‘we have to do both,’ chevron CEO on energy in coming years

Worldwide demand for oil and gas is expected to grow through the decade’s end, Chevron’s top executive said during a round of recent interviews.

“We don’t control demand,” Mike Wirth, the company’s Chairman and CEO, told CNBC’s Brian Sullivan. “We supply demand. And so, we will grow our oil and gas business over the next five years.”

Chevron is growing its traditional energy business while investing in technologies to meet the demand for new lower carbon energies, Wirth added.

The world is already witnessing a record need for energy, with last year’s oil demand setting a record and this year’s demand tracking to top it.

Oil and gas are projected to remain a substantial part of the world’s energy mix to 2050, across a wide range of future scenarios published by industry experts including IEA, OPEC, EIA and others.

During an appearance at the Council on Foreign Relations CEO Speaker series, Wirth said Chevron is making progress toward its lower carbon ambitions.

He detailed how the company is:

• Working toward reaching its upstream methane-intensity target by 2028 and has reduced the methane intensity of its oil and gas operations by more than 50% since 2016.
• The second-largest producer of renewable fuels in the U.S.
• Investing in a hydrogen project that enables utility- and industrial-scale storage of renewable energy.

Wirth advised policymakers to not exclude one energy source in favor of another, as many solutions will be needed.

“There are three things that really matter when you talk about energy: affordability, reliability and the environment,” he said during an interview with Daniel Yergin, vice chairman of S&P Global. “If you have an energy policy that focuses on only one of those, you can create unintended consequences and have something that is not sustainable.”

Wirth added that solutions must be scalable and enacted with speed.

“If we can’t scale them up, they can’t make a difference,” he said. “And then if you get solutions that work on scale, we need to do it with some speed, and that’s where capital markets come in and you harness private investment.”

Separately, at the Wall Street Journal’s CEO Summit, Wirth underscored the important role companies like Chevron play in helping supply both traditional energy and lower carbon solutions.

“We have to be able to do both,” he said. “One of the big challenges for an energy company like ours is we’ve got a big business today that meets the needs of the world, and we’ve got customers and economies around the world that depend on what we do to keep the lights on and the trains going.”