Regulatory obstacles. Operating challenges. Safety and environmental issues. The fluctuating price of oil. These are just a few among myriad pervasive themes that require constant attention from leaders in the energy sector.
"And we are all judged by the same common denominator in this business: How, in the supply chain, do we attract and retain good, quality people, and how do we keep that sustainable over a long period of time?" ConocoPhillips Chairman and CEO Ryan Lance posited, addressing the National Association of Manufacturers (NAM) Leading Edge Executive Forum on Supply Chain Innovation held recently in Houston.
Discussing how industry business cycles are driving change and inspiring innovation in manufacturing and energy industries with NAM President and CEO Jay Timmons, Lance added dealing with the public's often-negative perception of the fossil fuel industry is another challenge. He praised the industry as a whole for "working hard to try to raise that perception in the court of public opinion."
One way to do that, Lance proposed, is to continue to show the sustainability of the business and the industry's genuine concern about the environment.
Fighting "energy illiteracy" will help ameliorate public perception of the fossil fuel industry, he said.
"It's fascinating; when people turn on a light switch, they don't understand where that light comes from," Lance said. "Education requires collaboration from all. This has been an age-old problem for us, and it is continuing to be a problem."
He strongly recommends industry continue to take a vigilant role in educating the public in terms of how energy derived from fossil fuels touches "all four corners" of their lives to help individuals realize how energy impacts everything from driving a car to national security to quality of life.
"We have to educate the public around how we do it," Lance said. "It really is a hightech business.
"I think it is important for us to collaborate with associations like NAM in terms of helping the advertising and the public relations campaigns to educate people around our product."
The renewables game
Regarding the emergence of renewables, including wind and solar power, Lance noted ConocoPhillips has chosen "not to play in renewables," adding his company's focus "is really on how to get oil and gas out of the ground as cheaply as we possibly can and make sure we're supplying it on a sustainable basis.
"That's not to begrudge what other companies are doing in the renewables space; that's fine," Lance continued, noting Texas is a leader in the wind generation energy sector. "That is a great power source, and that needs to be there. But there are transmission and intermittency issues."
Lance said ConocoPhillips is actively addressing intermittency through technology and innovation.
"I've got guys who have been working on batteries for the last 30 years to power some of our operations," he said.
While ConocoPhillips' emphasis is on oil and gas, Lance said solar panels and wind turbines do help power some of the company's facilities.
"We are a user of some of that technology as well, and it is important in our business," he said, endorsing the Obama administration's "all of the above" energy strategy. "If it's competitive, can stand on its own feet and is sustainable, absolutely -- the world is going to need that energy."
The ultimate conundrum, Lance said, is to provide energy "to the four corners of the world" and do it sustainably.
"We are really good at finding, developing and transporting oil and gas," he concluded. "That is what our focus is: how to do that cheaply and sustainably."
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