President-elect Donald Trump could be adding another business executive to his cabinet, as reports recently surfaced that he is probing a prominent oil and gas executive for secretary of state.
Trump is scheduled to meet with the CEO of Exxon Mobil, Rex Tillerson, sometime this week, a source from inside the Trump transition team tells the Journal. The president-elect chose another business mogul, Steve Mnuchin, a Goldman Sachs executive, for secretary of the treasury.
The 64-year-old oil executive is a native of the Dallas-Fort Worth area, and started his career with Exxon in 1975. Under his leadership, Exxon Mobil expanded into some incredibly lucrative markets. The company reported $32.5 billion in net income in 2014, and paid over $80 billion in taxes.
Arguably the most notable business venture under Tillerson was his negotiation of drilling rights in Russia’s Arctic region in 2014. The deal collaborates with Rosneft — a Russian government-controlled energy company — to secure drilling rights in relatively untapped oil fields that are expected to yield as much as $100 billion in new investments over the next decade.
The $700 million dollar exploration into the Russian arctic is notable not only for its potential profitability, but for its complete departure from the American foreign policy under President Barack Obama. This could also be a key reason Trump is probing the oil executive, as Trump has hinted that he is willing to work with Moscow and remove the sanctions imposed on Russia by the Obama Administration.
The United States and the European Union imposed sanctions on Russia in 2014 to limit the nation’s access to Western capital in the face of the what many nations viewed as Moscow’s invasion of Ukraine. The goal was to effectively stymie the productivity of Russian firms with strong ties to Russian President Vladimir Putin and the Russian government.
Sanctions were specifically tailored to the situation in Ukraine in 2014, President Obama asserted, saying they were “designed to have the maximum impact on Russia while limiting any spillover effects on American companies or those of our allies.”
President Obama and European leaders may have intended to limit spillover effects, but Exxon Mobil felt considerable blow-back from sanctions. The company announced in September, 2014, that it was winding down its operations in Russia, the first major sign that the Western-imposed sanctions were indeed hurting American business.
Tillerson’s company, in addition to the 2014 deal, signed a $3.2 billion investment agreement with Russia in 2012. Putin gave Tillerson Russia’s Order Of Friendship later that year. No doubt, Tillerson would have a unique perspective to offer the incoming Trump Administration on negotiating and operating in a Putin-run Russia.
Like Trump, Tillerson has a history of promoting deregulation and pro-business policies. Tillerson was an ardent supporter of lifting the 40-year oil export ban. The oil executive gave a speech on Capital Hill in March, 2015, where he urged Congress and the Obama Administration to allow U.S. export of oil of gas.
If the U.S. could promote “free trade in energy and common-sense regulatory reforms, the U.S. energy industry can strengthen U.S. energy security and continue to pioneer the innovations that make possible the safe and responsible development of energy,” Tillerson told lawmakers.
Tillerson’s vision of a more energy independent America aligns with that of Trump. The executive supports rolling back regulations on building projects to export liquefied natural gas, an industry in which America is expected to be the dominate player by 2021. Trump also plans to remove regulations currently preventing access to the $50 trillion in untapped shale, oil, and natural gas.
Tillerson supported former Florida Jeb Bush in the 2016 election, giving the candidate $2,700 in that cycle. He did not make a contribution to Trump’s campaign, according to Open Secrets.
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