Lee R. Raymond, who served as a lightning rod for environmental critics while steadily guiding ExxonMobil Corp. to become the world's richest public company, on Thursday said he will retire at the end of this year.
Raymond, 66, had already passed Exxon's mandatory retirement age of 65, and his retirement, which had been delayed upon a request by the board of directors, has been rumored for more than a year. The 42-year Exxon veteran is expected to be replaced by current President Rex W. Tillerson, 53.
Raymond, who some analysts rank as one of the top executives in U.S. corporate history, has marked his chairmanship by a disciplined approach to managing the company's cash and financial position. Earlier this year, presiding over another quarter of stellar earnings, he referred to ExxonMobil's profits as "boringly consistent," and insisted that the company likes it that way.
Many analysts cited Raymond's management of the Exxon and Mobil $80 billion merger in 1999 as the highlight of the oil executive's career.
"Mobil was a very strategic acquisition," said A.G. Edwards analyst Bruce Lanni. "It fit like a glove in the company. Year to date, it was one of the best acquisitions that has ever been made in the oil industry." However, Lanni said that the merger was not necessarily the highlight of Raymond's career.
"You have to understand that Lee Raymond has guided this company not only through the good times but also the bad times," said Lanni, who cited the Exxon Valdez oil spill as also happening on Raymond's watch. But he noted that under Raymond, ExxonMobil has remained a reliable moneymaker for shareholders.
"Whether oil prices are low or high, he's been able to do a very good job in generating returns."
Earlier this year, Raymond challenged analysts who questioned why ExxonMobil was not pouring more money into acquisitions and instead holding on to its cash. ExxonMobil, he said, takes "a long-term perspective. First we do not do anything stupid. Secondly, don't expect us to take mechanistic or knee-jerk reactions" (see NGI, March 10).
While rivals BP plc and Royal Dutch Shell -- among many -- have poured money into alternative energies and embraced the notion of global warming, Raymond disdained their efforts. ExxonMobil has publicly criticized global warming research, and instead its stance has been sensible and steady, focusing its attention on burning fossil fuels more effectively.
ExxonMobil researchers contend that solar and wind power will provide less than 1% of the world's energy supply in 2025, and Raymond has stated publicly that attempts by other energy companies to embrace alternative energy are basically designed to please the public. Greenpeace has even called Raymond the "No. 1 climate criminal" because of his opposition to the Kyoto treaty, but he has stood by his beliefs.
"We're not playing the issue," Raymond told The Wall Street Journal in an interview earlier this year. "I'm not sure I can say that about others. I get this question a lot of times: 'Why don't you just go spend $50 million on solar cells? Charge it off to the public-affairs budget and just say it's like another dry hole?' The answer is: That's not the way we do things."
Raymond believes that environmental activists have misunderstood ExxonMobil's intentions. "This notion that the oil companies -- and our company because of its position -- aren't interested in energy efficiency. Nothing could be further from the truth. We're one of the largest consumers of energy in the world. Obviously, it's to our advantage, just from a cost-management point of view, to be more efficient in how we manage all of our costs -- and energy in a single form is probably one of the biggest costs we have. The whole credo of our company is efficiency -- efficiency in everything we do."
A native of Watertown, SD, Raymond joined Exxon as a production research engineer in Tulsa after receiving a PhD from the University of Minnesota for chemical engineering. Over the next 16 years he held positions of increasing responsibility with Exxon Co. USA; Creole Petroleum Corp., which was Exxon's operating affiliate in Venezuela before those facilities were nationalized; the former Exxon International Co., which was responsible for Exxon's international supply and transportation of petroleum products and crude oil; and Lago Oil & Transport Co. Ltd., the Exxon affiliate in Aruba.
Raymond became president of Exxon Nuclear Co. Inc. in 1979 and moved to New York in 1981, when he was named executive vice president of Exxon Enterprises. In 1983, Raymond was named president and director of Esso Inter-America Inc., with responsibilities for Exxon's operations in the Caribbean, Central and South America. He was named a senior vice president and was elected to the board in 1984. He became president of the corporation in 1987, and in 1993, Raymond was named chairman and CEO of Exxon Corp. When Exxon and Mobil merged in 1999, he was named chairman and CEO.
Tillerson, who also joined Exxon Co. USA as a production engineer, is a native of Wichita Falls, TX. He earned a bachelor of science in Civil Engineering at the University of Texas at Austin before joining Exxon in 1975. He held several engineering, technical and supervisory assignments throughout Texas, and in 1987 he was named business development manager in Exxon's Natural Gas Department, where his responsibilities included developing long-range plans for the commercialization of Alaska and Canadian Beaufort Sea gas.
In 1989, he became general manager of Exxon's Central Production Division, responsible for oil and gas production operations throughout a large portion of Texas, Oklahoma, Arkansas and Kansas. He moved to Dallas in 1992 as production adviser to Exxon Corp., and then to Florham Park, NJ, as coordinator of Affiliate Gas Sales in Exxon Co. International.
Three years later he was named president of Exxon Yemen Inc. and Esso Exploration and Production Khorat Inc., and in January 1998, vice president of Exxon Ventures (CIS) Inc. and president of Exxon Neftegas Ltd. In those roles, he was responsible for Exxon's holdings in Russia and the Caspian Sea as well as the Sakhalin 1 Consortium operation offshore Sakhalin Island, Russia.
In December 1999, Tillerson became executive vice president of ExxonMobil Development Co. in Houston. He was named senior vice president of ExxonMobil Corp. in August 2001, and was elected president and member of the board on March 1, 2004.
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