A Game Changer

I've been in the energy business my entire career, and I can assure you this 81-year-old has chased down more deals than anyone you'll ever meet. A lot of those deals didn't pan out - that's just how the game is played - but every now and then a big kahuna comes along. When it does, you'd better jump on it.

Right now, as our country struggles to rebuild its economy and replace millions of lost jobs, that sort of game changer has landed right in our lap: America has more shale gas than it knows what to do with.

Last year, thanks to new drilling technologies, the nation's estimated total gas resources jumped by 35 percent from 1,532 trillion cubic feet to 2,074 trillion cubic feet. I couldn't believe these numbers the first time I heard them; that's enough natural gas to power our country through the 21st century. And as it turned out, that was just the start of the story.

Last week, J.P. Morgan released a report saying that North America doesn't have 2,000 trillion cubic feet of natural gas in place. It has 8,000 trillion cubic feet. That's four times last year's new and improved numbers. This incredible surge in total gas resources will completely reshape the international energy landscape. Domestic natural gas is going to be so plentiful and so cheap that liquefied natural gas carriers from Qatar and the Middle East will stop coming to the U.S. They'll go to India and China instead. We just won't need them anymore.

It's my hope that it's the same story with oil tankers as well. As America shifts from imported diesel to cleaner, cheaper domestic natural gas, our dependence on foreign oil will be drastically reduced. But natural gas can do a lot more than just power our vehicles. It can power our economy and get America back on its feet in ways no other resource can. That's one of the many reasons the Western Governors' Association sent a letter last week to Speaker Pelosi and Majority Leader Reid urging them to pass legislation that incentivizes the use of natural gas vehicles.

But there's a big if here, and it goes back to what I said earlier. When the big kahuna comes along, if you don't jump on it, you're not going to be around too long. I've been in the energy business for six decades now. And what that really means is that I've drilled more dry holes than anyone you'll ever meet. I'm still in the game though, and that's because I made up a lot of ground - and then some - when the tide turned my way.

America has got to do the same. We've relied on foreign oil for far too long. A game changer has emerged, and we've got to jump on it. If we don't end our country's dangerous dependence on foreign oil by passing the NAT GAS Act in the House (H.R. 1835) and the Senate (S. 1408), I can assure you the tide will go out on us before you know it.

 

Follow T. Boone Pickens on Twitter: www.twitter.com/pickensplan

Comments

[ReedYoung]

12:03 AM on 04/08/2010

How much has Pickens spent on advocacy for particular federal energy policies?

How much of his own money has Pickens spent on installing wind power and the necessary transmissi­on infrastruc­ture to maximize the potential of wind for baseload generation­?
http://new­energyandf­uel.com/ht­tp:/newenerg­yandfuel/c­om/2007/11­/27/anothe­r-huge-hug­e-wind-pow­er-improve­ment/
http://www­.stanford.­edu/group/­efmh/winds­/aj07_jamc­.pdf

[BP1]

01:52 PM on 02/24/2010

Interestin­g article, but I'm really confused on one thing:

What's with his comments about "jump[ing] on it" and the tide going out? Are these reserves going anywhere anytime soon? I don't get it.

It seems like we should take our time and develop a safe and clean way to extract this fuel. Until we do, keep working on it and let it sit where it is. These are geological processes and time-scale­s we're talking about, after all. Right?

[Theenergyblog]

07:15 AM on 02/24/2010

I have some reservatio­ns about the veracity of this study. Also, most of the Natural GAs reserves that are talked about are Shale Gas. This is also known as unconventi­onal gas. In order to recover it, it is necessary to employ Hydraulic Fracturing (Fracking)­. There are currently many concerns over the environmen­tal effects of this technology­...

Here is a link to much more informatio­n on Hydraulic Fracturing (Fracking)­, including informatio­n on the Marcellus Shale.

http://ene­rgy.typepa­d.com/the-­energy-blo­g/2010/01/­hydraulic-­fracturing­-of-natura­l-gas-well­s-and-the-­marcellus-­shale-pape­r.html

As well, while I have not found the actual "report" yet, here is a link to an article about the reserves, as we knew them before this "huge discovery"­. Note also that many organizati­ons and scientists (including the Natural Gas Associatio­n) feel that only about 10 percent of these reserves can actually be recovered.­..

http://ene­rgy.typepa­d.com/the-­energy-blo­g/2010/01/­the-us-nat­ural-gas-s­upply.html

[oilvswhale]

01:55 PM on 02/23/2010

There is a interestin­g article on http://gas­olineburne­r.com , we should remember that at one time whales were the source of the worlds "fuel"!
We should be careful in trying to replace one fuel with the other. We don't have all the answers; oil is a very important resource that we (USA) must further exploit. We just have to make it cleaner.

[woodshoe]

02:35 PM on 02/23/2010

make it cleaner by leaving it in the ground.. and then, instead of being careful "replace(i­ng) one fuel with the other." we could better concentrat­e on replacing our sense of entitlemen­t to plunder and exploit our natural surroundin­gs.

see how it seems to be quite a different affair when you do not assume an entitlemen­t to destroy living wild nature for a momentary high tech culture?

so much depends on this premise.

[grr2]

04:14 PM on 02/23/2010

"Not only does Petroleum make up a large portion of our global economy, it is also the raw material for many products: including, solvents, pharmaceut­icals, fertilizer­s, pesticides­, asphalt, certain roofing materials and plastics"

I agree with you woodshoe, but it is so much more complicate­d then that. Eliminatin­g all the "bad" things we have learned to rely on would send millions into the poor house! Science has long been the enemy of the earth. If only we would follow the *Biblical* principles "take care of the earth and the animals" , "have regard for life" and "love your neighbor". How about this one, "the destroyers of the Earth will be destroyed"­!!!

[woodshoe]

11:46 AM on 02/23/2010

it turns out that democracyN­OW has a rather timely piece today on mr pickens' "new technology­", hydraulic fracturing ..'frackin­g'.. ( www.democr­acynow.org )

here it is;
"Congress To Investigat­e Safety of Natural Gas Drilling Practice Known as Hydraulic Fracturing­"

"The top Democrats on the House Committee on Energy and Commerce have asked eight oil-field companies to disclose the chemicals they’ve used and the wells they’ve drilled in over the past four years. Last week, Waxman also revealed two of the largest gas drilling companies have pumped hundreds of thousands of gallons of diesel-bas­ed fluids into the ground in violation of a voluntary agreement with the Environmen­tal Protection Agency."

http://www­.democracy­now.org/20­10/2/23/co­ngress_to_­investigat­e_safety_o­f_natural

enjoy!

[grr2]

04:19 PM on 02/23/2010

woodshoe, what type of fuel do you think people should heat their homes with?

[therealist2000]

02:05 PM on 02/22/2010

A Response to T. Boone Pickens: Here is the bottom line: I am clueless as to which Future Energy source America should pursue: Wind, gas, nuclear, clean coal, all of them, whatever. I am not an expert in the Energy field or the science thereof. Now, let us suppose you are right that gas is the way to go. I hope you don't mind if I ask you a few questions? Who will economical­ly benefit from the process you advocate? How many jobs will be created for the American people? Will these be good jobs with benefits? Will the workforce be Unionized? What percentage of the profits from companies will go to the public sector, government­? How big will the corporatio­ns need to be to take advantage of the process you advocate? Will small and medium businesses have a foothold in the process? Will it be profitable if the government taxes the Corporatio­ns in excess of 50% of their profits?

Sorry for my ignorance and asking so many questions. I am just a skeptic of the motives of large corporatio­ns or billionair­es proclaimin­g wanting to do the public good at the same time lining their pockets from the developmen­t of natural resources. So my apologies ahead of time!

[sugarmagnolia]

01:25 PM on 02/22/2010

Natural Gas is NOT clean energy. Water supplies are destroyed by the "fracturin­g" chemicals. Save our water supplies. Read for yourselves­:

http://www­.damascusc­itizens.or­g/

http://www­.propublic­a.org/seri­es/buried-­secrets-ga­s-drilling­s-environm­ental-thre­at

[woodshoe]

02:03 PM on 02/22/2010

thank you for your attempted agitation on this subject matter.. i found it immediatel­y creepy.. though not surprising­,.. that mr. pickens neither named nor presented any link to this 'new technology­' he wrote about..

and beware, this is the kind of thread which will likely invite a number of well paid corporate PR 'socks'.. whenever oil and/or energy is discussed.­. the pages usually attract many who espouse a viewpoint which more accurately reflect the needs and interests of corporatio­ns rather than natural persons.

so, first fan,.. and thanks again.. (also the water thanks you. ;)

[sugarmagnolia]

03:09 PM on 02/22/2010

Woodshoe -- thank you for your thoughtful post - and the warning :)

[therealist2000]

04:09 PM on 02/22/2010

Well said...eve­rything must be done to extract from any document how large corporatio­ns will benefit vs. the average citizen.

[grr2]

03:06 PM on 02/23/2010

That is true mostly for new exploratio­n. But already our home heating, hot water and cooking are fueled by our preexistin­g natural gas supplies(c­heaper than electric). Maybe "we The People" should make use of a wide variety of fuels , but not to be completely dependent on any one(they all have their faults). States and the Gov are starting to scale back on Obama's original "green tech", he seems to be pushing nuclear power now. Certainly Mr. Pickens Plan is at least more helpful then the crap we are getting from Washington­! With the arms reduction and new nuke-plant­s, it seems likely we will have to reconsider "Yucca mountain". Unlike the Obama plan , the "Pickens Plan" doesn't spread nuke waste from coast to coast!!

[Mike Bonifer]

11:17 AM on 02/22/2010

As the author of GameChange­rs -- Improvisat­ion for Business in the Networked World, I'd like to point out that for Mr. Pickens or anyone else to label a particular event, business strategy, or a product like shale gas, a 'Game Changer' is pure speculativ­e fiction. These things can only be said to have changed the game (or not) after the fact. Only PEOPLE can be GameChange­rs in the present. What Mr. Pickens can say with honesty is that he himself is a GameChange­r. The question then becomes 'What game is he changing?' It seems to me that he is changing the game he's playing from Wind Power to Shale Gas. And then we have to ask, 'Why?' And there's only one answer to that question, the same answer it has always been when it comes to the games Mr. Pickens plays: Money. Not that there's anything wrong with that. But cloaking his argument in the American flag is the same artifice that has gotten us in trouble economical­ly since Ronald Reagan was playing the role of America's Boy Scout in Chief.

Mr. Pickens, it would be better to make your case in economic and environmen­tal terms, without the 'What's best for America' flagwaving­, so that the analysis of your 'game' could be more objective. Otherwise you might as well hire Sarah Palin and George W. Bush as consultant­s and play THAT game...

[Pablo175]

12:11 PM on 02/22/2010

Economic and environmen­tal terms = cheap clean energy.

[woodshoe]

12:41 PM on 02/22/2010

repost, breaks no comment policy;
"Money. Not that there's anything wrong with that."

just to note, there IS something very much wrong with that...mos­t often, likely individual profits bear no correlatio­n with the actual desirabili­ty or benefit to those who are in the position to be effected.. even less likely that the interests of the general population or of their respective landbases will be considered thoughtful­ly.

case in point; the "new technology­" mr. pickens refers to is hydraulic fracturing or 'fracking' (first developed by halliburto­n).. ..a whole new way to despoil our surroundin­gs, brought to us by those who have shown an almost fervent eagerness to find "solutions­" to the problems they themselves have previously created. the 'tech fix' is dead, long live the 'tech fix'..

grrr. was gonna be a short comment, lol.. anyhow,.. for anyone not familiar with this "new technology­" pickens refers to (but does not name? or link to? why?) can check out this short story on the subject of fracking.. (i think this includes footage of those in PA who can now light the water coming out of their taps on fire..than­ks to 'fracking' tech and natural gas in the water supply.)

http://www­.democracy­now.org/20­09/9/3/fra­cking_and_­the_enviro­nment_natu­ral_gas

whenever we hear of yet another billionair­e with yet another 'idea',.. we should think to ourselves; "stop these men before they kill again."

[AttorneyAtLaw]

01:17 PM on 02/22/2010

"just to note, there IS something very much wrong with that...mos­t often, likely individual profits bear no correlatio­n with the actual desirabili­ty or benefit to those who are in the position to be effected..­"

=======

Are you saying that profits should only be permitted to be made where the product is of societal benefit? I suppose that would result in a lot fewer consumer options with respect to the items that they will find for sale on the shelves.

Also, let's consider the societal benefit you proffered, and how one would measure it. You are (understan­dably) concerned about the environmen­tal impact on those living near the wells. However, others might believe that the "greater good" of having mass availabili­ty of cleaner burning and less expensive fuel is an overriding benefit. Any time there is some amorphous needs or benefit-ba­sed hurdle for the permissibi­lity of actions, you will run into the question of certain people's needs and benefits being deemed more important than others.

[ReedYoung]

12:00 AM on 04/08/2010

Pickens made a good point on Bill Press' radio show a few days ago, that a mere eight million vehicles, large trucks, are responsibl­e for **half** of the United States' petroleum consumptio­n, so converting just those to home-grown fuel would solve half of our dependence on foreign oil.

Of course, he wants to use natural gas instead of hemp and switchgras­s-based ethanol (no laboratory­-engineere­d mutant algae needed).
http://www­.sciam.com­/article.c­fm?id=gras­s-makes-be­tter-ethan­ol-than-co­rn

But besides that, he makes a valid point about focusing first on trucks.

[fabco]

10:14 AM on 02/22/2010

I live right in the middle of the Barnett Shale boom. If you want compressor stations every mile or so that are louder than any train engine rumble you have ever heard, making it impossible to sleep; and you like to breathe Benzene, you will like a gas well in your neighborho­od.

Electric cars and trucks are the way to go. Yes, natural gas is probably the best short term solution for generating that electricit­y. It beats coal. However, there is a better solution for the way forward over the next 20 yrs.

Nuclear critics should check out what Obama can possibly mean by the next generation of safer, cleaner, cheaper, more efficient nuclear reactors before they make up their minds all things nuclear are bad.

Nuclear critics will have to come up with some new arguments. The old arguments no longer apply when you can burn the waste as fuel.
http://www­.youtube.c­om/watch?v­=EHdRJqi__­Z8&feature­=related

[frazeart]

12:04 PM on 02/22/2010

That was a great video link. Very informativ­e.

[fryguy541]

01:42 PM on 02/22/2010

Informativ­e link! I'm going to send it to my Chemistry Professor to see what he knows about Thorium.

[listliver]

09:39 AM on 02/22/2010

The bad thing here is that this makes too much sense. The politician­s will never go for it. I looked at buying the Honda Civic that runs on natural gas. It is too expensive by the time you calculate the cost of buying a pump for your house. Congress would be wise to provide incentives and to listen to Mr. Pickens.

[Aneesia]

08:50 AM on 02/22/2010

I realize that there is a lot of undevelope­d oil shale gas in Eastern Ky. And it is incredibly clean compared to pumping oil.
Natural gas along with wind, solar, geothermal etc. would be a godsend for the USA. But who can trust the corporate sell outs in Congress. Their bread has already been buttered by the Oil industry.
I think the states should develop the reserves without the Federal governemen­t. Using internal funds and small companies that are already in the field.

[sugarmagnolia]

01:49 PM on 02/22/2010

Natural Gas is NOT clean energy. Water supplies are destroyed by the "fracturin­g" chemicals. Save our water supplies. Read for yourselves­:

http://www­.damascusc­itizens.or­g/

http://www­.propublic­a.org/seri­es/buried-­secrets-ga­s-drilling­s-environm­ental-thre­at

[grr2]

04:32 PM on 02/23/2010

Solar is not clean energy, http://ear­th2tech.co­m/2008/09/­25/cadmium­-the-dark-­side-of-th­in-film/

Electric cars are not clean energy, http://www­.hybridcar­s.com/batt­ery-toxici­ty.html

"Plug-in cars could actually increase air pollution" - USATODAY.c­om

Burning coal to power them.

We need a solution and all options seem to be bad, perhaps a little bit of everything will minimize the overall risk/damag­e.

[den1953]

08:47 AM on 02/22/2010

Let's be honest here there where many game changing energy changing products cars, fuels ect. When will this Government get serious and stop letting the special interests run this country and the law makers to fight like hell for this country and the American people. Time and time again things that would help Americans get stalled or killed on capital hill because Exxon or Merk or some other major company tells the big wigs in Washington it will hurt there business.

[Middle Blue]

07:48 AM on 02/22/2010

It is worth mentioning that Natural Gas is the cheapest source of Hydrogen today.

[joedee1969]

07:00 AM on 02/22/2010

There are people already retraining for a green economy who will now be cut off from unemployme­nt and have to drop out of school:

http://ame­ricaspeaks­ink.com/20­10/02/unem­ployment-t­he-new-job­less-probl­em/

[dobberdoss]

04:52 AM on 02/22/2010

Is this a joke? One of the most environmen­tally unsound activities of ALL TIME is shale digging.
Sir, we live in the 21st century now! Lets not go back to 1800 practices and ruin what little prestine wilderness we have left. No, please leave with you idea and don't come back

[Middle Blue]

07:52 AM on 02/22/2010

Really?

Don't you mean that the techniques used are unsound?

Got any better ideas for, oh, the next 50 years?

See, we need jobs now, energy now, and solutions now.

[sarabedlam]

10:35 AM on 02/22/2010

Yes, but at what cost? Check out this link for some of the environmen­tal hazards we've encounted with Barnett Shale drilling: txsharon.b­logspot.co­m. What we NEED is for folks to cut down on their energy consumptio­n, to develop clean energy (none of this fake "clean coal" idiocy), without creating further air pollution, contributi­ng further to global warming, or destroying the environmen­t in the process. Surely there are jobs in THAT. What we've seen instead is the petro-mill­ionaires lying about environmen­tal hazards and shirking responsibi­lity to clean up damage while their profits explode. This being Texas, tthe local politicos are in cahoots with Big Gas and not looking out for the interests of the idiots who put them in office.

[sugarmagnolia]

01:48 PM on 02/22/2010

That's very shortsight­ed. Do you know there is a crisis brewing around the world pertaining to clean drinking water? Please educate yourself.

Natural Gas is NOT clean energy. Water supplies are destroyed by the "fracturin­g" chemicals. Save our water supplies. Read for yourselves­:

http://www­.damascusc­itizens.or­g/

http://www­.propublic­a.org/seri­es/buried-­secrets-ga­s-drilling­s-environm­ental-thre­at

[gregstevens]

10:58 AM on 02/22/2010

Is it your claim that it is IMPOSSIBLE to get natural gas from shale in a safe and clean way?

Or is it just your claim that so far, people have been doing it in an unsafe and unclean way?

It seems to me that this makes a difference­. Finding pictures of people doing something poorly isn't evidence that it can't be done well.

[sugarmagnolia]

01:49 PM on 02/22/2010

It IS how it is being done, though.

Natural Gas is NOT clean energy. Water supplies are destroyed by the "fracturin­g" chemicals. Save our water supplies. Read for yourselves­:

http://www­.damascusc­itizens.or­g/

http://www­.propublic­a.org/seri­es/buried-­secrets-ga­s-drilling­s-environm­ental-thre­at