|Oil Billionaire Revises Plan to Reduce Foreign Oil Imports |
By Ryan Randazzo
The Arizona Republic
January 01, 2009
Billionaire T. Boone Pickens said that his Texas wind farm
is on hold because natural-gas prices have dropped but that his plan for wind
power and natural-gas vehicles is still viable to reduce foreign oil imports.
The Texas oil tycoon spoke Tuesday to about 650 utility and investment officials
gathered in Phoenix for the Edison Electric Institute Financial Conference.
Pickens launched an advertising campaign last summer to promote wind farms to
generate electricity and to use natural gas to power vehicles. "I'm the only
person in the United States that has a plan," he said. "Senator Obama and his
people have been in touch with mine. They see the merits of what we are doing."
Pickens said the U.S. needs to exploit all its resources, from solar power in
Arizona to coal and nuclear energy, but that few things could cut foreign oil
He said neither Obama's plans for 1 million plug-in hybrid vehicles nor John
McCain's plans for 45 more nuclear plants would make a dent in oil imports, but
semitrucks fueled by natural gas could reduce oil demand for the next 20 years
before better transportation technology is available.
"It's a bridge to the next generation, which will probably be the battery, the
fuel cell," he said. "It won't be the hydrocarbon."
But the current drop in oil and natural-gas prices is slowing things down.
Until natural-gas prices rise, Pickens said his wind farm and most others in the
country will not go forward because electricity from gas plants will be more
economical. Still, he was confident prices would rise.
He said Americans haven't understood the nation's energy challenges because
prices have been low, until last summer when oil hit a record $147 a barrel.
"You haven't had the leadership in Washington to tell us what the problem was,"
he said. "The American people did not realize where we were. When oil went to
$100, I had a story to tell."
Steven Dreyer, managing director at Standard and Poor's, credited Pickens for
"Arguably, for the first time, ordinary people were able to connect the dots
between carbon reduction and energy," Dreyer said.
Ron Insana, managing director of SAC Capital Advisors and former CNBC
commentator, questioned Pickens about how he will benefit financially by such a
plan through his wind farm and large stake in Clean Energy Fuels Corp., a
natural-gas, vehicle-fueling company.
Pickens described his potential to profit from wind and natural gas but said his
motivations are patriotic.
"I'd rather be playing golf at the Del Mar Country Club this afternoon," Pickens
said. "But I truly believe this is good for the country."
Pickens believes that global oil production has already "peaked" and that it
will continue to become scarcer and more expensive, despite the current lull in
He is founder and chairman of energy-investment company BP Capital and founded
Mesa Petroleum, a natural-gas and oil producer. He is a geologist by training.
"When I launched my plan July 8, gas prices were $4.11 a gallon, and now they're
half that. I think I've done a pretty good job," he said to chuckles from the audience.
He predicted oil, which closed Tuesday at $59, to be $100 a barrel within a
year, and could be $300 a barrel by 2018.
Pickens supports domestic drilling but said that can't come close to meeting
daily U.S. oil demand.