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Chevron's CEO: Affordable energy is crucial

Published on NewsOK Modified: December 27, 2012 at 12:05 pm •  Published: December 27, 2012

AP: Do fossil fuel producers bear the responsibility for curbing greenhouse gas emissions?

WATSON: We have the responsibility to deliver our energy in an environmentally sound fashion. The greatest advancements in living standards in recorded history have taken place in the modern hydrocarbon era. I don't think that's coincidental. Our leaders have to make a decision. Do they want that to continue or do they have a better solution for us? So it's not my call.

AP: How should society go about reducing greenhouse gas emissions?

WATSON: If you look around the world, the countries with the best environmental practices are the wealthiest. There's a reason for that. If you're worried about where your next meal is going to come from or shelter over your head, your focus is on those things.

AP: The U.S. is a wealthy country, how should we reduce emissions?

WATSON: Well, we are a wealthy country. On the other hand, the economy is growing slowly. We have high unemployment. I think that's part of the reason why the president said now is not the time for a carbon tax, because he recognized that that would put pressure on the economy and put pressure on our energy prices, put pressure on manufacturing business, put pressure on consumers.

AP: When it's time to address the carbon issue, how should we do it?

WATSON: It's very difficult for the United States to go it alone. Watch what (other) governments do. The day-to-day decisions being made (show) that concern about climate change is less than other concerns that they have. China is racing by the U.S. in greenhouse gas emissions. Germany is shutting down their nuclear power, the only energy source with zero carbon emissions that can be produced at scale. Japan, much the same way. Governments around the world are making the choice that the benefits of lifting people out of squalor are very important. And affordable energy is the way to get there. And that currently comes through oil, gas and coal.

That doesn't mean there's nothing we can do. First, we can do a lot more on energy efficiency in this country. There are a number of promising technologies to deliver lower carbon fuels. I would support (government funding) of pre-commercial activity to try to advance some of these breakthrough technologies, rather than putting big subsidies on technologies that we know are more expensive and won't necessarily solve the issue.

AP: Will fracking be curtailed in this country?

WATSON: I see very little obstacle to it, notwithstanding all the rhetoric. Now it's being done in some different areas. People aren't used to it, and there have been legitimate concerns expressed, like truck traffic at a simple level, but also concerns about water supplies. They're understandable anxieties. And so we have to work through those with the governments. I think in due course we'll do that because they'll see the advantages to it.

AP: Will natural gas become a bigger part of the energy mix?

WATSON: Natural gas will displace coal in power generation. Getting natural gas into the transportation fleet is harder. It works best for vehicles that work from centralized fueling facilities like trucking fleets or buses and cabs. That is happening. Before it can make big inroads beyond that, infrastructure is going to need to be developed. It will take some time.

AP: A recent factory fire in Bangladesh killed more a hundred people, shining a spotlight on the connections between Western companies and overseas suppliers. What is the responsibility of a company like yours when you go into a developing area?

WATSON: We have global standards for how we operate. And it's our responsibility to operate to those high standards everywhere. We use local labor in almost all cases and we spend an enormous amount of time training people. We provide half the natural gas in Bangladesh. I've been there a number of times. If you go to a construction site, you won't see hard hats. You won't see shoes in many cases. And so we teach people safety standards.

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