Chevron boss Mike Wirth leads the fossil fuel fightback

The boss of Chevron, one of the world’s largest producers, has a front-row seat to the energy revival that’s gathered pace under the Trump administration. After a 43-year career in the oil and gas industry, he sees part of his role as helping deliver some home truths on the reality of the energy transition.

“Some criticise fuels as somehow being evil or immoral or any number of different characterisations that you can find out there … to attack our industry,” Mr Wirth tells The Australian.

“When, in fact, people in the world have the highest standard of living in human history today because they are not toiling all day long to feed themselves and feed their families and create heat when it’s cold or try to stay cool when it’s warm. I strongly disagree with characterisations that our products are only bad.”

Companies including Chevron and its chief US rival, ExxonMobil, have been in the crosshairs of activists intent on pressuring Big Oil to accelerate its efforts to cut pollution and prioritise climate change solutions. Chevron operates the giant Gorgon and Wheatstone LNG projects in Western Australia, built for $US80bn ($123bn) a decade ago.

While demands have been made by some investors for a faster push to low carbon sources of energy, companies including Chevron have been pushing back and reinvesting in new oil and gas projects amid robust demand and healthy prices.

A reckoning on the speed of reaching net zero targets and delivering on environmental, social and governance goals has swept through much of the energy industry, according to the company veteran.

“I think you do see some of the things that were widely discussed and maybe taken as a given in the ESG arena – in particular relative to climate – people are becoming better informed about the costs, the investment magnitude and the timescale involved,” Mr Wirth says. “You have the challenges in taking an energy system which supports 7 billion people on the planet today and represents trillions of dollars of investment over 150 years, and discarding that system A rapidly and moving to a system B, which hasn’t been built yet. I think these costs and the realities of the time involved are beginning to become better recognised.”

US President Donald Trump’s rallying cry of “drill, baby, drill” and his decision to exit the Paris climate agreement has confounded some institutional and green investors, worried it will further damage stuttering attempts to offset the worst effects of global warming.

Mr Wirth said he understood the President’s call on withdrawing from Paris.

“Policy makers have the prerogative to make decisions on policy matters and I don’t second guess decisions that are made in Australia or in the US. The President had the power and the right to make those decisions.”

The two speak a lot, with Mr Wirth drawing a sharp distinction with Mr Trump’s predecessor in the Oval Office.

“I find the President to be curious. He asks questions. He asks good questions. He likes to talk to people in business. Under the prior administration, the door was not open. I only met President Biden once, and it was for a photo op,” Mr Wirth says.

“I have met President Trump many times. I speak to him on a semi-regular basis, I would say, and he is passionate about the American economy and the American people.

“He’s a man of action. He’s prone to move quickly. But he also listens, he will evolve his thinking as he learns more. And he’s a big believer in American energy, and he believes that American energy strength can underpin economic strength and national security.”

For Chevron, which moved its global home from California to energy industry capital Houston last year, a renewed Trump has reignited the oil sector.

“It’s a big change from what we had before, where American energy was not broadly accepted, but certain types of energy were favoured and others were not. President Trump wants to see American energy dominance – was the term that he uses – underpin economic dominance and AI dominance, and I think that’s good for our country.”

In Australia, Labor’s environmental wing is pushing Anthony Albanese to adopt a 70-plus per cent ­emissions-reduction target for 2035 but the Chevron chief said it was important for countries to balance aspiration with a dose of realism.

“What’s important in setting targets for countries or for companies is to not allow the aspirational elements of these things to override the practical evaluation of what it would take to get there,” Mr Wirth says.

“Aspiration is great. That’s how new businesses are started. That’s how progress occurs as people aspire to greatness in the real world, then you have to have a pragmatic pathway that you follow on your way to achieve those aspirations.

“In this space, there often can be quite a disconnect between the aspiration and the pragmatic realities of how to achieve the aspiration.”

He points to the ongoing issue of energy security in Europe, where prices have spiked. For the Chevron chief, the world must find a balance between affordability, reliability and environmental protections.

“What happens when you over index on just one of those is you create risks on the other two.

“We’ve certainly seen this in Europe, where the extreme focus on climate-created vulnerabilities which were exposed when Russia invaded Ukraine.

“We saw the gas flows from Russia cut off. And you know, the industrial core of Europe became incredibly uncompetitive very quickly, and Germany is at the centre of this. The lessons that are being learned in Europe are ones that we should all be paying attention to.”