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Chevron Shareholders Reject Shale Disclosure Measure for Fifth Year

Chevron Corp. shareholders on Wednesday rejected for the fifth year in a row a proposal to disclose more information about unconventional drilling operations.

A preliminary tally indicated that 72% voted against the stockholder proposal. Last year 69% voted against the measure (see Shale DailyMay 31, 2013).

Some shareholders had asked that the board report every year beginning in September about how the company was minimizing "adverse water resource and community impacts from hydraulic fracturing operations associated with shale formations."

However, the board recommended voting against the proposal because it said Chevron had in place "well-developed risk management systems in its natural gas from shale development operations to help ensure water is sourced, used, managed and protected." A special report "would be duplicative" of its reporting and "would not result in meaningful additional information."

ExxonMobil Corp. has faced similar shareholder-backed proposals, which also had been defeated the previous four years. However, in March, the company agreed to disclose for the first time more details about the risks to drill unconventional wells using fracturing (see Daily GPIApril 4). The first disclosure report is to be published in September.

More than 80% of the 1.5 billion shares cast at Chevron's annual meeting in Midland, TX, also voted against a shareholder proposal to split the roles of CEO and chairman,  both held by John Watson. Close to two-thirds (65%) voted against a stockholder proposal to grant those holding at least 10% of common stock the power to call special meetings.

Chevron is headquartered in San Ramon, CA, but this year management opted to hold the annual meeting in the heart of the Texas Panhandle.

"It's been a little over a decade since we've hosted our stockholders meeting here, and we're excited to return particularly because the Permian Basin has such a prominent place in our portfolio," Watson told shareholders. Chevron has had operations in Midland for close to a century, he said.

"We're in the process of constructing a new office here to serve as a state-of-the-art technology center and to house our growing workforce. And we have plans to significantly increase production in this region by 2020..."

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