Speeches

John Hofmeister's '07 Speech - Los Angeles

13/04/2007

John Hofmeister's remarks at the UCLA Shell Eco-marathon Americas Event in Los Angeles, California

I’m the President of Shell Oil Company and delighted to welcome you here to what we trust and look forward to as a dialogue on subjects that are near and dear to each of us.

We’re here to talk about energy security and energy in general.  Sustainable mobility is the theme that Shell believes is important to all of us.  But, if we go one step deeper for just a moment and think about energy in the context of our way of life and of our economy, we are at a tipping point in the history of our societal relationship with energy, as we see it at Shell. 

That tipping point was reached a couple of years ago as the supply-demand relationship in terms of achieving our economic well-being and at the same time supporting our chosen lifestyle reached a point where the demand overcame the supply, particularly in the late period of 2005, after the hurricanes of that summer in which there was a dramatic interruption of the energy supply to the nation when 25 percent of production capacity was offline not for a few days, not for a few weeks, but for many months. 

And the nation experienced what it’s like when demand outstrips supply, and we saw price escalation, which has lead to many, many consequences in the use of energy and in the consideration of energy policy.

At the same time, we see that the demand for energy continues unabated, despite those high prices.  And at the same time we see social conscience – social conscience playing into the energy world in terms of greenhouse gas, our reliance on fossil fuels, our search for alternatives, public policy affecting supply-side issues, demand-side issues, environmental issues, distribution issues and the future of our energy altogether. 

So, what Shell has decided to do—having listened to many, many policy makers, elected officials and customers around the country and, frankly, around the world—Shell has launched a dialogue series that has been ongoing now for about a year.  In the course of that period of engagement, we’ve learned many things.

We’ve learned how consumers see the world of oil and gas.  We’ve seen how policymakers think about environmental responsibilities, as policymakers and as political leadership.  We’ve, obviously, testified in Congress on several dramatic occasions.  We’ve been listening in state houses, we’ve been talking to governors, and we’ve been listening to academics. 

I had the pleasure of being at Cornell University on Tuesday listening to nanotechnologists working on biofuels, talking with chemical engineers, talking about the future of energy education, for example, at Cornell University where the school is coming together to create a new degree program in something called “Energy,” which is an integrated, cross-disciplined process in which students can study the whole of energy, not just the pieces of it.

But, in a very real and practical way, we are here today to carry that dialogue to a deeper, more fundamental level around the issues of sustainability, continuous mobility because our lifestyle is predicated upon it.  We’ve chosen the event that occurs today and tomorrow a bit east of here in Ontario called Eco-marathon.  Eco-marathon is an invitation to schools across the country to come and test their genius, their innovation in ways in which students can envision sustainable mobility in the future. 

And there will be a prize for that school, that automobile such as it is (and it’s not the standard automobile that you would see on the highways of California), but rather a specially designed vehicle that demonstrates the upper limits of miles per gallon in ways that invent and suggest alternatives in the future. 

This event in California is the first in the United States in many, many years, but the Eco-marathon history at Shell goes back 70 years when scientists in Wood River, Illinois—a refinery of Shell’s at the time—said, “How can we get more miles per gallon out of the fuel that we design and make here in Wood River?”  And from there a contest was started, and that contest is now actually worldwide next month in May in France, and some 250 schools will compete for the prize of the greatest miles per gallon.

Here in California, tomorrow, we will have about 21 cars.  For our first year, we expected a small number, but 21 actually exceeded our expectations, so we look forward tomorrow evening to naming the winner based upon the results of what they have designed into their vehicle.  But, in a very practical sense, the Eco-marathon is about tomorrow; today is about today, in which we would like to hear from experts and engage you in your own world of expertise on the subjects of technology, sustainability, mobility, fuel and energy. 

All of the questions that you may have in your mind will be facilitated by Mary Nickels, and she will introduce the panel in just a moment.  What we hope to have is a free-wheeling exchange of views, in which the experts here on the stage will be able to respond with their backgrounds; you are informed in the things that you know, and we’re very pleased to have this opportunity to be with you.

I’d like to take a moment, before I turn it over to Mary, to introduce David Sexton, my colleague and compatriot sitting in the back of the room, who is the President of the U.S. Downstream Business and has responsibility for all of our Downstream activities. Downstream in our parlance means right down to the end customer who buys gasoline at a Shell station somewhere across the nation.  But, also involved in making it, designing it, distributing it, making sure that the supply is where the demand is.

I’d also like to thank many Shell colleagues who helped organize this event.  I wonder if you could all please raise your hand, all of my Shell colleagues who are here, so that you can see who they are.   Among the Shell colleagues are world experts—world experts in gas to liquids (a clean future fuel that we’re investing heavily in), experts in fuel generally (our chief scientist in fuels is here today), experts in supply and distribution, experts in renewable energy, including hydrogen. 

I hope later today you will have an opportunity to visit the General Motors hydrogen vehicle. Shell and the GM partnership actually have real hydrogen fuel cell vehicles on the streets of some of our major cities because we do look to the hydrogen option as a future possibility—one that if we don’t start today will never get to where we need to get to as and when the technology and the supply opportunities are there.

So without further ado, I’d like to turn it over to Mary who will introduce our panelists and begin our dialogue. 

Thank you, Mary.