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At Exxon, Making the Case for Oil

Jad Mouawad, New York Times
… While other oil companies try to paint themselves greener, Exxon’s executives believe their venerable model has been battle-tested. The company’s mantra is unwavering: brutal honesty about the need for oil and gas to power economies for decades to come.

… FROM a purely financial standpoint, there’s no doubt that Exxon’s business strategy has paid off. Despite the broader economic turmoil, Exxon is worth around $375 billion — more than General Electric, Bank of America and Google combined — making it the world’s largest corporation.

… What might be called the Exxon Way can be summed up in three ideals: discipline, patience and long-term vision. It is a formula the company drills into its managers from the moment they join Exxon, and which it keeps repeating through their careers. It explains the company’s resilience and its view that it has survived, and thrived, through countless commodity cycles.

… At Exxon, the engineers rule. From its very early days, the company has focused relentlessly on one thing: finding more ways to squeeze every penny out of each barrel of oil.

… Exxon and the other oil giants are facing a stark new landscape.

High prices have meant stratospheric profits, of course, but they have also led to more restrictions on access to oil fields around the world, making it harder for companies to increase their production and replace reserves.

… “If a company is not replacing reserves, and they are spending their cash to buy back their shares, and they are not growing their production, that is called liquidating the company,” says Amy Myers Jaffe, the associate director of Rice University’s energy program in Houston.

Ultimately, the biggest test for Exxon’s long-term business model is the fact that rising energy use — whether in the United States or in China — will eventually have to be reconciled with reducing carbon emissions and finding low-carbon energy sources. But as its contentious shareholder meeting with the Rockefeller heirs demonstrated, few topics are as touchy as Exxon’s stance on climate change.

… But while Exxon is slowly unshackling itself from Mr. Raymond’s stance on global warming, it remains faithful to his legacy by dismissing most green alternatives and sticking with hydrocarbons. Although the company’s tone has changed, its strategy has not. Despite growing pressures on oil companies to invest in alternative energy, Exxon’s long-term view remains unapologetically tied to fossil fuels.
(15 November 2008)
A laudatory piece on Exxon. It does give some interesting insights into the Exxon culture, but leaves out many nagging details. See Joseph Romm’s dissection of the article (next item).

What bugs me is the timing of the piece. The International Energy Agency has just released a groundbreaking report, which is in desperate need of analysis and explanation. And the lead energy writer for the New York Times writes a glowing piece on Exxon???? Meanwhile, there’s little word about the IEA report from the LA Times and Washington Post.

In contrast, ASPO-USA and The Oil Drum have managed to come up with about a half dozen articles analyzing the IEA report. (To be fair, the report has gotten coverage from some of the mainstream media, including the Guardian, the Financial Times and the Wall Street Journal. Also Jad Mouawad did write an article based on the executive summary of the report.) -BA

NYT suckered by ExxonMobil in puff piece titled ‘Green is for Sissies’

Joseph Romm, New York Times
Stenography on the deck of the Titanic

Another nail in the coffin of the “liberal media” meme.

The NYT has run a greenwashing press release from the oil giant masquerading as a major business news story. Yes, the print headline really is “Green is for Sissies,” but as you’ll see, it isn’t some kind of postmodern Onion-esque irony (except maybe unintentionally). Here are some unchallenged quotes:

  1. “The business model is based on a disciplined and rigorous approach to dealing with scientific data and facts,” [CEO Tillerson] says.
  2. “For the foreseeable future — and in my horizon that is to the middle of the century — the world will continue to rely dominantly on hydrocarbons to fuel its economy,” Mr. Tillerson says.
  3. “It’s the world’s greatest company, period,” says Arjun N. Murti, a Goldman Sachs oil analyst … “It is also the most misunderstood company in the world. For many people, the image of Exxon is the Exxon Valdez … Exxon has persevered over the past 100 years with the best culture and management team any company could have.”

Poor misunderstood oil giant … poor, misunderstood, disinformation-peddling, planet-destroying ExxonMobil. I need to pause for a moment to wipe the tear from my eye …

… To ExxonMobil, peak oil is a non-issue, global warming is no big deal, and renewable energy is for sissies. And for the New York Times, what ExxonMobil says goes!

I guess if you are in a downsizing industry, one way to cut costs is to simply repeat whatever you hear or read. That way you can replace your reporters with stenographers and copy machines. Heck, you can even replace your readers, since they will need to look elsewhere for credible analysis.
(17 November 2008)

Somali pirates seize tanker carrying oil worth $100m

Xan Rice, Guardian
Capture of huge Saudi ship hundreds of miles out to sea demonstrates that gangs have resources and audacity to disrupt one of world’s busiest shipping lanes

Somali pirates yesterday seized a Saudi supertanker carrying up to 2m barrels of oil worth around $100m in an audacious attack several hundred miles out to sea. Two Britons are among the 25 crew of the Sirius Star, which was captured 450 miles south-east of the Kenyan port of Mombasa. The US navy, which has been tracking the ship, said last night it was close to anchoring in the notorious pirate haven of Eyl on Somalia’s north-eastern coast.

“Both the size of the vessel and the distance from the coast where the hijackers struck is unprecedented,” said Commander Jane Campbell, a spokeswoman for the US Fifth Fleet, based in Bahrain. “It shows how quickly the pirates are adapting.”
(17 November 2008)