Chevron – Chevron may not be an oil-first company in 2040, CEO says
“Oil and gas will still be a very big part. Will it be the biggest part? Time will tell,” Wirth told Fintech Zoom Business. “Twenty years forward there are things we are not doing today at any scale that no doubt we will be doing at a very large scale.”
The comments, from one of the captains of Big Oil no less, underscore the identity crisis facing the fossil fuels industry.
Chevron is not banking on solar and wind
Neither company has made major investments in solar and wind beyond supporting their own power needs — and Wirth indicated that won’t change.
‘It will not go away in 20 years’
Even so, Wirth realizes Chevron may need to change to meet the times.
“Twenty years from now we’ll be earning our profits from energy. But our company looks quite different today than it did 20 years ago,” he said in the interview.
In recent years Chevron has adapted to the shifting energy landscape by expanding into new areas, including shale and liquefied natural gas (LNG), two of Chevron’s most lucrative sources of revenue.
And Wirth stresses that Chevron is not saying goodbye to oil and gas. “It will not go away in 20 years. It will still be very important,” he said.
Heat from Washington
Still, over the next two decades, Wirth said the company could use its technical skills and financial strength to tackle big problems and invest in large, complex energy systems.
“That’s what we do. Twenty years from now that’s what we’ll be doing,” Wirth said. “Those energy investments will evolve to look different from today.”
Big Oil may be forced to evolve by a combination of Wall Street and the federal government.
“We support the president’s priorities,” Wirth said, pointing specifically to the Paris climate agreement, methane regulation and global engagement on climate change. “We also agree that the future of energy is lower carbon.”
But some of Biden‘s early actions “do raise concerns,” he said, including the moratorium on leasing. “These executive orders…will not reduce demand. They may simply reduce taxes and jobs.”
The White House has defended the impact on jobs by promising investments in clean energy that will create millions of union jobs.
The future of energy
Looking ahead, Wirth said Chevron plans to focus on three key areas: carbon capture and storage, hydrogen and renewable natural gas.
Chevron has a pair of projects in Australia and in Canada focused on carbon capture and storage, a way to trap emissions before they harm the planet.
“It’s currently expensive and not necessarily economical,” Wirth said. “But there are reasons to believe that with further investments in technology and cost structures, we can make it much more competitive.”
The question is which, if any, of these bets turns into a major moneymaker for Chevron. And whether the company finds an answer to that question before it’s too late.