I agree with the guy who said mulva should be thrown out on his ass. Other majors are not laying off because they know oil will be back above $60 in less than a year and they have enough cash to wait it out versus laying off thousands. Where do you think those people will end up? The competition will suck them up.
And the $32 billion in write-downs is directly due to his only strategy of growth through buying other companies. COP has miserable track record of growing through the bit ever since mulva took over. This is what happens when your only growth is through aquisitions and a company is run by bean counters.
Is this why COP has not met its production target for the last 5 years or reserves replacement has been less than 100% or why COP is the only major that does not have any cash on hand, but rather bucket loads of debt?
If we ever get to 50, I'll be dumping and moving on to CVX.
I agree with your bean counter and drill bit discoveries comments. Mulva certainly paid too much for BR but he really did really well buying Arco's Alaska properties. Phillips got some good oil finders with the merger with Conoco but many have left because of the Phillips bureaucracy (Phillips also had some good people but they were conditioned to not take risks). At the time of the Conoco-Phillips merger, the managers were basically half Conoco and half Phillips, but most the Conoco managers are gone and replaced by those more in the old Phillip's mold.
I value Mulva's business analysis skills. He messed up in paying too much for BR, but I am not sure Mulva needs to go. I would be concerned if any the current Exec VPs replaced him with the possible exception of the new E&P EVP who I do not have much knowledge on.
It is getting harder to make major new oil discoveries, but an oil company must still try. Expanding by acquisitions makes sense to me especially with current low oil prices. I would love to see COP acquire DVN or APC, but I suspect the new presidential administration would object to oil company mergers.
COP has good people in every department but preparing for a tough economy and low oil prices might make sense. They could probably benefit from laying off some of their bureaucrats in their corporate service departments, but I would hope they keep every good geoscientist, production engineer and refinery engineer they have in their core businesses of finding, producing, refining and marketing petroleum products (some day oil prices will be going up). I would hope all deadbeats any where in the company are already gone.
I agree, but past experience indicates that each plant will lose at least one or more token engineers and others. This has been the case in every prior layoff. I have seen some very good people lost in the past. I won't be sweating out the pink slips this time, I retired at the end of December.
The new guy in EP is a cost cutter, not a grower. Most folks in Downstream were very glad to have him leave for E&P. He's a Phillips guy with a Financial and Law background but has been around all portions of the company. Straight shooter, to the point and to the bone. Not the kind of guy to build up morale or long term comittment but he can get the job done in the current "hunker down, cut all costs and don't worry about growth" mode. Unfortunately, probably the right guy for the right job at the right time. For those that survive the meat grinder, good luck, you'll need it. For those that don't, good luck, you'll need it.
But hey, the Messiah is in office in DC and all things will be just grand!! Meanwhile, reserves growth is dwindling and projects are being slashed. Our supply/demand imbalance will soon do another flip/flop...maybe later this year but most certainly next year.