http://money.cnn.com/2007/04/09/news/newsmakers/occidental.reut/index.htm?cnn=yes

$400 million record salary for this Occidental CEO...they say he earned it, but I'd like to see the ROI....:rolleyes:

I read that. Stunning.

What's sad is that people just don't care. Panis circenses. That's all. Society is collapsing around us and all we care is when GM is having the next employee sale on the Hummers.

Hey!, if the guy was a Pro football player, his 1.3 Mil salary and 1.4Mil bonus would be no big deal. Everything else was stock options. Sounds like a very smart man.

Society is collapsing around us
Braaaaaaaaaaaaaaaaaaaaaack!!!!!!!! Chicken Little the sky is falling! You probably never had it so good. How's that imported Italian bike doing?

http://money.cnn.com/2007/04/09/news/newsmakers/occidental.reut/index.htm?cnn=yes

$400 million record salary for this Occidental CEO...they say he earned it, but I'd like to see the ROI....:rolleyes:

"They say he earned it..."

So, what kinda stock options does Bush/Cheney get to cash in when all's said and done?

The Bush admin is the ONLY reason these oil cos are raping America and world... It has nothing to do with their performance...

The Bush admin is the ONLY reason these oil cos are raping America and world... It has nothing to do with their performance...

What are you talking about? Fuel prices are dirt cheap in the US--- you can claim it is due to taxes (the lack thereof) or whatever... but they are hardly raping America and the world. The truth is, these days, it is impossible NOT to make record profits in the oil business. What is driving these profits is technology that has made oil exploration and drilling more efficient than ever. "Risk" is practically nonexistent these days. But I agree- it has nothing to do with the performance of a CEO.

A democrat could be in office and nothing would be different regarding energy prices. At this point in history, requiring a "realistic" tax on fuel would be hugely regressive.

I read that. Stunning.

What's sad is that people just don't care. Panis circenses. That's all. Society is collapsing around us and all we care is when GM is having the next employee sale on the Hummers.

Uh...okay. So it's our fault.

Uh...okay. So it's our fault.

But really now...would it have mattered if the guy got $300M instead of $400M? Beyond some point money isn't really the issue--ego is. To say he earned that money seems to stretch it a bit for me. Now if it could be shown that he did the equivalent work of 4000 mid-level managers (based on $100k per year salary per person) then I might reconsider.

But really now...would it have mattered if the guy got $300M instead of $400M? Beyond some point money isn't really the issue--ego is. To say he earned that money seems to stretch it a bit for me. Now if it could be shown that he did the equivalent work of 4000 mid-level managers (based on $100k per year salary per person) then I might reconsider.

I agree that it is horribly excessive. But what say do your or I have in the matter? I am not a stockholder. I am not an employee. If the company wants to give that kind of money away, and they are breaking no laws by doing it, then there is nothing I can do about it. And it's not because I don't care.

Since almost all of it is in stock options, the only damage being done is to the shareholders...

When you fill up, you're not paying for the stock options a company gives away as compensation. All these stock options do is dilute the value of existing shares. They are not a real 'expense' for the company.

What are you talking about? Fuel prices are dirt cheap in the US--- you can claim it is due to taxes (the lack thereof) or whatever... but they are hardly raping America and the world. The truth is, these days, it is impossible NOT to make record profits in the oil business. What is driving these profits is technology that has made oil exploration and drilling more efficient than ever. "Risk" is practically nonexistent these days. But I agree- it has nothing to do with the performance of a CEO.

A democrat could be in office and nothing would be different regarding energy prices. At this point in history, requiring a "realistic" tax on fuel would be hugely regressive.

Oh please, that's about as naive as it gets...

It looks like also that when this guy took over, their stock was trading at only $9/share. Now, it is trading well over $50. Whether or not he had anything to do with that (he probably did since he was CEO after all) doesn't matter, it happened on his watch, and he can take credit for it. Also, most of that record compensation, as others have mentioned, came from stock options. It wasn't his salary. If he wants to cash out the options that company gave him, that's his prerogative right?

It wasn't his salary. If he wants to cash out the options that company gave him, that's his prerogative right?
It is money...whether or not it was salary really isn't the point. The guy made $400 mill last year because of what his company gave him and because the stock went up instead of down. Even if the stock would have stayed at $9 he would have made lots of money selling it--he was gifted these options--he didn't have to buy it like the rest of us would. I'm all for rewarding good performance, but this is excessive. Hiding salary in stock options is de rigeur these days.

It is money...whether or not it was salary really isn't the point. The guy made $400 mill last year because of what his company gave him and because the stock went up instead of down. Even if the stock would have stayed at $9 he would have made lots of money selling it--he was gifted these options--he didn't have to buy it like the rest of us would. I'm all for rewarding good performance, but this is excessive. Hiding salary in stock options is de rigeur these days.

Until it's illegal, then companies will probably keep doing it, but normally and I'm sure in this case, there were conditions placed on said stock options, meaning he had to keep them for so long of a time period before he could cash them out, which in turn means he's going to try and work harder to get them to go up (this is the theory at least), so that he has a definite incentive to work harder, and make the company successful.

So, if it's not illegal, and their stock holders approved this bit of "payment" then what is the problem? Sure, oil companies are making record profits all over the place, but what are we supposed to do? Stop them? Take away their profits?

Until it's illegal, then companies will probably keep doing it, but normally and I'm sure in this case, there were conditions placed on said stock options, meaning he had to keep them for so long of a time period before he could cash them out, which in turn means he's going to try and work harder to get them to go up (this is the theory at least), so that he has a definite incentive to work harder, and make the company successful.

So, if it's not illegal, and their stock holders approved this bit of "payment" then what is the problem? Sure, oil companies are making record profits all over the place, but what are we supposed to do? Stop them? Take away their profits?

Not everything that is legal is right or ethical. I think any CEO getting paid that much needs to show exactly how his INDIVIDUAL efforts have made the stock go up--maybe he just got lucky or more likely he's getting rich because of the efforts of his subordinates.

Not everything that is legal is right or ethical. I think any CEO getting paid that much needs to show exactly how his INDIVIDUAL efforts have made the stock go up--maybe he just got lucky or more likely he's getting rich because of the efforts of his subordinates.

Not everything legal is ethical, or right, or moral for that matter, but for some people, if it's legal, then it's OK. And in this case, they paid him off with some stock options probably at the start of his tenure, and made him wait to cash them in, and when he did, then it was then (now actually) that he got his big pay out.

Of course he got rich off the backs of his subordinates, every top level person at any company in the world gets rich off the sweat of others, but they also had to work to get there themselves. It's not very often that you get a high paying, top level exec job without having earned it first, there are of course, some notable exceptions (our President being prime example #1).

But again, this guy came in. Stock at 9. This year, stock about 50. There appears to have been a POSITIVE increase in the value of the company, and he is said leader of the company. I don't have to like it, and I can be jealous of it, but you can be damned sure that if I were him, I'd cash out too, and so would you, and so would just about anyone.

Again, it is up to the company to pay him what they think he's worth, and to give him stock options as to what they think he's worth. They did that, he got a windfall. I don't see anything wrong with it at all.

I wish he earnt $800 million.

I mean who cares ... if that's what he's into and that's important to him then good luck for him. it is a crazy world but what he earns is his business. no skin off my nose.

i devote my life to chicks. d'you think i'm gonna care about getting derided by you cats for breaking 4 figures :hand: :ciappa:

What I don't understand is why do shareholders pay this? I own stock. I NEVER vote to give any kinda raise or options or bonus. I always vote no. Who are the other idiot shareholders who think paying crazy bucks means more money for them? I have owned shares in companies that lost BILLIONS but paid MILLIONS to the jerk CEOs. I have never seen any return on my money by paying crazy sums. Even the stocks that I have made money on, I still think most of the CEOs are overpaid as well. I doubt that if this guy had only made 20 million that the stock performance would have been any different.

It is money...whether or not it was salary really isn't the point. The guy made $400 mill last year because of what his company gave him and because the stock went up instead of down. Even if the stock would have stayed at $9 he would have made lots of money selling it--he was gifted these options--he didn't have to buy it like the rest of us would. I'm all for rewarding good performance, but this is excessive. Hiding salary in stock options is de rigeur these days.

Those options weren't all given to him last year. They were accumulated over a 10 year period. He just happened to cash them in last year.

Hang on here, I haven't checked these numbers so tell me if I'm wrong.

The CNN.com article had this quote: "the company said that from December 1990 - when Irani succeeded Armand Hammer as chief executive - through 2005, the company's stock rose to about $40 a share from $9 and its total shareholder return was 699 percent."

Today it closed at $49.68, for a market cap of $41.64 Billion, so at $9 per share it would've been about $7.5 Billion total value of the company.

So under his regime, he increased the collective value of the stockholder's wealth by $34.4 billion, and his cut on that was $400 million... or the .4 billion off of the 34.4

And that sounds like a bad deal to you? Dude, I'd want to find as many of him as I could and hire 'em ALL.

And make no mistake: the primary job of a CEO is to increase the shareholder's return. Sounds to me like he needs a raise.

Creak.

p.s. I'm sure somebody will check my math.

The math is correct but I do not believe he was all that responsible for the rise in stock value. I think he would have done the same job for 20 million.

Not everything that is legal is right or ethical. I think any CEO getting paid that much needs to show exactly how his INDIVIDUAL efforts have made the stock go up--maybe he just got lucky or more likely he's getting rich because of the efforts of his subordinates.

Gawd, that's just music to my ears.

One mistake though, he got rich because Bush is in Iraq. The whole sector is pumping money and it doens't have anything to do with new tech... It's called raping America at $62 bbl.

Oh please, that's about as naive as it gets...

No- it is as paranoid as it gets to suggest that this is partisan. These unprecedented huge profits are not only seen in the US.

Hang on here, I haven't checked these numbers so tell me if I'm wrong.

The CNN.com article had this quote: "the company said that from December 1990 - when Irani succeeded Armand Hammer as chief executive - through 2005, the company's stock rose to about $40 a share from $9 and its total shareholder return was 699 percent."

Today it closed at $49.68, for a market cap of $41.64 Billion, so at $9 per share it would've been about $7.5 Billion total value of the company.

So under his regime, he increased the collective value of the stockholder's wealth by $34.4 billion, and his cut on that was $400 million... or the .4 billion off of the 34.4

And that sounds like a bad deal to you? Dude, I'd want to find as many of him as I could and hire 'em ALL.

And make no mistake: the primary job of a CEO is to increase the shareholder's return. Sounds to me like he needs a raise.

Creak.

p.s. I'm sure somebody will check my math.

Your math is likely correct--where I disagree is that this CEO was solely responsible for this increase. Gas is something most of us have to buy. Kind of like being a heroin dealer--you always have a market for it and people will pay whatever it takes to get it. Having GWB in charge probably didn't hurt profits any either. Sure the balance sheet looks good and the shareholders are happy, but did he really earn that $$?

Hang on here, I haven't checked these numbers so tell me if I'm wrong.

The CNN.com article had this quote: "the company said that from December 1990 - when Irani succeeded Armand Hammer as chief executive - through 2005, the company's stock rose to about $40 a share from $9 and its total shareholder return was 699 percent."

Today it closed at $49.68, for a market cap of $41.64 Billion, so at $9 per share it would've been about $7.5 Billion total value of the company.

So under his regime, he increased the collective value of the stockholder's wealth by $34.4 billion, and his cut on that was $400 million... or the .4 billion off of the 34.4

And that sounds like a bad deal to you? Dude, I'd want to find as many of him as I could and hire 'em ALL.

And make no mistake: the primary job of a CEO is to increase the shareholder's return. Sounds to me like he needs a raise.

Creak.

p.s. I'm sure somebody will check my math.

As excessive as this seems, it is much less offensive than say, what the ex CEO of Home Depot took when he was basically FIRED. Or all the tech execs who changed their option prices when the internet boom collapsed. Actually the deal that Dr. Irani cut with Armand Hammer originally was 100x more offensive, because the stock was underperforming badly at that time, and he took a big paycheck. There are still institutional investors that avoid the stock because of what happened 20 years ago. The fact is if you have been an Oxy shareholder the last 10 years, you are very very happy. The company made incredibly timely investments in two US fields that transformed it, and Dr. Irani has contacts in the Middle East that other much larger companies only dream about. The price of oil has nothing to do with his paycheck, and if you are looking for clues to the end of our civilization, there are much better places to look. Is he overpaid? Yup. But a lot off folk's retirements will be a little better because of him.
Kicking an expired horse for me, but the focus of pure hatred toward energy companies by folks is irrational and misplaced when looked at objectively. Sorry but it is, even tho you don't want to hear it...
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As excessive as this seems, it is much less offensive than say, what the ex CEO of Home Depot took when he was basically FIRED. Or all the tech execs who changed their option prices when the internet boom collapsed. Actually the deal that Dr. Irani cut with Armand Hammer originally was 100x more offensive, because the stock was underperforming badly at that time, and he took a big paycheck. There are still institutional investors that avoid the stock because of what happened 20 years ago. The fact is if you have been an Oxy shareholder the last 10 years, you are very very happy. The company made incredibly timely investments in two US fields that transformed it, and Dr. Irani has contacts in the Middle East that other much larger companies only dream about. The price of oil has nothing to do with his paycheck, and if you are looking for clues to the end of our civilization, there are much better places to look. Is he overpaid? Yup. But a lot off folk's retirements will be a little better because of him.
Kicking an expired horse for me, but the focus of pure hatred toward energy companies by folks is irrational and misplaced when looked at objectively. Sorry but it is, even tho you don't want to hear it...
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Disagree with the premise. He didn't earn the $$, he was just in the right position at the right time. Good article here:

http://www.businessweek.com/bwdaily/dnflash/apr2006/nf20060414_4611_db046.htm

What's wrong with such enormous pay? Simply put, it's undeserved. ExxonMobil didn't earn $36 billion last year because Raymond did an amazing job as CEO. It earned that sum because world oil prices were extremely high, which reflected strong demand and tight supply.

THANK THE SHEIKS. There was a time when oil-company executives understood this. Crystal says he was a compensation consultant to Mobil in the 1970s, when it was still an independent company, and remembers a conversation about whether to award the then-CEO a big bonus after profits shot up because oil prices rose in the aftermath of the first Arab oil embargo in 1973.

According to Crystal, a member of the compensation committee thought a big bonus was unjustified, saying something like: "We're still pumping the same number of barrels we pumped last year. Our success is due to those white-robed sheiks."

Precisely. That's a point that seems to have escaped the members of ExxonMobil's super-generous compensation committee last year.

UNDER PRESSURE. When people advocate a windfall-profits tax on oil companies, it's because they're disgusted that people like Raymond are getting rich while ordinary motorists get sucked dry at the pump. As it happens, the instinct is wrong. In most years, oil companies don't earn big profits in comparison to their revenue. They depend on the occasional windfall to give them respectable overall returns. Taking away oil companies' profits when prices are high would discourage them from exploring for and producing more oil, which is essential to meeting the world's future energy needs.

But when Big Oil chooses to spend its profits on making its top executives fabulously wealthy instead of drilling for more crude, it makes it extremely hard to resist the pressure to confiscate some of those enormous earnings.

Disagree with the premise. He didn't earn the $$, he was just in the right position at the right time. Good article here:

http://www.businessweek.com/bwdaily/dnflash/apr2006/nf20060414_4611_db046.htm

While it is true that energy executives benefitted from the oil increase, the test should be to look at OXY stock performance vs their peers over the last ten years, not all of them good for energy companies. OXY has strongly outperformed Anadarko, Apache and most other independent producers over that time, largely due to specific decisions that I alluded to and would be happy to discuss in more detail. I think CreakyKnees analysis holds up.

BTW, what about all the internet and technology execs that made millions before their companies collapsed? Many computer billionaires have done much better than their shareholders in recent years. There are MANY examples of exhorbitant CEO salaries in many industries. I think the equating of high salaries for energy execs and high gas prices is goofy, and does not stand up to analysis in any way.

Again if you look over the last 20 years, the energy business has been very difficult--you may not want to hear it but one of the reasons you are paying so much for gas now is that you were paying so LITTLE before--returns in the refining business averaged single digits for many years, permitting for a new refinery in the US was impossible--and yes it was tried-so companies invested elsewhere. As for reinvesting in oil production now, the companies are going full out--they have been negotiating with many countries, like Saudi Arabia, Nigeria, Venezuela with little success (and being criticized for doing so, it's "why aren't you investing more?" and "why are you negotioting with the Saudis and the Libyans?".) They have also gone to the limit of resources in people and equipment. When the energy cycle was going boom and bust every few years in the 80's and 90's, the number of people training to get into the industry plummeted, and it is only now rebounding.
I think it has to be looked at in context of many years, not one or two. That is when the options were issued. Flame at me if you like, but I believe many people on this board and in America have an emotional negative response to energy companies that has nothing to do with the reality of the industry, and it is promoted by people for political purposes and it does more harm than good.

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Flame at me if you like, but I believe many people on this board and in America have an emotional negative response to energy companies that has nothing to do with the reality of the industry, and it is promoted by people for political purposes and it does more harm than good.

b21

Fair enough and I'll admit to my biases and about Big Oil...I still think there is a difference between a company selling something we all can't do without and whose price can be manipulated easily by the foreign producers to create artificial shortages that all but gaurantee record profits than a company making luxury goods that are nice to have, but not really needed.

Fair enough and I'll admit to my biases and about Big Oil...I still think there is a difference between a company selling something we all can't do without and whose price can be manipulated easily by the foreign producers to create artificial shortages that all but gaurantee record profits than a company making luxury goods that are nice to have, but not really needed.

i don't believe that an artificial shortage has been created at all. It's quite real. Here's my perspective. For many years, the Saudis have been the swing producer in the world--essentailly every OPEC nation is producing at their capacity (Nigeria, Iran, Venezuela) which in most cases is actually below their OPEC quota. It was the Saudis alone that had millions of barrels of excess capacity that could be supplied or withdrawn from the markets. For most of my career (1983) oil was between $11 and $30 per barrel, averaging $18-19. At this price, returns for NON OPEC countries and companies weren't very good.

Look at this chart of performance of the three major oil indices vs the S&P 500 from 1985-2000-(it may come out in B&W, having trouble going from PP to gif). This is relative, the S&P 500 is the straight line. All three indices boradly underperformed for 15 years. The lowest line is US Exploration and Production companies (E&P)-companies that made most of their money producing energy in the US. The stocks were horrific investments, and the stock returns correlate closely with the returns the companies generated--LOUSY. 20% of the market return over 15% years is pretty stinking awful-if their capital was costing them 14%, they were earning a return of about half that for YEARS and YEARS. That is why I say shareholders SUBSIDIZED energy consumers for a long time.

Meanwhile the Saudis were going merrily along, not really re-investing in their production. Nobody saw China coming. The Saudis excess capacity went from 5 million barrels to 4 to 3 to 2 to virtually zero. Now they have begun to spend heavily--they have DOUBLED the number of rigs drilling in the country in the last two years, and that's a big deal for them. But it takes time to bring it to production.

Meanwhile guerillas are shooting at Chevron employees in Nigeria, Chavez is booting out US companies in Venezuela, Iran is threatening everybody etc. All three countries have something in common-investment is falling and production is falling too. It makes no sense because they are dependent on oil for revenue. Our neighbor Mexico refuses outside investment and their oil producton is falling and they have been IMPORTING natural gas from the US for years, despite huge untapped resources.

So my point is that this is not some huge international conspiracy. Every country has their own agenda. Oil companies are in the business of producing oil and trying to earn a return for shareholders. They invested when oil was $15 and they are investing now. It's a hugely complex game, but comments in this thread like "raping America at $62/bbl" simply is not true. My 2cents

b21

"What are you talking about? Fuel prices are dirt cheap in the US--- you can claim it is due to taxes (the lack thereof) or whatever... but they are hardly raping America and the world. The truth is, these days, it is impossible NOT to make record profits in the oil business. What is driving these profits is technology that has made oil exploration and drilling more efficient than ever. "Risk" is practically nonexistent these days. But I agree- it has nothing to do with the performance of a CEO.

A democrat could be in office and nothing would be different regarding energy prices. At this point in history, requiring a "realistic" tax on fuel would be hugely regressive."


I tend to agree with with most of this sentiment but I don't see that oil companies do no harm. Look into Occidental, as well as Texaco and Chevron, and their history in Ecuador and Columbia. I would not claim that they havn't done incredible harm to the environment and the indegenous people there. I would like to see these people get a big hunk of that cash. I suppose that the shareholders would not like that, however. It seems that everywhere that oil is found there are always an accompanying problems and they never turn out so well for the locals - the curse of oil I suppose.

I tend to agree with with most of this sentiment but I don't see that oil companies do no harm. Look into Occidental, as well as Texaco and Chevron, and their history in Ecuador and Columbia. I would not claim that they havn't done incredible harm to the environment and the indegenous people there. I would like to see these people get a big hunk of that cash. I suppose that the shareholders would not like that, however. It seems that everywhere that oil is found there are always an accompanying problems and they never turn out so well for the locals - the curse of oil I suppose.
Oil companies make deals with National Oil Companies, which are controlled by the government. I would argue that if you hand out awards for most damage done, the biggest ones would go to the government. Often the government would insist that the oil company pay for hospitals and schools and roads, etc. Usually the demand was give us the money and we will build it. Guess what?? It went into the pockets of the government. I know that in many instances now, the oil companies insist that the money go directly to an organization within the country to make sure it goes where it was supposed to. As for Columbia, it is now one of the most stable countries in South America when it comes to a relationship between companies and the people. I totally agree that indigenous people got screwed; I am just saying its not as simple as blaming big oil--a lot of money that was given for good causes was stolen. I would bet anything that Mr. Socialist Hugo Chavez has stashed away a billion for himself and friends in Switzerland.

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I gotta get into the oil business....

Lets assume there is an artificial refined oil/gas shortage created by lack of maintenance and upgrades to refineries. Lets also assume this artificial supply manipulation happened under this CEO's watch, and directly contributed to the revenues the company is making now, throw in the reduced maintenance costs, thus creating record profits. Business is business, I wouldn't want the government dictating the supply of oil.

The oil industry learned it's lesson when the price of oil collapsed in the 80s, largely due to over supply. When profits soared during the embargo days, much was allocated to capital expenditures, that created huge refining capacity.

Sounds like the CEO made the right decisions and created huge shareholder equity.

This could get ugly if the super giant oil companies start acquiring the smaller companies, in effect creating large barriers to entry for competitors. In a well behaved market economy it doesn't take long for competitors to move into areas where profits are highly lucrative. The one caveat is the supply of raw crude, personally I think the supply problem has been greatly exaggerated.

i don't believe that an artificial shortage has been created at all. It's quite real. Here's my perspective. For many years, the Saudis have been the swing producer in the world--essentailly every OPEC nation is producing at their capacity (Nigeria, Iran, Venezuela) which in most cases is actually below their OPEC quota. It was the Saudis alone that had millions of barrels of excess capacity that could be supplied or withdrawn from the markets. For most of my career (1983) oil was between $11 and $30 per barrel, averaging $18-19. At this price, returns for NON OPEC countries and companies weren't very good.

Look at this chart of performance of the three major oil indices vs the S&P 500 from 1985-2000-(it may come out in B&W, having trouble going from PP to gif). This is relative, the S&P 500 is the straight line. All three indices boradly underperformed for 15 years. The lowest line is US Exploration and Production companies (E&P)-companies that made most of their money producing energy in the US. The stocks were horrific investments, and the stock returns correlate closely with the returns the companies generated--LOUSY. 20% of the market return over 15% years is pretty stinking awful-if their capital was costing them 14%, they were earning a return of about half that for YEARS and YEARS. That is why I say shareholders SUBSIDIZED energy consumers for a long time.

Meanwhile the Saudis were going merrily along, not really re-investing in their production. Nobody saw China coming. The Saudis excess capacity went from 5 million barrels to 4 to 3 to 2 to virtually zero. Now they have begun to spend heavily--they have DOUBLED the number of rigs drilling in the country in the last two years, and that's a big deal for them. But it takes time to bring it to production.

Meanwhile guerillas are shooting at Chevron employees in Nigeria, Chavez is booting out US companies in Venezuela, Iran is threatening everybody etc. All three countries have something in common-investment is falling and production is falling too. It makes no sense because they are dependent on oil for revenue. Our neighbor Mexico refuses outside investment and their oil producton is falling and they have been IMPORTING natural gas from the US for years, despite huge untapped resources.

So my point is that this is not some huge international conspiracy. Every country has their own agenda. Oil companies are in the business of producing oil and trying to earn a return for shareholders. They invested when oil was $15 and they are investing now. It's a hugely complex game, but comments in this thread like "raping America at $62/bbl" simply is not true. My 2cents

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Oh please, this is utter BS.

It has everything to do with the price per barrel. It has everything to do with the fact that the industry hasn't built a refinery since the mid '70s.

Would oil companies invest as they are if the prices were still $15 bbl?

Get real.

Oil companies make deals with National Oil Companies, which are controlled by the government. I would argue that if you hand out awards for most damage done, the biggest ones would go to the government. Often the government would insist that the oil company pay for hospitals and schools and roads, etc. Usually the demand was give us the money and we will build it. Guess what?? It went into the pockets of the government. I know that in many instances now, the oil companies insist that the money go directly to an organization within the country to make sure it goes where it was supposed to. As for Columbia, it is now one of the most stable countries in South America when it comes to a relationship between companies and the people. I totally agree that indigenous people got screwed; I am just saying its not as simple as blaming big oil--a lot of money that was given for good causes was stolen. I would bet anything that Mr. Socialist Hugo Chavez has stashed away a billion for himself and friends in Switzerland.

b21

Yes, the oil companies give the money to the governments that are most favorable to their interest. Also I would not suggest that Oil companies (or any large companies) are acting altruisticlly. They are in the money making business. Yes consumers make the demand and they supply it, so I would never simply blame the big oil companies. However, The oil companies in Central and South America have been known to have created environmental disasters and violated human rights in the region.

But how much of the spoils actually go back into the welfare of the citizenry? This is largely why there has been so much unrest in these areas. This is how "Mr Socialist Chavez" finds his platform (not that he is any less corrupt than his opponents on the right who have surley lined their pockets quite well). He simply says that he wants to keep a larger portion of the oil revenue in his own country.

Also, "stable" is not a word I would use to describe the situation in Columbia.

Oh please, this is utter BS.

It has everything to do with the price per barrel. It has everything to do with the fact that the industry hasn't built a refinery since the mid '70s.

Would oil companies invest as they are if the prices were still $15 bbl?

Get real.

Spydey, the investment HAS been made by US companies, but it was made overseas--the gasoline is imported now-and in existing facilities in the US. Companies have spent heavily in the US to meet gasoline regs, increase output, and to increase complexity (i.e., to be able to process heavier crudes, which is what we get from Mexico and Venezuela). I have been accused of not supporting my opinion but come on! You are accusing me of "utter BS". Your view that the US companies are witholding spending because no new greenfield refineries have been built is well, utter BS, and shows a complete lack of knowledge of the industry. Read the NYTimes article today about what Venezuela (Citgo) did with their refineries in the US.

Below is a history of refinery margins in the US. As you can see the last few years have been nirvana, and created a situation with both the refining and production side of companies have been profitable. As you can also see, history has not been so kind. I can provide you with what those low margins for many years translated into for returns on investment if you like, but think in terms of what you earn on your savings account. That, combined with environmental restrictions for permiting, is why no new refineries have been built in the US. No sane management would commit Billions to a five year project that would not earn the cost of capital! Would you? Especially if you can make the same investment somewhere else in the world and double your return. That's what has happened--its cheaper for companies to build the plants elsewhere and have the gas imported. Cheaper to find oil elsewhere and import it, and coming to your neighborhood soon, cheaper to find natural gas elsewhere and import it. That's the reality Spydey.


b21

Here's the quote that I think best sums up the anti's:
" I do not believe he was all that responsible for the rise in stock value. I think he would have done the same job for 20 million."

Suppose I concede both points (I don't). But if I did... does that make it wrong that he was able to negotiate a deal that ended up making him 400 million, for whatever it was that he did do?

Here's what I think it boils down to - whether you who has essentially zero skin in the game, or knowledge of the critical details, are a valid critic of the deal that was negotiated in good faith between the board and the dude, and faithfully delivered upon, beyond any reasonable expectation.

Given that you don't have a stake in that game, then it's just pure jealousy and envy talking. Not pretty.

Creak.

There is not point offering a logical argument--- the real issue is that some people just do not WANT to like big oil.

Spydey, the investment HAS been made by US companies, but it was made overseas--the gasoline is imported now-and in existing facilities in the US. Companies have spent heavily in the US to meet gasoline regs, increase output, and to increase complexity (i.e., to be able to process heavier crudes, which is what we get from Mexico and Venezuela). I have been accused of not supporting my opinion but come on! You are accusing me of "utter BS". Your view that the US companies are witholding spending because no new greenfield refineries have been built is well, utter BS, and shows a complete lack of knowledge of the industry. Read the NYTimes article today about what Venezuela (Citgo) did with their refineries in the US.

Below is a history of refinery margins in the US. As you can see the last few years have been nirvana, and created a situation with both the refining and production side of companies have been profitable. As you can also see, history has not been so kind. I can provide you with what those low margins for many years translated into for returns on investment if you like, but think in terms of what you earn on your savings account. That, combined with environmental restrictions for permiting, is why no new refineries have been built in the US. No sane management would commit Billions to a five year project that would not earn the cost of capital! Would you? Especially if you can make the same investment somewhere else in the world and double your return. That's what has happened--its cheaper for companies to build the plants elsewhere and have the gas imported. Cheaper to find oil elsewhere and import it, and coming to your neighborhood soon, cheaper to find natural gas elsewhere and import it. That's the reality Spydey.


b21

yadda, yadda... reality is it's cheaper to rape America at $63 per bbl. Big oil is getting rich on America's backs. Big oil has a great friend in the White House. Big oil is raping America!

Here's the quote that I think best sums up the anti's:
" I do not believe he was all that responsible for the rise in stock value. I think he would have done the same job for 20 million."

Suppose I concede both points (I don't). But if I did... does that make it wrong that he was able to negotiate a deal that ended up making him 400 million, for whatever it was that he did do?

Here's what I think it boils down to - whether you who has essentially zero skin in the game, or knowledge of the critical details, are a valid critic of the deal that was negotiated in good faith between the board and the dude, and faithfully delivered upon, beyond any reasonable expectation.

Given that you don't have a stake in that game, then it's just pure jealousy and envy talking. Not pretty.

Creak.

I think we all have some skin in the oil game--what if they took half that money and put it towards making oil refinement cleaner? Or for exploring for new sources of oil? Instead they made one man very rich.

step 1: open an etrade/scottrade/ameritrade/schwab/whtatever account
step 2: buy some oil stocks
step 3: start riding the bike to work -- this is a cycling forum after-all
step 4: stop griping about oil prices

The oil companies have the US consumer by the nuts.. wanna see oil prices come down, reduce your demand for oil.