| Pickens: My Energy Plan Is The "Only Plan", Tells 60 Minutes |
January 25, 2009
Wind Power, Solar Energy And Domestic Natural Gas Are The Only Choices To End Country's Oil Addiction
Man On A Mission
The oil and gas maven is on a mission to lessen Americaís dependence on
foreign oil. Charlie Rose reports.
If you've been watching television lately, chances are you've seen a
white-haired Texas oil man promising he can save America from foreign oil
by using wind power, solar energy and domestic natural gas. He's T. Boone
Pickens, and he's playing the role of pioneer and provocateur, in a
massive national campaign warning of an energy crisis as dire as the
current financial one.
As 60 Minutes contributor Charlie Rose reports, Pickens says he has a
solution - a plan that might sound unrealistic in the current economic
climate - but one he hopes will be good for the country and good for Boone
At 80 years old, T. Boone Pickens acts like a man in the prime of his
life, and there's no better place to see that than at Oklahoma State
University. He has given his alma mater about $350 million, turned around
the school's football team and rebuilt its stadium.
And that has made him a very big man on campus.
But can this billionaire, who has helped his alma mater so much, help
break America's addiction to foreign oil?
"It seems to me that Boone Pickens is a guy that needs an idea and a
challenge. He almost needs to be at war all the time," Rose comments.
"I know it. They call 'em crusades. I mean, I've been accused, 'You're a
crusader, Pickens,'" he says. "I said, 'I don't start out that way.' But
I'll have to admit that sometimes it ends up kinda like a crusade."
Pickens is spending $58 million of his own money to promote his biggest
crusade yet, and probably the biggest of its kind. He calls it the
The essence of his plan is to reduce oil imports by 30 percent in ten
years, and save the country hundreds of billions of dollars. Pickens is an
oil man who believes the era of oil is over, and that there's enough
natural gas in this country to take its place in millions of cars and trucks.
"We own it. And it's abundant and it's cheap. It's cheaper than the oil.
And whatever we spend here for energy at home creates jobs, taxes and the
economy goesÖ," Pickens says.
He believes this would stimulate the economy. "We can do so much here at
home with the money here, instead of letting it go out of the country."
The Pickens Plan, which could be overly ambitious in this financial
crisis, calls for a conversion from oil products to natural gas in
vehicles, first by phasing in two million new heavy trucks - roughly the
entire fleet of big rigs that move goods around the country. Trucks
account for about a quarter of the amount of oil we import every year.
"If you don't buy into natural gas, you're not buying into the Pickens
Plan as a bridge to the future?" Rose asks.
"That's right," Pickens agrees.
"Anybody, whether it's Sarah Palin or George Bush or John McCain, who
thinks you can drill your way out of the problem, is?" Rose asks.
"You don't have a chance. There's no way. We're importing 12 million
barrels of oil a day. Okay, let's just say that we were gonna replace 12
million barrels by drilling in America. We would be bigger than Saudi
Arabia. We are stretched for everything. I mean, we are a marginal
producer," Pickens says.
Asked if he thinks his plan is the last, best hope for America to get off
its addiction to foreign oil, Pickens tells Rose, "It's the only plan."
Pickens says his father told him, "A fool with a plan can beat a genius
with no plan."
In order for his plan to work, Pickens proposes replacing the natural gas
that's now used to generate 22 percent of the nation's electricity with a
new source of power: wind power, created by thousands of wind farms that
would need to be built.
"How do you know the utilities are gonna take wind power as a substitute
for natural gas?" Pickens asks. "That may be a mandate."
"So that's a critical point. You may have to have the government demand
this happen," Rose says. "Speak to that. Suppose it doesn't work? Suppose
the Pickens Plan doesn't happen? What happens to the country?"
"Well, the plan then is foreign oil. You're totally at the mercy of
foreign oil. There's no option one, two, three," Pickens says.
But it's not at all simple. It would be a massive undertaking,
requiring more than $500 billion of private investment in wind power and
$150 billion in government subsidies. And Pickens wants the next president
and Congress to remake the nation's electrical grid by declaring emergency
eminent domain to run new transmission lines through private land across
That kind of urgent action hasn't been taken since President Eisenhower
commissioned the Interstate highways to move military equipment during the
"This needs to be identified as an emergency is what it is. Itís a crisis.
Weíre at war with no guns in this one," Pickens says.
And Pickens is right where he wants to be when he makes a deal: on the
front lines and poised to make a profit, which could happen if his plan
takes off, and the demand for wind power and natural gas eventually soars.
The energy hedge fund he now runs, BP Capital, invests in natural gas
He's the founder and major shareholder in Clean Energy Fuels, the largest
natural gas vehicle fueling company in the country. And Pickens has
already spent $2 billion of what he hopes will be $10 billion to build an
enormous wind farm near the far edge of his 68,000-acre ranch in the Texas
That's risky in and of itself, since wind power is still in its infancy,
and the financial markets are tight.
Asked how many turbines he'd get with $10 billion, Pickens says, "Ten
billion dollars? Well I have about 2,500 of Ďem."
He says these turbines could create enough energy to service 1.3 million
homes. "So, itís big. It would be the biggest wind farm in the world,
today," he says.
Where's the risk in this?
"Well, the risk is just like the risk we just experienced in the last
thirty days. I mean, if the financial markets fell apart. I mean, you
could be left holding the bag, in that deal. And, you know, you won't be
able to finish the project or something. Thatís the concern I have,"
"Whatís the balance for you between, Iím doing something for America and
Iím doing something for Boone?" Rose asks.
"Oh, you know, come on, thereís no question, Iím rich enough, letís not
talk about Boone," Pickens replies.
"What do you mean don't talk about Boone? Boone thinks about Boone," Rose
"I sure as hell donít want to lose, Iíll tell you that, but getting rich
for me isn't really that big a deal. You know, in the last five years, I
have given away $700 million, and so, I don't need any more money. My
standard of living is about as good as it can get," Boone says.
Whatever the motive, Pickens knows he has to sell his plan to the
public and to politicians. So he's been barnstorming the country in his
$45 million private jet, preaching his gospel to packed town hall
Boone says he's been a running national campaign that's at presidential
level, crisscrossing the country to speak to groups.
And the presidential candidates have been listening closely.
"I've paid attention to one of the, some of the Boone Pickens commercials
that youíve seen," McCain said at a town hall meeting.
And they've been using some of Pickens' best lines.
"Even Texas oil man Boone Pickens has said this is one emergency we canít
drill our way out of," Obama said in a speech.
A life-long Republican, Pickens' candidate this election is his Pickens
Plan. And in August, 60 Minutes found him venturing into unfamiliar
territory: the Democratic National Convention.
Asked what he was doing there, Pickens told Rose, "I'm here, honestly,
what I'm here for, I'm here for America. My cause is a bipartisan,
But it didn't take long for the new non-partisan Boone Pickens to have a
visibly uncomfortable encounter with his partisan past - Senator John
Kerry, whose presidential campaign Pickens helped destroy four years ago
when he gave money for the infamous and widely criticized "Swift Boat "ads
that attacked the senator's service in Vietnam and his later testimony
"You spent $3 million funding an advertising campaign that, in some
peopleís mind, was representative of dirty politics, smear politics,
character assassination, all of that. At this stage, do you have any
regrets?" Rose asks.
"None," Pickens says.
Asked if he'd do it over again tomorrow, Pickens says, "What I knew then,
I know that same thing now. And nothing has changed my mind."
Surprisingly, that hasn't stopped some of the country's leading Democrats,
like Senate Majority Leader Harry Reid, from embracing him and his ideas.
"Here is a man who was my mortal enemy. Heís my pal now," Sen. Reid said.
T. Boone Pickens grew up as an only child in Holdenville, Okla.,
during the Great Depression.
60 Minutes didn't have to go to Oklahoma to see his childhood home - it
was moved board by board right to his Texas ranch.
At age 12, Thomas Boone Pickens was a paper boy with the smallest route in
town. He orchestrated his first merger and acquisition when he talked his
boss into letting him take over four rival routes.
"I said 28 is too small, I got to have more papers, And I finally got to
156," he remembers.
Pickens says he didnít have any idea at the time he was headed for a
business career. "I knew I was gonna make some money sometime," he says.
"And how did that turn out?" Rose asks.
"I just didnít know how much money I was gonna make. It turned out pretty
good!" Pickens admits.
He made his first big money searching for oil, and built Mesa Petroleum,
one of the most successful independent oil and natural gas companies in
the country. He attributes his success to being relentlessly competitive.
Pickens took his hunt for oil to Wall Street in the 1980s, as one of the
original corporate raiders, earning hundreds of millions of dollars for
himself and shareholders of the companies he tried to take over.
But he went through a long dry spell after that - until he hit his 70s,
and came back bigger than ever with a new company and a new love: his
fourth wife, a wealthy heiress named Madeleine Paulson. They've created a
sanctuary for themselves at their Texas ranch, but that hasnít insulated
them from the current financial crisis. Pickens is getting battered by it.
The steep drop in oil and gas prices since July has cut the value of
Pickens' hedge fund in half. Among those who've suffered: his alma mater,
OSU, which has lost about $100 million of investments the school made with
money Pickens had donated and then managed in his hedge fund. Overall,
Pickens and BP Capital are down a staggering $2 billion.
Boone acknowledges that is serious money. Asked if he'll get it back
again, he says, "Yeah, I'll get it back."
And there it is: the credo this oil man has lived by all his life: if one
hole is dry, the next one is bound to be a gusher. And thatís what he
hopes his Pickens Plan will become.
"Youíre 80 years old. Does it give you any hesitancy? I mean, in other
words it puts you in a race against time," Rose comments.
"Weíre absolutely in a race against time. Thatís where I am. Iíve got to
make it happen fast," Pickens says.
"So youíve got a real sense of urgency," Rose asks.