Chevron, in a blow to California, says it is relocating to Houston

Chevron, the oil giant that was founded in California some 145 years ago, said Friday that it is relocating its headquarters from the Bay Area to Houston.

The announcement, which also included news of a reshuffling of senior management, was not a complete surprise given that the second largest U.S. oil company, based in San Ramon, has been battling with California over its aggressive climate change policies.

Chevron, in its statement, said the move would allow the company to “co-locate with other senior leaders and enable better collaboration and engagement with executives, employees, and business partners.” Chevron already has about 7,000 employees in the Houston area.

Chevron has about 2,000 employees in San Ramon. It is the latest high-profile departure of a California company to another state.

Recently Elon Musk said he is moving SpaceX and X from California to Texas, and over the last decade there have been scores of other California companies in tech and other industries that have fled the state, with many attributing it to the state’s high operating costs and other policies that they see as not supportive of business.

Last fall California sued Chevron and several other big oil companies, alleging that their production and refining operations have caused billions of dollars in damage and that they deceived the public by downplaying the risks of fossil fuels in global warming. Chevron’s chief executive, Mike Wirth, has pushed back against the suit and California’s approach to climate change.

Wirth and Chevron’s vice chairman, Mark Nelson, will move to Houston before year’s end. “There will be minimal immediate relocation impacts to other employees currently based in San Ramon,” Chevron said in its statement. Some operations will remain in San Ramon, but the company said it expects all corporate functions to move to Houston over the next five years.

Chevron traces its founding to September 1879 when a group of explorers and merchants established the Pacific Coast Oil Co.

The company today operates crude oil fields, technical facilities and two refineries in California that supply more than 1,800 retail stations in the state.