Thursday, April 10, 2014

Pickens Plan

U.S. Crude Oil Reserves Jump 15 Percent

For the fourth year in a row, U.S. oil reserves increased, according to a recently published Energy Information Agency report. Proven crude oil reserves jumped 15 percent in 2012 to 33 billion barrels, their highest level since 1976. The jump was the the largest by volume and percentage increase in oil reserves since 1970.

Natural gas reserves shrank, at least temporarily. Gains in Marcellus and Eagle Ford shale gas reserves were offset by declines in more mature fields, breaking a trend that had seen the natural gas figure increase for 14 years in a row. Natural gas reserves decreased 7.5 percent in 2012. But the decrease is viewed as only a temporary one.

“With natural gas prices higher in 2013 and technology continuing to advance, EIA expects U.S. natural gas proved reserves to increase in 2013,” EIA Administrator Adam Sieminski said.

Proved reserves are the volumes of oil and gas still in the ground that are considered possible to produce based on available technology and current energy prices. Improvements in technology and rising energy prices both lead to higher reserve estimates.

Monday, March 31, 2014

Pickens Plan

Forbes Life: T. Boone Reborn

The following article ran in the April 14, 2014 issue of Forbes Life.

At 85, T. Boone Pickens has discovered a powerful source of energy: his own. He’s got a new love, a new natural gas empire and a continuing mission to change the world. All he needs now is time.

Aboard his Gulfstream G550, T. Boone Pickens — legendary trader, corporate raider, energy visionary and billion-dollar philanthropist — slides off his shoes and reaches down to grab his feet. He’s got a surprise in store. Pulling his legs up onto the thick leather seat, he tucks himself into lotus position, as if getting ready to meditate. It’s proof that he’s still got it: physical strength, stamina, ability. A future.

“He’s the most flexible man I’ve ever known,” Pickens’ wife, Toni Brinker, says with a wry smile. The two were married on Valentine’s Day in the lovely chapel next to the opulent lodge on his 68,000-acre ranch northeast of Amarillo in the Texas panhandle. It’s the fifth marriage for Pickens and the fourth for Brinker, who is some 20 years his junior. The two have known each other for a decade; Pickens was friends with her late husband, Norman Brinker, the restaurateur who founded the Chili’s chain. What sealed the deal for Pickens is that Toni enjoys traveling with him, is keenly engaged with the events of the day and always looks great everywhere she goes (especially with that enormous new diamond on her finger).

It was only two years ago that Pickens got divorced from his previous wife, Madeleine. And just a year ago that Pickens had “Toni” embroidered on the headrest of the seat next to his on his plane. (His own headrest features a TBP monogram.) Pickens’ beloved Papillon, Murdock, takes turns sitting in their laps. “If you can get your dog to like your girlfriend,” he says, “you’ll keep your girlfriend.”

Putting Toni’s name on the seat was another form of commitment for Pickens. After all, rather than settle in for a plush retirement, he lives on that Gulfstream, logging 500 hours a year jetting around the country to give speeches and interviews about the miracle of the American oil-and-gas boom, the importance of weaning the country from foreign oil and the no-brainer of powering cars and trucks with cheap natural gas instead of expensive gasoline and diesel. He’s the largest shareholder in publicly traded Clean Energy Fuels, which is building out a network of natural gas fueling stations. Retirement? “That’s not me,” Pickens says.

Besides, he’s had too much fun reinventing himself over the years. In the 1980s, Pickens was the original corporate raider (“I prefer the term ‘shareholder activist,’” he says), famously going after the likes of Gulf Oil and Unocal. During the next decade, he lost control of his Mesa Petroleum by getting overleveraged in natural gas. By the 2000s, he reemerged as a hedge fund manager–and not only made his first billion after age 70 but turned it into $4 billion. Then in 2008, deep into his fifth decade of investing, he literally tilted at windmills, launching his ambitious Pickens Plan to build $2 billion worth of wind energy projects. The recession, paired with the shale drilling boom, gutted both energy prices and Pickens’ fortune. “My timing hasn’t been perfect,” he admits. “I’ve lost two billion, given away one and I’ve got one left.”

After he fell off The Forbes 400 list of the wealthiest Americans last year, he tweeted to his more than 110,000 followers: “Don’t worry. At $950 million, I’m doing fine. Funny, my $1 billion charitable giving exceeds my net worth.” The quip was retweeted nearly 3,000 times.

“Some people are most brilliant when they don’t know what’s coming,” says longtime friend Jerry Jones, owner of the Dallas Cowboys. “Boone has as high a tolerance for ambiguity as anyone I’ve ever met.”

The reason is pretty simple, Pickens says. “I know I can make it all back–if I have enough time.”

At 85 , Boone Pickens knows he’s mortal. He figures he’s got another ten years left–if he’s lucky. A fitness fanatic since the 1970s, he’s also made damn sure that he’s going to be remembered long after he’s gone. The $1 billion he’s given away has gone to dozens of institutions. And he’s not exactly shy if they want to name a building after him. The biggest recipient of his largesse has been his alma mater, Oklahoma State University, where, in 1951, he earned his degree in geology. Among the $500 million he’s designated to OSU is $165 million for the athletics department. His name is now on the football stadium as well as the school of geology.

Pickens has also given more than $150 million to hospitals and medical centers, including $11 million to the University of Texas Center for Brain Health in 2006. After he made that gift, I convinced him that if he was going to donate so much money he should at least get his brain scanned. The subsequent MRI showed that part of the secret to Pickens’ success might be that his brain is about 30 years younger than he is. As he told me then: “I’d rather surround myself with sharp young minds than play golf and gin rummy all day.”

Some of his donations are more personal than others. The day after he got an experimental eye injection at Johns Hopkins Medical Center in Baltimore to treat macular degeneration (which claimed his own father’s eyesight), the hospital held a lunch to honor Pickens’ $20 million bequest to the eye clinic. After doctors and administrators took turns saying nice things about him, Pickens told the audience: “My dad would say, ‘Where’d all these liars come from?’ My mom would say, “They shoulda gone on a little more.’” Then he added: “It’s fun to make it. It’s almost as much fun to give it away.”

To arrest the progress of the condition, Pickens flies to Johns Hopkins once a month for an experimental treatment that involves injections into the center of his eyeball. Has he gotten used to it? “Well, what if I kick you in the shins today and then do it again a month from now. Do you think you’d have gotten used to it?” But the treatment appears to be helping. His doctor, Neil Bressler, believes “this could cure macular degeneration.”

Whatever pain Pickens endures to preserve his vision is nothing compared to what he felt in January 2013, when his 21-year-old grandson Ty died from an overdose of heroin and Xanax that were provided to him by a college drug dealer. At Ty’s burial, out on his ranch, Pickens was more depressed than any time since he gave up liquor in 2000. “I almost had a drink of Scotch when I lost my grandson,” he admits. “Almost.”

He says that if there is any “silver lining” at all in Ty’s death, it’s that it unified his 11 grandchildren into a kind of generational coalition, determined not to let such a thing happen again. “He really did bring them all together,” Pickens says.

Out on his Mesa Vista ranch, Pickens proved how good his eyesight still is by driving his Cadillac Escalade at high speed over winding gravel roads. “You scared?” he asks. “I’m not blind yet.”

We stop for a tour of the modest house he grew up in — relocated from Holdenville, Oklahoma, 300 miles away. Bringing it to the ranch and restoring it was the idea of Pickens’ previous wife. They even transplanted old chunks of sidewalk with young Boone’s hand- and footprints from 1939.

“Ask him where he hid the money,” says Pickens’ handler, Jay Rosser, as we walk around. Pickens then shows me a spot in his bedroom closet where he had stashed $286 from his paper route under the floorboards–until, when he was 13, his mom made him take it to the bank. “I’ve always loved making money,” he says. “And since that first paper route, I’ve never been broke.”

Not that Pickens hasn’t had a few scares. “He’s a true role model for those of us entering the fourth quarter,” says Jerry Jones. “By the time you start the fourth quarter of a game, you’re banged up. Not pretty anymore. He entered his in one of the down times, in a serious depression. And he went from being broke to making several billion.”

Part of Pickens’ secret is that he tries not to look back too often. “I don’t dwell on the past,” he says. “I have too much to look forward to.”

Among the things Pickens looks forward to is a revolution in the use of natural gas to power cars and trucks. He aims to profit on it with Clean Energy Fuels. The nine-year-old publicly traded company has built the nation’s biggest network of stations to fill up cars and trucks with both compressed natural gas (CNG) and liquefied natural gas (LNG). Clean Energy boasts 200 locations across 43 states, many installed at Pilot/Flying J truck stops. It pumped the gasoline equivalent of 200 million gallons last year, filling up 26,000 vehicles per day.

The economics of natural gas fuel make total sense: For about $2.60 you can get the same amount of energy as you would from $4 of gasoline or diesel. Pickens became a proselytizer for natural gas vehicles (NGVs) more than 20 years ago, back when Mesa was one of the nation’s biggest independent gas producers, and he desperately needed to goose demand for the product. In 1997, he gave his close lieutenant Andrew Littlefair $3 million to launch what became Clean Energy Fuels.

The business is finally approaching critical mass. Today, 60% of the 8,000 new trash trucks sold each year are made to run on CNG, up from 3% in 2008. Pickens can almost taste the coming boom in NGVs now that heavy-duty truck makers like Navistar and Volvo are finally introducing big 13-liter and 14-liter LNG-fueled engines that are powerful enough to haul big trailers down the interstate. There’s no doubt in Pickens’ mind that the company is in a position to eventually make hefty profits. “I know I have to wait for the payoff there. But the gun is loaded and ready to go. All we’ve been waiting for is the 12-liter engine.”

Last October, I accompanied Pickens to the Securing America’s Future Energy conference in Washington, D.C. He spoke on a panel with General Motors’ then CEO Daniel Akerson and Waste Management CEO David Steiner. Akerson seized the occasion to announce the launch of a new Chevy Impala that can run on both CNG and gasoline. Steiner said that in four years Waste Management has transformed its fleet of 20,000 trash trucks from all-diesel to 80% natural gas. He said he has heard just one complaint about the CNG trucks: They’re so quiet that people can’t hear them coming down the street as a reminder to put the trash out.

Pickens was gleeful. Here, at last, was validation from some of the world’s most important companies of what he had been prophesying for years. Think what the long-term impact could be for America’s energy balance.

After the event in Washington and another eye treatment in Baltimore, the Boone Pickens air caravan headed to Pittsburgh. He had agreed to speak at a fundraiser for Stan Saylor, the Pennsylvania State House majority whip who is working to get more state funds to subsidize the purchase of natural gas vehicles, especially trucks.

As we sat in horrendous Pittsburgh traffic, Pickens spotted the Gulf Oil building that he used to visit during his raid on the company 30 years ago. The city has deteriorated since then, the steel mills rusted away. But Pittsburgh, he believes, could rise again thanks to the giant shale-gas field lying thousands of feet below.

“The Marcellus is probably the biggest gas field in the world,” Pickens told the small crowd at the fundraiser. “Your state was first in oil, in 1858 at Titusville. And coal, too. And now you have more natural gas than you can imagine.”

The challenge for Pittsburgh, Pickens said later on the plane: “You can’t get them to think big enough–they’ve been down too long.”

So what’s the secret? How can we all last as long as Boone Pickens? Back in Dallas, he challenges me to find out by working out with him. At 6 a.m., his driver picks me up. We head to his mansion in the posh Preston Hollow neighborhood. Through the darkened house and up the stairs is Pickens’ home gym. “It’s the cheapest insurance,” he says. Already at that hour Pickens has been on the phone to headquarters and has CNBC on the flat-screen. His personal trainer of 23 years is there too, checking his blood pressure as Pickens gets an early morning update from his traders on the phone. I do a triple take as CNBC puts Pickens’ face up on the screen and touts an interview with him that afternoon. After the trainer checks Pickens’ pulse rate, we get down to it: a mile on the treadmill. Fifty sit-ups. Two sets of 20 squats while wearing a 60-pound weight vest. A couple sets of 150-pound pull-downs. I manage to match him, but just barely.

Standing on the treadmill, Pickens looks over at me. “Is it clear to you yet that I’m trying to change the world?”

Yes, sir, it is. It sure is.

Read more HERE.

Wednesday, March 26, 2014

Pickens Plan

U.S. Now Produces 10 Percent of World’s Crude

This week the Energy Information Administration announced that domestic production of crude oil had surged to the point that the U.S. is now producing 10 percent of the world’s crude. The figure applied to the fourth quarter of 2013, when domestic production totaled 7.84 million barrels per day.

The continued growth in production is attributable primarily to technologically advanced drilling and completion processes that facilitate production of oil from tight formations in fields such as the Eagle Ford and the Bakken Shale. Tight oil refers to oil found within reservoirs with very low permeability, including but not limited to shale. Presently, the U.S. and Canada are the only major producers of tight oil in the world.

U.S. tight oil production averaged 3.22 million barrels per day (MMbbl/d) in the fourth quarter of 2013, according to U.S. Energy Information Administration estimates. This level was enough to push overall crude oil production in the United States to an average of 7.84 MMbbl/d, more than 10% of total world production, up from 9% in the fourth quarter of 2012.

Read more HERE.

Tuesday, March 25, 2014

Pickens Plan

State of Oil and Gas: We’re Creating the Jobs

I was asked by the folks at LinkedIn to write an essay about the state of the oil and gas industry. Because of your hard work and dedication, we have successfully put oil and gas in almost every public policy conversation dealing with the economy, the environment, and national security.

I invite you to read about where I think we are and where I think we should be going.

Friday, March 14, 2014

Pickens Plan

OPEC Oil Trumps America’s Veterans in 2013

In 2013, Americans spent more on OPEC oil - $147 billion - than the $140 billion the federal government spent on veterans. Let’s put it another way. The total cost of OPEC oil in 2013 was twice the $72 billion that the federal government spent on education.

Despite America’s increased production of domestic oil and gas, OPEC continued to supply a little under 40 percent of the oil imported to the United States. All told, we imported 1,353,007,000 barrels of OPEC oil at a total cost of $146,760,242,370.

2013 OPEC Totals
1.35 billion barrels of petroleum imported
38% of US imports came from OPEC
$147 billion sent to OPEC countries

Pickens Plan

Think We Have Energy Security?

Think again. The U.S. is still twice as dependent on foreign oil than we were at the time of the OPEC Oil Embargo in 1973. And it shows. Here are the numbers.

In February, 2014, the U.S. imported almost 50 percent of the oil we consumed: some 255 million barrels. And we paid an average price of $108.90 per barrel. That cost us $27.8 billion or approximately $689,458.00 per minute.

On top of that, as soon as Russia moved troops into Crimea, domestic oil prices, which have been trending about $10 a barrel below import prices, jumped by $3 a barrel.

This should be a wakeup call for anyone who thinks that America’s increased domestic oil production has solved our dependence on imported energy. Oil remains a world market, and the U.S. is still susceptible to price spikes and to supply disruptions.

Tuesday, March 11, 2014

Pickens Plan

T. Boone Pickens on CNBC and Fox Business

Earlier today, T. Boone Pickens was a guest on CNBC’s Squawk Box. Immediately following, he was Maria Bartiromo’s guest on Fox Business. Following are excerpts from Boone’s interviews and links to videos from the shows.

On the Keystone Pipeline
“I can’t believe that for six years you’ve had a Christmas present on the front porch. A guy knocks on the door and says, ‘Here’s a nice present for you,’ and you say, ‘Well, we’ll think about it.’ It’s nuts. Here you have oil offered to you, you don’t have to have the fifth fleet in the Persian Gulf, you don’t have to have your military, you don’t have to have anything to protect it, here it is, you can have it, and it’s all for you and we’re still sitting here. ”

On Weights and Measures
“We tried in Washington to get something done. We now are working at the state level. We’re getting some of the archaic stuff out of there now. Somebody all at once showed up and they want to sell natural gas on a kilogram basis. What is this all about? We already have converted natural gas, mcf, over to diesel gallons. It’s very simple to do. You wonder where some of this stuff comes from.”

On Filling Stations
“The stations are in. They have 100 stations on the interstates now. That’s ready to go. Don’t worry about that. If you talk about the government doing the infrastructure, that’s a nightmare. That will with be a huge mistake. It’s something the left and right could come together on.”

More Excerpts
“Because of a cold winter, we’ve drawn down storage to where we’ll be under a trillion in storage and that’s the first time that’s ever happened to us. What does it mean? It means we still have a lot of natural gas. We had almost 4 trillion in storage. We pulled down and we’re under 1 trillion coming out of storage. That will end at the end of March.”

“We could do better. Just letting the markets work and money go where it’s treated best has done pretty well with the shale revolution. The leadership should be, they should come and do the Southern California deal on trash trucks, take the heavy-duty trucks to natural gas is what you should do. When you do that, you’ll cut off 3 million barrels a day.”

“We import 4 million barrels a day of OPEC crude. Cut 75% of it out with 6 million trucks.”

CNBC VIDEOS
Boone’s natural gas energy plan
Putin is a ‘young Joe Stalin’
Strong natural gas prices through the summer

FOX BUSINESS VIDEOS
Russia will use gas and oil as weapons of war
T. Boone Pickens’ outlook for oil
T. Boone Pickens on natural gas, Keystone
T. Boone Pickens Q & A

Monday, March 10, 2014

Pickens Plan

Oil and Natural Gas as Weapon of War

The following op-ed by T. Boone Pickens appeared originally on Forbes.com

With Russia’s invasion of Crimea, the threat is greater than Vladimir Putin’s ambitions, the real danger to the world is that oil and natural gas are once again being used as a weapon of war.

This isn’t the first time. When Russia cut off natural gas supplies in 2009 to Ukraine and six other countries in the middle of winter, millions were left in the cold until they paid Russia’s ransom in the form of higher prices. It was a stark example how vulnerable Europe had become to Russia’s control over energy resources. I said at the time it should be a wake-up call to an America confronting its own foreign oil dependence issue and the national security and economic threats that come with it.

We rely on oil suppliers around the world for half of the oil we use. Our OPEC oil dependence is particularly troubling. We’re caught in OPEC’s web that has entangled us in wars and Middle East politics and costing thousands of American lives and trillions of tax dollars.

I launched the Pickens Plan to help America get free from dangerous oil and make sure energy could never again be used as a weapon against us. I’ve urged America to use our vast domestic resources to create a real alternative to OPEC oil, and natural gas is the only resource to do that. But now it seems like everyone with a microphone is calling on the United States to begin exporting natural gas to Europe to undercut Russia’s power over the region.

I have nothing against exporting American natural gas – thanks to hydro-fracturing and horizontal drilling we’ve got more of it than anyone else in the world – but it’s foolish to think we can just turn on the tap and expect Russia to melt like the Wicked Witch. Realistically, it will be early 2016 at best before any of the permitted liquefied natural gas export facilities come on line. Rome wasn’t built in a day, and Russia’s expansion plans can’t be thwarted with our energy overnight.

Russia is the world’s second-largest supplier of oil and has tremendous power over the market. While America’s oil and natural gas industry has achieved stunning increases in domestic production, this has done nothing to alleviate our vulnerability to foreign oil. Russia’s intrusion into Ukraine last week caused our prices to spike $3 in a single day. This dangerous dependence makes us just as vulnerable to state-sponsored energy-terrorism as Ukraine, which is why we can’t liberate Europe from its dependence until we’ve freed ourselves first.

The fact is, the only way American can reclaim control of its foreign policy is to take advantage of our own resources. The best way to make a big difference quickly is to transition heavy-duty trucks from diesel to natural gas. That is beginning to happen. More and more trucking, delivery, and refuse and recycling companies are switching to natural gas – compressed or liquid. All up and down our Interstate highway system LNG and CNG fueling islands are sprouting up. It’s a great start, but we need to do more.

We should step back, look at all our resources and build a real plan to make the highest and best use of them right here at home. Reducing our dependence on dangerous oil will do more than just make America safer and stronger, it will lower demand and hit Russia where it really hurts: In the value of its oil and gas exports. Long-term strategic thinking and energy planning can be used to cripple foreign governments. President Reagan proved that in 1982 when he worked with Saudi Arabia and encouraged them to overproduce oil, ultimately collapsing oil prices…and Russia. It’s unlikely we have that same card to play with the Saudi’s today, and it would bust our domestic industry anyway. But we do have other cards to play, and natural gas as a fuel substitute for OPEC oil is the trump card.

Putin’s invasion of Crimea shouldn’t be fodder for the cable chat shows, it should be a rallying cry for American energy policy. It should remind us that we are blessed with enormous natural gift and we should have a plan to properly use those resources to be sure foreign oil can never again be used as a weapon of war.

Wednesday, March 5, 2014

Pickens Plan

The country hears you even if CNBC doesn’t

Dear Members of the Pickens Plan Army:

We want to thank you.

Several weeks ago we told you CNBC was asking America to help them decide which 25 people have had the biggest impact on American business over the past quarter century since CNBC was first launched.

CNBC encouraged us to engage our social network in support of this contest. We did, and you responded in a big way. Tens of thousands of you voted for Boone and, overnight, you helped move Boone Pickens from 24th on the list to number eight.

But, sadly, CNBC has made significant changes to the contest, and your votes were disregarded. According to CNBC, a special judging panel decided to disqualify Boone on the basis that the bulk of his contributions preceded 1989 (ironically, the decision to remove Boone from the list of “Contenders” came from the same panel that decided to put him on there in the first place!). Of course we think their decision is ridiculous – there are third-world countries that do a better job with voting than the CNBC contest team – but one thing we’ve learned from the legendary oilman is this: When you have a dry hole, plug it and move on.

The contest CNBC announced is different than the contest they are moving forward with. So we’ll just move along, too.

Boone Pickens has a long and storied relationship with CNBC. Through their partnership over the years, the American public has grown more informed on key energy issues. The impact that education has had and the important role you have played in helping reshape the energy in America has never been clearer. Our country is better off today because of Boone’s efforts and your involvement.

That is why, despite the hiccup, we expect Boone’s relationship with CNBC will continue. America’s energy future is more important than a TV contest.

-Team Pickens

Monday, February 24, 2014

Pickens Plan

Brand New Year, Same Old Story

Despite the fact that domestic energy numbers are surging and newer vehicles are becoming increasingly efficient, America’s dangerous addiction to foreign oil shows little sign of diminishing in 2014.

According to figures released by the Energy Information Administration this week, Americans spent more than $30 billion on imported oil in January. That’s a little less than what we spent in December, and it’s a little more than what we spent in November. These minor fluctuations can be attributed to minuscule differences in the price per barrel and the number of barrels imported.

Same story, different year. But wait … it gets worse.

It turns out that the amount of oil we imported from OPEC countries actually increased. According to the most recent figures from the Energy Information Administration - November 2013 - the U.S. imported 106 million barrels of OPEC oil at a total cost of $11.4 billion.

Isn’t it time America got the energy plan it deserves?

Wednesday, February 19, 2014

Conversations

Energy industry moving back to United States

Congratulations! We live in the only country on Earth whose oil and gas production is increasing along with its reserves. America is enjoying an energy renaissance while the rest of world is suffering a decline in reserves and production and a corresponding increase in prices.

This is big news. Cheap, abundant, domestic energy affects everything from employment to cost of living, and from the environment to national security. It makes the U.S. more appealing to manufacturers. And our dependency on OPEC oil continues to decrease.

These newfound energy resources are a great national treasure. Watch this video for my thoughts. Then tweet me yours at @BoonePickens.

Wednesday, February 5, 2014

Pickens Plan

Ohio Helping to Chart Nation’s Energy Path

The following op-ed by T. Boone Pickens ran in The Columbus Dispatch on Wednesday, February 5, 2014.

Last week, in his State of the Union address, President Barack Obama made a renewed call for further development and utilization of natural gas. Here in Ohio, on the edges of both the Utica and Marcellus shale plays, natural gas has become an important economic driver.

Until 2009, natural gas was considered a limited resource. Then new drilling techniques began to offer the promise of recovering enormous amounts of natural-gas deposits contained in shale under the continental United States at an economically viable price.

A drive down the Ohio River Valley, through Jefferson, Monroe, Noble and Washington counties demonstrates how shale gas already has had a positive economic effect on towns along the way.

Ohio has a long history in the oil and gas industry. The first oil boom began in Titusville, Pa., in 1859 and went through Marietta, Ohio, before it spread west to Oklahoma and Texas.

Let’s use the American energy renaissance to our advantage. The worst thing we can do is be lulled into a sense of security and think the national-security and economic threats posed by our reliance on OPEC oil have been solved.

Gov. John Kasich and his peers across the nation can have a major impact on U.S. foreign policy in the Middle East. Even with the increased production of gas and oil — which the president highlighted last week — America still imports about 40 percent of the oil we use from OPEC. The annual transfer of wealth to Middle Eastern governments is in the area of $130 billion.

Most of the chatter on the cable shows and out of Washington misrepresent the use of fossil fuels. They correctly talk about wind and solar to replace coal as fuels to generate electricity. I’ve been saying since I started the Pickens Plan in 2008 that I’m for everything American, and wind and solar have a promising future, but it’s misleading to say they help to reduce our dependence on OPEC oil. That’s just wrong. Only about 1 percent of our electricity is produced from oil.

The only way to bring down that $130 billion OPEC price tag is by looking for a transportation fuel that will replace OPEC oil. That fuel is natural gas. Despite the stunning resurgence in domestic oil production, gasoline prices in the U.S. remain largely unchanged. That’s because OPEC — a cartel we protect with our military — still largely controls world oil prices. The logical way to combat that is to inject serious competition into the transportation-fuel mix. Let’s start with domestic natural gas.

We may see natural-gas fueling stations in neighborhoods, but before we get to that point, we can immediately move from imported diesel to domestic natural gas by focusing on heavy trucks. We have about 8 million heavy-duty trucks in America; everything from refuse and recycling trucks that move at walking speed through neighborhoods to the 18-wheelers that run the long-haul routes on our interstate highways . These trucks tend to run the same routes on a regular schedule, so building out refueling facilities along the interstate highway system is a relatively simple logistical process.

Ohio is uniquely involved in the process of migrating from Middle Eastern oil to domestic natural gas. Not only is Ohio a natural-gas producer, it is a major player in over-the-road truck traffic moving goods from West Coast ports to markets in the East.

By moving quickly toward making natural gas the standard fuel for heavy trucks, Ohio is helping to lower our dependence on OPEC oil. At the same time, Ohio is helping to improve the standard of living in areas where drilling is taking place and, along with other states, improving our environment, because natural gas is far cleaner than diesel.

Ohio has helped lead the way, but more can be done. For example, Ohio is looking at changing the weight rules to allow heavy-duty trucks powered by liquefied natural gas to carry the heavier fuel tank necessary. If Ohio allows LNG-powered trucks to have a higher fuel limit, those trucks will be able to carry the same amount of cargo as a diesel-powered truck with far less environmental impact.

Obama endorsed natural gas in heavy-duty trucks in his State of the Union speech last week. He also called for a year of action. Ohio is acting, and leading. Let’s keep the momentum going. Just like the original oil boom, it looks like the next generation of America’s energy future begins here.

Read more HERE.

T. Boone Pickens is chairman and CEO of BP Capital and architect of the Pickens Plan, an energy plan for America. He will speak today to The New Albany Community Foundation, launching the Jefferson Series of community lectures at the Jeanne B. McCoy Community Center for the Arts.

@BoonePickens

Wednesday, January 29, 2014

Pickens Plan

President’s State of the Union: A plan without action isn’t a plan. It’s a speech. Let’s act on energy.

President Barack Obama talked about energy in his State of the Union address as every President since Richard Nixon has done. In his State of the Union address, President Obama came out strongly for the continued development of natural gas as a major American resource.

That is great news and music to my ears. I have championed a comprehensive national energy strategy – the Pickens Plan – since 2008, with natural gas as a cornerstone. The goal has been to get off OPEC oil by using natural gas for heavy duty trucking.

While I’m obviously heartened by the President’s endorsement of that, I’m also a realist. A plan wihout action isn’t a plan, it’s a speech. The OPEC oil threat is real. Our national security is threatened by it as is our economic future. After 40 years we just take OPEC for granted, and that’s a big mistake.

As far back as his first State of the Union, President Obama talked about creating and moving energy in new ways. He said “We will soon lay down thousands of miles of power lines that can carry new energy to cities and towns across the country.”

Few, if any, miles of new power lines have been proposed, much less sited, engineered or installed. Great plan. No action.

In January 2009 our national energy mix was as it had been for decades: Diminishing domestic oil production, falling levels of natural gas reserves, solar and wind were interesting but difficult to bring to market. Then the Potential Gas Committee released its biennial report that, for the first time, counted what was then known as “unconventional” gas – now known as shale gas – as economically recoverable using modern drilling techniques and the nation’s energy profile was turned on its head.

Credit goes to private individuals and companies taking a chance, risking their money, and using the best minds in the nation to develop new production techniques. They were not the result of a plan – not a Republican plan nor a Democratic plan.

Last night the President endorsed a principal element of the Pickens Plan when he called for new incentives for medium- and heavy-duty trucks to run on natural gas and other fuels. I’m for unleashing every American resource to back out OPEC oil, be it ethanol, batteries or anything American. But ethanol and batteries won’t move America’s 18-wheelers.

We need to be watchful that the President follows through on this by incenting the move from imported diesel to domestic natural gas, by working with major interstate truckers, express delivery companies, and truck manufacturers, as well as state and local governments.

Oil is not a player in the production of electricity in America. It accounts for only about one percent of power generation. The rapid move from coal to natural gas (as well as to wind) to produce electricity has led the U.S. Energy Information Administration (EIA) to claim that greenhouse gasses from fossil fuels were the lowest in 2012 than any time since 1994.

The real advantage these new reserves of natural gas and oil bring to us, is that we move farther and farther away from the next energy crisis. That is a mixed blessing because our national leaders – for over 40 years – have only acted when a crisis has loomed over their collective heads.

We have over eight million heavy trucks on our roads. Everything from refuse and recycling trucks that go back to “the barn” every night, to over-the-road trucks that run coast-to-coast over the same routes on a regular schedule. Simple arithmetic tells us where to put natural gas refueling stations on the most heavily traveled Interstate highways.

In last year’s State of the Union speech, President Obama said, “The natural gas boom has led to cleaner power and to greater energy independence. We need to encourage that.” That is still a good policy. With so much natural gas we should be looking for ways to utilize our vast supplies – especially where we can use it to replace imported oil.

The President’s focus on natural gas in the 2014 State of the Union speech is important because it helps us keep our eye on the ball. Now, we have to work with leaders at the federal, state, and local levels as well as the companies that will build, fill, and drive the trucks across America to make certain we keep moving toward an economy that is not dependent on OPEC oil.

If the president is serious on natural gas and trucking in America, here’s an idea: Lead by example. Sign an executive order mandating government vehicles use natural gas, and that those who contract with the federal government for goods and services do, too. Because natural gas is so much cheaper than diesel, you can make the case that such an order is fiscally responsible as well as environmentally beneficial.

President Obama was right on one other point last night: Let’s make this the year of action. There is a domestic energy renaissance in America, with natural gas production leading the way. Let’s act and take advantage of it.

Tuesday, January 28, 2014

Pickens Plan

T. Boone Pickens’ Statement on President Obama’s State of the Union Address and The Call for Expanded Use of Natural Gas in U.S. Transportation

FOR IMMEDIATE RELEASE
January 28, 2014

Contact: Jay Rosser
Email: Jay@BPCap.net

Contact: Amy Weiss
Email: Amy@weisspublicaffairs.com

T. Boone Pickens’ Statement on President Obama’s State of the Union Address and The Call for Expanded Use of Natural Gas in U.S. Transportation

“The goal for me is and always has been to get our country off of OPEC oil and onto our own natural resources – including natural gas, with a focus on heavy-duty trucks.

“I’ve lived through a lot of energy crises in my life. We shouldn’t wait for a crisis to act. We should act now. I’m encouraged by the President’s focus on natural gas and transportation. But remember, a plan without action isn’t a plan, it’s a speech. I look forward to seeing how the President and Congress follow through.”

About the Pickens Plan
Unveiled on July 8, 2008 by T. Boone Pickens, the Pickens Plan is a detailed solution for ending the United States’ growing dependence on foreign oil. That year, when oil prices reached $140/barrel, America was spending about $700 billion for foreign oil, equaling the greatest transfer of wealth in history. America’s dependence on OPEC oil represents a continuing national security and national economic threat. The plan calls for expanding the use of domestic renewable resources, such as wind and solar, in power generation and using our abundant supplies of natural gas as a transportation fuel alternative to OPEC oil.

More than 2 million people have joined the Pickens Army through the website www.pickensplan.com, which has had over 20 million hits. For more information on the Pickens Plan please visit our website www.pickensplan.com. Boone can be followed on Twitter @boonepickens.

Wednesday, January 22, 2014

Pickens Plan

Wind’s Outlook Remains Strong

The following op-ed by T. Boone Pickens ran in the Des Moines Register on Wednesday, January 21, 2014.

In 2008, I launched the Pickens Plan to help get America off OPEC oil. Our reliance on Middle East oil has been the number one threat to our national security and economy.

Thanks to advances in the oil industry’s discovery and recovery technologies, the U.S. energy picture is much better today. Let’s take stock of where we are.

The golden goose then was natural gas and still is. In 2008, there were concerns that America’s supplies of natural gas were stretched thin, and there were serious doubts about the ability to meet industrial, power and home heating demands.

The Pickens Plan began with a call to increase alternative forms of energy generation — including wind, solar, hydro, and geothermal — to reduce the amount of natural gas that was needed. We could then move that natural gas into a fuel for heavy-duty trucks, thus reducing our need for OPEC oil.

In 2009, the “Potential Gas Committee” began to quantify the natural gas reserves that were recoverable from the huge shale deposits beneath North America. That report noted natural gas supplies had increased so dramatically that the price dropped from about $12.60 per thousand cubic feet (Mcf) to a low of $3.14 per Mcf, as markets understood the value of hydro-fracturing and horizontal-drilling techniques. At one point, natural gas prices even plummeted to about $2 per Mcf.

Natural gas is the cheapest energy source in America, a reality that has hindered aggressive development of renewable energy in Iowa and elsewhere. While the federal production tax credit has kept the alternative industry alive, thankfully, the same innovation and technology advances that have reshaped the domestic oil and natural gas landscape have also impacted the wind industry.

The U.S. Department of Energy now says wind is the second-cheapest American power resource, behind natural gas.

Wind energy is becoming economically feasible again. The Iowa Wind Energy Association calculates that nearly $10 billion has been invested in Iowa’s wind farms and manufacturing facilities. That figure might well double in the next three to five years.

The production tax credit has existed in various forms since 1992. The most recent extension expired at the end of 2013 and will probably not be considered as a stand-alone tax measure this year, though it is possible the production tax credit will be reinstated as part of a comprehensive tax overhaul.

Even without the tax incentives, wind is growing increasingly competitive as an energy source. More efficient turbines, better siting, the ability to tie into regional electric grids and other factors are all positive factors.

Oil and ethanol are not players in the generation of electricity. They are players in transportation.

Iowans have long understood that a coordinated effort is necessary to produce anything. Corn and beans don’t spontaneously grow. They take careful planning, fertilizer, proper equipment, and enough water to get a marketable crop.

Wind takes the same type of coordination. According to the Iowa Wind Energy Association, as of the end of 2012 Iowa had nearly 3,200 utility-scale wind turbines producing more than 5,133 megawatts of power — third in the nation. Those operations are providing between 6,000 and 7,000 jobs, ranging from maintenance of the wind turbines to roads to trucks to building and maintaining the lines.

But the most critical factor in wind energy is wind itself. As reporters covering the Iowa caucuses have known for decades, the wind starts on the eastern slope of the Rockies, and there is nothing in its way between there and Grand Avenue.

Iowa may not have natural gas reserves, but 75 percent of the state is suitable to generate energy from wind.

Developing natural gas for use in heavy-duty trucks and wind for electricity make a solid partnership, for Iowa and the rest of America.

Read more HERE.

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