Chevron, the second-largest US oil company, said it would move its headquarters from California to Texas due to continued restrictions on business activities in left-leaning states.
The company operates several oil fields, technical facilities and refineries and supplies over 1,800 retail stores in California. Announced On Friday, the company announced it would be relocating its headquarters from San Ramon, California, to Houston, Texas.
Chevron already has more employees in the Houston area than it does in California, with about 7,000 in the Houston area compared with about 2,000 in San Ramon, near San Francisco.
The oil giant’s Chairman and CEO Mike Wirth and Vice Chairman Mark Nelson will relocate to Houston by the end of 2024 “to be co-located with other senior executives and enable better collaboration and engagement with executives, employees and business partners,” according to the announcement.
The move comes as California is becoming a more hostile environment for businesses, particularly the oil and gas industry.
Chevron has repeatedly criticized the law, which gives the California Energy Commission the power to set caps on gasoline refining gross margins and impose fines on refiners that exceed them.
The law will be signed by Governor Gavin Newsom (Democrat) in March 2023. It came into effect June 2023, according to the CEC.
“Unfortunately, the distorting impact of such a policy would likely work against the goal of ensuring gasoline is affordable, reliable and clean,” Andy Waltz, Chevron’s president of Americas products, said in a December 2023 report. letter To CEC.
“Rather than solving the supply challenge or increasing production of clean, affordable gasoline, a margin penalty would exacerbate a decades-long trend of disinvestment and tight supply,” Waltz explained. “Since the 1980s, a tougher regulatory environment has led to dozens of refinery closures, greater gasoline price volatility and declining production. A margin penalty would only exacerbate this troubling trend.”
Walz again criticized the policy in a May 2024 speech. letter In a letter to the CEC, they wrote that the real cause of rising gasoline prices is “decades of restrictive government policies.”
Chevron is concerned about the impact of margin caps on gasoline supplies. Poorly defined and arbitrary maximum margins for refiners will not lower gasoline prices this summer. As we explained in our December letter to the CEC, we do not believe the policy will lower gasoline prices anywhere in the supply chain; rather, it will likely reduce gasoline supplies and discourage investment by California refiners, resulting in higher prices, reduced and unreliable fuel supplies, and increased reliance on imports.
Instead, we encourage the CEC to use the wealth of data available to drive productive change. We urge you to address the real causes of high gasoline prices. Effective solutions start with understanding how we got to where we are today: how decades of restrictive state policies have diverted investment capital away from California’s refinery sector.
The California Fuel and Convenience Alliance (CFCA) also filed a lawsuit against the CEC in March, challenging the implementation of the law, formerly known as SB X1-2. press release It would impose “unreasonably burdensome requirements” and “significantly” increase regulatory control over transportation fuel markets.
Following Chevron’s recent announcement, Texas Governor Greg Abbott (R) voiced his support for X.
Welcome home, Chevron!
Texas is your true home.
Drill, baby drill.
Chevron rejects California expansion, moves headquarters to Houstonhttps://t.co/KCMWoTKphY
— Greg Abbott (@GregAbbott_TX) August 2, 2024
“Welcome home Chevron! Texas is your true home,” the Republican governor wrote. “Good luck, good luck.”
Chevron officials said in the announcement that “the relocation will have a minimal immediate impact on other employees currently based in San Ramon” and that all corporate functions will relocate to Houston “over the next five years.”
“The position supporting the company’s California operations will remain in San Ramon,” it added.
The oil company’s announcement follows Elon Musk’s July announcement that he would be relocating his and SpaceX’s headquarters from California to Texas, Breitbart News reported. report.
