Chevron ex­pects change in top ex­ec­u­tives to bring tran­si­tion

The Gulf Today - Business - - 6viewpoint -

HOUS­TON: Chevron Cor­po­ra­tion Vice Chair­man Mike Wirth will be­come chief ex­ec­u­tive next Fe­bru­ary, re­plac­ing the re­tir­ing John Wat­son, the oil and nat­u­ral gas pro­ducer said.

The tran­si­tion brings an ex­ec­u­tive with ex­pe­ri­ence in the cost­cut­ting world of re­fin­ing to Chevron’s cor­ner of­fice as the in­dus­try emerges from a two-and-a-half year rout in crude prices that has squeezed rev­enue. Reuters re­ported the change of lead­er­ship last month, cit­ing a source close to the mat­ter.

Wirth, an en­gi­neer by train­ing, has worked at Chevron since 1982 and pre­vi­ously ran the com­pany’s pipeline and chem­i­cals and re­fin­ing busi­nesses.

“Mike was cho­sen for his track record of ac­com­plish­ment,” Wat­son said in an in­ter­view. “He is well known for his time in our down­stream port­fo­lio and his work on cost” con­trol.

The move copies ri­val Exxon Mo­bil Cor­po­ra­tion, which this year named re­fin­ing ex­pert Dar­ren Woods as its CEO, a step seen as pri­or­i­tiz­ing cash gen­er­a­tion to pro­tect pay­outs to share­hold­ers above pricy ex­plo­ration projects. The CEOS of ri­vals To­tal and Royal Dutch Shell also have ex­pe­ri­ence in re­fin­ing.

Chevron’s board of­fi­cially voted on Wed­nes­day to give Wirth the CEO post in ad­di­tion to the role of chair­man.

Wat­son said he told the com­pany’s board late in 2016 he was think­ing of re­tir­ing as large ex­pan­sion projects near com­ple­tion in Aus­tralia and Kaza­khstan and the com­pany taps more of its low­cost shale acreage in the Per­mian Basin. “$50 oil is not easy. But we’re as well po­si­tioned as any­one else,” Wat­son said. Chevron de­clined to make Wirth, 56, avail­able for an in­ter­view.

Wat­son, who will not hit the com­pany’s manda­tory re­tire­ment age of 65 for another four years, be­came CEO in 2010.

The com­pany’s growth un­der him has not been pain­less. Chevron has strug­gled with cost over­runs at two Aus­tralian liq­ue­fied nat­u­ral gas (LNG) projects.

“It’s fair to say we’ve done some things well and there’s ar­eas we can im­prove,” he said. “But we’ve dra­mat­i­cally out­per­formed our peers.”

He pointed out that Gor­gon, one of the LNG projects, was al­ready prof­itable and the other should be as it comes on­line later this year.

Wirth will also have to con­tend with grow­ing un­cer­tainty about Chevron’s op­er­a­tions in strife-torn Venezuela, where it is the only re­main­ing ma­jor U.S. oil pro­ducer.

Newspapers in English

Newspapers from UAE

© PressReader. All rights reserved.