Exxon CEO’s Job-Creating Spending Spree is Hardly About Trump

Darren Woods estimated 45,000 jobs will be created as the oil giant leverages the shale boom to ramp up production of fuels, chemicals and exportable natural gas.

GettyImages-88295584-compressorThe world’s biggest listed oil company has appeared to back Donald Trump’s home-focused trade agenda. But, as has been the case with other companies promising large local investments, all is not entirely as it seems.

In one of his first major speeches since taking the reins from Rex Tillerson—who is now Trump’s Secretary of State—new Exxon Mobil CEO Darren Woods told a conference on Monday it would invest $20 billion in local refining and natural gas export facilities out to 2022.

The president responded glowingly: “This is a true American success story,” he said in a statement praising the oil company’s initiative.

Woods had told a conference in Houston the projects would create 45,000 jobs in U.S. Gulf Coast region, seemingly aligning with Trump’s campaign pledge to revive the local manufacturing industry.

Many of the related projects, however, had already been announced and it’s unclear how much of the $20 billion represents new spending. For example, Exxon had announced in 2014 that it would expand two chemical plants in Texas for an undisclosed sum.

“THE REAL DRIVE TO INNOVATE COMES FROM COMPETITION IN A FREE MARKET.”

Exxon is also a major shareholder in the $10 billion Golden Pass liquefied natural gas project, which would chill some of America’s vast shale gas resource and place it on tankers bound for fast-growing Asian economies. A final investment decision on the project has yet to be made and may ultimately depend on a rise in persistently low oil and natural gas prices.

Regardless of how much of the heralded investments are new, Woods also made it clear the developments are underpinned by another powerful motivating factor: the rise of America’s shale gas sector.

New drilling techniques that can extract oil and gas by blasting rocks apart with a combination of water, sand and chemicals have made the U.S. one of the world’s biggest energy producers, offering it scope to become a major exporter of energy. “The United States is a leading producer of oil and natural gas, which is incentivizing U.S. manufacturing to invest and grow,” Woods said.

The CEOs of Intel and GM have also recently pledged big investments in U.S. manufacturing capabilities. But, like Exxon, it was unclear how much, if any, weren’t already on the drawing board.

Woods’ focus on what the oil industry calls downstream operations, the refineries and other facilities that manufacture products from crude, comes as Exxon’s so-called upstream operations—oil exploration and production—suffer from a fall in reserves. Woods was the head of Exxon’s downstream business before taking over from Tillerson, so it’s not surprising that he’s touting that division’s ability to drive profits in the future.

And if further evidence was needed that the investments weren’t all about Trump, Woods made it clear the company is still a strong believer in free trade with other countries. “The real drive to innovate comes from competition in a free market,” Woods said. “It comes from all of us striving to out-perform one another to find a cleaner, cheaper, smarter way to meet society’s needs.”


MORE LIKE THIS

  • Get the CEO Briefing

    Sign up today to get weekly access to the latest issues affecting CEOs in every industry
  • upcoming events

    Roundtable

    Strategic Planning Workshop

    1:00 - 5:00 pm

    Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process

    Executives expressed frustration with their current strategic planning process. Issues include:

    1. Lack of systematic approach (70%)
    2. Laundry lists without prioritization (68%)
    3. Decisions based on personalities rather than facts and information (65%)

     

    Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns.  They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning.  Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process.  This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented.  If you are ready for a Strategic Planning tune-up, select this workshop in your registration form.  The additional fee of $695 will be added to your total.

    To sign up, select this option in your registration form. Additional fee of $695 will be added to your total.

    New York, NY: ​​​Chief Executive's Corporate Citizenship Awards 2017

    Women in Leadership Seminar and Peer Discussion

    2:00 - 5:00 pm

    Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations. 

    Limited space available.

    To sign up, select this option in your registration form. Additional fee of $495 will be added to your total.

    Golf Outing

    10:30 - 5:00 pm
    General’s Retreat at Hermitage Golf Course
    Sponsored by UBS

    General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.

    The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.

    To sign up, select this option in your registration form. Additional fee of $295 will be added to your total.