intention it needs, which is the

167
00:09:09,600 --> 00:09:12,080
Speaker 3: affordability of these things. And you know, is it a

168
00:09:12,120 --> 00:09:14,960
Speaker 3: productive use of money? You know, the challenge today is

169
00:09:14,960 --> 00:09:17,319
Speaker 3: there's not a policy banker around that can tell you

170
00:09:17,360 --> 00:09:19,679
Speaker 3: what is the cost for the benefit of a ton

171
00:09:19,720 --> 00:09:23,840
Speaker 3: of carbon removed? And every government has its constraints and limits.

172
00:09:23,840 --> 00:09:27,120
Speaker 3: Every organization has its constraints. We don't have unlimited budgets,

173
00:09:27,520 --> 00:09:30,360
Speaker 3: and so I think every government around the world should

174
00:09:30,360 --> 00:09:32,640
Speaker 3: be focused on how do you get the biggest bang

175
00:09:32,679 --> 00:09:35,160
Speaker 3: for the buck. How do I remove the most emissions

176
00:09:35,200 --> 00:09:38,720
Speaker 3: for the least spend. You can't do that today without

177
00:09:39,040 --> 00:09:41,559
Speaker 3: because we have no carbon accounting mechanism, no mechanism to

178
00:09:41,679 --> 00:09:43,200
Speaker 3: understand the benefits.

179
00:09:42,720 --> 00:09:44,000
Speaker 2: Of the policy.

180
00:09:44,120 --> 00:09:47,559
Speaker 3: So as a result, we get very expensive solution sets

181
00:09:47,600 --> 00:09:51,080
Speaker 3: that frankly aren't sustainable. And so I think stepping back

182
00:09:51,559 --> 00:09:54,959
Speaker 3: and trying to understand what are the economics, the underlying

183
00:09:55,120 --> 00:09:57,439
Speaker 3: cost and the affordability of some of these solutions is

184
00:09:57,480 --> 00:10:01,480
Speaker 3: a critical part to laying the right foundation for the future,

185
00:10:01,800 --> 00:10:04,080
Speaker 3: and I think challenging that today to try to get

186
00:10:04,120 --> 00:10:06,119
Speaker 3: to better solutions is appropriate.

187
00:10:06,679 --> 00:10:10,839
Speaker 1: Specifically, though, how do you feel about Trump canceling offshore

188
00:10:11,160 --> 00:10:15,679
Speaker 1: win permits projects that were fully permitted, some were under construction.

189
00:10:16,760 --> 00:10:21,760
Speaker 1: There's a risk another president comes in who's left leaning,

190
00:10:21,800 --> 00:10:26,840
Speaker 1: whose for clean energy, and uses the kind of policy

191
00:10:27,040 --> 00:10:29,200
Speaker 1: weaponizes it against ail and gas projects.

192
00:10:29,280 --> 00:10:31,080
Speaker 3: Well, we've certainly seen that with Biden came in and

193
00:10:31,120 --> 00:10:33,880
Speaker 3: canceled the pipeline coming from Canada. So you're absolutely right

194
00:10:34,280 --> 00:10:37,040
Speaker 3: that challenge sets on both sides of the aisle. And

195
00:10:37,080 --> 00:10:41,719
Speaker 3: I think frankly, for businesses to be successful, particularly businesses

196
00:10:41,760 --> 00:10:44,080
Speaker 3: like ours that invest very large sums of money over

197
00:10:44,120 --> 00:10:47,719
Speaker 3: a very long horizon, you need stability, you need predictability,

198
00:10:47,760 --> 00:10:50,160
Speaker 3: and so I think that's one of the challenges that

199
00:10:50,200 --> 00:10:52,400
Speaker 3: we have today with permitting is the way it can

200
00:10:52,440 --> 00:10:55,160
Speaker 3: be challenged, the way it can be changed, challenged, the

201
00:10:55,240 --> 00:10:57,320
Speaker 3: legal system, and so I think a reform of that

202
00:10:57,360 --> 00:11:01,240
Speaker 3: whole area is very appropriate. Focused as you advance these things,

203
00:11:01,280 --> 00:11:04,000
Speaker 3: you advanced projects, you get the permit that you have

204
00:11:04,080 --> 00:11:06,720
Speaker 3: to have confidence that those permits are going to continue

205
00:11:06,720 --> 00:11:08,760
Speaker 3: to exist and allow you to make those investments. I

206
00:11:08,800 --> 00:11:11,520
Speaker 3: think that's critical for every industry, every business, and for

207
00:11:11,600 --> 00:11:12,240
Speaker 3: every government.

208
00:11:12,600 --> 00:11:14,960
Speaker 1: You had also told me last year that if the

209
00:11:15,080 --> 00:11:20,439
Speaker 1: energy transition provides opportunities outside the US, you will pursue those.

210
00:11:21,120 --> 00:11:23,400
Speaker 1: In the US. It's pretty clear the energy transition is

211
00:11:23,400 --> 00:11:25,880
Speaker 1: going to slow down. It's not going to stop. We

212
00:11:25,920 --> 00:11:28,080
Speaker 1: know that electric car sales are going to rise, just

213
00:11:28,120 --> 00:11:30,640
Speaker 1: not as much as it was predicted. Solar and wind

214
00:11:30,640 --> 00:11:35,480
Speaker 1: projects will get deployed. But if you look outside the US,

215
00:11:35,880 --> 00:11:38,959
Speaker 1: even there the Trump administration is having an impact. So

216
00:11:39,200 --> 00:11:43,040
Speaker 1: one thing that Exon has long supported is carbon pricing. Ideally,

217
00:11:43,040 --> 00:11:45,040
Speaker 1: you would want a global carbon price that would be

218
00:11:45,800 --> 00:11:49,360
Speaker 1: level playing field for everybody. We were about to get that.

219
00:11:49,440 --> 00:11:51,960
Speaker 1: You know, the politics have been very difficult around carbon pricing.

220
00:11:51,960 --> 00:11:55,400
Speaker 1: But at the International Maritime Organization there was a vote

221
00:11:55,440 --> 00:11:59,400
Speaker 1: to have a global carbon tax on shipping. Were you

222
00:11:59,440 --> 00:12:01,559
Speaker 1: supportive of the net zero framework there?

223
00:12:01,960 --> 00:12:04,960
Speaker 3: So just to the first point that you made around

224
00:12:05,160 --> 00:12:07,600
Speaker 3: things have slowed down. If you actually look at what

225
00:12:07,600 --> 00:12:10,280
Speaker 3: the Trump administration did with the build and the legislation,

226
00:12:10,720 --> 00:12:14,600
Speaker 3: incentives for carbon capturing storage remain. In fact, they increased

227
00:12:14,640 --> 00:12:17,520
Speaker 3: them for enhanced oil recovery, and so there is a

228
00:12:17,559 --> 00:12:21,400
Speaker 3: scenario that says more carbon is captured in sequestered through

229
00:12:21,480 --> 00:12:24,400
Speaker 3: enhanced oil recovery as well as seequestration under the Trump

230
00:12:24,400 --> 00:12:27,200
Speaker 3: administration because the incentive for that has gone up, and

231
00:12:27,320 --> 00:12:30,640
Speaker 3: for a low carbon hydrogen the incentive remains there. It's

232
00:12:30,679 --> 00:12:33,240
Speaker 3: just a shorter time horizon. So I don't think you

233
00:12:33,280 --> 00:12:36,359
Speaker 3: can jump immediately to there's going to be less investments

234
00:12:36,360 --> 00:12:38,959
Speaker 3: made in low carbon. It's not as I think, black

235
00:12:39,000 --> 00:12:40,960
Speaker 3: and white, as you point out.

236
00:12:40,920 --> 00:12:45,280
Speaker 1: On carbon capture specifically, the Environmental Protection Agency wants to

237
00:12:45,320 --> 00:12:48,360
Speaker 1: get rid of the greenhouse gas reporting at asset level,

238
00:12:48,520 --> 00:12:51,120
Speaker 1: which is crucial to get your forty five Q tax

239
00:12:51,160 --> 00:12:54,680
Speaker 1: credit that would enable carbon captured projects to go forward. Yes,

240
00:12:54,840 --> 00:12:57,640
Speaker 1: doesn't that change your investment thesis if you're not able

241
00:12:57,679 --> 00:13:00,400
Speaker 1: to tap into the forty five Q tax credit even

242
00:13:00,440 --> 00:13:02,680
Speaker 1: if it's available to you, because you can't do the

243
00:13:02,679 --> 00:13:03,360
Speaker 1: carbon accounting.

244
00:13:03,440 --> 00:13:04,160
Speaker 2: Yeah, I think that's right.

245
00:13:04,200 --> 00:13:07,280
Speaker 3: But I think also the Trump administration is supportive of

246
00:13:07,360 --> 00:13:09,920
Speaker 3: forty five Q and so I think the question is

247
00:13:10,120 --> 00:13:13,800
Speaker 3: what mechanism gets put in place to allow that to happen.

248
00:13:13,840 --> 00:13:16,760
Speaker 3: And that story hasn't been written yet, but we're very

249
00:13:16,880 --> 00:13:18,880
Speaker 3: actively involved in terms of how can we do this.

250
00:13:18,960 --> 00:13:21,720
Speaker 3: We were supportive of continuing to report emissions. We think

251
00:13:21,760 --> 00:13:24,360
Speaker 3: it's important if that happens, and so we've got to

252
00:13:24,360 --> 00:13:28,000
Speaker 3: find an alternative if not that, to ensure that we

253
00:13:28,040 --> 00:13:29,240
Speaker 3: can report on those emissions.

254
00:13:29,240 --> 00:13:30,320
Speaker 2: So, yeah, that is critical.

255
00:13:30,720 --> 00:13:33,360
Speaker 1: And on the energy transition slowing down, this is not

256
00:13:33,440 --> 00:13:36,360
Speaker 1: my analysis. This is analysis done by different groups, Rodium Group,

257
00:13:36,360 --> 00:13:40,480
Speaker 1: Bloomberg Enif it's more to do with the speed at

258
00:13:40,480 --> 00:13:43,640
Speaker 1: which low carbon stuff will get deployed, and so you

259
00:13:43,679 --> 00:13:46,320
Speaker 1: know emissions reductions, which is what matters, which is what

260
00:13:46,559 --> 00:13:48,320
Speaker 1: you know. A lot of the low carbon work that

261
00:13:48,360 --> 00:13:51,320
Speaker 1: you do is aimed at is going to slow down

262
00:13:51,440 --> 00:13:53,560
Speaker 1: as a result of the policies that have been brought in.

263
00:13:53,640 --> 00:13:56,240
Speaker 1: So maybe carbon capture doesn't get affected because forty five

264
00:13:56,320 --> 00:13:59,160
Speaker 1: Q will be sorted out, but so many solar and

265
00:13:59,240 --> 00:14:02,000
Speaker 1: wind projects have been canceled, so the energy transition does

266
00:14:02,040 --> 00:14:03,040
Speaker 1: slow down in the US.

267
00:14:03,240 --> 00:14:04,600
Speaker 2: I think it slows down in Europe as well.

268
00:14:04,640 --> 00:14:06,720
Speaker 3: I think actually what you see happening around the world

269
00:14:07,400 --> 00:14:10,120
Speaker 3: is that the incentives that people have put in place,

270
00:14:10,760 --> 00:14:15,360
Speaker 3: and frankly, some of the impractical aspects of the policy

271
00:14:15,400 --> 00:14:17,000
Speaker 3: that put in place and it's been rolling out is

272
00:14:17,040 --> 00:14:19,920
Speaker 3: starting to be manifest itself. And so you see even

273
00:14:19,960 --> 00:14:22,120
Speaker 3: in Europe that the cost of energy has gotten so

274
00:14:22,240 --> 00:14:24,960
Speaker 3: high that they're stepping back and rethinking what needs to

275
00:14:25,000 --> 00:14:28,320
Speaker 3: happen in order to achieve their missions reductions while continuing

276
00:14:28,360 --> 00:14:32,680
Speaker 3: to provide affordable energy and reliably available energy. So there's

277
00:14:32,960 --> 00:14:36,640
Speaker 3: a broader recognition that's needed that these solution sets that

278
00:14:36,680 --> 00:14:40,360
Speaker 3: are out there today have their limits, and to blindly

279
00:14:40,440 --> 00:14:42,680
Speaker 3: follow those and to assume that that is the only

280
00:14:42,720 --> 00:14:45,320
Speaker 3: solution and not step back and think more broadly about

281
00:14:45,520 --> 00:14:48,600
Speaker 3: what else can be done to address the issue is

282
00:14:48,640 --> 00:14:50,240
Speaker 3: going to slow it down everywhere in the world the

283
00:14:50,280 --> 00:14:54,920
Speaker 3: practical aspects of the problems associated with some of the

284
00:14:54,920 --> 00:14:58,160
Speaker 3: solutions being proposed. The deeper you penetrate it, the more

285
00:14:58,200 --> 00:15:01,160
Speaker 3: manifest those become going to slow things down.

286
00:15:01,280 --> 00:15:04,120
Speaker 1: But one of those was having a global carbon price,

287
00:15:04,200 --> 00:15:07,520
Speaker 1: at least on shipping, which the International Maritime Organization in

288
00:15:07,560 --> 00:15:10,680
Speaker 1: the countries in it were going to vote for. Were

289
00:15:10,720 --> 00:15:11,600
Speaker 1: you supportive of that?

290
00:15:12,080 --> 00:15:16,200
Speaker 3: Yeah, Actually as a concept having a price on carbon,

291
00:15:16,280 --> 00:15:18,760
Speaker 3: we've always thought that at global price on carbon is

292
00:15:18,760 --> 00:15:21,720
Speaker 3: an effective way to control the emissions to the extent

293
00:15:21,800 --> 00:15:25,560
Speaker 3: that governments around the world want to control those emissions.

294
00:15:25,560 --> 00:15:28,360
Speaker 3: I think with climate change in particular, as you think back,

295
00:15:28,560 --> 00:15:31,440
Speaker 3: the governments are put in place, are elected to represent

296
00:15:31,480 --> 00:15:33,800
Speaker 3: their people, and so that's what you see happening around

297
00:15:33,800 --> 00:15:36,480
Speaker 3: the world. I don't have a perspective on what government

298
00:15:36,480 --> 00:15:39,520
Speaker 3: shooter shouldn't be doing. Their obligation is to their people.

299
00:15:39,840 --> 00:15:42,280
Speaker 3: What I focus on is not the what, but the

300
00:15:42,320 --> 00:15:43,400
Speaker 3: how best to achieve it.

301
00:15:43,560 --> 00:15:45,480
Speaker 1: But it's part of the industry which is not just

302
00:15:45,600 --> 00:15:49,880
Speaker 1: you exonmobile, but you support a lot of lobbying organizations

303
00:15:49,920 --> 00:15:52,880
Speaker 1: that speak the voice of the industry as a whole.

304
00:15:53,440 --> 00:15:57,800
Speaker 1: Was the industry supportive of the carbon tax in shipping.

305
00:15:57,520 --> 00:15:59,960
Speaker 2: Because we were not advocating against it.

306
00:16:00,080 --> 00:16:03,600
Speaker 1: What we saw was an extraordinary attempt by the US administration.

307
00:16:03,800 --> 00:16:06,280
Speaker 1: This is again not my words, but we've spoken to

308
00:16:06,440 --> 00:16:09,040
Speaker 1: lots of diplomats who were there in the room who

309
00:16:09,160 --> 00:16:12,920
Speaker 1: said that those activities were extraordinary. That there were not

310
00:16:13,040 --> 00:16:15,400
Speaker 1: just threats made at the country level, which were public

311
00:16:15,440 --> 00:16:17,840
Speaker 1: and were published on the White House website, but also

312
00:16:17,920 --> 00:16:23,480
Speaker 1: personal threats, visa restrictions or individual sanctions, which caused many

313
00:16:23,480 --> 00:16:26,640
Speaker 1: of them to then really rethink whether they would go

314
00:16:26,720 --> 00:16:30,360
Speaker 1: forward with the vote. If you get another chance to

315
00:16:30,440 --> 00:16:34,320
Speaker 1: have a global carbon price, how would you speak to

316
00:16:34,680 --> 00:16:37,760
Speaker 1: the Trump administration and how would you get them to

317
00:16:37,840 --> 00:16:40,600
Speaker 1: change their mind on something that they currently aren't supportive of.

318
00:16:40,920 --> 00:16:43,520
Speaker 3: Yeah, I'm not familiar with all the things you talked about,

319
00:16:43,560 --> 00:16:45,480
Speaker 3: so I don't know if that happened or not. And

320
00:16:45,560 --> 00:16:48,080
Speaker 3: I certainly wasn't involved in the Trump administration and their

321
00:16:48,120 --> 00:16:50,840
Speaker 3: dialogue on this, so I can't pretend to know the

322
00:16:50,880 --> 00:16:53,560
Speaker 3: complexity of the discussions that were happening. What I would

323
00:16:53,560 --> 00:16:57,320
Speaker 3: tell you is what we have consistently advocated for with

324
00:16:57,360 --> 00:17:01,920
Speaker 3: the Miid administration, with the Trump administration is what thoughtful

325
00:17:01,960 --> 00:17:04,960
Speaker 3: policies can be put in place to help reduce emissions

326
00:17:04,960 --> 00:17:09,320
Speaker 3: that don't compromise economic growth, that don't penalize people's standards

327
00:17:09,320 --> 00:17:11,679
Speaker 3: of living. We've been very consistent with that, and there

328
00:17:11,680 --> 00:17:13,800
Speaker 3: are opportunities to go do that. In fact, you know

329
00:17:13,920 --> 00:17:16,880
Speaker 3: today at this Action Agenda that there is a drive

330
00:17:16,960 --> 00:17:20,199
Speaker 3: for carbon accounting. That is a critical first step in

331
00:17:20,359 --> 00:17:25,120
Speaker 3: establishing a more uniform approach to how we address emissions

332
00:17:25,160 --> 00:17:28,520
Speaker 3: and getting from carbon accounting to carbon intensity standards, so

333
00:17:28,600 --> 00:17:31,240
Speaker 3: you can start specifying that on products and letting every

334
00:17:31,280 --> 00:17:34,760
Speaker 3: government around the world establish what those specs should be.

335
00:17:35,320 --> 00:17:39,359
Speaker 3: Is a very flexible approach that allows every government to

336
00:17:39,359 --> 00:17:42,720
Speaker 3: tailor that to the needs of their constituency and to

337
00:17:43,160 --> 00:17:47,840
Speaker 3: their specific economic conditions. That's an approach that I think

338
00:17:47,880 --> 00:17:51,440
Speaker 3: has very broad application and can be very effective.

339
00:17:51,720 --> 00:17:55,080
Speaker 1: I'm definitely coming to coboniccounting because that's an interesting change

340
00:17:55,080 --> 00:17:57,640
Speaker 1: since we last talked about it. But before we get there,

341
00:17:58,160 --> 00:18:00,520
Speaker 1: you to only last year that you want the Trump

342
00:18:00,520 --> 00:18:04,000
Speaker 1: and administration to stay in the Paris Agreement. I understand

343
00:18:04,040 --> 00:18:07,360
Speaker 1: that you've even delivered that message directly to the president.

344
00:18:07,800 --> 00:18:10,040
Speaker 1: Why did they not listen to you?

345
00:18:10,040 --> 00:18:13,200
Speaker 3: You'll have to ask President Trump that there are a

346
00:18:13,200 --> 00:18:14,520
Speaker 3: lot of people that don't listen to me.

347
00:18:16,440 --> 00:18:19,600
Speaker 1: So, now that the US is officially going to be

348
00:18:19,640 --> 00:18:22,679
Speaker 1: out of the Paris Agreement by January, what kind of

349
00:18:22,720 --> 00:18:24,960
Speaker 1: harm does that do to the US is the only

350
00:18:25,000 --> 00:18:26,520
Speaker 1: country that is leaving.

351
00:18:26,600 --> 00:18:28,840
Speaker 3: You know, I look at the challenge here over a

352
00:18:28,920 --> 00:18:32,840
Speaker 3: very long horizon, and again, our action here, the work

353
00:18:32,880 --> 00:18:35,280
Speaker 3: that we do, the engagements that we have with governments

354
00:18:35,280 --> 00:18:38,760
Speaker 3: all around, remain consistent. We're going to continue trying to

355
00:18:38,800 --> 00:18:41,280
Speaker 3: do that because our view is there is something that

356
00:18:41,320 --> 00:18:43,200
Speaker 3: needs to be done in this space, and that we

357
00:18:43,280 --> 00:18:45,560
Speaker 3: have a role to play and can contribute, and we

358
00:18:45,600 --> 00:18:48,639
Speaker 3: will work with whatever administration comes in and continue to

359
00:18:48,960 --> 00:18:51,119
Speaker 3: drive in an agenda that we think makes sense, that

360
00:18:51,200 --> 00:18:53,919
Speaker 3: doesn't compromise economic growth or people standards of living. We

361
00:18:53,920 --> 00:18:56,080
Speaker 3: think there's an option to do that and open the

362
00:18:56,119 --> 00:18:58,960
Speaker 3: aperture to the solution set. You're framing all of this

363
00:18:59,040 --> 00:19:01,320
Speaker 3: as a US Trump, I think you should frame it

364
00:19:01,359 --> 00:19:04,840
Speaker 3: more as an opportunity to open the aperture for a

365
00:19:04,880 --> 00:19:08,040
Speaker 3: broader set of solutions to achieve the real objective, which

366
00:19:08,080 --> 00:19:11,560
Speaker 3: is lowering emissions, versus the objective that people have been

367
00:19:11,600 --> 00:19:13,639
Speaker 3: working to, which is getting rid of oil and gas.

368
00:19:14,119 --> 00:19:16,080
Speaker 3: And I think that's one of the big challenges is

369
00:19:16,119 --> 00:19:19,240
Speaker 3: that we've gotten the objective statement wrong, or the problem

370
00:19:19,240 --> 00:19:21,320
Speaker 3: of statement wrong, and we've got to go back to

371
00:19:21,600 --> 00:19:25,320
Speaker 3: how do we best reduce emissions? And the approach being

372
00:19:25,359 --> 00:19:30,320
Speaker 3: taken today is centrally controlled government's dictating what the solutions

373
00:19:30,359 --> 00:19:33,600
Speaker 3: need to be and then trying to force companies to

374
00:19:33,800 --> 00:19:38,280
Speaker 3: implement their solutions. We've seen how controlled economies work, the

375
00:19:38,320 --> 00:19:44,640
Speaker 3: Soviet Union, North Korea, Cuba, East Germany plan. Centralized government

376
00:19:44,680 --> 00:19:47,320
Speaker 3: control does not work. You need the markets to be engaged.

377
00:19:47,320 --> 00:19:49,679
Speaker 3: There hasn't been a solution set out there that engages

378
00:19:50,000 --> 00:19:53,680
Speaker 3: the markets. That's absolutely needed. Ideology only takes you so far,

379
00:19:54,440 --> 00:19:57,800
Speaker 3: and then you need practical systems that deal with the

380
00:19:57,800 --> 00:20:00,600
Speaker 3: real market constraints and the challenges of making things happen.

381
00:20:00,920 --> 00:20:01,919
Speaker 2: That's what we got to get to.

382
00:20:02,520 --> 00:20:05,840
Speaker 1: You didn't raise the exception China, where things are working.

383
00:20:06,040 --> 00:20:07,919
Speaker 2: I would tell you that that's a mix of things.

384
00:20:07,920 --> 00:20:08,400
Speaker 2: You do need.

385
00:20:08,480 --> 00:20:11,080
Speaker 3: Some government has a role. Don't get me wrong, not

386
00:20:11,080 --> 00:20:14,240
Speaker 3: suggesting government doesn't have a role, but picking the solutions

387
00:20:14,800 --> 00:20:18,400
Speaker 3: as a function of ideology versus a function of i'd

388
00:20:18,400 --> 00:20:21,520
Speaker 3: say strategy, are two very different set of circumstances. I

389
00:20:21,520 --> 00:20:23,840
Speaker 3: think the Chinese government operates a little differently than some

390
00:20:23,880 --> 00:20:26,600
Speaker 3: of the democratically elected governments around the world, so it's

391
00:20:26,640 --> 00:20:28,480
Speaker 3: a different decision making process.

392
00:20:28,600 --> 00:20:30,520
Speaker 1: So one way in which you think you can address

393
00:20:30,560 --> 00:20:33,320
Speaker 1: that is through carbon accounting. Last year you talked about

394
00:20:33,359 --> 00:20:36,760
Speaker 1: the idea, but today you have the initiative in front

395
00:20:36,760 --> 00:20:39,679
Speaker 1: of you. It's called Carbon Measures, right. It's based on

396
00:20:39,760 --> 00:20:42,359
Speaker 1: a concept that's been developed academics at Harvard University and

397
00:20:42,400 --> 00:20:45,720
Speaker 1: Oxford University. The goal is to make carbon emissions work

398
00:20:46,000 --> 00:20:50,960
Speaker 1: almost like financial liabilities, that once you sell the goods,

399
00:20:51,080 --> 00:20:55,880
Speaker 1: you pass on the liabilities emissions liabilities that come with it.

400
00:20:56,480 --> 00:20:59,680
Speaker 1: And you wanted that system so that you could get

401
00:20:59,720 --> 00:21:04,440
Speaker 1: coben accounting at a product level. The trouble is that

402
00:21:04,640 --> 00:21:06,840
Speaker 1: the only way it's going to work is if you

403
00:21:07,000 --> 00:21:11,240
Speaker 1: have all parts of the supply chain of that product

404
00:21:11,960 --> 00:21:14,440
Speaker 1: also reporting under that framework.

405
00:21:14,880 --> 00:21:16,560
Speaker 3: Yeah, this is but be clear, this is not a

406
00:21:16,600 --> 00:21:20,000
Speaker 3: reporting framework. This is not an accounting in the pure

407
00:21:20,040 --> 00:21:23,560
Speaker 3: sense of a financial accounting. This is an accounting analog.

408
00:21:23,680 --> 00:21:26,720
Speaker 3: So there's a financial model that we think makes a

409
00:21:26,720 --> 00:21:29,920
Speaker 3: lot of sense in terms of how to think about accounting,

410
00:21:30,280 --> 00:21:34,280
Speaker 3: but it's also anchored in chemistry, and frankly, a molecul

411
00:21:34,440 --> 00:21:38,040
Speaker 3: of emissions or CO two is created once, and so

412
00:21:38,280 --> 00:21:42,679
Speaker 3: accounting for where in that value chain that emission is

413
00:21:42,800 --> 00:21:45,320
Speaker 3: generated is critically important. So I don't think of it

414
00:21:45,320 --> 00:21:49,240
Speaker 3: as a financial you know, an asset register in terms

415
00:21:49,280 --> 00:21:52,560
Speaker 3: of liabilities or assets. I think of it as understanding

416
00:21:52,680 --> 00:21:55,639
Speaker 3: where in a value chain for a product or a

417
00:21:55,720 --> 00:22:00,200
Speaker 3: service is the emissions generated, and that's critically import and

418
00:22:00,240 --> 00:22:02,640
Speaker 3: if you want to eliminate all emissions, you damn will

419
00:22:02,680 --> 00:22:04,120
Speaker 3: better be able to account for.

420
00:22:04,080 --> 00:22:04,520
Speaker 2: All of them.

421
00:22:04,680 --> 00:22:07,320
Speaker 1: Conceptually, what you're saying is right, and the way the

422
00:22:07,359 --> 00:22:10,679
Speaker 1: academics have put it is that once you have the

423
00:22:10,760 --> 00:22:13,800
Speaker 1: concept in place, the way it will work is through

424
00:22:14,000 --> 00:22:17,600
Speaker 1: reporting emissions at a product level through the supply chain

425
00:22:17,880 --> 00:22:21,200
Speaker 1: and having these liabilities be passed on from company to

426
00:22:21,280 --> 00:22:24,720
Speaker 1: company as the product moves through the supply chain before

427
00:22:24,760 --> 00:22:26,959
Speaker 1: it's delivered to the brand customer.

428
00:22:27,040 --> 00:22:28,760
Speaker 3: But I would keep I mean you refer to as

429
00:22:28,760 --> 00:22:31,159
Speaker 3: a liability being passed on, and then it's almost talk

430
00:22:31,240 --> 00:22:35,199
Speaker 3: about it from a reporting standpoint the opportunity here is

431
00:22:35,240 --> 00:22:37,879
Speaker 3: to be able to understand what is the carbon intensity

432
00:22:38,280 --> 00:22:41,560
Speaker 3: of a service or a product. And when you have

433
00:22:42,320 --> 00:22:46,600
Speaker 3: a standard that uniformly calculates that, there is an opportunity

434
00:22:46,840 --> 00:22:51,239
Speaker 3: to begin to regulate carbon intensity of products that in

435
00:22:51,280 --> 00:22:54,080
Speaker 3: my mind takes you that will bring in market forces.

436
00:22:54,160 --> 00:22:56,479
Speaker 3: That's the element that's of interest to me that I

437
00:22:56,680 --> 00:23:01,240
Speaker 3: view would make carbon and carbon emission and just like

438
00:23:01,320 --> 00:23:03,679
Speaker 3: every other parameter that we control in the products that

439
00:23:03,720 --> 00:23:06,320
Speaker 3: we sell, sulfur and lead and other things that we

440
00:23:06,400 --> 00:23:07,720
Speaker 3: control in our products.

441
00:23:07,480 --> 00:23:09,959
Speaker 1: Liabilities is the word that the academics use.

442
00:23:10,000 --> 00:23:12,680
Speaker 2: They call it an academic Sure, I'm a realist.

443
00:23:12,680 --> 00:23:14,320
Speaker 3: I mean, I'm the guy who's making this stuff, and

444
00:23:14,359 --> 00:23:15,800
Speaker 3: so I think that's how we think about it.

445
00:23:15,880 --> 00:23:18,320
Speaker 1: Yeah, I mean they called it eliabilities. It went nowhere,

446
00:23:18,359 --> 00:23:20,800
Speaker 1: and then it got rebranded as carbon Measure, and I

447
00:23:20,800 --> 00:23:23,119
Speaker 1: think it's now getting momentum. So you know, I totally

448
00:23:23,160 --> 00:23:25,919
Speaker 1: from a conceptual perspective, I'm on your side here. What

449
00:23:26,040 --> 00:23:28,560
Speaker 1: I wanted to get to though, was that to get

450
00:23:28,560 --> 00:23:31,760
Speaker 1: it to work, you need the entire supply chain to

451
00:23:31,840 --> 00:23:35,639
Speaker 1: be able to agree on this framework, and that means

452
00:23:35,680 --> 00:23:39,200
Speaker 1: it's going to take years, decades, right, the Greenhose Gas

453
00:23:39,200 --> 00:23:41,520
Speaker 1: protocol that you don't like, which has Cope one, two

454
00:23:41,560 --> 00:23:43,920
Speaker 1: and three emissions. It's been in place for twenty five

455
00:23:44,000 --> 00:23:48,359
Speaker 1: years now. So there are climate advocates who are worried

456
00:23:48,440 --> 00:23:51,480
Speaker 1: that carbon measures is just another delay tactic. How do

457
00:23:51,480 --> 00:23:52,439
Speaker 1: you address their consults?

458
00:23:52,520 --> 00:23:54,280
Speaker 3: Well, first, i'd say you don't have to get rid

459
00:23:54,320 --> 00:23:57,320
Speaker 3: of the GHG protocol. You can do this in addition

460
00:23:57,359 --> 00:23:59,440
Speaker 3: to that. So I'm not sure, you know. I think

461
00:23:59,440 --> 00:24:01,960
Speaker 3: there's always view that it's an either or option that

462
00:24:02,840 --> 00:24:03,679
Speaker 3: are keep coming back to.

463
00:24:03,720 --> 00:24:05,119
Speaker 2: This is an and option.

464
00:24:05,600 --> 00:24:07,880
Speaker 3: But I would also tell the JSP protocol first of all,

465
00:24:07,920 --> 00:24:10,000
Speaker 3: it's not an accounting system.

466
00:24:10,040 --> 00:24:11,280
Speaker 2: It's a reporting system.

467
00:24:12,000 --> 00:24:14,119
Speaker 3: And the other issue is is if you're going to

468
00:24:14,160 --> 00:24:16,879
Speaker 3: use it account it doubles triple counts, which means it

469
00:24:16,920 --> 00:24:20,280
Speaker 3: doesn't add up to the total planet's emissions. That's a problem.

470
00:24:20,560 --> 00:24:23,800
Speaker 3: It also attempts to assign accountability where it doesn't belong.

471
00:24:23,840 --> 00:24:25,399
Speaker 3: And I make a point with Scope three all the

472
00:24:25,440 --> 00:24:28,480
Speaker 3: time to ask me, as a company that produces products

473
00:24:28,520 --> 00:24:31,480
Speaker 3: that are in demand and that are desperately needed by

474
00:24:31,640 --> 00:24:34,719
Speaker 3: communities all around the world, that I can't sell that

475
00:24:34,800 --> 00:24:37,440
Speaker 3: to them because I need to reduce their emissions.

476
00:24:37,760 --> 00:24:39,119
Speaker 2: I think is unreasonable.

477
00:24:39,160 --> 00:24:41,520
Speaker 3: It's an unreasonable request, and it ends up with an

478
00:24:41,560 --> 00:24:44,520
Speaker 3: outcome that nobody wants. We've got four billion people on

479
00:24:44,560 --> 00:24:48,560
Speaker 3: the planet that living in energy poverty, that desperately need reliable,

480
00:24:48,680 --> 00:24:52,879
Speaker 3: affordable sources of energy. Today, those sources have emissions associated

481
00:24:52,880 --> 00:24:54,960
Speaker 3: with them. Okay, we need to address that, but we

482
00:24:55,000 --> 00:24:59,080
Speaker 3: can't do that by robbing them of the tools and

483
00:24:59,119 --> 00:25:02,239
Speaker 3: the leverage and enabling them to grow economically and to

484
00:25:02,240 --> 00:25:04,640
Speaker 3: improve their lifestyle. And so we've got to figure out

485
00:25:04,640 --> 00:25:06,800
Speaker 3: how we do both. I don't know how how long

486
00:25:06,840 --> 00:25:09,399
Speaker 3: it takes. You know, you can start. This doesn't have

487
00:25:09,440 --> 00:25:12,360
Speaker 3: to be a big bang from my perspective. I mean,

488
00:25:12,560 --> 00:25:14,439
Speaker 3: I'm a big believer in the pareto that there are

489
00:25:14,560 --> 00:25:17,640
Speaker 3: twenty percent of the products or services are causing eighty

490
00:25:17,680 --> 00:25:18,440
Speaker 3: percent of the emissions.

491
00:25:18,480 --> 00:25:20,520
Speaker 2: Let's start by focusing on those and by.

492
00:25:20,359 --> 00:25:22,840
Speaker 3: The way, you don't get it perfect, get eighty percent

493
00:25:22,920 --> 00:25:25,080
Speaker 3: of the twenty percent and start there and then eve

494
00:25:25,119 --> 00:25:26,840
Speaker 3: all that and get better as you go. There are

495
00:25:26,880 --> 00:25:30,679
Speaker 3: lots of ways to address this in a thoughtful, objective way,

496
00:25:31,000 --> 00:25:32,720
Speaker 3: but we've got to do it in that way, thoughtfully

497
00:25:32,760 --> 00:25:35,800
Speaker 3: and objectively, based on the science of CO two emissions

498
00:25:35,840 --> 00:25:38,920
Speaker 3: and generation of CO two, and then accounting philosophy for

499
00:25:39,000 --> 00:25:41,040
Speaker 3: how best you do that get started.

500
00:25:41,320 --> 00:25:43,800
Speaker 1: I think on the people who are worried about the

501
00:25:43,840 --> 00:25:46,120
Speaker 1: delay tactic, they would welcome the view that you can

502
00:25:46,160 --> 00:25:49,640
Speaker 1: have both green as Grass protocol and the combon measures

503
00:25:49,680 --> 00:25:52,000
Speaker 1: accounting system, because that would allow you to in a

504
00:25:52,080 --> 00:25:54,160
Speaker 1: market of ideas competitions.

505
00:25:53,680 --> 00:25:56,800
Speaker 2: Anybody is suggesting you get one, Yeah, that's exactly right. Market.

506
00:25:56,880 --> 00:25:58,960
Speaker 2: It's a competition of ideas.

507
00:25:59,000 --> 00:26:01,520
Speaker 3: And if you've got a good if you've got a

508
00:26:01,560 --> 00:26:03,960
Speaker 3: good idea, you shouldn't be afraid of competition.

509
00:26:09,840 --> 00:26:11,840
Speaker 1: Join me after the break for more of my conversation

510
00:26:11,920 --> 00:26:15,080
Speaker 1: with Darren Woods, CEO of Exon Mobile, And if you'd

511
00:26:15,119 --> 00:26:17,760
Speaker 1: like more from Bloombergreen at cop thirty, sign up for

512
00:26:17,840 --> 00:26:21,920
Speaker 1: our daily newsletter at Bloomberg dot com Forward Slash Newsletters.

513
00:26:29,920 --> 00:26:32,840
Speaker 1: So let's come to the low carbon side of the

514
00:26:32,920 --> 00:26:36,359
Speaker 1: ideas that you are funding. You have been clear in

515
00:26:36,560 --> 00:26:40,040
Speaker 1: multiple forums that EGXON strength is in the molecules business,

516
00:26:40,680 --> 00:26:42,760
Speaker 1: and that's why you haven't really made a play in

517
00:26:43,000 --> 00:26:46,800
Speaker 1: solar or wind deployment. But what we've seen over the

518
00:26:46,840 --> 00:26:51,080
Speaker 1: past few decades is that the demand for electricity has

519
00:26:51,119 --> 00:26:56,399
Speaker 1: been typically at double the pace of energy from molecules.

520
00:26:57,240 --> 00:27:01,800
Speaker 1: With AI that's a more recent phenomena. We are seeing

521
00:27:01,800 --> 00:27:04,680
Speaker 1: the gap grow between the demand for electricity and rest

522
00:27:04,720 --> 00:27:08,960
Speaker 1: of energy. Are you reconsidering getting into the electricity business

523
00:27:09,000 --> 00:27:09,240
Speaker 1: as it is?

524
00:27:09,600 --> 00:27:11,800
Speaker 3: I would start by reminding you that the electricity is

525
00:27:11,840 --> 00:27:15,639
Speaker 3: generated from molecules, not always majority of them, a majority

526
00:27:15,680 --> 00:27:17,720
Speaker 3: of them, and if you go well into the future

527
00:27:17,760 --> 00:27:20,120
Speaker 3: to twenty fifty, you're still going to see the majority

528
00:27:20,119 --> 00:27:23,080
Speaker 3: of power being generated by molecules. So no, I'm not

529
00:27:23,119 --> 00:27:26,000
Speaker 3: reconsidering that. I think there is a capability that we

530
00:27:26,040 --> 00:27:28,720
Speaker 3: bring there. And I would also strongly make the point

531
00:27:28,840 --> 00:27:32,880
Speaker 3: that hydrogen and carbon molecules go into a lot more

532
00:27:32,960 --> 00:27:36,119
Speaker 3: products that society needs that enable modern living than just

533
00:27:36,200 --> 00:27:40,240
Speaker 3: combustion products. And so I'm perfectly comfortable with the idea

534
00:27:40,240 --> 00:27:42,760
Speaker 3: that over time there will be elements of the products

535
00:27:42,760 --> 00:27:45,520
Speaker 3: that I make which are no longer needed by society

536
00:27:45,560 --> 00:27:49,600
Speaker 3: because we've found better alternatives with less emissions maybe other benefits.

537
00:27:49,720 --> 00:27:52,280
Speaker 3: I'm okay with that. We have historically evolved as a

538
00:27:52,320 --> 00:27:56,360
Speaker 3: company on that basis. That doesn't change, though the fundamental

539
00:27:56,440 --> 00:28:00,560
Speaker 3: need for our ability to transform these molecules into products

540
00:28:00,600 --> 00:28:03,600
Speaker 3: as society needs. I just very quickly give you two examples.

541
00:28:03,880 --> 00:28:07,080
Speaker 3: One of them is we recognize that one carbon molecules

542
00:28:07,640 --> 00:28:10,399
Speaker 3: are in low demand, high supply, and so you know,

543
00:28:10,440 --> 00:28:13,120
Speaker 3: my business drives the low cost what can we make

544
00:28:13,160 --> 00:28:17,200
Speaker 3: with low cost carbon molecules? Our organizations invented a unique

545
00:28:17,240 --> 00:28:21,080
Speaker 3: carbon molecule that has properties that lend themselves to anodes

546
00:28:21,119 --> 00:28:25,440
Speaker 3: and batteries, and we're seeing through third party testing that

547
00:28:25,520 --> 00:28:30,119
Speaker 3: are carbon this used in nanodes gives thirty percent faster

548
00:28:30,240 --> 00:28:34,280
Speaker 3: charging times, thirty percent further range, and over four times

549
00:28:34,320 --> 00:28:37,480
Speaker 3: the battery life. So there's a huge improvement in lithium

550
00:28:37,480 --> 00:28:40,200
Speaker 3: ion battery with a product that I'm making out of

551
00:28:40,240 --> 00:28:40,960
Speaker 3: a molecule.

552
00:28:41,240 --> 00:28:44,320
Speaker 1: Let's come to that battery breakthrough, because that's recent the

553
00:28:44,360 --> 00:28:48,320
Speaker 1: announcement at least, and you know, batteries are something that

554
00:28:48,360 --> 00:28:50,400
Speaker 1: the world wants a lot of right now, and so

555
00:28:50,760 --> 00:28:53,760
Speaker 1: having new materials is good. There's lots of innovation that's

556
00:28:53,760 --> 00:28:58,080
Speaker 1: happening in that space. But with any technology breakthrough, and

557
00:28:58,120 --> 00:29:00,880
Speaker 1: this is not just a battery problem, but any technology breakthrough,

558
00:29:01,000 --> 00:29:03,040
Speaker 1: there tends to be a certain amount of hype that

559
00:29:03,080 --> 00:29:05,200
Speaker 1: comes with it before we can see it in action.

560
00:29:06,320 --> 00:29:07,040
Speaker 2: With this company.

561
00:29:07,440 --> 00:29:11,600
Speaker 1: Well, we can take the example of algae fuels that

562
00:29:11,720 --> 00:29:14,680
Speaker 1: you know, Eggson was supportive of thought there was a breakthrough,

563
00:29:14,720 --> 00:29:17,400
Speaker 1: but now that doesn't become a practical solution.

564
00:29:17,880 --> 00:29:21,080
Speaker 3: So how we should You should make the distinction between

565
00:29:21,120 --> 00:29:25,600
Speaker 3: pursuing a technology breakthrough and announcing one. And what we

566
00:29:25,640 --> 00:29:28,640
Speaker 3: talked about with biofuels was the need to produce the

567
00:29:28,680 --> 00:29:31,600
Speaker 3: productivity of algae, to generate the amount of oil to

568
00:29:31,640 --> 00:29:34,400
Speaker 3: make it economically viable. That's what we were working on and

569
00:29:34,440 --> 00:29:37,080
Speaker 3: we saw the potential there. We never announced the breakthrough

570
00:29:37,080 --> 00:29:39,640
Speaker 3: that said we were there. I would contrast that with

571
00:29:39,680 --> 00:29:41,800
Speaker 3: what we're saying with carbon material, which is to say

572
00:29:42,040 --> 00:29:44,880
Speaker 3: we had a view and an idea, we've developed the molecule,

573
00:29:45,120 --> 00:29:48,200
Speaker 3: we've graphatized it, we've put it into application, and we've

574
00:29:48,200 --> 00:29:50,959
Speaker 3: had third parties testing it, and those results are what

575
00:29:50,960 --> 00:29:51,840
Speaker 3: we're reporting on.

576
00:29:52,120 --> 00:29:53,920
Speaker 2: That's a very different construct.

577
00:29:54,120 --> 00:29:58,280
Speaker 1: So when might we see that carbon molecule in an

578
00:29:58,280 --> 00:30:00,600
Speaker 1: actual battery, in a commerce product.

579
00:30:00,760 --> 00:30:01,600
Speaker 2: When will we see that.

580
00:30:02,160 --> 00:30:04,520
Speaker 3: We're working really hard to get that commercialized by the

581
00:30:04,560 --> 00:30:06,800
Speaker 3: end of this decade. But I think you know, again,

582
00:30:07,440 --> 00:30:09,880
Speaker 3: in my mind, we don't over promise and hun to deliver,

583
00:30:10,320 --> 00:30:12,080
Speaker 3: and what we try to do is report on what

584
00:30:12,120 --> 00:30:15,040
Speaker 3: we're trying to do and accomplish. We've got to commercialize that.

585
00:30:15,120 --> 00:30:17,520
Speaker 3: We have gone from the lab to a demo unit

586
00:30:17,560 --> 00:30:18,760
Speaker 3: and we have to commercialize that.

587
00:30:18,840 --> 00:30:19,720
Speaker 2: So that will take time.

588
00:30:19,760 --> 00:30:21,479
Speaker 3: These are large scales, and by the way, we're only

589
00:30:21,520 --> 00:30:23,160
Speaker 3: going to pursue the things that are large and make

590
00:30:23,360 --> 00:30:26,200
Speaker 3: material difference. Stacks on mobile I can't have a bunch

591
00:30:26,200 --> 00:30:29,240
Speaker 3: of nickel and dime businesses. So it doesn't bother me,

592
00:30:29,280 --> 00:30:31,880
Speaker 3: and it should not suggest that because it's going to

593
00:30:31,880 --> 00:30:34,959
Speaker 3: take time, that it's not real. I think you know,

594
00:30:35,080 --> 00:30:37,320
Speaker 3: the difference may be in your mindset versus ours. We

595
00:30:37,440 --> 00:30:40,160
Speaker 3: think in terms of decades because we understand what it

596
00:30:40,200 --> 00:30:42,680
Speaker 3: takes to make these very large scale investments in the

597
00:30:42,720 --> 00:30:44,440
Speaker 3: time that it will take to bring them online and

598
00:30:44,480 --> 00:30:47,960
Speaker 3: then penetrate to markets. And that's true with all all products.

599
00:30:48,120 --> 00:30:50,560
Speaker 1: Let's talk about some of the other low carbon solutions

600
00:30:50,560 --> 00:30:55,320
Speaker 1: that you've worked on. You have a lithium extraction idea

601
00:30:55,400 --> 00:30:58,560
Speaker 1: that you are working on now. Lithium prices, as you

602
00:30:58,680 --> 00:31:02,520
Speaker 1: well know, are even more volatile than fossil fuel prices.

603
00:31:03,760 --> 00:31:08,160
Speaker 1: Does that make the investment thesis less attractive?

604
00:31:08,840 --> 00:31:11,680
Speaker 3: No, because we look at lithium no different than we

605
00:31:11,680 --> 00:31:14,160
Speaker 3: look at any other products that we make, which is

606
00:31:14,240 --> 00:31:17,240
Speaker 3: where does our production sit on the cost of supply curve.

607
00:31:17,760 --> 00:31:21,080
Speaker 3: So you know, if I independent upon a commodity, if

608
00:31:21,120 --> 00:31:24,120
Speaker 3: I'm in a commodity business where prices are set by

609
00:31:24,120 --> 00:31:26,320
Speaker 3: supply and demand, I do not control the supply and

610
00:31:26,360 --> 00:31:27,560
Speaker 3: I do not control the demand.

611
00:31:27,600 --> 00:31:28,760
Speaker 2: So I'm a price taker.

612
00:31:29,520 --> 00:31:32,640
Speaker 3: Across majority of my businesses, I'm a price taker, and

613
00:31:32,680 --> 00:31:35,000
Speaker 3: so I will never know where prices are going to be,

614
00:31:35,000 --> 00:31:37,720
Speaker 3: and I know that they will fluctuate based on where

615
00:31:37,760 --> 00:31:41,360
Speaker 3: demand goes and how much supply comes on. Our strategy

616
00:31:41,400 --> 00:31:45,000
Speaker 3: for being successful in a volatile market is to bring

617
00:31:45,040 --> 00:31:47,520
Speaker 3: production on that's the low cost of supply. Because I

618
00:31:47,600 --> 00:31:52,240
Speaker 3: know in these markets that the least efficient supplier required

619
00:31:52,280 --> 00:31:54,200
Speaker 3: to meet the demand is going to set the price.

620
00:31:54,480 --> 00:31:57,120
Speaker 3: I've got to be better than that producer to get

621
00:31:57,160 --> 00:31:59,360
Speaker 3: a margin. And that's what we're working on and in

622
00:31:59,440 --> 00:32:02,360
Speaker 3: lithium exactly the approach that we're taking. And I would

623
00:32:02,360 --> 00:32:04,680
Speaker 3: tell you with respect to that, we're still working to

624
00:32:04,720 --> 00:32:07,600
Speaker 3: convince ourselves that we can get on the low end

625
00:32:07,640 --> 00:32:09,800
Speaker 3: of the cost of supply curve. So we're building small

626
00:32:09,920 --> 00:32:12,600
Speaker 3: units to test that to drive the technology. Whether that

627
00:32:12,600 --> 00:32:14,880
Speaker 3: will be successful, we don't know yet. But what I'll

628
00:32:14,920 --> 00:32:17,320
Speaker 3: tell you is we know we have a concept. We're

629
00:32:17,360 --> 00:32:19,959
Speaker 3: demonstrating the ability to do that. We've made lithium. Now

630
00:32:20,000 --> 00:32:22,800
Speaker 3: the question is can we commercialize it at scale at

631
00:32:22,800 --> 00:32:25,440
Speaker 3: a cost that's competitive with Chinese cash costs.

632
00:32:25,760 --> 00:32:27,360
Speaker 2: That's a question that's yet to be answered.

633
00:32:27,640 --> 00:32:31,080
Speaker 1: And would that be the same answer for direct air

634
00:32:31,080 --> 00:32:32,000
Speaker 1: capture technology?

635
00:32:32,520 --> 00:32:34,680
Speaker 3: Direct air capture the same thing everything that we're doing.

636
00:32:34,760 --> 00:32:37,520
Speaker 3: It's a little different in that it's a cost of abatement,

637
00:32:38,080 --> 00:32:40,240
Speaker 3: but it's the same principle. We have to be on

638
00:32:40,280 --> 00:32:42,000
Speaker 3: the low end of the cost of abatement curve because

639
00:32:42,000 --> 00:32:46,040
Speaker 3: if it can't compete economically, then we're not interested in

640
00:32:46,040 --> 00:32:47,920
Speaker 3: And I would tell you that's true even for the

641
00:32:47,960 --> 00:32:49,440
Speaker 3: businesses today that are being.

642
00:32:49,280 --> 00:32:50,760
Speaker 2: Subsidized by policy.

643
00:32:51,280 --> 00:32:53,960
Speaker 3: What I tell the organization is we can begin the

644
00:32:54,000 --> 00:32:56,280
Speaker 3: business based on that, but we're not going to end

645
00:32:56,360 --> 00:32:59,040
Speaker 3: up there. And so anything that we're doing, we have

646
00:32:59,120 --> 00:33:02,360
Speaker 3: to convince ourselves that over time we'll find a way

647
00:33:02,400 --> 00:33:03,840
Speaker 3: to get on the far left hand side of the

648
00:33:03,840 --> 00:33:06,800
Speaker 3: cost of supply curve so that when market forces take

649
00:33:06,840 --> 00:33:09,480
Speaker 3: over and by the way they have to if we're

650
00:33:09,480 --> 00:33:11,880
Speaker 3: going to be successful as society, that I better be

651
00:33:11,920 --> 00:33:14,480
Speaker 3: advantaged with respect to that production. And if I can't

652
00:33:14,520 --> 00:33:16,920
Speaker 3: clear that hurdle and convince myself of it, we won't

653
00:33:16,960 --> 00:33:18,680
Speaker 3: go in that business or make those investments.

654
00:33:18,960 --> 00:33:22,480
Speaker 1: Another low carbon commitment you have is to reduce the

655
00:33:22,960 --> 00:33:26,680
Speaker 1: methane intensity of natural gas, so the amount of methane

656
00:33:26,680 --> 00:33:29,560
Speaker 1: that you leak as a result of the processes that

657
00:33:29,600 --> 00:33:33,640
Speaker 1: are involved in extracting and delivering natural gas to customers.

658
00:33:34,320 --> 00:33:36,960
Speaker 1: You have a goal for twenty thirty to try and

659
00:33:37,080 --> 00:33:42,920
Speaker 1: be near zero methane leaks, and that's crucial here at

660
00:33:42,960 --> 00:33:45,600
Speaker 1: COP thirty, where there's going to be a big discussion

661
00:33:45,640 --> 00:33:48,680
Speaker 1: around methane and maybe even a methane deal of some sort.

662
00:33:48,800 --> 00:33:50,760
Speaker 1: You know there's already a target, but how do you

663
00:33:50,800 --> 00:33:53,720
Speaker 1: actually get to that target. Lots of countries are talking

664
00:33:53,800 --> 00:33:57,840
Speaker 1: about that now. The Inflation Reduction Act would have benefited

665
00:33:57,880 --> 00:34:00,720
Speaker 1: companies like yours who are starting to work on reducing

666
00:34:00,760 --> 00:34:03,400
Speaker 1: methane intensity because it was going to put a methane

667
00:34:03,400 --> 00:34:06,400
Speaker 1: fee on those who leak. A lot that's gone now

668
00:34:06,840 --> 00:34:09,960
Speaker 1: to use stop investing in methane reductions. As a result

669
00:34:09,960 --> 00:34:11,160
Speaker 1: of the incentive going away.

670
00:34:11,239 --> 00:34:15,160
Speaker 3: We were driving methanetense reductions before the IRA came along,

671
00:34:15,239 --> 00:34:18,000
Speaker 3: and we'll continue to it long after the IRA has expired.

672
00:34:18,040 --> 00:34:22,480
Speaker 3: So we don't our commitment to reduce emissions CO two emissions,

673
00:34:22,520 --> 00:34:25,799
Speaker 3: methane emissions isn't a function of policy being put in

674
00:34:25,840 --> 00:34:29,440
Speaker 3: place or being incentivized by penalties.

675
00:34:29,960 --> 00:34:31,200
Speaker 2: Our objective there.

676
00:34:31,040 --> 00:34:33,640
Speaker 3: Is to be a responsible operator, and from my perspective

677
00:34:33,640 --> 00:34:35,920
Speaker 3: from the dagout in this job, it was if we're

678
00:34:35,960 --> 00:34:39,960
Speaker 3: producing something, it's our responsibility and obligation to keep it

679
00:34:39,960 --> 00:34:42,200
Speaker 3: in the pipe, and we need work to do that.

680
00:34:42,239 --> 00:34:45,560
Speaker 3: And we've made huge progress in that, irrespective of the

681
00:34:45,600 --> 00:34:47,840
Speaker 3: commitments that we've made publicly. That was if you go

682
00:34:47,920 --> 00:34:51,279
Speaker 3: back in time, before methane was had the profile that

683
00:34:51,320 --> 00:34:55,120
Speaker 3: it has today, we began reducing our methane emissions intensity

684
00:34:55,440 --> 00:34:58,640
Speaker 3: before even this became a very public issue or a

685
00:34:58,719 --> 00:35:00,759
Speaker 3: high profile issue, and we're going to continue to do that.

686
00:35:00,760 --> 00:35:01,960
Speaker 2: We make great progress with it.

687
00:35:02,120 --> 00:35:03,759
Speaker 1: One of the things that has happened over the last

688
00:35:03,760 --> 00:35:07,799
Speaker 1: few years, which has been exceptional relative to other oil

689
00:35:07,800 --> 00:35:11,840
Speaker 1: and gas companies, is that EGXON has signed lots and

690
00:35:11,880 --> 00:35:15,760
Speaker 1: lots of permitting deals around the world, so recently grease,

691
00:35:15,880 --> 00:35:21,680
Speaker 1: but also you're re entering Iraq, Trinidad, Libya. Given where

692
00:35:21,680 --> 00:35:25,160
Speaker 1: we are in oil and gas markets, generally there's lots

693
00:35:25,200 --> 00:35:29,000
Speaker 1: of oversupply right now, prices have been falling. Why are

694
00:35:29,080 --> 00:35:32,560
Speaker 1: you expanding your permitting regimes aggressively?

695
00:35:32,719 --> 00:35:34,160
Speaker 2: This is a depletion business.

696
00:35:34,880 --> 00:35:38,520
Speaker 3: The bigger you are, the more production you have, the

697
00:35:38,560 --> 00:35:41,160
Speaker 3: bigger the whole you dig through depletion. So every barrel

698
00:35:41,200 --> 00:35:43,279
Speaker 3: who produces a peril that's not available to us. So

699
00:35:43,280 --> 00:35:44,920
Speaker 3: you can think of it, it's like having a bottle

700
00:35:44,920 --> 00:35:47,560
Speaker 3: of water. Every sip you take is less water in

701
00:35:47,600 --> 00:35:49,680
Speaker 3: the bottle. Eventually the bottle runs out of water and

702
00:35:49,719 --> 00:35:51,480
Speaker 3: you need to find a new bottle. So that's the

703
00:35:51,560 --> 00:35:54,200
Speaker 3: job that we have is as we continue to produce

704
00:35:54,640 --> 00:35:57,280
Speaker 3: as a large producer, we have to find ways to

705
00:35:57,360 --> 00:35:59,960
Speaker 3: replace the barrels that we've put on the market.

706
00:36:00,480 --> 00:36:01,759
Speaker 2: That's a huge challenge.

707
00:36:01,880 --> 00:36:04,240
Speaker 3: And given that if you go out to twenty fifty

708
00:36:04,280 --> 00:36:07,279
Speaker 3: and beyond that oil and gas will continue to play

709
00:36:07,320 --> 00:36:11,880
Speaker 3: an important role and the energy mix and providing products

710
00:36:11,880 --> 00:36:14,160
Speaker 3: that the world needs. We know those barrels are going

711
00:36:14,200 --> 00:36:18,279
Speaker 3: to be needed, and so finding opportunities to bring more

712
00:36:18,320 --> 00:36:20,680
Speaker 3: production on to fill the depletion curve is a critical

713
00:36:20,680 --> 00:36:23,000
Speaker 3: part of the job. There's only really three levers that

714
00:36:23,040 --> 00:36:25,799
Speaker 3: we have to pull there. One is for the resources

715
00:36:25,800 --> 00:36:29,440
Speaker 3: that we already have today, how do we recover more.

716
00:36:29,960 --> 00:36:33,200
Speaker 2: That's a technology challenge that we're working very hard on.

717
00:36:33,640 --> 00:36:35,440
Speaker 3: The other is you can go out and bring a

718
00:36:35,480 --> 00:36:39,600
Speaker 3: technology advantage or a production advantage or operating advantage to

719
00:36:39,640 --> 00:36:43,040
Speaker 3: buy somebody else's assets and produce those more effectively, get

720
00:36:43,080 --> 00:36:45,799
Speaker 3: better recovery, and do it at a lower cost. And

721
00:36:45,800 --> 00:36:47,800
Speaker 3: then the third is you've got to find new things

722
00:36:47,840 --> 00:36:49,680
Speaker 3: and explorations are a critical part of that.

723
00:36:50,360 --> 00:36:53,560
Speaker 1: In getting those permits. How much has the Trump administration

724
00:36:53,680 --> 00:36:54,280
Speaker 1: been helpful?

725
00:36:54,400 --> 00:36:56,400
Speaker 2: We don't work through the US government on those.

726
00:36:57,040 --> 00:37:00,520
Speaker 1: Would you be interested in on gas assets in Azuela

727
00:37:00,600 --> 00:37:01,640
Speaker 1: if they were to open up?

728
00:37:01,760 --> 00:37:04,520
Speaker 3: So you know, we've been expropriated for Minnesota at two

729
00:37:04,560 --> 00:37:07,560
Speaker 3: different times, and so I think we have our history there,

730
00:37:07,600 --> 00:37:10,600
Speaker 3: we have an experience set, and so certainly looking at

731
00:37:10,640 --> 00:37:13,880
Speaker 3: what follows and what's in place, and how comfortable and

732
00:37:13,920 --> 00:37:16,600
Speaker 3: confident are we that if we made investments, that we'd

733
00:37:16,640 --> 00:37:18,719
Speaker 3: see the return on those investments. It would be a

734
00:37:18,719 --> 00:37:21,680
Speaker 3: critical part to evaluating that. And then we'd have to

735
00:37:21,680 --> 00:37:24,359
Speaker 3: see what the economics look like. So I wouldn't put

736
00:37:24,400 --> 00:37:24,680
Speaker 3: it on.

737
00:37:24,640 --> 00:37:25,839
Speaker 2: The list or take it off the list.

738
00:37:25,960 --> 00:37:28,399
Speaker 3: We'd have to see what the circumstances are at the time,

739
00:37:28,440 --> 00:37:29,880
Speaker 3: which today I don't know what they're going to be,

740
00:37:30,200 --> 00:37:31,120
Speaker 3: if they're even different.

741
00:37:31,360 --> 00:37:33,959
Speaker 1: You said previously that you don't work with the Trump

742
00:37:33,960 --> 00:37:38,120
Speaker 1: administration on permitting deals abroad, but there is a clear

743
00:37:38,160 --> 00:37:40,879
Speaker 1: indication from the Trump administration that they would like more

744
00:37:40,880 --> 00:37:44,240
Speaker 1: oil and gas production globally. Has there been any support

745
00:37:44,600 --> 00:37:46,719
Speaker 1: to help you figure out where that might be?

746
00:37:47,120 --> 00:37:48,680
Speaker 2: We don't need any help in that area.

747
00:37:49,320 --> 00:37:52,440
Speaker 1: Now. Key to your efforts to turn around performance at

748
00:37:52,440 --> 00:37:55,399
Speaker 1: Exomobil one hundred and fifty year old company has been

749
00:37:55,600 --> 00:37:59,759
Speaker 1: what you've classed as your focus on winning. Some of that, though,

750
00:37:59,800 --> 00:38:04,719
Speaker 1: has included layoffs and cost cutting internally, it's also doing

751
00:38:04,760 --> 00:38:08,880
Speaker 1: active as shareholders and even taking a rival to arbitration court.

752
00:38:09,280 --> 00:38:11,000
Speaker 1: Can you define what winning means to you?

753
00:38:11,320 --> 00:38:13,200
Speaker 3: Yeah, you've mixed a lot of things up in that

754
00:38:13,719 --> 00:38:17,560
Speaker 3: question that frankly don't are. You've got apples, oranges, bananas

755
00:38:17,560 --> 00:38:19,840
Speaker 3: and pairs in there. I think, first of all, what

756
00:38:19,840 --> 00:38:21,600
Speaker 3: I would tell you is what we've been very focused

757
00:38:21,640 --> 00:38:25,719
Speaker 3: on the winning is bringing a unique set of capabilities

758
00:38:25,760 --> 00:38:29,400
Speaker 3: and competitive advantages to the marketplace and realizing those advantages

759
00:38:29,440 --> 00:38:31,600
Speaker 3: on the bottom line. And so if you look at

760
00:38:31,600 --> 00:38:34,040
Speaker 3: the transformation the company's been making, the changes that we've

761
00:38:34,040 --> 00:38:38,000
Speaker 3: made in our organization, it has been restructuring to more

762
00:38:38,040 --> 00:38:42,880
Speaker 3: effectively bring the advantages of scale, bring the advantages of

763
00:38:42,920 --> 00:38:45,200
Speaker 3: the integrated businesses that we have and the synergies that

764
00:38:45,239 --> 00:38:48,960
Speaker 3: exist between those businesses to the bottom line, taking advantage

765
00:38:49,000 --> 00:38:53,120
Speaker 3: of and driving technology and technology benefits to the bottom line.

766
00:38:53,520 --> 00:38:58,279
Speaker 3: It's a focus on execution excellence, to drive capital efficiency,

767
00:38:58,640 --> 00:39:02,240
Speaker 3: to drive reliability, to drive a lower maintenance, higher safety,

768
00:39:02,400 --> 00:39:05,680
Speaker 3: better environmental performance. And then it's been about unlocking the

769
00:39:05,680 --> 00:39:08,239
Speaker 3: potential of our people. That's what the changes that we've

770
00:39:08,239 --> 00:39:11,759
Speaker 3: been driving to unlock this advantage we've been very focused on.

771
00:39:11,840 --> 00:39:15,239
Speaker 3: We've made great progress, and the layoffs that came from

772
00:39:15,239 --> 00:39:19,719
Speaker 3: that is a function of the restructuring and better organizing

773
00:39:19,920 --> 00:39:21,759
Speaker 3: our people in a way that they can work more

774
00:39:21,800 --> 00:39:24,800
Speaker 3: productively and take advantage of everything Excellent Mobile has to offer.

775
00:39:25,280 --> 00:39:29,440
Speaker 3: It was more about effectiveness less about efficiency, But like everything,

776
00:39:29,440 --> 00:39:32,640
Speaker 3: when you focus on being more effective, you find efficiencies,

777
00:39:32,680 --> 00:39:36,600
Speaker 3: and so that's what's driving that With respect to the lawsuits,

778
00:39:36,719 --> 00:39:38,720
Speaker 3: this is really around protecting the value that we're creating

779
00:39:38,719 --> 00:39:43,200
Speaker 3: for our shareholders and importantly defending ourselves against activist attacks

780
00:39:43,200 --> 00:39:47,120
Speaker 3: which are generated by an agenda that's not aligned with

781
00:39:47,160 --> 00:39:48,960
Speaker 3: the value of the company or the value that we

782
00:39:49,000 --> 00:39:52,759
Speaker 3: create for our shareholders. And unfortunately, we've gotten to a

783
00:39:52,840 --> 00:39:56,600
Speaker 3: place in society where the courts are being used frequently

784
00:39:57,000 --> 00:40:00,759
Speaker 3: to bring challenges to some of these activities. We're going

785
00:40:00,800 --> 00:40:03,600
Speaker 3: to use the same tools that our antagonists use to

786
00:40:03,680 --> 00:40:06,000
Speaker 3: defend the value that we're creating for our shareholders.

787
00:40:06,280 --> 00:40:10,360
Speaker 1: But sticking to layoffs, Egxon currently has fourteen thousand fewer

788
00:40:10,360 --> 00:40:13,360
Speaker 1: employees than in twenty nineteen, and there are plans to

789
00:40:14,040 --> 00:40:18,160
Speaker 1: lose another two thousand jobs. And Eggxon isn't the only

790
00:40:18,239 --> 00:40:22,160
Speaker 1: company doing this. We've seen jobs in Kinneco Phillips being

791
00:40:22,160 --> 00:40:24,960
Speaker 1: cut twenty percent to twenty five percent. Chevron has said

792
00:40:24,960 --> 00:40:27,719
Speaker 1: it would cut about twenty percent of its workforce. Do

793
00:40:27,760 --> 00:40:30,279
Speaker 1: you think it's a sign of the industry shrinking, that

794
00:40:30,360 --> 00:40:32,000
Speaker 1: its social license is eroding.

795
00:40:32,080 --> 00:40:34,439
Speaker 3: I can't speak for Kindaco and Savon, I can speak

796
00:40:34,480 --> 00:40:35,960
Speaker 3: for ourselves, and it's not. If you look at the

797
00:40:36,080 --> 00:40:39,360
Speaker 3: layoffs that you're talking about for us like three percent.

798
00:40:39,120 --> 00:40:40,600
Speaker 2: Of the workforce global workforce.

799
00:40:40,840 --> 00:40:44,160
Speaker 3: So again this is we've been very focused on changing

800
00:40:44,200 --> 00:40:46,520
Speaker 3: the how we work, as I mentioned the transformation that

801
00:40:46,560 --> 00:40:49,560
Speaker 3: we're trying to make to unlock our competitive advantages. What

802
00:40:49,600 --> 00:40:52,840
Speaker 3: we've shifted to as we've changed the how is to

803
00:40:52,880 --> 00:40:55,200
Speaker 3: focus on the where. And if you look at our

804
00:40:55,200 --> 00:40:58,440
Speaker 3: global footprint and where we were located, it is based

805
00:40:58,480 --> 00:41:03,680
Speaker 3: on an operating model, a construct that was developed decades ago,

806
00:41:03,840 --> 00:41:07,960
Speaker 3: and so we're bringing our operational footprint, our facility footprint

807
00:41:08,440 --> 00:41:11,680
Speaker 3: in line with how we work today. That is my mind,

808
00:41:11,800 --> 00:41:15,800
Speaker 3: an optimization step and it is not a deep cut

809
00:41:15,800 --> 00:41:18,480
Speaker 3: to drive. And again it wasn't driven, wasn't focused on

810
00:41:18,520 --> 00:41:22,319
Speaker 3: a cost cutting. It was focused on taking advantage of

811
00:41:22,320 --> 00:41:24,440
Speaker 3: our people and the teamwork and the collaboration and the

812
00:41:24,440 --> 00:41:26,960
Speaker 3: innovation that comes from that that we have unlocked with

813
00:41:27,000 --> 00:41:28,919
Speaker 3: these changes, and we can only do that when people

814
00:41:29,000 --> 00:41:32,440
Speaker 3: are in the same location. I'm a big believer in

815
00:41:32,560 --> 00:41:34,480
Speaker 3: working together, not working remotely.

816
00:41:34,680 --> 00:41:37,759
Speaker 1: Well, the two thousand ars yes, three percent, but since

817
00:41:37,760 --> 00:41:40,920
Speaker 1: twenty nineteen it's more than twenty five percent because you

818
00:41:40,920 --> 00:41:43,799
Speaker 1: have sixty three thousand employees now, so which comes.

819
00:41:43,520 --> 00:41:47,160
Speaker 3: From the transformation in the organizational. We had I think

820
00:41:47,239 --> 00:41:52,919
Speaker 3: eleven independent unique companies siloed in our organization. We've gotten

821
00:41:53,000 --> 00:41:55,960
Speaker 3: rid of the silos today and reorganized. We have a

822
00:41:55,960 --> 00:41:59,240
Speaker 3: one team, one goal mentality. People are working collaboratively together

823
00:41:59,520 --> 00:42:02,040
Speaker 3: and so you need less people when you take away

824
00:42:02,080 --> 00:42:06,360
Speaker 3: the artificial construct that exists. That's a function of improving

825
00:42:06,360 --> 00:42:08,239
Speaker 3: your effectiveness, getting better at what we do, and you

826
00:42:08,280 --> 00:42:10,319
Speaker 3: see that in the results that we have. If this

827
00:42:10,440 --> 00:42:13,040
Speaker 3: was a pure cost cutting exercise, you wouldn't see the

828
00:42:13,080 --> 00:42:16,320
Speaker 3: improvement that we're getting in safety, personnel safety, and process safety.

829
00:42:16,440 --> 00:42:18,799
Speaker 3: You wouldn't see the improvement that we're getting in our

830
00:42:18,840 --> 00:42:21,879
Speaker 3: reliability and we now have record reliability with our operations.

831
00:42:22,080 --> 00:42:24,560
Speaker 3: You wouldn't see that in the projects that we're delivering,

832
00:42:24,600 --> 00:42:28,080
Speaker 3: which today are industry leading both in cost and schedule.

833
00:42:28,120 --> 00:42:29,759
Speaker 3: And so there's a lot of benefits that you can

834
00:42:29,800 --> 00:42:33,439
Speaker 3: see that's happening in the company because of this effectiveness thing.

835
00:42:33,840 --> 00:42:36,799
Speaker 1: If we dig that five year period, the stock price

836
00:42:36,840 --> 00:42:40,640
Speaker 1: has certainly done wonders for eggs on. But if we

837
00:42:40,760 --> 00:42:43,800
Speaker 1: just take the last twelve months since Donald Trump's selection,

838
00:42:43,960 --> 00:42:47,319
Speaker 1: but since all these regulatory rollbacks, since the push to

839
00:42:47,320 --> 00:42:50,000
Speaker 1: try and get more fossil fuels. The stock price hasn't

840
00:42:50,000 --> 00:42:52,359
Speaker 1: done all that well. It's a little bit lower than

841
00:42:52,400 --> 00:42:54,680
Speaker 1: it was exactly one year ago. Now very much.

842
00:42:54,760 --> 00:42:56,040
Speaker 3: You have to I think anytime you look at the

843
00:42:56,040 --> 00:42:57,400
Speaker 3: stock price of the company, you have to look at

844
00:42:57,400 --> 00:43:00,640
Speaker 3: the commodity price market that we're in. Our stock price

845
00:43:00,719 --> 00:43:04,160
Speaker 3: is highly correlated with commodity prices, and so it will

846
00:43:04,200 --> 00:43:07,160
Speaker 3: move up and down. So the absolute number is less

847
00:43:07,280 --> 00:43:09,759
Speaker 3: important than the relative number over time and the things

848
00:43:09,760 --> 00:43:12,000
Speaker 3: that you're doing to improve that. So I don't have

849
00:43:12,000 --> 00:43:13,280
Speaker 3: any concerns in that space.

850
00:43:13,680 --> 00:43:16,919
Speaker 1: You've been in the role for nine years. How long

851
00:43:17,120 --> 00:43:18,080
Speaker 1: do you plan to stay on?

852
00:43:18,719 --> 00:43:20,560
Speaker 2: Well, the board gets to decide that, not me.

853
00:43:22,280 --> 00:43:24,319
Speaker 1: And what would you like to get done before you

854
00:43:24,360 --> 00:43:24,920
Speaker 1: step away.

855
00:43:25,120 --> 00:43:26,759
Speaker 3: You know, we've made a lot of changes, as you've

856
00:43:26,760 --> 00:43:28,960
Speaker 3: talked about. Many of those have been recent. In fact,

857
00:43:28,960 --> 00:43:31,320
Speaker 3: we just announced this week the formation of a global

858
00:43:31,360 --> 00:43:34,799
Speaker 3: operations organization, and we've got to bed those in and

859
00:43:34,840 --> 00:43:37,840
Speaker 3: I think we're only beginning to see the benefits of

860
00:43:37,880 --> 00:43:40,040
Speaker 3: that change, and I would like to have time to

861
00:43:40,400 --> 00:43:43,560
Speaker 3: really focus the organization on improving the effectiveness of the

862
00:43:43,640 --> 00:43:46,960
Speaker 3: changes that we've made we are rolling out. I think

863
00:43:47,120 --> 00:43:50,640
Speaker 3: the largest instance of SAP were today under our corporation,

864
00:43:50,719 --> 00:43:53,280
Speaker 3: the first time in our history, we will have a

865
00:43:53,320 --> 00:43:57,280
Speaker 3: system that spans the entire corporation and a data structure

866
00:43:57,320 --> 00:43:59,960
Speaker 3: that's consistent for every business we do everywhere around the world.

867
00:44:00,400 --> 00:44:03,239
Speaker 3: So it unlocks huge opportunities if you think about that

868
00:44:03,280 --> 00:44:07,520
Speaker 3: in conjunction with AI, where data and data consistency and

869
00:44:07,560 --> 00:44:10,319
Speaker 3: integrity is so critical to the benefits of AI, we

870
00:44:10,400 --> 00:44:13,680
Speaker 3: will have an unmatched platform with more data than anybody

871
00:44:13,920 --> 00:44:16,279
Speaker 3: else in our industry. And so I think i'd like

872
00:44:16,360 --> 00:44:18,239
Speaker 3: to see that through GOT We've got a program that

873
00:44:18,280 --> 00:44:20,360
Speaker 3: we're developing that through the next several years.

874
00:44:20,480 --> 00:44:21,640
Speaker 2: So there's still a lot to be.

875
00:44:21,640 --> 00:44:24,080
Speaker 3: Done in the company that's going to keep me busy,

876
00:44:24,120 --> 00:44:25,759
Speaker 3: and I'd like to see some of that land and

877
00:44:26,080 --> 00:44:27,960
Speaker 3: begin to produce the results that we're counting on.

878
00:44:28,120 --> 00:44:30,120
Speaker 2: Thank you, Dear, Thank you good talking with you.

879
00:44:45,239 --> 00:44:47,840
Speaker 1: Thank you for listening to zero. If you liked this episode,

880
00:44:47,880 --> 00:44:49,719
Speaker 1: please take a moment to rate and review the show

881
00:44:49,719 --> 00:44:52,920
Speaker 1: on Apple Podcasts and Spotify. This episode was produced by

882
00:44:52,960 --> 00:44:56,520
Speaker 1: Oscar Boyd with additional help from annam Azarakis. Our team

883
00:44:56,600 --> 00:45:00,680
Speaker 1: music is composed by Wonderly Special. Thanks to Sommersaudi, Moses Adam,

884
00:45:00,920 --> 00:45:04,880
Speaker 1: Laura Milan and Sharan chen i'm Akshadrati Baksu