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Exxon Mobil CEO Tells Shareholders That Fossil Fuels Have Long Future
DALLAS - Exxon Mobil Chairman Rex Tillerson issued a ringing defense of the oil titan at the company's annual meeting Wednesday, where 11 shareholder proposals, all opposed by management, were roundly defeated in a spirited gathering at the Morton H. Meyerson Symphony Center.
Exxon Mobil CEO Rex W. Tillerson addresses reporters at a news conference at the conclusion of the Exxon Mobil Shareholders Meeting in Dallas, Texas May 27, 2009.
(REUTERS/Jessica Rinaldi) Tillerson praised Exxon's record-breaking financial performance in 2008, its handsome returns to shareholders in recent years, technological advances that have greatly enhanced oil and natural gas recovery, and its efforts to reduce the environmental harm of its far-ranging operations. He defended the company's large buybacks of company stock, saying that they have increased value to shareholders.
In comments at the meeting and a news conference afterward, Tillerson said U.S. gasoline consumption has probably peaked and will slowly decline as a result of increased fuel economy and a growing reliance on low-sulfur diesel fuel. But he said the world isn't anywhere close to reaching "peak oil," the point at which oil production will crest and then begin an irreversible decline as a result of dwindling petroleum deposits. A full-scale transition from fossil fuels could be "100 years away," he said.
Company focus intact
Tillerson strongly indicated that Exxon's primary focus in coming decades will likely remain on its core businesses of oil and gas exploration and production, refining and chemicals. He said there appears to be "a pretty bright future" for drilling in previously untapped shales - such as the natural-gas-rich Barnett Shale of North Texas and Haynesville Shale in northwest Louisiana and East Texas - as a result of technological advances in horizontal drilling and hydraulic fracturing.
If Congress passes climate-change legislation designed to slow global warming, Tillerson said he prefers implementation of a carbon tax rather than a "cap-and-trade" system being most strongly considered in Washington. A carbon tax would be "far more efficient," he said.
Tillerson got complaints from shareholders, who variously alleged that the company is largely shunning the issue of global warming, needs to become more involved in renewable energy such as wind and solar power, should have a more independent board of directors and doesn't provide sufficient avenues for shareholders to weigh in on issues such as executive pay.
The Rev. Michael Crosby, a Franciscan friar from Milwaukee who deals with corporate responsibility issues, told Tillerson that he has "a moral obligation" to address global warming, which many scientists say is aggravated by the burning of coal, oil and natural gas.
"I think Exxon Mobil should put a warning on every one its gas pumps . . . about the dangers of burning fossil fuels," similar to tobacco companies putting warning labels on cigarettes, Crosby said.
CEO pay
Mari Mather, speaking for Massachusetts-based NorthStar Asset Management, said that if Tillerson retires at 65 he could receive an "outrageous" retirement package of more than $600 million, including stock options. That prompted only an amused chuckle from Tillerson, who received $22.4 million in compensation in 2008, when Exxon rang up a net profit of $45.2 billion, the largest ever by a U.S. company. Tillerson's predecessor as CEO, Lee Raymond, drew a retirement package of nearly $400 million.
None of the 11 proposals offered by shareholders came close to passing. A "say on pay" proposal that shareholders take a nonbinding "advisory" vote at the annual meeting on compensation for top executives was supported by 41.4 percent of shares voted. A proposal for calling of special shareholder meetings drew 40.8 percent, and a proposal to make the board of directors more independent by not allowing Tillerson to serve as both CEO and board chairman garnered 29.5 percent.
Environmental proposals fared even worse. Proposals to adopt goals for limiting greenhouse-gas emissions, craft a policy for renewable energy research and development, and establish a task force to report on the likely consequences of climate change drew 29, 27 and 10 percent of shares voted, respectively.
Tillerson was stumped by one question: When will the U.S. again see record prices of $147 a barrel for oil and $4.11 a gallon for the average price for regular-grade gasoline, as it did last summer?
"I don't know," he responded with a bemused smile.
28 Comments so far
Show AllAnd these are the guys who are running full page ads saying they need tax subsidies or you will pay more for gasoline.
They drill 15,000 (50,000?)new wells a year in USA just to maintain current output.
Speculation is driving up prices again.
Hold 6 million leased USA acres with no wells.
And believe it is their privilege to poison your water with their "secret" toxic fracturing chemcal cocktail.
Fossil Fuels are for Fools.
With a $400 Billion investment 69% of USA electric could come from Photovoltaic by 2020( Scientific American Jan. '08).
"Global Warming Causes 300,000 Deaths a Year, Says Kofi Annan thinktank
Climate change is greatest humanitarian challenge facing the world as heatwaves, floods and forest fires become more severe"
The above from another CD thread.
Exxon/Mobil is a vile company headed by a vile man who is supported by vile shareholders who all pray to Mammon.
I could not agree with you more. I hope one of his many homes (or more) is among the first to go under water from global warming. I hope he is in the house at the time without a life preserver!!!!!
"Fossil Fuels Have Long Future" shouldn't that be translated to....
"WE WILL MAKE SURE Fossil Fuels Have Long Future"
glenn ford says
"Speculation is driving up prices again."
I'm not sure it is speculation, rather it is a pure calculated move with combined effort from Commodities "trades" and people in Oil business.
look at price last June/July $150/brl along with Record profit for all Oil companies !! We are again here at summer "Driving" season and Oil going up with "Demand Increase" and probably another season for profit.
glen ford is correct..
"Fossil Fuels are for Fools." unfortunately these people do not understand or are not informed that money from their pocket are being transferred to big oil and their top brass, while they themselves struggle to save for their own life.
This is a Corporate run Democracy !!
"This is a Corporate run Democracy !!"
Unfortunately (or fortunately, as some view Democracy), this is not a Democracy, it is a Corporate Fascist state.
"WE WILL MAKE SURE Fossil Fuels Have Long Future"
Exactly. "That's why we're spending your kids lives and your tax dollars to secure the middle east, home of the biggest light-sweet crude reserves on the planet: for our profits. Have a nice day."
The high demand in the summer driving season I believe is purely a calculated lie. I live in northern new jersey, I know I am sorry to, but during the summer there are less people on the road. I am in sales and during the summer it is easier for me to get around. When schools let out for the summer there are no school buses, teachers and all the people who support the schools on the roads and after labor day when school starts so does the traffic.
A "corporate-run democracy"??? Sounds a bit like Fascism. Eh????
Be advised, this bunch will not unhitch from fossil fuels until they have managed to wring out every possible currency unit out: its' Business 101.
"WE WILL MAKE SURE Fossil Fuels Have A Long Future"
OF COURSE. IT IS WHY WE ARE IN IRAQ, GIVING UP THE LIVES OF OUR BROTHERS AND SISTERS.
IRAQ is the holder of the second largest reserves of oil in the world, most of which hasn't really been developed.
When the economy is good, the price of oil goes up.
When the economy is bad, there is a glut of oil, but the price of gas goes up due to purposely cutting back on refinery output.
These corporations will continue to make billions in profits every year, no matter what. Its a lose-lose proposition for everyone else.
We will continue to use fossil fuels until the world is a sweltering, stinking mess, beyond any hope of repair.
Stimpy
Is there any logical reason why Tillerson needs a $600M retirement package? With that kind of money, his great-great grandchildren wouldn't have to work, assuming they will be able to survive on reeking, smog-choked and devastated planet. Maybe they will be eating their Soylent Green crackers with that strawberry jam that will cost $500 a jar.
Stimpy
I have been reading more on how the Gas is to be extracted from those Shale formations. People should be very concerned as these formations are widespread. A swathe has been found in the USA that is in the same area as the Oglalla reservoir.
"This PBS program was made possible by:"
"Exxon-Mobil"
"Chevron"
"Archer Daniels Midland"
"Lockheed-Martin"
and by:
gullible viewers like you"
excellent!
forgot 2 more words at the end....
"Thank You !!"
Tillerson is fundamentally correct: Fossil fuels will be around for another 200 or so years, but at ever increasing amounts of scarcity as reserves are exhausted. Prices are rising again because demand is again outstripping supply, as was predicted prior to the US economic meltdown. And in case you haven't noticed, the Energy War is being escalated in Af-Pak while force levels aren't really being reduced in Iraq. PLEASE read Pepe Escobar's essays about Pipelinestan for their revelatory, explanatory power, as well as Michael Klare's historical backgrounders. And there is theoildrum.com which is still providing lots of info about all things energy and those related to it.
And it should be remembered that the internet is powered by coal.
We need to starve the BEAST. That means we need to consider giving up stomping-our-feet in rage and begin using our creative energy... individually, and as a people as a whole, to starve the beast. The BEAST has devoured our government...all branches, our healthcare system, our environment, our ability to have affordable energy, and on and on. The BEAST thrives on profit which in turn fuels its power. We need to starve the Beast. Let's start talking about how that might be accomplished. Let's cease being victims, and start taking our lives back. Are we ready for that? Really? Are we grown up enough as a people(we live in one of the youngest countries in the world and we continue to behave as such......."I want, I want, I want".. "how come he gets $600 million in retirement mommy?"....). Are we ready to consider real sacrifice to starve the beast?
Yeah, it'll be available for a long, long time. To the very wealthy. As peak oil (real or not) hits the ground in earnest, more and more people at the other end are going to be sol.
I suppose that's the point of Iraq- besides the oil. Just the very wealthy practicing their defense against the masses....
Mr. Tillerson, I can assure you that fossil fuels have a much better future han you do. Save those millions. You and Ray are going to need every penny just to eat.
Fossil Fuels Have a Long Future - that's why they are using our money to build massive Emperial Fortresses (Embassies) in Iraq, Pakistan, Afghanistan etc. They will be spilling blood and plundering for lifetimes.
Exactly...so many places yet to be invaded too.
Apparently, Exxon Mobil has had a good year this year. Record profits again, but this time, less negative press. With the banks on Wall St. busy hogging up that and the bankruptcies of GM/Chrysler and the endless bailouts of AIG, we have forgotten Exxon.
Lets just say that the sooner that we get off of oil and coal, the better things will be not just for future generations, but also for our health. (And by that I mean both physical and the way that this world works, mental).
Tillerson lied when he said "I don't know," when prices will hit $147 a gallon again. He knows they will be double that shortly. As soon as the US & Israel iron out the details of their 'Iranian' attack on a US Naval vessel in the gulf of Oman.
Well...Gee whizz. I guess anyone who takes a close look at Rex's eyes will see the same vacant stare that has haunted the world since Bush II took office.
We...ordinary folks...really do control the diet of these freaks. Perhaps adding a bit of cyanide to their feed bowls might improve things? If not for us, today, maybe 100 years on?
and the porcine frame for the dead eyes
and does he die his eyebrows or his hair?
and how inappropriate to suggest cyaniding rex,
much too kind emaho, much too kind.
Of course they do. Heavy oil deposits in the U.S., now readily useable with new technology exceeed proven reserves in Saudi Arabia (which themselves don't account for recent results obtained by a couple of deep wells).Vast resources in Iraq and Iran are way under-developed. Gas reserves world-wide are largely untapped. Coal conversion and shale oil are becoming increasingly available through new and cleaner technologies. Consumption efficiencies alone will save billions of barrels in the coming years, not to mention co-generation and carbon-capturing techniques being developed in refining as well at least some minimal replacement sources being developed in the wind, solar and nuclear field. No one knows what would happen if political conflicts inhibiting developments in places like Africa were resolved or the reactionaries in the U.S. stopped thinking about "The Clash of Civilizations" and "survival of the fittest".
Rises in the price of oil are largely caused by lack of development in our refining capacities, deliberate withholding of supplies from the market and failure of the U.S. to use this resource in a sensible and sustaining way, thus undermining the confidence of the market as well as the strength of the dollar.
The typical response to this kind of story in Common Dreams is a completely passive one. As Chinese peasants used to tell their children: "submission ensures a safe life, courage leads to trouble and risk". It's so easy and personally satifying to finger a "Great Satan" and indulge in fantasies about the end of the world, proposing solutions for which the great masses of poor in all the rest of the world will suffer the most, like spraying sterilizing mists over rural villages in India to control world population growth.
It's totally disgusting!
A little perspective:
President Obama Announces Over $467 Million in Recovery Act Funding for Geothermal and Solar Energy Projects
source: http://www.energy.gov/news2009/7427.htm
Other government expenditures:
C. Boyden Gray on Oil Subsidies
http://www.cato-at-liberty.org/2006/12/21/c-boyden-gray-on-oil-subsidies/
The study, co-authored by major Republican C. Boyden Gray and published in a conservative law journal out of the University of Texas, alleges that the oil industry is subsidized to the tune of $250 billion a year
467,000,000/250,000,000,000 = 0.00186, or 0.19%
Defense budget: $533.7 billion for the Department of Defense base budget in 2010
source: http://www.whitehouse.gov/omb/asset.aspx?AssetId=729
467,000,000/533,700,000,000 = 0.000875, or 0.09%
Financial Rescue Nears GDP as Pledges Top $12.8 Trillion (Update1)
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=armOzfkwtCA4
467,000,000/12,800,000,000,000 = 0.000036484375, or 0.004%
I wonder what the ratio of the average drop to the average bucket is?
And yet Obama has the nerve to say this:
“We have a choice. We can remain the world’s leading importer of oil, or we can become the world’s leading exporter of clean energy,” said President Obama. “We can hand over the jobs of the future to our competitors, or we can confront what they have already recognized as the great opportunity of our time: the nation that leads the world in creating new sources of clean energy will be the nation that leads the 21st century global economy. That’s the nation I want America to be.”
"We have an ambitious agenda to put millions of people to work by investing in clean energy technology like solar and geothermal energy,” Energy Secretary Steven Chu said. "These technologies represent two pieces of a broad energy portfolio that will help us aggressively fight climate change and renew our position as a global leader in clean energy jobs.”
source: http://www.energy.gov/news2009/7427.htm
mtnbsatob
Just like a drunkard...addicted to the very end. And the end is coming rather sooner than later.