Tuesday, May 30, 2006

Exxon Mobil's "Can't-do" Attitude

In an era of $3.00 gas and oil companies' multi-billion-dollar quarterly profits, it's so refreshing to hear Exxon Mobil's CEO Rex Tillerson talk about how his company will lead the charge to develop alternative fuels and the technology to make them economically viable. Of course, as the CEO of a Fortune 50 company, one absolutely must have a clear vision of what's to come and a concrete plan for how to get there.

So, when asked recently by the Dallas Morning News to describe the coming explosion in alternative fuels development, here's what Mr. Tillerson had to say:

The day will come when we'll move from oil and fossil fuels to something different. It may or may not come in my lifetime. But what I know is, the day I die, I'll probably get driven to my funeral in something that uses hydrocarbons.

For the record, Mr. Tillerson is 54 years old. Surely, he must have a terminal disease that will see his life end soon, right? I mean, he's not seriously talking about being driven to his funeral in thirty years or so in a conventional, gasoline-powered vehicle, is he?

Is Mr. Tillerson joking? Well, as it turns out...not so much.

I think it would be a good idea if people used gasoline a little more efficiently. I'm not worried about it because you know gasoline, oil, natural gas, are so instrumental to people's lives today, both from an economic standpoint and from a quality of life standpoint.

And there is absolutely nothing out there for the next 30 years that's going to change that. ... Now, I'm not saying therefore I have a captive market and I can treat it however I want to. That's not the case either, because there are plenty of other people who want to sell gasoline into the market, too. ...

People will ... alter their habits around how to use gasoline when it gets too high ... unless people have concluded that this price is not inconvenient to them.

So far everything I see others investing in, they're losing money. There have been huge write-offs by some of my competitors of their investments in solar energy. There have been huge write-offs by some of my competitors of their investment in wind.

This biofuels phenomenon is very recent, like in the last six months. And it took an act of Congress to mandate its use and to leave in place a subsidy to make that work.

Okay. So, we've got oil and gas companies making billions of dollars in quarterly profits. We've got the same companies saying they need to spend up to one hundred billion dollars - yes, $100 BILLION - in the coming years to develop new oil refining capacity. And these companies also want to open vast new geographies - such as the Arctic National Wildlife Refuge - to new exploration and drilling. Yet, they are unwilling to invest in a new fuel like ethanol that is proving to be a legitimate alternative to gasoline in countries such as Brazil.

The United States can put men on the proverbial moon, develop microprocessing chips and nanotechnology that is revolutionizing countless industries, and find cures for an untold number of previously incurable diseases. But, for some reason, we can't find a way to do what a third world country like Brazil is doing to ween itself off of carbon-based fuels and foreign energy supplies. Incredible!

The oil companies have money to burn - literally. The U.S. government is spending hundreds of billions to do...whatever the hell it's trying to do in the Middle East. But they can't find a way to fund the development of corn-based ethanol technology...in a land that is among the most agriculturally fertile in the entire world.

Corn? We have corn. Lots of it. In fact, our own government has been paying farmers for years NOT to grow crops such as corn. We're talking about complete energy self-sufficiency for this country. No more oil imports. No more being held hostage by hostile foreign governments and cartels.

Hell, even the Indy 500 will have all of its race cars running on 100% ethanol in next year's race.

Yet, based on the comments of Exxon Mobil's Tillerson, we're just plain stuck with good old oil and gas for the foreseeable future. To do otherwise is just too expensive. It's too time-consuming. It's too uneconomical.

I'll tell you what it is: IT'S INSANE!!! And it's completely unacceptable!


At 5:25 AM, Blogger Andre VFB said...


I have just read your post and have to say that I agree for the most part. The concept is absolutely correct, and the continuous use of standard emission rate fuels is unacceptable. I happen to be Brazilian/American and have a good understanding of the subject, from both points of view, therefore I couldn't agree with you more that the US has an obligation to exceed the efforts of the Brazilian government. The reason being, the US is richer! There is however a few aspects that I wish to point out. Firstly, although the US is already the second largest alternate fuels producers in the world (second to Brazil), there is no possible way to replace the demand for oil based fuels. The shear land mass required to farm bio-ethanol in the US along with the higher costs (in comparison to Brazil) makes it a much less feasible alternative. The two main differences between the US and Brazil are: Brazil's cheap labour and the fact that in Brazil bio-ethanol is produced from sugar-cane, a much more appropriate crop (as it can provide a much larger amount of energy once fermented due to it's sugar content) than corn (what seems to be more abundant in the US.) The fact remains that the US government is indeed trying to conform to modern times, and diminish its dependency on oil. I for one do find it only fair the gas prices continue to rise in the States, as they are currently (at $3.00 a gallon) amongst the cheapest in the world. Providing alternatives to oil based fuels is not only a necessity for the well being of our environment, but also a preventive method for the future. However in order to remain realistic, we have to accept that Brazil is in a somewhat unique situation, although posing a grand example, and most countries will have to either import bio-ethanol or find other alternatives. As I am working on a PR campaign for SasolChevron's GTL Diesel, I have extensive information on alternate fuels like this cleaner diesel.

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The GTL diesel is much cleaner than regular diesel and has a much much lower rate of emissions. Although it is an oil derived fuel, it is a massive step towards a cleaner environment. Unfortunately as is mentioned on your post, we are unlikely to see the demise of oil derived fuels, so the least we can do is make an effort to improve it's refining. There is no excuse to pollute when we can take advantage of new and improved alternate fuels, even if they are derived from oil.

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At 1:08 PM, Blogger vcthree said...

"The day will come when we'll move from oil and fossil fuels to something different. It may or may not come in my lifetime."

But what he didn't say was: "That day won't come until after I've pocketed millions upon millions in my pension and retirement package!"


He said a hell of a lot of nothing. All he really said was, "Well, we understand people are pissed about this. But you see...we don't give a damn about y'all. We know you'll be back, whether the price is $3 or $10. We don't care--we're talkin' about our financial security, here!"

And you see how he went to the good 'ol "we're losing money" card. Um, WHAT? EXCUSE ME? You're losing money? Bull-and-horse crap. You don't lose money when you make BILLIONS of $$ in profit! Really, how stupid do these oil executives think we all are? Isn't the fact that they profited billions of dollars proof that they took all expenditures into account when they released the numbers? And here's Tillerson, crying about how he has to spend billions a year, when they make twice of their annual budget in less than a annual quarter. Shut up, BIG OIL.

The reason why they don't want to go to ethanol yet is because they're having too much fun raping us at the pump, and the government is helping them do it. Lazy asses.

At 1:13 PM, Blogger corndog said...

Excellent post. I share some of your frustration with the "us against them" attitude the Exxon executive has taken. There is no reason, since oil companies already have a distribution system in place, that they could not have as part of their vision the deriving of profits from the sale of both ethanol and gasoline.

Also, excellent commentary from Andre. I agree that America cannot follow the Brazilian model because some 70% of Brazil's liquid fuel usage is gasoline. The Brazilian trek toward energy independence was one of finding new sources of oil within their own borders, and with the power of the environmental lobby in this country, that is simply not a template the US could embrace.

I believe that the combination of ethanol from corn, cellulosic ethanol, bio-diesel, and plug-in hybrids that also are flex-fuel capable, CAN in time eliminate every drop of "jihad juice" we buy.

At 11:27 PM, Blogger DrewL said...


Thanks for your comments on my blog. Very informative and an excellent perspective on the alternative fuel successes in Brazil. I will be the first to admit that I don't possess enough knowledge about the intracacies of the fuel debate. However, I am one who believes in the adage, "Where there's a will, there's a way." Sadly, there doesn't seem to be enough "will" to make alternative fuels a legitimate reality in this country. At least not yet.

I'll spend some more time reading through the posts on your blog, so that I can educate myself a bit more on the issues.

Thanks, again!


At 11:32 PM, Blogger DrewL said...


As always, your comments get right to the meat of the issue. I wouldn't have so much of a problem with the oil companies' excessive profits if I felt that they were being put to good use to develop and IMPLEMENT legitimate alternate fuel systems. Clearly, they are not, and that is what's so galling. They are riding the petroleum gravy train like never before...and simultaneously driving us all into the ground by not being part of the solution.

On this front, methinks the free markets aren't strong enough to counter Big Oil. The only thing that will work is government regulation. And unless Big Oil gets its act together, they deserve every bit of regulation that comes their way.

At 11:38 PM, Blogger DrewL said...


Thanks for your comments. At some level, we "the people" are going to have to make our voices heard on this issue if we hope to get Big Oil to move off of their collective a$$e$ (with an emphasis on the $$$). They absolutely HAVE to be a big part of the solution, simply because of their financial muscle, their refining expertise and their distribution system. They are the 50 ton gorilla that can pretty much dictate how the fuel market goes, and if they want to focus on petroleum to the exclusion of all alternatives, then very little progress can be made.

At 4:02 PM, Blogger Jule said...

I loved your post about the gay marriage ban at usa today.
right on! I'm also married, heterosexual and also think it's ludicrous. It's a ploy all right and it's disgusting that it's even an issue our president is discussing when our people here are struggling with poverty, healthcare and serious probelms with our education system and while our children are dying for a war that doesn't make sense.

At 10:25 PM, Blogger Eric in Ottawa said...

Two words: gigantic kickbacks.


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