Fossil Fuel Wealth
As the Industrial Revolution spread throughout the world during the 18th and 19th centuries, fossil fuels started to become an integral part of society. Energy provided by cheap and easily accessible fossil fuels provided the fuel needed to power a rapidly growing global population. Prior to the Industrial Revolution, humanity mainly relied on subsistence living. However, when fossil fuels started to make their way into society, the development of industrialized economies and modern cities began to take shape in regions all around the world. In addition to powering the growth of modern society, fossil fuels generated enormous levels of wealth. Today, the fossil fuel industry continues to produce massive levels of personal wealth for a handful of oil and gas tycoons. Who are these oil and gas tycoons? How did they amass a fortune from fossil fuels?
With a total estimated net worth of $13.8 billion, Harold Hamm is the world’s fifth richest fossil fuel tycoon. Hamm is the chief executive officer (CEO) and chairman of Continental Resources. Continental Resources is an American oil and natural gas exportation company that is known to have the largest stake in the Bakken shale oil region of North Dakota. While the shale oil industry has largely collapsed in 2020 as a result of the historic plunge in oil prices, Hamm has still maintained his prominence as one of the world’s biggest oil and gas tycoons. During the height of the oil price collapse, it was reported that the shares of Continental Resources dropped as much as 25 in a single day, leading Hamm’s fortune to plummet by $1 billion overnight (Helman, 2020). The oil supply glut and tremendous weakness in the oil and gas sector caused Continental Resources’ future growth perspectives to fall off a cliff, which sent investors running from the company.
Harold Hamm has led Continental Resources since 1967. Hamm is famous in the oil industry for being the first to move forward with the process of combining horizontal drilling and hydraulic fracturing to extract oil and gas from the Bakken shale. Combining horizontal drilling and hydraulic fracturing is thought to have been the driving force that has transformed the United States into the world’s biggest oil producer. Because of his ability to reinvigorate the entire American oil and gas industry, Hamm has often been called the modern John D. Rockefeller. Hamm’s use of horizontal drilling and fracking helped to propel domestic oil production by 50 percent between 2010 and 2014 (Helman, 2014). Moreover, between 2007 and 2014, stock in Continental Resources soared by upwards of 600 percent.
The massive success of horizontal drilling helped to propel America’s domestic energy boom, while it also made Hamm a billionaire many times over. His contributions to the fossil fuel industry landed him a lifetime achievement award from the prestigious Platts Global Energy Awards. Furthermore, Hamm has been named TIME Magazine’s “100 Most Influential People in the World” because of his contributions to global economic development and his philanthropies in support of diabetes research and educational programs. He has also been passionate about inspiring the world’s next generation of energy leaders. In 2012, he worked in partnership with the University of North Dakota to create the Harold Hamm School of Geology and Geological Engineering.
Gennady Timchenko is the world’s fourth richest fossil fuel tycoon. With a net worth of $21.3 billion, Timchenko has used his fossil fuel wealth to become one of the most powerful people in Russia. Timchenko is one of the founding members of Gunvor, which is one of the world’s largest independent oil and gas trading companies. When it was founded in 2000, Gunvor was established as a company that dealt exclusively with crude oil and other petroleum products. Through its diverse team of global logistics leaders, Gunvor employs a workforce of around 1,500 people who acquire energy assets from fossil fuel producers and distribute those commodities to regions that have the greatest demand for energy. Today, Gunvor operates in more than 100 countries across the Americas, the Middle East, Asia, and Europe.
In addition to generating energy wealth through Gunvor, Timchenko also amassed another fortune through the development of a private investment company known as Volga Group. Volga Group is another specialized energy company that invests in infrastructure, transportation, and other capital needs related to fossil fuels. Prior to becoming a well-known Russian energy oligarch, Timchenko was able to build his vast energy-related skillset through positions within the Russian Ministry of Foreign Trade and during his time as the director of Kirishineftekhimexport, which was a Russian state-owned oil company. After his time at Kirishineftekhimexport, he worked his way up the ranks of a Finnish oil company called International Petroleum Products Oy. While Timchenko has successfully become one of the richest oil and gas businessmen in the world, the U.S. Department of Treasury has implemented financial sanctions against Timchenko for his involvement in efforts to undermine Ukraine’s political sovereignty.
With a fortune of $21.6 billion, Vagit Alekperov is the third richest oil and gas tycoon in the world. As of 2019, Forbes magazine says that Alekperov is the third richest person in Russia and also the 46th richest person in the world. Born in Baku, Azerbaijan, Alekperov has spent his entire life in the oil industry. His father worked as an oilman directly in Azerbaijan’s oil fields. Baku is known as one of the world’s first cities that became a hub for the international petroleum industry. After being mentored by his father, Alekperov attended the Azerbaijan Institute of Oil and Chemistry to refine his knowledge of the fossil fuel industry. Immediately after graduating, he starting working as a petroleum engineer in the Caspian Sea oil fields. Following his time here, he made his way to western Siberia to take a position as the director of Kogalymneftgaz, which was a local oil and gas producer. He held this position from 1979 to 1990. Following his tenure at Kogalymneftgaz, Alekperov was named the Soviet Union’s deputy minister of the oil and gas industry.
As the youngest top-level minister in the Soviet Union, some Soviet leaders were originally skeptical of Alekperov’s ability to lead the oil and gas industry in the right direction. However, soon after becoming one of the socialist state’s top fossil fuel executives, Alekperov pioneered the idea of state-owned energy companies. Only a year after taking one of the top fossil fuel jobs, Alekperov worked to establish a vertically unified state-owned oil company known as Langepas-Uray-Kogalymneft. Two years later, Langepas-Uray-Kogalymneft was transformed into Russia’s giant LUKoil Petroleum Company. After this transformation, Alekperov became the company’s president and ultimately helped LUKoil become one of the world’s biggest and most influential fossil fuel companies. Today, LUKoil is second to only Exxon Mobil in terms of its total owned oil reserves.
The majority of Alekperov’s wealth has come from his LUKoil successes. In 1997, he helped to land a monumental deal with Saddam Hussein to develop the West Qurna oil field in Iraq, which contains oil reserves in excess of 20 billion barrels (Helman, 2014). During the height of 1980’s the Soviet Union was world’s biggest producer of crude oil. One of Alekperov’s goals has been to revive Russian oil and gas production to become the world’s leading fossil fuel producer once again. Shortly after the collapse of the Soviet Union in 1991, Russia’s oil production dropped by half (Maass, 2004). Since then, Alekperov has been charging ahead with new production opportunities in countries like Iraq, Iran, and Azerbaijan.
Leonid Mikhelson is the second richest fossil fuel businessman in the world. With a net worth of $25.4 billion, Mikhelson is a prominent Russian billionare and CEO of Novatek, which is the second-biggest natural gas producer in the world. As a result of his success in the natural gas industry, Mikhelson has become the richest person in Russia. During 2018 alone, Mikhelson was able to increase his wealth by over $16 million each day (Nilsen, 2019). In addition to being the CEO of the largest natural gas producer in Russia, Mikhelson is a majority shareholder in the Sibur petrochemical energy conglomerate. Similar to other Russian fossil fuel oligarchs, Mikhelson climbed the ranks of energy industry during the rise of the Soviet Union. Following his 1977 graduation from the Samara Institute of Civil Engineering with a degree in Industrial Civil Engineering, Mikhelson worked his way through several natural gas pipeline companies prior to becoming the CEO of Novatek.
One of Leonid Mikhelson’s biggest areas of interest has been the development of fossil fuel resources in the Arctic. The Arctic frontier is one of the last remaining regions of the world that has yet to be thoroughly explored for natural resources. Research conducted by U.S. Geological Survey suggests that there may be 412 billion barrels of oil and gas Arctic waiting to be discovered in the Arctic. (USGS, 2008). Geological surveys have estimated the value of these untouched onshore and offshore fossil fuel reserves to be worth up to $35 trillion (Dillow, 2018). As new research continues to convey the Arctic’s riches, Mikhelson has continued to invest more resources into securing these fossil fuels for Russia.
With a total net worth of $55.3 billion, Mukesh Ambani is the world’s richest fossil fuel tycoon. Ambani accumulated his massive fortune through Reliance Industries, which is a massive multinational energy, petrochemical, and natural resource extraction company based in India. While many of the other fossil fuel tycoons on this list built their fortune from the ground up, Ambani inherited his role in Reliance Industries from his late father, who started the company in 1966. While Ambani may not have climbed the ranks of the fossil fuel industry like Harold Hamm, Gennady Timchenko, Leonid Mikhelson, or Vagit Alekperov, Ambani transformed his father’s company from a relatively modest textile business into one of the world’s biggest oil and gas exploration and petroleum refining companies.
Ambani’s leadership helped him develop the world’s largest petroleum refinery in Jamnagar, India. The Jamnagar refinery sprawls over 7,500 acres, employs 2,500 workers, and has the ability to process 1.24 million barrels of oil per day. The complex is so large that it is said to contain enough oil pipelines to be stretched the entire length of India from north to south, which is a distance of nearly 2,000 miles. The massive scale of this refinery has enabled Ambani to generate more wealth than any other fossil fuel tycoon in the world. In fact, Bloomberg’s Billionaires Index list labels Ambani as the 19th-richest person in the world. This wealth has afforded Ambani and his family the ability to live an extremely lavish lifestyle. Amazingly, Ambani constructed a 27-story skyscraper in Mumbai for him and his family (Warren, 2020). At a cost of over $1 billion to build, Ambani’s home is said to be one of the most expensive private homes in the world. As a result of his success in the fossil fuel industry, Ambani has been labeled as one of Fortune Magazine’s s 50 greatest leaders of 2018. As the demand for oil continues to grow in the coming decades, Ambani’s fortune is likely to grow with it.
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Helman, C. (2014). “Amid Chaos, Russian Billionaire Launches Giant Iraqi Oilfield.” Forbes.
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Nilsen, T. (2019). “Arctic’s biggest investor increased personal wealth with $6 billion last year, is now Russia’s richest.” The Independent Barents Observer.
Maass, P. (2004). “The Triumph of the Quiet Tycoon.” The New York Times.
USGS. (2008). “Circum-Arctic Resource Appraisal: Estimated of Undiscovered Oil and Gas North of the Arctic Circle.” Fact Sheet 2008-3049. U.S. Geological Survey.
Warren, K. (2020). “Meet the Ambanis, who live in a $1 billion skyscraper and mingle with royals and Bollywood stars.” Business Insider.