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| ExxonMobil chief Rex Tillerson |
President-elect Donald Trump is expected to name as his secretary of state Rex Tillerson, the chief executive of ExxonMobil, who has worked extensively around the globe and built relationships with such leaders as Russian President Vladimir Putin, three people close to the transition team confirmed Saturday.
Tillerson’s nomination could face intense scrutiny in the Senate, considering his years of work in Russia and the Middle East on behalf of the multinational petroleum company. Already, two leading Republican hawks, Sens. John McCain (Ariz.) and Lindsey O. Graham (S.C.), have voiced concerns about Tillerson’s serving as the nation’s top diplomat because of his ties to Putin.
Trump spokesman Jason Miller said Saturday that there would be no official announcement about a secretary of state until this coming week “at the earliest.”
But three officials briefed on Trump’s deliberations, who spoke on the condition of anonymity because of the sensitivity of the matter, said the pick would be Tillerson, barring a late and unanticipated shift in Trump’s thinking. NBC News first reported that Trump has settled on Tillerson.
Trump is considering nominating for deputy secretary of state John R. Bolton, a former ambassador to the United Nations and a combative hawk whose tenure in the George W. Bush administration was controversial, two of the officials said.
rump spent a month deliberating over the secretary of state position and interviewed an array of candidates, including Mitt Romney, the 2012 GOP presidential nominee, who was opposed by some of Trump’s closest advisers because he had been the face of the Republican resistance to Trump’s presidential candidacy. Other contenders included former New York mayor Rudolph W. Giuliani and Bob Corker (R-Tenn.), chairman of the Senate Foreign Relations Committee.
The search at times resembled Trump’s reality TV show, “The Apprentice,” with the hopefuls parading before journalists — and, in the case of Giuliani, publicly campaigning for the job before announcing Friday that he had withdrawn from consideration.
Tillerson’s stock rose late in the process, after he met with the president-elect on Tuesday and again on Saturday morning at Trump Tower in New York. Trump settled on Tillerson, 64, because he projects gravitas, is regarded as a skillful manager and personally knows many foreign leaders through his dealings on behalf of the energy giant, people close to Trump said.
In an excerpt of an interview with Fox News, which will be aired in full Sunday, Trump praises Tillerson, although he does not reveal his decision.
“He’s much more than a business executive; he’s a world-class player,” Trump says. “He knows many of the players, and he knows them well. He does massive deals in Russia — for the company, not for himself.”
Tillerson’s nomination would fit the pattern of other Trump selections — wealthy business leaders with little experience in policymaking. But Tillerson has spent years dealing with the complexities of one of the world’s biggest enterprises, spanning six continents and about six dozen nations.
The company’s deep ties to Russia would potentially serve Tillerson well, given Trump’s desire to repair relations with the Kremlin. But Tillerson’s close ties to Putin could also become a flash point during confirmation hearings, especially in light of a recent CIA assessment that Russia intervened in the 2016 election to help Trump win the presidency, rather than just to undermine confidence in the U.S. electoral system.
“Few corporate titans are closer to Putin than Tillerson,” said Jason Bordoff, founder of Columbia University’s center for global energy. “So his pick, along with Trump’s campaign rhetoric, would suggest a sharp shift in U.S. policy toward Russia.”
McCain told Fox News on Saturday that Tillerson’s relationship with Putin “is a matter of concern to me.”
“You want to give the president of the United States the benefit of the doubt because the people have spoken,” McCain said. “But Vladimir Putin is a thug, a bully and a murderer, and anybody else who describes him as anything else is lying.”
In the 1990s, Tillerson oversaw an Exxon project on Russia’s Sakhalin island and developed a working relationship with Putin. In 2011, Exxon signed an agreement with the state-controlled oil company, Rosneft, to work jointly on oil exploration and development in the Arctic and Siberia.
After inking the deal in New York, Tillerson and Rosneft chairman and Putin confidant Igor Sechin dined on caviar at the luxury Manhattan restaurant Per Se, according to one account. The next day, they gave oil analysts black pens with the date of the agreement engraved in gold.
Two years later, the Kremlin awarded Tillerson the Order of Friendship, an honor reserved for foreigners.
“I don’t know the man much at all, but let’s put it this way: If you received an award from the Kremlin, [an] Order of Friendship, then we’re gonna have some talkin’,” Graham said. “We’ll have some questions. I don’t want to prejudge the guy, but that’s a bit unnerving.”
Exxon discovered oil in a well it drilled in the Kara Sea, but the joint partnership was put on ice after Russian intervention in Ukraine and the annexation of Crimea led to international economic sanctions.
As secretary of state, Tillerson, who has been critical of the sanctions, would be in a position to argue for easing them, which could allow Exxon to resume operations. And for a company the size of Exxon, few countries outside of Russia hold sufficient potential to bolster the oil giant’s reserves. In addition to the Arctic, Exxon wants to drill in the deep waters of the Black Sea and search for shale oil in West Siberia. In each case, the company would be providing expertise and technology that Russia lacks.
“Russia is critical for Exxon,” said Fadel Gheit, an oil analyst for Oppenheimer & Co.
Robert McNally, president of the consulting firm Rapidan Group and a director for energy on President George W. Bush’s national security council, said, “The closest thing we have to a secretary of state outside government is the CEO of Exxon.”
Tillerson has spent his entire career at ExxonMobil, joining the company in 1975 with a degree in civil engineering. His career has taken him from Oklahoma and Texas to Yemen and Russia, and as ExxonMobil’s top executive, he has cultivated relationships, meeting regularly with world leaders such as Putin, the Saudi oil minister, and the emir of Qatar. He will retire with a nest egg of about $300 million, including stock options and pension benefits.
Yet Tillerson’s track record — during a decade in which crude oil prices lurched from less than $30 to nearly $150 a barrel — has been mixed. The company has managed some of the world’s biggest infrastructure projects, often in forbidding locations, but it has spent heavily on share buybacks and has borrowed heavily to maintain both capital spending and dividend payments.
Wall Street analysts say ExxonMobil overpaid for XTO Energy, a domestic shale gas company, and it has failed to meet the production targets Tillerson himself set. In April, Standard & Poor’s downgraded the company’s gold-plated triple-A credit rating to double-A plus, the first time Exxon had lost its triple-A rating since the advent of color television.
Tillerson’s nomination is likely to draw strong opposition from environmentalists. The secretary of state takes the lead in international climate talks, meaning that Tillerson could play a role in unwinding U.S. commitments under the recent Paris accord.
Environmental groups allege that ExxonMobil’s scientists knew about the impact the use of fossil fuels was having on climate change, and that the company suppressed internal research instead of sharing it with investors and the public.
The New York and Massachusetts attorneys general have issued broad subpoenas to ascertain whether ExxonMobil’s failure to disclose that information violated Securities and Exchange Commission requirements. ExxonMobil has fought back in federal court in Texas.
“Covering up climate science and deceiving investors qualifies you for federal investigation, not federal office,” May Boeve, executive director of the climate group 350.org, said in a statement.
When Tillerson took the helm at ExxonMobil a decade ago, he was seen as moderating the company’s position on climate change. Whereas his predecessor opposed any action on climate change, Tillerson said in 2009 that he favored a carbon tax and proposed an initial price “somewhere north of $20” a ton. And he reduced ExxonMobil’s own emissions.
Tillerson has acknowledged that humans cause climate change, and under his leadership, ExxonMobil curtailed funding for the Competitive Enterprise Institute, whose energy and climate expert Myron Ebell played down the extent of climate change. Ebell heads Trump’s transition team on environmental issues.
Yet Tillerson has insisted that oil use is essential. He chaired the American Petroleum Institute and once told Fortune magazine, “To say that you’re addicted to oil and natural gas seems to me to say you’re addicted to economic growth.”
ExxonMobil has important relationships throughout the Middle East. It relies on Saudi Arabia for oil supplies and is a partner in refinery projects. It has enormous projects in liquefied natural gas export in Qatar. It has also managed to carry out exploration and production ventures in the semiautonomous Kurdish region of northern Iraq and in southern Iraq, transcending rivalries between Baghdad and the Kurds.
But under Tillerson, ExxonMobil has walked away from other countries. It left Venezuela after contract disputes with the late Venezuelan leader Hugo Chávez, and it ended its onshore operations in Nigeria, where local insurgents sabotaged infrastructure.
Tillerson was born in Wichita Falls, Tex., the son of a Boy Scout administrator. He still lists the rank of Eagle Scout on his résumé and has remained active in the organization. In 2012, he was instrumental in pushing the Boy Scouts board to admit openly gay youths.
The ExxonMobil chief also chaired the $50 million campaign to restore Washington’s Ford’s Theatre, where President Abraham Lincoln was assassinated.
Tillerson has been a major donor to the GOP and its candidates, including former Florida governor Jeb Bush during this year’s presidential primaries, federal campaign finance filings show. Although there appears to be no record of Tillerson’s giving to Trump’s campaign, his wife, Renda, contributed $2,700 to Trump in September, filings show.
Within the oil industry, ExxonMobil has been regarded as the most button-downed company, conservative and sometimes arrogant. But even Tillerson’s critics admire his leadership abilities.
“Rex is a very, very, very honorable man,” Gheit said. “He is smart, levelheaded. He has tremendous resolve and very strong character.”
