“The World Will Be Using More Oil & Gas in 20 Years” says Chevron CEO

Chevron Chairman & Chief Executive Officer Mike Wirth said that the world will use more oil and gas in 10, 20 years. Wirth said that they want to incrementally improve understanding of new technologies and that the company will be methodical in doing so. Wirth spoke with Bloomberg’s Alix Steel. Watch or read the interview below.

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Wirth: The world will be using more oil and gas 20 years from now than it is today, and we intend to be one of the very best companies in this industry. And I think our shareholders deserve for us to continue to, you know, deliver that to them. At the same time, demand for energy is growing, expectations are changing. And we would look to invest in things where we have unique capabilities, technologies, capacity to solve some of the most difficult challenges confronting us on the energy and climate issue. And so, you know, we’ve announced investments in and a commitment to carbon capture. And storage is an area that we think is part of the solution. And we think companies in our industry are uniquely qualified to do that where others couldn’t.

Hydrogen is another in the hydrogen business today. There are different ways to think about manufacturing hydrogen and using hydrogen in the future. That’s something that would build off of capabilities that we have geothermal. We at one point where one of the world’s largest geothermal producers, we’ve recently invested in a couple of companies that have new and novel ideas on geothermal. So it would be things that extend strengths that we have today into new ways to be part of this future energy equation.

Host: I guess make under what circumstances would you spend more? I mean, you’re looking at about $3 billion in the coming years to try to deal with the energy transition strategy. And at one point, we were spending more that money. And is it a chicken and egg is that you have to ramp up your spend or is there have to be the scalable opportunities?

Wirth: Well, I think we need to know, many of these are very young and emerging technologies and opportunities. And so we want to see them dressed. We want to see them evolve. We want to see the economics continue to improve. You know, I’ll take you back to something you followed very closely, Alix, a decade ago as people looked at the Permian Basin and small companies were going fast, investing big and putting up kind of flashy promises. Some investors or some people in the media would come to us and say, you’re too big to do this, you’re too slow to do this. And we said, no, we want to understand it. We we want to derisk it. We want to have the technical and operating plans to scale this in a way that is sustainable, meaningful and can deliver strong performance. And that’s what we’ve done.

As you look at back at that from a decade in the future, I think you would argue that the kind of slow and steady approach that we and some others have taken probably was the better approach. As we’re looking at some of these new technologies, very similar, as you step into it, you want to incrementally build your understanding of the technology. You want to invest, you want to improve. You want to provide operating performance and business models and customer acceptance. And as these things are developed, you’re prepared to put more capital into them. So I think we’ll be methodical and disciplined in that. We have to do both. We have to have high returns and lower carbon. If we only invest in lower carbon, that won’t work for the long term for our shareholders. And if we only invest in things with strong returns and don’t pay attention to the environment, that’s not sustainable either. So it really is an end world as we look at this.

*Bloomberg contributed to this content

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