Oil Industry Opens the Door to Black Suppliers
More than 300 representatives of minority businesses passed around stacks of business cards last week at a one-day trade fair sponsored by the Western Oil & Gas Assn., an industry group whose members include most of the major oil companies with operations on the West Coast.
The conference was co-sponsored by the National Ocean Industries Assn., a group representing companies in offshore drilling.
The trade fair at the Los Angeles Airport Hilton was a first-time effort for the two associations, which said they wanted to give minorities a larger share of the $4.5 billion spent on oil supplies and services in California every year.
Skip Cooper, president of the Black Business Assn. in Los Angeles, said he welcomed the conference as a chance to “penetrate” the oil industry, “which historically hasn’t been very responsive to minorities.”
Hiram E. Bond, president of Arco Transportation, Atlantic Richfield’s pipeline subsidiary, acknowledged that in the past the oil industry didn’t do much business with minority contractors “for reasons of race, or color, or simple lack of preparation to play the game.”
To help change that situation, Bond said, Los Angeles-based Arco wants to spend 3% of its total purchases with minority vendors by 1987. Last year, Arco bought $80 million worth of goods and services from minority vendors around the country, about 1.5% of its total purchases.
Many minority businessmen at the conference had kind words for Arco, which has had a minority purchasing program since 1972. They were doubtful, however, that the conference would lead to much new business with other oil companies. “They haven’t given us any percentages,” said Rudolpho Trujillo, owner of an Anaheim-based oil refining and trading business. He said only Arco indicated how much it would spend with minority contractors.
“I understand where they (minority businessmen) are coming from,” said George Marich, a Chevron executive and chairman of the conference. “But it’s hard for most of us to give percentages, since we don’t know what our spending is going to be.” Marich said, however, that it seemed clear that new business relationships would sprout from the conference. “I think we’ve met some whom we can effectively utilize.”
Many who came to the conference took the opportunity to sell, sell, sell. Earl Turner, a partner in United Cash Register, a $200,000 office equipment supply company in Los Angeles, said he felt encouraged after meeting oil company purchasing agents. “This is what we need,” he said, toting his brown briefcase from table to table. “I don’t think anything will happen overnight. But now we have a name, a contact. If we don’t get the business, we know who to call, who to put the pressure on,” he said.
Some minority businessmen viewed the conference as an effort to garner support for oil drilling off the California coast. (The industry is currently lobbying hard to have Congress open potentially oil rich tracts to development, but it faces strong opposition from environmentalists, who fear drilling will damage the California coast.) “If they want our support, we will have to reap some benefits from it,” said Steven Stallings, president of the United Indian Development Assn. in Los Angeles.
Alberto Juarez Jr., a representative from Mayor Tom Bradley’s office, noted that Arco, Chevron, Shell and Texaco want to build a 130-mile onshore pipeline to transport Kern County crude oil to refineries in Carson. The pipeline would pass through 12 cities, including Los Angeles. “The people are saying, ‘If you are going to put a pipeline underneath our homes and neighborhoods, what are you going to do for us?’ ”
Marich said the conference wasn’t a vehicle for gathering support for any project. He said, in fact, that conference speakers were told to downplay opportunities related to offshore drilling. “There are many other opportunities. We need maintenance workers, landscapers, caterers,” he said.
