A Conversation with Oxy CEO, Vicki Hollub
*This My Climate Journey podcast episode was recorded in front of a live audience at the Ion during Houston Energy and Climate Startup Week.
Our guest is Vicki Hollub, CEO of Occidental Petroleum (Oxy), a century-old oil and gas company employing over 12,000 people globally with a market cap near $50 billion. Recently the company has made significant investments into what they refer to as “carbon management” technologies including the acquisition of Carbon Engineering, a Direct Air Capture (DAC) company, in 2023 for $1.1 billion. Oxy is commercializing Carbon Engineering’s technology through its 1PointFive initiative and aims to deploy 70 DAC facilities by 2035. These efforts include recently receiving draft permits from the EPA for Class VI Injection wells, enabling the permanent geologic sequestration of CO₂, an advance market commitment from Microsoft to purchase 500,000 metric tons of carbon removal, and an award from the US Department of Energy for up to $500M to build a 1M ton per year facility.
The conversation covers a lot of territory. Vicki acknowledges climate change and its effects on extreme weather and natural ecosystems, while also stating that Oxy does not view the energy transition as a shift away from oil and gas. Instead, she describes a future where oil and gas exploration could become carbon-negative through advancements in enhanced oil recovery (EOR), a technology that uses CO₂ to extract fossil fuels from otherwise depleted wells.
This is a notable interview for MCJ as Vicki is the first oil and gas CEO we’ve had on the show. We believe it’s important to understand how a company like Oxy, which has a very large greenhouse gas emissions footprint, thinks about its future plans. We also know that many who listen to this show are interested in Oxy’s DAC efforts and their perspective on the future of the technologies and markets around it.
Vicki became CEO in 2016, the first woman to lead a major American oil company. We are grateful to Katie Mehnert of ALLY Energy for connecting us with her for this conversation.
Episode recorded on Aug 30, 2024 (Published on Sept 16, 2024)
In this episode, we cover:
[03:28] Navigating the trust gap between O&G companies and the public
[06:42] Vicki's early career path
[08:32] The O&G boom in the Permian Basin in the mid-2000s
[11:18] Vicki's path to becoming the first female CEO at Oxy
[17:15] Changing dynamics and priorities while running a complex company like Oxy
[18:00] How Vicki pitched Warren Buffet to invest in Oxy and navigated the impacts
[21:11] How Oxy attracts and retains talent, plus generational differences
[26:36] Challenges and opportunities Oxy sees in the energy transition
[30:45] Navigating urgency relative to long-term planning
[34:01] How the transition of innovation and legacy businesses could play out
[44:36] Oxy's focus on carbon management, including direct air capture
[49:55] Challenges in scaling DAC, including partnerships and funding
[53:46] Vicki's thoughts on achieving a net-zero carbon barrel of oil
[59:44] Her perspectives on the future of the oil and gas industry and its evolution
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Cody Simms (00:00:00):
Live from Houston in front of an amazing audience at the Ion. I'm Cody Simms from MCJ, and welcome to My Climate Journey. My guest today is Vicki Hollub of CEO at Oxy. Oxy or Occidental Petroleum as it's more formally known, is a 100-year plus year old stalwart of the energy industry. Founded in 1920 by Armand Hammer. Today the company employs over 12,000 people globally, has a market cap approaching $50 billion, and is a longtime member of the Fortune 500. Some of its largest shareholders include Berkshire Hathaway, Dodge & Cox, Vanguard, and State Street. On the climate tech front, the company is emerging as an early leader in Direct Air Capture. Having acquired Carbon Engineering for 1.1 billion in 2003 and now making waves with their 1.5 initiative, which has an aspiration of deploying 70 DAC facilities around the world by 2035. Just within the past week, they received draft permits issued by the US EPA for Class VI Injection wells for the permanent geologic sequestration of CO₂.
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The company's primary businesses today, of course, are in the production and exploration of oil and gas as well as chemicals. They're one of the largest acreage holders in the Permian Basin here in Texas and are the top independent oil producer in Oman. And have been a leader in enhanced oil recovery, which injects carbon dioxide into depleted oil and gas reservoirs to stimulate production and extend the life of the field. The company was ranked number one on the world's most admired companies list by Fortune Magazine in 2023 in the mining and crude oil production category.
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Putting all of this together, and you can see a business that's right in the crosshairs of the energy transition, and working through a phenomenally critical potential transformation. Critics and some climate activists often accuse Oxy's efforts and direct air capture as being, "Licensed to pollute" and call for the halt of all oil and gas exploration around the world, while Oxy has begun referring to the sum of its efforts as being a "Carbon management company." As for our guest today, Vicki Hollub, she became CEO in 2016, the first woman to be CEO of a major American oil company. She has been with Oxy for most of her career and has been the driving force behind Oxy's move into direct air capture and their low-carbon ventures efforts. With all of that, I'm excited for this conversation and grateful to Vicki for making the time to join us. And a sincere thank you to Katie Mehnert of ALLY Energy for connecting us for this conversation. But before we start, I'm Cody Simms.
Yin Lu (00:02:53):
I'm Yin Lu.
Jason Jacobs (00:02:54):
And I'm Jason Jacobs, and welcome to My Climate Journey.
Yin Lu (00:03:01):
This show is a growing body of knowledge focused on climate change and potential solutions.
Cody Simms (00:03:06):
In this podcast, we traverse disciplines, industries, and opinions to better understand and make sense of the formidable problem of climate change and all the ways people like you and I can help. Vicki, welcome to the show.
Vicki Hollub (00:03:21):
Thank you. It's great to be here, especially with all the people here who I know are incredible innovators themselves. So, thank you all.
Cody Simms (00:03:28):
I'm so excited to learn from you today. I have asked our audience on social media what people want to hear about in this discussion, and I've had a lot of people who want to hear about your approach on direct air capture on CO₂ as a feedstock for enhanced oil recovery, on your thoughts about sustainable aviation fuel, and your plans for the energy transition. And we're going to try to get as many of these as we can, but I've also had people question why our climate focused podcast should be interviewing an oil and gas CEO at all. And in the past we've had people on the show who are in the ventures teams at oil and gas companies making investments, working alongside companies driving the transition. And when we've had those conversations, we've taken heat sometimes. Obviously, we've invited you here. You're here, we're really excited for the conversation. I have my reasons why I think it's important, but I thought I'd start by asking you why should a climate podcast have an oil and gas CEO on? How do you think about navigating the trust gap that exists with the public?
Vicki Hollub (00:04:30):
I don't understand why there is a trust gap, because when I got into the industry back in 1981, I was so fascinated by the fact that the United States produced oil and gas and that the world so much needed oil and gas. And got into the industry, came through 40 years of the industry. But back when I first started realizing that we needed to be different, it was years ago, but it wasn't until about maybe 10 years ago or so that I realized that we were being accused of what's happening to the world with respect to climate. And when I started hearing the talk about oil companies being evil and polluting the world, it was initially shocking to me because I didn't grow up that way. I didn't grow up thinking that I grew up in the state of Alabama. I grew up loving to go down to the beach and to play in the ocean and to go to some of the parks, state parks, federal parks, and see all the beauty that was there, the wildlife, there's no way I wanted anything to do with damaging our world.
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And so that's not the way I thought of that when I was growing up and going through the industry. And so now I don't feel that way today. I do feel like we as oil company CEOs have a responsibility to do something about it now that we know about it, and we are absolutely doing that and doing it in a big way. And now I hope that people will understand that I want to be as much an environmentalist as anyone else because I do care. And I think that we, in our company, I think we have a lot of people that want to do the right thing. I don't think we've seen as an engaged and empowered workforce as we have over the last few years as we've built this strategy. Our employees are excited about it, they're committed to make it happen. They want to see the world a better place, and they're happy that Oxy could be a part of making that happen.
Cody Simms (00:06:37):
Tell me about your early career path when you first joined. You've been with Oxy almost your whole career, right?
Vicki Hollub (00:06:42):
I went to University of Alabama, huge Alabama football fan, played in the band at Alabama. And-
Cody Simms (00:06:49):
What was your instrument?
Vicki Hollub (00:06:50):
It was a French horn.
Cody Simms (00:06:52):
All right.
Vicki Hollub (00:06:52):
In fact, I went to Alabama to be a musician. However, my first semester at the University of Alabama, I had an instructor who told me that my aspiration to be in a symphony was not going to happen. So, then I had to think about what do I do? And growing up in Alabama, there were a lot of coal mines around our house, and so I thought I'll just go into coal mining.
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And then I went down into a deep Jim Walter Coal Mine, and it was cold, it was wet, it was dark. I got claustrophobic. I wanted to get out of there as quickly as I could. I did, and that was one of our field trips. The next field trip, a couple of months later, we went out to a drilling rig that was drilling not too far from university, and it was amazing. It was outside, it was big equipment, pulling this strange stuff out of a hole, out of a very small hole I thought relatively speaking, but it was exciting. And so, that's how I got into the industry. I did no research on it other than that. I went immediately and changed my major to get into that. Then that's where I've been since.
Cody Simms (00:07:56):
And you were in the Permian Basin in the mid-2000s during what I would've thought would be the go-go times of the oil and gas boom. Share a little bit more about what that was like.
Vicki Hollub (00:08:06):
Well, it's always been exciting to be in our industry and we've gone through booms and busts, but no matter what we've been going through, I think we've always been able to do amazing things. The things that we had to do during times of downturns when oil prices were low, those were also some challenging times where we had to get pretty innovative and do some amazing things. But what happened to us in the mid-2000s was we were headed toward changing the US and changing the world in terms of oil production, because what we were producing at the time... And then the production in the United States, oil production started in the early 1900s, but around the time of 2005 or so, conventional oil production had dropped to around 5 million barrels a day. So the United States was at close to 5 million barrels a day. That was not enough to provide the energy that the US needed.
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And then we figured out how to engineer oil out of these shale reservoirs. The shale reservoirs are a lot different from conventional. Conventional reservoirs have porosity and permeability, and the oil has the ability to move through that. Shale reservoirs, they look even less porous than your granite or your marble countertops. It's like you can't see porosity in your countertops in the shale, that porosity is even less than that. So it takes a lot to get that movement through the shale. So engineering oil out of shale was something the world had never done anywhere else, but it happened here in the United States because of the innovation that was driven by people who just would not accept that we couldn't get oil from what was really the source rock of all oil. So that was an exciting period. The growth in shale in the United States was so dramatic that we became almost energy independent, really.
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We got to the point where we're now producing 13 and a half million barrels a day. We import some, but if we needed to be totally independent and not import any oil, we could be there with the resources that we have and our ability to get oil out of the shale now. So going from 5 million barrels a day where today if we hadn't discovered the shale, we'd probably today be down to about two and a half to 3 million barrels a day. We'd have to get our oil from the Middle East or Russia. We would be in a totally different scenario from a geopolitical standpoint. So, it made a difference not only for the US but for the world.
Cody Simms (00:10:39):
And you then spent a bunch of time operating at a senior role in California, I think. I'm curious to hear how for you operating in Texas compared to operating in California.
Vicki Hollub (00:10:51):
Well, Texas is a friendly place. Texas is business friendly, oil friendly, and California is not. And I don't know how many people are from California, so I'm going to make sure people understand. This is a quote from a former CEO, not myself, but a quote from a former CEO said that, "Houston has good people, but bad weather, California has good weather."
Cody Simms (00:11:18):
Oh, man. All right. Well, we have a lot of listeners who I will agree with you that California has good weather. I'll leave it at that. Okay. What was your path to becoming CEO?
Vicki Hollub (00:11:32):
So I was an engineer, mineral engineer, and I grew up in operations. So my first task, I went to work for a company called City Service, and they were bought the next year by Occidental. But I started out working in the oil fields on work-over rigs, drilling rigs, so not in an office out in the field. And with filled people who knew a lot about what they did and who helped to teach me. And I went out there thinking I was going out there to manage them. I didn't realize that the goal was to send me out there to learn from them. I quickly learned that they knew a whole lot more than I did, so I better understand my role. So I quickly got that. But I can tell you in terms of breaking the ice for to be out there with men, there were no women working in the areas that I initially started working.
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And so the way that I broke the ice was actually quite easy. Growing up an avid Alabama football fan and understanding at Southeastern Conference football and knowing statistics and everything there is to know about every team in the SCC starting out in Louisiana, Mississippi was not a hard thing to do. So that was a way to break the ice and to get to know the people I worked with. And it was fun for me to start out because the camaraderie that you can build in that scenario and what you can learn from people. And people weren't quite willing to help me learn. From the very start, I knew that I'd made the right decision about the industry.
Cody Simms (00:13:01):
And how did the CEO role happen? What was the path there for you?
Vicki Hollub (00:13:05):
So the path beyond that was just growing up and taking different roles. I never said no to any role I was offered. I knew that even the best role I ever had was managing our field operations in the jungles of Ecuador where we were so remote out on the Napa River that we had to be fully sustainable. There were no cities, nothing to provide us power or anything. So we were out remote, and I had an advocate within Oxy who helped me to get that role to manage those field operations. It was the best role I'd ever had. It was like being a restaurant manager, a hotel manager, the city manager, running the water supply and treatment and power, and also getting to do operations engineering with my team as part of that and growing a business out there. It was great, but then I got a call to go do a different role.
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And so my roles overall, I was able to work in Russia right after the fall of the Soviet Union. So going to Russia at that time was quite interesting, worked there and then went to Venezuela, then followed by Ecuador. And in each of those areas, I was able to work in the field operations and get the experience of being around a lot of different ways to operate in a lot of different philosophies and techniques and cultures. And I think the cultural experience was as valuable to me as any of the rest of that over that period.
Cody Simms (00:14:27):
I'm hearing an incredible importance put on building out your skill sets across multiple areas.
Vicki Hollub (00:14:33):
It was really important. And as I was learning all of those things, I never knew that in this role that I'm in today, first of all, never aspired to be here, never thought I'd be here. But now, once I got in the role, I realized that a lot of that stuff has been critically important for me to know. Because to know what people are going through to do the jobs that they do, to know what people need, what the resources are, how they feel in doing their jobs, and what's important to them, what really drives them. I think I got some good experience in learning to know what that is.
Cody Simms (00:15:07):
When you all operate over so many complex geographies, so many complex technologies, there's the ability to swoop in and know when to go deep and when to not go deep. It has to be incredibly challenging for any leader, but especially in a business as complex as yours.
Vicki Hollub (00:15:23):
It is and it's fun. It's fun to do. And I'll say that the more I'm in this role, the less deep I can go in some of the technical areas because it is getting more complex. The technology that we have today, that's exciting and it's changing our industry, changing the world, and we have a lot of people that are now taking a technical path that we have with a company that allows them to be those people that can go incredibly deep, that can help us figure out what technologies we need to use, which ones are important, and which ones are going to deliver value for us and our shareholders. So we've got a really good scenario now with the combination of great leaders and great technical people.
Cody Simms (00:16:03):
What's it meant for you to be the first woman, CEO of a major American oil and gas company?
Vicki Hollub (00:16:08):
Well, again, I didn't aspire to be here. So when I got the role, I was not so much focused on that. I was a lot more focused on how in the world did this happen to me when I'm not at all prepared for it. And so fortunately, I had a one-year transition with our former CEO and that was like a living MBA program where I tried my best to learn all I could from him, and he was quite willing to give me the time and the patience to help me do that. So, I felt grateful just for the opportunity. And not just grateful for the opportunity to be a CEO, but I wouldn't have wanted to be a CEO of any other company, but to be a CEO of the company where I grew up. And I knew a lot of the people and I knew how good our people were. And the fact that I really wanted and felt like Oxy needed an internal CEO, not an external one.
Cody Simms (00:16:56):
Especially at the time of, again, heavy transition, right? Like you're navigating so many different factors that I would assume prior CEOs weren't having to think about. We talked about how you joined the company, climate change wasn't a topic, right? And now it's a very big topic I think that you probably navigate all the time as the CEO.
Vicki Hollub (00:17:15):
It is. And it's not just climate change, it's the society. It's where we are with respect to social challenges and trying to decide what corporations really need to be and what role we play in helping shape the way the country operates. And so I think it's incredibly complex, but it's also exciting times because what's being presented to us now is an opportunity to be a part of changing the world. And there's a lot of reception to changing the world now because we all know, or maybe not everybody in the world, but I'm sure all of us here know that climate change needs to be addressed, and we need to have a solution and we need to be more aggressive with it. So, it's exciting now to know that we have some technologies that can help us do that.
Cody Simms (00:18:00):
All right, this is a slightly voyeuristic question, but talk about pitching Warren Buffett to invest.
Vicki Hollub (00:18:07):
Well, the challenge there is when I go talk to Warren Buffett, when I talked to him the first time, he was helping us with a transaction that we did. It was an acquisition, and we were a little bit short of making our acquisition work. We needed about $10 billion. And Brian Moynihan with Bank of America told me, "The only person he knew of that we could get 10 billion from in a weekend would be Warren Buffett." And so, I laughed when he said that and he said, "Let me give you his number." And I laughed even harder when he said that. I took the number, I made the call and I expected to get somebody on the other end of the phone who was someone who would write my name down and then scratch it out, and then I'd never hear from anybody again.
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But I made the call and Warren answered the phone on the other end, I was shocked. I couldn't even hardly speak when he answered the phone. I said, "Mr. Buffett." I said, "This is Vicki Hollub. You don't know me, but I'd like to come and see you." He said, "I know you and when do you want to be here?" And so I said, "What about tomorrow morning?" This was on a Saturday morning of all times when I was calling. And I said, "What about tomorrow morning at 10 o'clock?" He said, "I'll be waiting." He said, "Call me when you land." And I did and got to his building, and he was standing there and a little sweater vest holding the door open for me. But negotiating with Warren Buffett is a different thing. You will always find that he's done his research, he knew everything about our company, he knew the numbers in his head, he had it all worked out. And so, he knew what he was willing to do and I knew what I needed to do. So it was a really quick negotiation actually.
Cody Simms (00:19:48):
And I know that transaction obviously was a huge one. It struggled during the pandemic lockdowns, and then now as the price of oil has gone back up, that transaction seems like it has been working out well for you. How did navigating that up and down, down and up with him sort of play out?
Vicki Hollub (00:20:05):
Well, the navigation up and down was challenging, but he's a long-term investor and he was watching oil and he has this intuition about him. He can sense things and he can see things and see trends. And he knew that oil was going to be very much needed for a lot longer than most people realize. And so, he had this view that prices would be better than they had been in the past. And he knew that we would have these volatile times, but he's willing to stay in it for the long term. And so, I think he saw that. He also saw that something that I'm incredibly grateful for, and that is our people, our operating team are performing at a very high level. They're doing things that are really different than other companies and some other companies are doing. They're getting more oil at lower cost than a lot of our competitors. And he was reading third party analysis as well as reading the data we put out. And he saw that we have good people, we have good people doing good things. And so, that was important to him as well.
Cody Simms (00:21:11):
That's actually the next area I want to dig into is culture and talent around the company. How do you attract and retain talent in Oxy? And in particular, what generational differences do you see in your workforce as it pertains to attitudes about the energy transition, oil and gas, climate change? And I'll give a little personal story. I was born in Texas. I grew up in Kansas. My grandparents ran an oil and gas company, small one. My in-laws ran a chain of gas stations and convenience stores in Kansas. The auditorium at my high school was the Charles Koch High School. So that's my background. So growing up, this industry was just what people did. It was normal. I feel like today, young talent, university talent, they want to work on clean energy transition. They want to work on, how do we solve climate change as what motivates them as the big problem they see in their life. It's different than I want to work on powering the world. It's how do we do this in a new way. How do you navigate this? And do you see this generational difference inside your company today?
Vicki Hollub (00:22:21):
There is a generational difference. There really is. There's the people my age who again, grew up in the industry but had no idea that one day we would not be appreciated. And even worse than that, we'd be vilified because we're accused of damaging the world. And certainly our product is not healthy for the world the way it is being used today. So, we have that generation that didn't come up with an understanding that climate change is real and that we need to do something about it. It's something that has been introduced.
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And because of the division in the United States, sometimes that message is not introduced in a very helpful way, in a way that can be accepted by those that have been in the industry for a long time. So we have that generation that we're bringing along, and actually I've been very surprised by how open and receptive to the fact that we need to be different. How well our team has accepted that and really taken it to heart and run with it. And I'll say more about that in a minute. The thing I love about our early career people is they've come to us. There was that first wave, the Gen Xers I guess, and then the waves after that.
Cody Simms (00:23:39):
I'm not considered young anymore. I'm a Gen Xer and I don't think I'm young.
Vicki Hollub (00:23:43):
You're younger than I am. I hate to say, maybe by a year or two maybe. So the generations that have come, they have two things that I wish our generation had. One was an appreciation for quality of life, an appreciation and a desire to be here for what we're here for. And that is to be with our families, to make our family life better, to enjoy our families, and to not sacrifice our family life because of our work to try to make that balance work. I appreciate that about them, and I've changed in a lot of ways with respect to that. Second thing is they came with a determination that we need to be better and that we have to worry about the world, that the world matters and earth matters, people around the world matter. And so that's helped a lot to get their commitment and their buy-in.
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And so, the way we've approached it is with respect to how we operate. We're a part of an oil and gas climate initiative, which is 12 oil and gas companies from around the world that have gotten together and that have tried to help each other and push each other to make our operations better, and to be a progressive and proactive part of the transition. And as a part of that, we all agreed that we would set targets to get our methane emissions down to net-zero. And that's hard to do in oil and gas operations. And so the interesting thing is that when we rolled out this initiative internally and said, "Hey, we want zero methane emissions. We want to have a target to get to that." And when I first heard it, I thought, "There's no way. We can't get there." But when we rolled it out and we said that to our organization, I was amazed at the ideas that came back.
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People embraced it, our field guys embraced it, and they got behind it. And they started coming up with some amazing ideas, things that I'd never thought of, I wouldn't have thought of, I don't think in their role, but they're doing amazing things there. So, I think that has been exciting because it wasn't just the early career people that came up with neat ideas. It was some of our very experienced people and our people that had been with us as long as I have 40 years. These guys were coming up with ideas and wanting to be a part of the solution.
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So, I'm proud of our organization because I think we have buy-in from everybody to do that and to push toward that. So what that's done for us with respect to recruiting is the interns that we bring in and that see what we're doing and that live what we're doing, they see it, they want to be a part of it, and they go talk about it. And so our interns almost always, every one of them want to come back and want full-time employment want to be a part of what's happening because they want to be a part of an organization that is doing something to help the climate.
Cody Simms (00:26:33):
How do you define the energy transition? What's the why?
Vicki Hollub (00:26:36):
So the energy transition is, in my view, not a transition away from oil and gas. It's a transition to a lower carbon world. So, that leaves open all technologies. That leaves open even a path for oil and gas to continue to be produced as long as it can become carbon-neutral. And so that's the challenge, and there is a way to do that. I think if we don't discriminate against fuels and we just attack the emissions, we're in a much better scenario and that's how the transition really needs to occur. So I don't see oil and gas production going away, but I see technologies needing to be built that will help to lower the volume of oil over time and to make that volume of oil carbon free.
Cody Simms (00:27:27):
I've heard you refer to Oxy as a carbon management company. Can you share more about... I assume that's sort of related to what you just said, but maybe define that in a bit more direct way?
Vicki Hollub (00:27:37):
Yeah. What I mean by a carbon management company is we do manage carbon, whether it's hydrocarbons or CO₂, we manage methane and ethanol going into our chemical plants. And the thing that we do with CO₂ is we've been using CO₂ for enhanced oil recovery in our operations for almost 50 years. And that's in the Permian Basin. It almost works like CO₂ in Coke, in Coca-Cola. When you put CO₂ in oil reservoirs, it creates an energy and the ability to move the oil better. And so you can get oil to a producing well easier. In fact, the oil that we're moving with CO₂, you can't move any other way.
Cody Simms (00:28:18):
This is enhanced oil recovery, is that-
Vicki Hollub (00:28:19):
Enhanced oil recovery.
Cody Simms (00:28:21):
Okay.
Vicki Hollub (00:28:21):
And so since we've been handling CO₂ for a long time, we know how to do it, and we can do it less expensively than others. We've seen others feel like you've got to use these exotic materials to be able to even handle CO₂. We've been handling it so long, we know how to do it in a less expensive way, in a very safe way. And so, what we're going to do in the future is the CO₂ that we'll be handling will be out of the atmosphere. And that CO₂ that we also might catch from point-source emitters.
Yin Lu (00:28:51):
Hey everyone, I'm Yin a partner at MCJ Collective. Here to take a quick minute to tell you about our MCJ membership community, which was born out of a collective thirst for peer-to-peer learning and doing that goes beyond just listening to the podcast. We started in 2019 and have grown to thousands of members globally. Each week we're inspired by people who join with different backgrounds and points of view. What we all share is a deep curiosity to learn in a bias to action around ways to accelerate solutions to climate change.
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Some awesome initiatives have come out of the community. A number of founding teams have met, several nonprofits have been established, and a bunch of hiring has been done. Many early stage investments have been made as well as ongoing events and programming like monthly women in climate meetups, idea jam sessions for early stage founders, climate book club, art workshops and more. Whether you've been in the climate space for a while or just embarking on your journey, having a community to support you is important. If you want to learn more, head over to mcjcollective.com and click on the members tab at the top. Thanks and enjoy the rest of the show.
Cody Simms (00:29:52):
We're going to spend a ton of time on your work in DAC and carbon capture in a minute. And just trying to set the stage a little bit more to understand how you all as a company sort of think about all of this work ahead of us as a society, right? To some extent there's a time value trade off too, right? How do you decide how quickly certain parts of, you said lower carbon fuels, for example, or getting fuels to net-zero need to happen relative to the ability to continue to deliver fuel to people to live their daily lives and do the things they need to do relative to... I've talked to a lot of Houstonians here this week who are saying, "Hey, we definitely have more hurricanes. It's hotter. Our grid can't handle the instability because of climate change, frankly." And how you navigate urgency relative to long-term planning, I guess?
Vicki Hollub (00:30:45):
Yeah, I think the sense of urgency should be incredibly high. The storms, they're more frequent. They're stronger. This barrel that we just got through here, I don't know how many of you were here during that storm, but that didn't feel like a category one when we weren't even a direct hit. That didn't even feel like a category one, that felt like something much worse. And so I think the storms are getting stronger. We have to do something about it. The sense of urgency should be much higher. And the way I feel about it is this is 9/11. We had a horrible thing happen in our country. And when 9/11 happened for a period of time, there was so much patriotism, and we pulled together as a country. And the way that that felt of everybody feeling like, "Hey, we are here together and we are going to get through this together as a country."
(00:31:40):
That feeling felt good. It was a horrible thing that caused it, but it felt like the right way to feel. What I don't get is here, our world is facing a tragedy here. We're already facing things that we shouldn't have to face. We're living things that, and people are dying all around the world because of the storms that are being caused that are worse than they've ever been. But has that caused us to want to work together? Has that caused us to collaborate with each other? There are people who won't even speak to me because I'm an oil CEO. We should be pulling together. There's no greater tragedy facing the world today than what's happening to our earth. And so there's some wars and things that are also incredibly bad, but this is a tragedy that if we don't pull together and if we don't work together, we're not going to solve it.
Cody Simms (00:32:38):
There are some who will say, "Oh, innovation is going to come from the side and just wipe out this legacy oil business completely." A personal story for me again, and I'm not saying I agree with this, I'm really interested to hear your point of view. I said, I grew up in Kansas. After that, I moved out of college to San Francisco in the late '90s, fell into the dot-com boom by accident. I studied Chinese in college. I randomly moved to San Francisco to try to get a job using my Chinese language skills. Wasn't a French horn, it was Chinese, and ended up falling into the dot-com boom. And then was essentially a digital native employee. My first job out of college was an internet person. And then I spent time after that working in traditional media companies. I worked at the New York Times. I worked in places that there was definitely this culture change issue that we were talking about earlier.
(00:33:29):
There was resistance internally to change, but ultimately the generational change happened. And even these traditional companies switched to being more digital forward. Some did a great job. Disney's done a great job. Some didn't do as well of a job, but the big winners in the space were the new companies, right? The Googles, the Facebooks, the Amazons that came in out of nowhere. Nobody thought of those as media companies 25 years ago. And they're the biggest media companies in the world today. So, this is a long setup. But the question I have for you is there are people who say, "Ah, shut all the oil and gas off as soon as possible or as quickly as we reasonably can because the innovation's going to come from outside and everything we do today is just going to be totally different." Do you see the same thing playing out that we saw happen in media in energy or is that just totally ridiculous thinking?
Vicki Hollub (00:34:16):
I would say that if we could make that happen, we would make that happen, but it can't happen. And the people who tell me that fossil fuels should go away tomorrow, what always ask is, "Okay, so tell me the plan. Let me understand how this is going to happen. How do you do it?" Because all of these things that you see sitting here come from oil and gas. So if we shut off world production of oil and gas today, it would shut down the world. It would shut down the world. And the problem with some of the people saying that is they will not sit down with us and commit to going through a workshop to figure out how do we make it happen. And that's what I'm trying to get. Eric and I are trying to get the World Economic Forum to think about doing today.
(00:35:11):
Plus the UN hasn't done it, so why don't we sit down and get aviation and maritime and oil and gas and chemicals and some NGOs who have also some scientists that are incredibly good. Let's get everybody together and let's forget all of these models that are driven by people with biases. Let's put our biases aside and let's figure out a real practical strategy to make that happen. Let's do it together. Let's do it with maybe someone facilitating it that's clearly not following an agenda one way or the other, but just wants to find the best solution for the world. We have not seen that happen yet, but we need that to happen. If that can happen, then we have a chance to design a transition that's doable. And right now we don't have that because there are these groups on both sides. They're the climate deniers and then they're the climate activists.
(00:36:10):
Some of whom, and not all of them, but some are just so emotional about it that they're not being very logical and very reasonable about what the approach should be. Without that collaboration and a better plan, there's no way we can achieve it. And what our concern is that without understanding and putting a plan together like that, I'm afraid that 10 years down the road, we're still going to be fighting and people are still going to be trying to shut us down because we're an oil company and they don't like us doing direct air capture. So they'd rather us go away. 10 years down the road, we're going to wake up and realize, "Oh my God, the world is in a much worse place and we're further behind."
Cody Simms (00:36:55):
I'm hearing you say a little bit of "Yes and." Yes, and we should have people working on radical new solutions that will electrify everything and this that and the other, and the best and the brightest also need to be helping you solve the world's problems of how do we continue to have oil and gas that power certain things in our lives that we depend on, but do so in a way that help with the emissions problem?
Vicki Hollub (00:37:18):
Yeah, because you got to remember, some people are so busy in what they do, they've never really thought about the fact that wind and solar are important as is nuclear, but they can't do anything about nuclear can. But wind and solar can't do anything about powering aviation and maritime. They can't do it. And so, we have to power aviation and maritime. And then there's the other component that solar and wind can't make the products that go into hospitals, the medical bags. In fact, our chemicals business makes the products that Bayer uses for the IV bags and tubing that's used in hospitals. Where does that come from if it doesn't come from gas? So what we have to do, there's so much innovation going on in the world that I think if we could form this coalition that could work it, we could have a website.
(00:38:15):
We would send out queries, who is developing things that could make IV bags and tubing, who in the world? And it may be somebody in their garage somewhere. Who has an alternative that would work there? Who has an alternative to make the products that go in our iPhone, where could we get those? And maybe Apple's working on that, maybe they need to, but we have to have solutions for everything that oil and gas today is needed for. Without those solutions, then the transition is going to be incredibly disruptive to everything we do. And I don't think people want that. I think people don't understand the chaos that would cause and how much everybody's lives would be impacted if we immediately shut down oil and gas.
Cody Simms (00:39:05):
In my past life in software tech, there's a saying when you're building a product, the saying is, "Fast, cheap, or good. Pick two." You can't do all three. And I had Barbara Burger, the former president of Chevron Technology Ventures who I assume you know, had her on the show nine months or a year ago. And she said, "When it comes to the energy transition, we've always had two requirements on energy that it needs to be low cost and it needs to be reliable." And essentially the world in the last decade has added a third requirement that it needs to be lower zero emissions. Do you agree with that?
Vicki Hollub (00:39:39):
I do. The other problem is that nothing is sustainable if it's not in some way commercial, that is the other problem. It's like the governments are not going to build these technologies for us. They're not going to do it. So those of us that are public companies that are trying to take these entrepreneurs and invest money in what they're doing. And in the case of Carbon Engineering buy them and invest so that we can make them better, because we can provide the capital they need to do the innovations that they've been dreaming of doing.
(00:40:13):
Without those kind of scenarios, this doesn't happen either. And what I believe is happening, I believe that there are people are all around the world that are out of their garages or out of their backyard. They're developing things that really can help, but we've got to know about that. And we've got to know where they are, what they're doing, and how to get that from their concept, maybe their first build to something that's of scale and can be done in a bigger way. Like what some of you guys are doing here, trying to build things that are going to be important and may one day help to change the world. But you're going to have, in most cases, have some help with doing that.
Cody Simms (00:40:58):
It's an enormous challenge though, because if you were in the pick two out of three, boy, low cost and reliable. That's kind of what we have today. Low cost and low emissions, but not reliable. That doesn't work. Reliable and low emissions, but not low cost, that doesn't work. And so it's a whole culture change to get the team, not just your company, but the whole industry to adopt this and put plans in place where those things are going to compete internally for sure, right? How do you make decisions across those?
Vicki Hollub (00:41:24):
Well, it's challenging, but again, I'm an optimist and I'm excited about what people are doing. There's this company called 8 Rivers out of Durham, and there's some Duke guys and some other guys who got together in MIT, a few MIT people who put together a technology called NET Power. And the thing about NET power is we ran across it, and when I first heard about it and started hearing all the details of it, I was blown away. What it does is it combusts hydrocarbon gas with oxygen instead of air. So it creates electricity. It creates electricity because that equation, when you do that combustion, you end up with fresh water and CO₂, and the CO₂ drives a turbine that creates the electricity, and then a stream of CO₂ comes off the side. That's an amazing technology. It's emission-free. So because it's being combust in oxygen instead of air, it has no volatile organic emissions.
Cody Simms (00:42:19):
This is a replacement for a combined cycle gas power plant in theory?
Vicki Hollub (00:42:21):
Exactly.
Cody Simms (00:42:22):
Okay.
Vicki Hollub (00:42:22):
It is, and we're now working on it. We're a 40% owner of the company. Baker is also an investor in the company, and they're redesigning the turbine. We'll have the first one of those built in 2027. That's the fastest we can get it built. But David Crane, he used to be the CEO of NRG. When he heard about the technology and started looking into it, he said, "He believes it's going to be transformational for the power industry, not just here in the United States, but around the world." And so that's one of those technologies that'll be critically important. And again, these guys in 8 Rivers just they pop up with this technology and they had nobody that was investing money in it and nobody to advance it. And so we started helping with it, and others came in to help too. That's what's going to make the world achieve this transition, but it's all happening too slowly.
Cody Simms (00:43:12):
How do you think about external disruption? To what extent do things like this, does things end around you? Does that worry you? Does that keep you up at night?
Vicki Hollub (00:43:20):
Disruption is a good thing sometimes. I would say, there's some disruptions that are not. We'll talk about those in another session. Eric's already looking at me. "Don't go there," he's saying. But disruptions, if it's technological disruptions, that's a really good thing.
Cody Simms (00:43:34):
Okay. Interesting.
Vicki Hollub (00:43:35):
That's what we need to have. And it doesn't matter where they come from. Somebody keeps asking us, what are you going to do if somebody comes out with a technology that's as good as your direct air capture? I'm going to say, "Great, because there are at least 10,000 of these things that need to be built as quickly as possible, and we can't build 10,000 quickly." So, there's a big enough market that we need others to be a part of that market too, to help the world.
Cody Simms (00:44:00):
Let's jump into direct air capture. I had so many questions come at me when I asked about preparing for this to social media and whatnot about direct air capture that clearly there's a lot of interest from our listenership. What's your why for direct air capture? Why are you doing it?
Vicki Hollub (00:44:13):
It worked so well for our company. I'll tell you the synergies. It was amazing for us. We had started way back in about 2006 or '07, trying to get more CO₂ for our enhanced oil recovery operations in the Permian Basin. The CO₂ that we use today is coming from an underground source. And what we realized is that we didn't have enough CO₂ to develop all of our conventional resources. We had 2 billion barrels of oil that could be developed if we had more CO₂ than what exists in those reservoirs, those current reservoirs. So we started going to various emitters saying, "Hey, we'd like to capture your CO₂, get it to the Permian and use it in our enhance our recovery operations." And we worked and worked and worked to make that happen. Nobody back then was listening to us. And it was right about that time that we started realizing how important it is to capture CO₂.
(00:45:07):
So we started telling them, "Hey, one day this is going to be a big thing, so it would be really important for you to enter into this project with us." Nobody wanted to talk about it. So then around 2016 or maybe a little bit sooner than that, we ran across Carbon Engineering and they told us they had a direct air capture technology that would work. And as our team started looking into it, the incredible thing is that it is so synergistic with our chemicals business. Because to extract the CO₂ out of the air, so what it does is you pull air through a contact tower using 25 foot diameter fans. So you're pulling air through this contact tower. And the interesting thing is that to extract the CO₂ out of the air as it's pulled through the contact tower, you mix it with potassium hydroxide.
(00:45:59):
We're the largest marketer of potassium hydroxide in the United States, second largest in the world. So, our chemicals business makes it so they understand it very well. In fact, we have one chemical engineer from our chem business. He said, "I've been trying to keep CO₂ out of our potassium hydroxide for 40 years, and now I got to figure out how to get it to take more CO₂."
(00:46:19):
And so it's a fluid we know very well. And then to make the mixing happen so that you get a more efficient extraction of the CO₂ out of the air, we have PVC that we need to put in the contact tower. We also make PVC. So the synergies with our chemical business, were right there. It was almost as if it was meant to be. And then we, of course, have been handling CO₂ for a long time, so we know how to move it around and get it around. We know how to drill the wells to inject CO₂ in either oil reservoirs and/or to sequester it in brine reservoirs. So we have all that experience, and that's why for us, direct air capture technology was a technology that we believe we're the best company around to make it.
Cody Simms (00:47:03):
And so you started out with it solving your own needs for enhanced oil recovery. I know recently in just this week, I think you were granted a Class VI well draft permits. So you're now thinking about also injecting it permanently underground. How do you balance using it as a feedstock, perpetuating it for your own business versus turning it into a carbon sink?
Vicki Hollub (00:47:24):
Right now, that balance is skewed because we have yet to use it for our enhanced oil recovery operations. Although, ultimately that's the goal. I can explain later why that is the goal. But currently, we intend to sequester it in a brine reservoir because we have a pilot plan in Squamish, we bought Carbon Engineering. And as I said earlier, we bought them so that we could get them the talent they need to advance their innovation faster and to get the projects happening. And they have a pilot plant in Squamish that we've been using to make and to try out some of the innovation and test some things. And so that pilot there, what we've realized is that we can build these things now and over time, enhance them enough to get the cost down lower from where it is today. But the first one that we're building of scale is in the Permian Basin, and we're already building it.
Cody Simms (00:48:15):
This is Stratos?
Vicki Hollub (00:48:16):
This is Stratos. And next year, by mid-year, we'll have it online and operating. And we've sold about 70% of the carbon reduction credits from it. And all of those credits, the purchasers of all those credits prefer that it be sequestered in a brine reservoir.
Cody Simms (00:48:34):
So you're selling it as a carbon removal credit. And then you have another facility coming online, I think fairly shortly after that, which is in South Texas, I think?
Vicki Hollub (00:48:43):
I don't know how shortly after that it'll come on. This gets to the problem of scale and how quickly can we scale. What we wanted to do in the second one, and the second one will be on the King Ranch in South Texas. That one is going to be somewhat supported by the DOE.
Cody Simms (00:48:58):
Yeah, that was part of the DAC hub's award, I think, right?
Vicki Hollub (00:49:01):
Yeah. And we've been discussing with the DOE how that would work, and we're working out agreements with them on that, but we expect to get some funding. So that one would probably come on in 2028, 2029. So the first two seem like they're taking a long time, but after that, we believe we could start to accelerate the development. But we're going to have to have partners. Oxy, we're a relatively large company, but we can't fund the building of 10,000 direct air capture facilities. We have to have partners. We have to have other people who want to do that as well and who will either help us with funding or build some themselves based on the technology that we prove up.
Cody Simms (00:49:41):
At MCJ, we're big believers in direct air capture too. We've got investments in Noya. I see Josh sitting in the room here. We've got an investment in Heirloom. In other technologies, Charm Industrial, point-source with Mantel, etc.
Vicki Hollub (00:49:53):
You don't have Oxy on that list?
Cody Simms (00:49:55):
We're not an investor in Oxy. An early stage a venture firm, but maybe 105 years ago, we could have jumped on it. But the critics that we hear, critics to us will say, "Hey, A, you're stealing clean electrons from the grid that could go to power other stuff. And B, just the size and scale you're soon up and running with a 500,000 ton facility." You're talking about launching a million ton facility. And the energy sector alone in the US did something like 4.8 or 4.9 billion metric tons of emissions last year, right? So the scale here is immense, the difference in scale. I mean, my response is, "Yeah, but you just got to start building. What are you going to do? Sit around?" I mean, I'd love to hear how you think about that.
Vicki Hollub (00:50:37):
Well, to get to the first point about using clean power that could otherwise be used, we are intending for the next units to build our own solar, not to take solar from existing sources. And in addition to solar, we'll be using NET power to power the units beyond that first unit that we'll build in 2027 of NET power. So we don't intend to always take from existing sources. It was just the first one. We didn't have time. And so we wanted to get it built, get the innovation going rather than wait. So it's an acceleration thing. The second thing about why would it make a difference, all of those ones that you invested in are lower volumes. We applaud what they're doing because we think it's going to take everybody doing everything they can that helps in any way. And so again, this technology, when you look at sustainable aviation fuels, and I think we need sustainable aviation fuels, but just to say that we're concerned that the volume is not going to be sufficient to offset the emissions for aviation.
(00:51:43):
And even if it was, we all know sustainable aviation fuels have emissions too. So we want to be a partner with those that are providing sustainable aviation fuels, either in providing them the CO₂ to make the fuels and to help offset the emissions that those fuels will have because they do have emissions. So we can be complementary to those, and then we can make up the difference. Because even if we were to get to 10% of the fuels used by aviation being sustainable aviation fuels, that's not enough. So carbon reduction credits can be used for the rest of that.
(00:52:21):
Some aviation companies are starting to realize that our carbon reduction credits as they stand today is a much lower cost than sustainable aviation fuels are today. So as we both work to get our costs down, and if we do it proportionally, we're still going to be lower cost in the future than where sustainable aviation fuels will likely get. And right now we're about 25 to 30% of the cost of sustainable aviation fuels. So they're starting to rethink what they want to do. Why go to SAF if they can just go straight to carbon reduction credits?
Cody Simms (00:52:57):
And to that end, I think I'm understanding where you're going with this, which is do you not then see a CO₂ to SAF pipeline coming from the carbon you capture, or are you expecting it's all just going to get sequestered for a pure credit?
Vicki Hollub (00:53:09):
We really believe that ultimately the world is going to recognize that putting CO₂ in a brine reservoir is a waste of the CO₂ since we need-
Cody Simms (00:53:17):
Is a waste of it.
Vicki Hollub (00:53:18):
A waste of the CO₂ because we could use it for sustainable aviation fuels. We can put it in cements. There's a company called Lancetek that's an incredibly creative company. Have you invested in them yet?
Cody Simms (00:53:29):
No, I'm familiar with them though.
Vicki Hollub (00:53:30):
I would check them out.
Cody Simms (00:53:30):
Yeah, they're cool.
Vicki Hollub (00:53:31):
Okay. So they're making clothing and other creative things and as well as fuels from CO₂.
Cody Simms (00:53:38):
Yeah. That is not what I thought you were going to say. That's really interesting. So you think over time the carbon to value pathway will exceed a sequestration and credit pathway?
Vicki Hollub (00:53:46):
That's right. And then ultimately, we believe that we should use as other oil companies, and ultimately every oil company in the industry should be using CO₂, at least carbon reduction credits to offset their emissions. And even better to use CO₂ in an oil reservoir to generate incremental oil that would then be net-zero carbon. Because the way you get net-zero carbon oil is that the CO₂ you inject to create incremental oil is a higher volume than what the emissions from that incremental oil will emit when used.
Cody Simms (00:54:21):
And does it stay sequestered as part of the process?
Vicki Hollub (00:54:23):
It stays sequestered because what happens is in these oil reservoirs, whether it's conventional or shale, and we can do both, is that there are these tiny micropores where there's oil trapped that can't come out unless you can get CO₂. You can't get a water molecule in there. You can get CO₂ in there that'll help pop the oil molecule out and have it move to a producer. Also, there's oil attached to the rock and the CO₂ acts like a scrubber that just gets the oil off the rock that you use CO₂.
Cody Simms (00:54:54):
There's still emissions from eventually combusting that oil after you remove it. But you're saying the production of it you can get to essentially?
Vicki Hollub (00:55:00):
No, I'm saying that even when you use that product and you consider the emissions from that product plus the emissions of the producing of that product, all that combined is a lower volume of emissions than what it takes of the volume to inject to get it that.
Cody Simms (00:55:16):
To currently inject. Oh, interesting.
Vicki Hollub (00:55:16):
Yeah, so if you do the math and others have done the math, if you do the math, it shows that you can actually create a net-zero carbon barrel of oil.
Cody Simms (00:55:25):
Okay. And so I'm hearing you say, right now you're selling the CO₂ for credits as a way to essentially get the business up and running. That will eventually sort of subside. It'll probably always be there, but it won't be the main reason you are running this business. You'll eventually have a feedstock pathway into sustainable aviation fuel or other chemical pathways, cement, et cetera, as you said. And you'll use it for enhanced oil recovery to help circumvent the emissions that the oil and gas portion of your business currently generates.
Vicki Hollub (00:55:57):
I think we'll have all three because if you look at aviation and maritime, either they're going to need to use net-zero oil or sustainable aviation fuels, or they'll need to offset with carbon reduction credits. They'll probably have to do all three. And then if you look at HITEC with the data centers that they'll be building around the world that are incredibly energy intensive, they'll need to use the carbon reduction credits.
Cody Simms (00:56:21):
Yep, yep. And presumably, eventually an increase in poin-source capture like using gas and capturing at the point of combusting it? Do you see that also taking off?
Vicki Hollub (00:56:30):
That needs to happen. It's taking off more slowly because to make that work, you have to make a deal with the emitter, then you have to get the CO₂ from the emitter to a sequestration site, so you have someone there potentially in the middle of it. And then you have to deal with wherever you have the sequestration site, which means that you probably have to deal with a landowner or a mineral owner. So, you have at least 3 to 5 people or companies involved in every negotiation for point source emitters. It doesn't happen fast. And remember, that's what we were working for a long time and it never worked.
Cody Simms (00:57:10):
Yeah. It doesn't work. And I suppose it's a retrofit of the existing facility as opposed to a that plant, which is clean sheet, like new facility design, right?
Vicki Hollub (00:57:17):
That's right. And we do believe it'll happen now because the world was a different place when we were trying to do it. Back then, emitters were, I'll just say a lot less concerned about the environment. Now emitters are concerned about the environment, but they do feel the need to make it commercial. They don't want it to be another cost for them.
(00:57:34):
And ultimately, we will educate the world to know that that's what they need to do. But when we look at aviation and what the carbon reduction credits do for what it costs their customers, if they pass it directly along to the customers. In most cases, it's not going to be what people think it is in terms of cost. The cost doesn't double your ticket price. In most cases where we've looked at it, and I wouldn't take these numbers to the bank yet because it sort of depends on each airline and the length of the flight, the size of the plane and all of that. But from a ticket cost standpoint, that could range anywhere from 8 to $15. How many of us wouldn't be willing to pay $15 extra if we're helping to save the world?
Cody Simms (00:58:18):
Yeah. Yeah. Wow. Okay. What do you see the cost per ton needing to get to be a competitive ticket for any of these companies to really want to purchase?
Vicki Hollub (00:58:27):
Well, right now we're competitive. We're more competitive than sustainable aviation fuels right here today.
Cody Simms (00:58:32):
But cost per ton of captured CO₂?
Vicki Hollub (00:58:34):
Yeah, that's what I mean.
Cody Simms (00:58:35):
Yeah. Okay.
Vicki Hollub (00:58:37):
And so the thing about it's point-source capture doesn't help aviation or maritime. They help the emitter. And so carbon reduction credits are the only way really their most reliable permanent source of capture for aviation and maritime to offset their emissions. But that doesn't mean we don't want to get the cost down. We're still working with the cost down. We're about 500 to 550, $550 per ton today. We have an aspiration to get it to about $150 per ton, and we have the innovation workstreams in place to make that happen. So we just have to get those more refined and get them into a plant and test it out.
Cody Simms (00:59:14):
Are there any major things you're advocating for right now with respect to policy related to direct air capture?
Vicki Hollub (00:59:20):
45Q has been incredibly helpful for us. So that's a policy thing that we thank Senator Manchin and others very much for pulling that together. I think that's been instrumental for not only us, but for other companies to do some of the projects that they need to do.
Cody Simms (00:59:35):
What are lessons that you've learned so far in your journey in the carbon management that you think can be activators for other oil and gas companies to follow your lead?
Vicki Hollub (00:59:45):
It's important to understand that for us to continue to operate, I think we all have to have a strategy and a plan and a way to offset our emissions, our carbon footprint. All of us need to by 2050, the industry needs to be carbon-neutral, and it'd be better if we could be carbon-neutral sooner than that. We think we have a pathway to get there. And part of it's selling some of our carbon reduction credits, but also retaining some of them to offset our own emissions.
Cody Simms (01:00:13):
What's been harder than you thought so far on this journey, and where do you need help externally?
Vicki Hollub (01:00:20):
Well, the hardest part has been the collaboration for me to call up another CEO from another industry and say, "Hey, let's get together and let's talk about this, and hear the click on the other end." As soon as I say, "I'm Vicki Hollub with," and they're okay with that. But then when they hear the Occidental Petroleum they're, "Okay, we're done." So it's really, it's getting back to the collaboration. The collaboration needs to work, and we need to be agnostic about what industry we're talking to. We just all need to get together. We all need to understand that working together is the only way we can make this happen. And it's important.
Cody Simms (01:00:52):
We tend to view the present as what has always been, and it's clearly not. We talked about the change in technology companies and the leading media companies today weren't even born 25 years ago. Today's leading energy companies are a human lifetime old, maybe? What do you think the next 50 years looks like in this industry? Where are we going?
Vicki Hollub (01:01:11):
I think the industry has to look a whole lot different. And I think for us, I think our carbon credit business, and I think our CO₂ enhanced oil recovery business is going to be thriving. And I think both of those will be thriving because they're the part of our business that will help offset the emissions from oil. They'll help others do the same with their operations, and they'll provide the offset for our chemicals business as well. We have to have different technologies, and we have to have the collaboration that works. And I think by then people will realize that the pathway that we're on is not sustainable and we won't achieve what we need to achieve. So I think that the collaboration will be there. It just needs to happen sooner rather than later.
Cody Simms (01:01:57):
Vicki, I so appreciate you taking the time to join us, to come out in front of everybody, to come onto a podcast about climate change and share how you're thinking about the future. Anything else I should have asked? Is there anything we should have talked about that we didn't talk about?
Vicki Hollub (01:02:10):
I just would say that I'm grateful for the people that are working the technologies to make this happen, and I'm grateful for those in our industry that are trying to revolutionize what our industry is. And I have to say, Katie Mehnert is a leader in our industry, and she's made a huge change, and I personally owe a lot to Katie for the support that she's given me in my role as CEO. So I appreciate that, and I appreciate others that are working to make our planet a better place.
Cody Simms (01:02:37):
Thanks so much for joining.
Jason Jacobs (01:02:39):
Thanks again for joining us on My Climate Journey podcast.
Cody Simms (01:02:43):
At MCJ Collective, we're all about powering collective innovation for climate solutions by breaking down silos and unleashing problem-solving capacity.
Vicki Hollub (01:02:52):
If you'd like to learn more about MCJ Collective, visit us at mcjcollective.com, and if you have a guest suggestion, let us know that via Twitter @mcjpod.
Yin Lu (01:03:05):
For weekly climate op-eds jobs, community events, and investment announcements from our MCJ Venture funds, be sure to subscribe to our newsletter on our website.
Cody Simms (01:03:15):
Thanks, and see you next episode.
