How T. Boone Pickens sees drilling, fracking, and the bounty of oil and gas
by Allen Best
Private jets shuttled in and out of Aspen on a recent weekend. Ted Turner spoke the first day at the American Renewable Energy Day conference and said that we must get off fossil fuels.
Saturday morning, he had breakfast with T. Boone Pickens, who asked him: Whatever are you thinking?
For Pickens, the bonanza of natural gas that has become apparent in recent years is a wonderful thing. It will, in his view, deliver the United States from the tyranny of OPEC. The United States, he went on to say, has three times as much energy in the form of natural gas as Saudi Arabia does in oil.
At current rates of consumption and with existing technology, according to this view, the United States has enough natural gas for 100 years, maybe even 150 years.
Based on cost and environmental performance, natural gas is already crowding out coal for generation of electricity. It is also creating competition for renewables that were long seen as synergistic with natural gas, because natural gas plants can be powered up quickly as wind dies down.
Pickens also wants to get on with conversion of transportation to natural gas. In relying too much on imports of oil from the Middle East, he said, the United States has been funding both sides of the wars.
“I want to get rid of ethanol. I want to get rid of OPEC. I want to get natural gas in transportation,” he said. Currently, he added, 70 percent of all world oil production is used as a transportation fuel.
Natural gas prices have always swung wildly during recent years: from $13 or $14 per million Btu down to $2 to $2.50 during the recession. Prices have recovered to $3 or $3.50. Pickens said he expected they will remain in the range of $3 to $7, but did not explain why.
Pickens, 85, grew up in Oklahoma and then moved to Texas, always exhibiting a daring approach to business that has made him many fortunes – and lost him money, too. In the last decade he has bet on wind. That was before the rapid increase in extraction of natural gas.
“I wasn’t as enthusiastic as I should have been,” he confided.
Sizing up his audience, Pickens admitted grounds for disagreement. “I don’t think I am talking to a group of people who are all that keen on drilling anything,” he said.
At the forum, he got several questions about the environmental impacts of fracking and other techniques used to extract oil and natural gas. He dismissed the potential of earthquakes as the “craziest thing I ever heard.” He also rejected fracking as a threat to potable water supplies.
He further rejected claims that the federal government funding was vital for development of fracking. “He saw his first frack job 62 years ago – long before the federal government got involved, he said.
But Pickens was no doubt right about his audience’s hesitancy. In addition to Turner, the group the day before had heard from Amory Lovins, one of the original proponents of renewable energy and dozens of others touting the need for renewable energy.
Earlier that day, former Colorado Gov. Bill Ritter had spoken, noting that 220 million Americans now live in states with renewable energy portfolio standards and 240 million Americans live in states with energy efficiency resource standards.
With some states turning more conservative, there has been fears that renewable energy portfolio standards would be repealed. “Guess what, it’s not happening,” he said. Instead, activists who make the business case for renewable energy – as he did when he was governor of Colorado – have prevailed.
But Pickens made the case for natural gas. “You’re going to have to deal with natural gas for 100 years,” he said. “It’s going to be around that long. We have a lot of natural gas in this country.