Exxon Mobil CEO
Darren Woods was born in Wichita, Kansas during the mid-1960s, but moved to Texas shortly thereafter and then he headed overseas to South Korea. Some of his fondest childhood memories took place on the Korean peninsula, although, those experiences were eventually followed by several formative years in the Philippines.
“My father worked for the Army and Air Force exchange service, headquartered in Dallas,” he says. “It supplied retail services on U.S. military bases. In supporting the military, we went where they went. As a result, growing up I moved every two to three years.”
Throughout most of elementary school, Woods was once again stateside, bouncing between San Antonio and Dallas. Rather than promoting to the nearest junior high with the rest of his recently-made friends, he hopped on a one-way flight to Hawaii, where he’d spend another four years. The moves were tiresome, never enabling him to develop a true “hometown,” and with that being said, the international businessman before us today holds nothing against his parents, he actually credits them for teaching him to respect others, believe in himself, work hard, never quit, and ultimately, adhere to a set of life’s more invaluable, globally transcendent principles.
At sixteen years old, he got his first job unloading overseas containers at a Navy warehouse on one of the islands. “I worked with people from different backgrounds, and it was hard, hot, and very dirty work,” he remembers. “I learned two very important lessons: first, there is dignity in hard work, irrespective of what it is; and second, if you respect differences, you’ll find more things in common.”
Texas A&M University
The middle of eleventh grade brought with it a reliably big move, on this occasion, teenage Woods was going back to Dallas, where he would receive his high school diploma and transition to college. While trying to figure out what to major in, his father offered the following advice: focus on what you like to do, choose a field that will let you do that, and success will follow.
“I liked problem-solving and had an affinity toward math, so engineering seemed a natural fit for me,” the then aspiring student, and current chief executive explains. “I was interested in the high math and analytics of electromagnetics and, as a result, pursued a degree in electrical engineering at Texas A&M University.”
That’s not to mention, Woods’ girlfriend at the time, Kathryn, who he later married, was born into an entire family of aggies, meaning her collegiate fate was virtually sealed from birth. Being so in love with this woman, her destined decision to attend Texas A&M pretty much confirmed where he was going too.
“People often ask me, ‘what was the most influential thing that happened to you at A&M?’ It helped me get my wife,” he shares during an interview at his alma mater. “I would tell you, that was probably one of the most important first steps I took in my life because it established a foundation that we’ve built on ever since then.”
Solving Unknown Problems
In one of his more difficult electrical engineering classes, Woods received a 56/120 on the first exam. “Talk about your stomach falling through your feet,” he laments. “I was shocked!”
After handing back a slew of failed tests, his professor promptly took to the bully pulpit upfront and informed them that the test would be graded on a twenty-point curve, without hesitating to add, the highest score he gave was a 56. The entire room was subsequently filled with concerned students as they attempted to grasp how this guy could fail his entire class.
One kid belted out, this was nothing like our homework! “I know you can do your homework, I want to know if you understand the principles behind your homework,” the professor retorted. “I’m not just testing what you learned, I’m testing whether or not you are capable of extrapolating on these points because that’s what an engineer’s job is. It’s not to solve known problems, it’s to take the principles and solve unknown problems.”
Looking back on the ordeal, Woods admits, “that was a very powerful message for me as a young person coming into the field.” The idea of solving problems or even inventing previously unimaginable solutions really got him jazzed up.
Outside of hitting the books, he juggled two jobs during college and paid his own way through. With this being said, Darren Woods graduated from Texas A&M University with a bachelor’s degree in electrical engineering in 1987.
The bottom line, Woods absolutely loved engineering, so much so, he initially planned on pursuing a Ph.D. in the subject and eventually hoped to become a university professor. When senior year rolled around, he conducted some fairly intense research on the area he intended to study, but in the midst of it all, felt incredibly burnt out – which set off doubts in his mind as to whether a career in academia was right for him.
To the dismay of his professors, he decided to enter America’s free-enterprise workforce as an engineer, hoping the experience could shed light on the validity of his original intuition. They told him, once you get a taste for the money, you won’t come back.
For the record, he did return to school three years later, for an MBA that is. “What I learned in those three years of working was you could be the best engineer but if you don’t know how to sell your ideas or get funding for those ideas, it’s difficult to be successful,” he reveals. “I really struggled because I was so narrowly developed as a student when I had been picking my engineering courses, I felt like I needed to learn a lot more about how you make money and fund the good idea.”
Following his undergraduate graduation, Woods spent his hiatus from the ivory towers of higher education at an aerospace company named TRW. There, he worked as a technical consultant to the U.S. Air Force on missile navigation systems.
“It gave me an opportunity to work with top engineering firms from around the country and explore all engineering disciplines,” he says. “After two years, however, it became clear that to be a successful engineer, you had to be part of a successful business.”
Therefore, he quit and invested his next two years into earning a master’s in business administration from Northwestern University. One interesting observation to point out is, a couple of self-made billionaires also found themselves working amongst TRW’s west coast offices at a particularly early stage in life, their names are Henry Samueli and Henry Nicholas III.
Darren Woods didn’t necessarily want to work for an oil and gas company, in reality, regardless of the industry, what he desired most was a general management career that included traveling around the world and regularly engaging with colleagues who could help him develop as a person. Truthfully, his on-campus interview with Exxon happened by mere chance; even upon accepting an entry-level position, he harbored doubts about long-term employment at the company.
“Soon after I joined Exxon, I was talking to the HR people and they were telling me about this philosophy behind a successful career – pension plans, all that kind of stuff,” he recounts. “I remember, I said to her, ‘you’re talking like we just got married, as far as I’m concerned, we’re just dating.'”
The astute young man’s first day on the job was August 31st, 1992, and because his wife was tired of living in student-like apartments, he managed to get them moved into their first house on December 2nd of that same year. On December 5th, he came home and asked her, “how much do you like this house?” She looked at him rather puzzled, wondering why he’d ask such a thing, that’s when he broke the news, “I think I’m going to get fired.”
Having been added to an exclusive, but cut-throat, program intended to groom international executives from within the company, he sensed something going awry. While scarfing down lunch with the mentor he was paired with, the seasoned veteran informed him how people generally advance up the company ranks by maintaining a low profile. “I didn’t quit my job, get an MBA, and come all this way to keep my head down,” Woods explained to his wife on said evening. “If that’s what it takes to get ahead, then I’m going to get fired.” She nervously acknowledged him, saying, “okay…just let me know when it happens!”
Darren Woods Climbs Up the Ladder
Lo and behold, the advice he had received on behalf of his “mentor” was not accurate in the least bit, so although Woods figured he’d inevitably get fired for carrying out what he felt was the right thing to do, regardless of the critical opinions of his peers, those effectively calculated decisions actually catalyzed his meteoric rise through a myriad of Exxon’s leadership positions. In order to form well-rounded executives, the oil giant stressed the importance of understanding the business from the ground up before trying to manage it.
“After Planning, ECI [Exxon] assigned me to the UK affiliate refinery, where I rotated through positions covering plant optimization and operations. I went on to manage the retail business in Scotland and northern England before becoming Supply and Trading Manager for the UK and Ireland,” he recollects. The next year of his life took place back in Dallas, where he functioned as Investor Relations manager. It was a unique and valuable experience early in his career that gave him a better understanding of the breadth of the business and the philosophies practiced in running it.
In 2005, Darren Woods was appointed vice president of Exxon Mobil Chemical Company in Houston, Texas, where he managed global specialty-chemical businesses. In 2008, he was named ExxonMobil Refining and Supply Company’s director of refining for Europe, Africa, and the Middle East, and was based in Brussels. In 2010, he was appointed vice president of supply and transportation, based in Fairfax, Virginia.
He was appointed president of Exxon Mobil Refining and Supply Company and vice president of Exxon Mobil Corporation in 2012. By 2014, he was elected senior vice president of Exxon Mobil Corporation. Effective January 1, 2016, Darren Woods was elected president of Exxon Mobil Corporation and a member of the board of directors.
“The best way to get your ideas across and make a difference is to make a compelling case because that’s within your control,” he shares. “The worst thing you can do in life is become a victim. Once you become a victim, things are no longer in your control, you’ve given the power to somebody else and that means you’ve lost because there’s nothing you can do anymore. Yes, there are going to be things you don’t have control over, but it’s your response that matters and you have complete control of that.”
Exxon Mobil Chief Executive
As December of 2016 reached its midpoint, former Exxon Mobil CEO, Rex Tillerson, expected to waltz his way into the new year poised to retire from the American oil giant on his birthday that upcoming March. The change in leadership was only a matter of practicality, as per company policy, there may not be a chief executive whose age surpasses 65 years – the exact golden age which awaited him. Then came an announcement that forced higher-ups to hasten their delicate transition process, Tillerson got appointed to President Donald Trump’s cabinet as Secretary of State.
“The board of directors of Exxon Mobil Corporation congratulates Rex W. Tillerson, chairman and chief executive officer, on his nomination for the position of U.S. secretary of state,” Suzanne McCarron, Exxon’s vice president of public and government affairs, said. “The board will be meeting shortly regarding transition.”
A media frenzy rapidly ensued over the rarity of a Fortune 500 executive going from the c-suite to the west wing and all sorts of theoretical conflicts of interest that could transpire considering he came from an international corporation monetarily tied to sanction-strapped adversaries such as Russia. Although there were many questions surrounding the man headed to Pennsylvania Avenue, professionals in the business world had little doubt about the gentle, soft-spoken, and effective executive who would take his place.
The Wall Street Journal, shortly after this news broke, released an article stating, while Mr. Woods’s expected ascension to the chief executive role isn’t yet official, and still must be approved by the company’s board, Exxon has consistently promoted from within its ranks, elevating future leaders to the role of president before they take over.
Exxon Mobil wasted no time in announcing a day or so later that Darren Woods would succeed Rex Tillerson as chairman and chief executive, effective – sooner than anticipated – January 1st, 2017. “When I was given the job, Rex didn’t offer it, he just told me, ‘this is your new job,'” Woods remembers. “I told him, ‘well I don’t really want it.'” However, Tillerson graciously reassured him, “that’s one of the reasons why you got it.”
A Challenging Situation
The largest remaining descendant of gilded age tycoon John D. Rockefeller’s Standard Oil Company, Exxon Mobil has traditionally existed as one of America’s most financially reliable corporations. It became the biggest public company in the world by revenue in 1975, and over the ensuing three and a half decades it was often the most profitable.
Ironically, it came at a time when oil prices were soaring beyond $140 a barrel (today, oil prices are around $65 a barrel) that the oil giant began making decisions they’d later regret. The 2000s were grinding to a close, the price of gas was outrageous, and fuel executives started searching far and wide for more oil to satisfy a seemingly relentless demand. Exxon Mobil looked to Canada’s oil sands, natural gas fracking, and even Russia’s Arctic, all of which required higher prices to be profitable.
Those efforts largely failed, explains The Wall Street Journal. Truth be told, Exxon’s production actually declined in the five years leading up to 2018, when the company was forced to acknowledge that 3.6 billion barrels of reserves in Canada – from an oil sands project that cost more than $20 billion – were no longer profitable to produce. Doing business in Russia did not fare well either, as in 2014, the United States along with many European nations hand-cuffed Moscow with crippling economic sanctions that impacted the profitability of their deal.
In 2016, S&P Global Ratings stripped Exxon of the triple-A credit rating they held since 1930; it was one of only three companies to hold the distinction at that time, the others being Microsoft Corp. and Johnson & Johnson. “Most investors like Exxon, but they like other companies better,” said Mark Stoeckle, chief executive of Adams Funds, which owns about $100 million in Exxon shares. “The market is not willing to reward Exxon for spending today in hopes that it will bring good returns tomorrow.”
Turning The Company Around
Exxon Mobil Corp.’s February 2021 annual filing with the SEC revealed the company debooked 6.3 billion barrels of oil equivalent in 2020, or almost 30% of its proved reserves. This has everything to do with the strategy Darren Woods and co. devised to stop unnecessary bleeding, and drilling for that matter. The SEC requires companies to estimate annually how much oil and gas they have below the ground that can reasonably be expected to see the light of day; in calculating this number, companies take into account factors such as market prices and the cost of producing said oil.
Woods is essentially tapping into the Canadian sands and certain natural gas reserves only exclusively at times when economic conditions reach profitable levels; on a related note, this is where those pipelines we occasionally hear about in the news come into play, they can have a huge impact on decreasing the price of oil production. Bloomberg documents how Exxon debooked 3.8 billion barrels of Canadian oil in 2016 when the Canadian benchmark price averaged just under $30 a barrel; rebooked 3.3 billion in 2018 when it averaged $38; and took them down 3.9 billion again when it fell back below $28.
Turning towards brighter horizons, Exxon has revised its Permian Basin growth plans to produce more than 1 million oil-equivalent barrels per day as early as 2024 – an increase of nearly 80 percent by 2019 standards and a significant acceleration of value.
“We’re increasingly confident about our Permian growth strategy due to our unique development plans,” said Neil Chapman, ExxonMobil senior vice president. “We will leverage our large, contiguous acreage position, our improved understanding of the resource, and the full range of ExxonMobil’s capabilities in executing major projects. Our plans are attractive at a range of prices and we expect them to drive more value as we continue to lower our development and production costs.”
Striking Black Gold
There is a tiny English-speaking country named Guyana situated along the coast of South America, lodged between Brazil and Venezuela, whose shores are about to experience an oil boom.
Since Exxon made an initial discovery of crude about 120 miles off the Guyanese coast in 2015, it launched one of the biggest underwater geological surveys in the industry’s history – and landed a remarkable string of 16 world-class discoveries. Last year alone, reports The New York Times, Exxon took credit for five of the six biggest oil finds, all in Guyanese waters.
A consortium led by Exxon plans to produce 750,000 barrels a day by 2025 from its Guyanese fields – an enormous addition to its current global production of four million barrels a day.
“It’s important to keep in mind that when we enter a country, our mindset is to be there for a lifetime–30 to 40 years,” Darren Woods explained on a conference call while addressing long-term political concerns regarding the developing nation. He added that the company has “engaged with the sitting government, the opposition, and communities” in Guyana to make sure the “development is understood.”
Just as this goliath oil tanker of a business was getting turned around, the global pandemic struck, throwing every industry’s planned future into jeopardy. To learn more about the company’s response, check out this March 4th, 2021 interview below, featuring Exxon Mobil CEO Darren Woods and “Squawk Box” of CNBC:
Darren Woods on Climate Change
On the heels of achieving Exxon Mobil’s 2020 emission reduction goals, Darren Woods announced plans for even more reduction than originally conceived by 2025 at the company’s most recent Investor Day. They’ve made significant progress in reducing their greenhouse gas emissions thanks to a robust development portfolio of technologies and products aimed at capturing carbon output.
“What society demands, and appropriately so, is affordable, reliable energy that doesn’t have the emissions associated with today’s energy systems,” he says. “We’re working on that evolution.” Exxon Mobil has set aside $3 billion through 2025 for capturing carbon from industrial plants and recently added an environmental activist with no previous ties to fossil fuels to its board of directors. He is Jeffrey Ubben, the co-founder of Inclusive Capital Partners, a firm that specialized in funding environmentally friendly businesses.
While Exxon is investing in energy efficiency projects, biofuels and hydrogen, there is particular enthusiasm surrounding the company’s 20 carbon capture and storage projects, reveals The New York Times. While the technology has yet to become widely deployed because it is very expensive, Woods and Exxon scientists argue that it could play an important role in reducing emissions from cement and steel manufacturing and other industrial processes that cannot easily run on renewable energy.
“Capitalizing on these emerging technologies and market opportunities could significantly reduce CO2 emissions and help society achieve the ambitions of the Paris Agreement – which we’ve supported since its inception,” explains Woods. “It can also help us grow shareholder value.”
If you enjoyed this story on the life of Exxon Mobil CEO Darren Woods, be sure to check out our biography of Chevron CEO, Mike Wirth.