T. Boone Pickens Talks About America's Lack of an Energy Plan

Energy legend T. Boone Pickens' father once told him, "a fool with a plan can beat a genius without a plan any day."

In the video below, Pickens tells Motley Fool contributor Jason Hall how America's lack of a consolidated energy plan, or even a single federal entity to handle energy policy and decision making, has led to an expensive and complex process. One that has real and lasting impacts on every American, including our men and women in the military, and the financial costs of providing security to parts of the world where oil is found. 

Check out the video, or read the transcript below, for Pickens' thoughts on this important topic. 

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Jason Hall: If you could, talk a little bit about the disjointed way our government functions, when it comes to energy. Thinking of the Keystone XL Pipeline alone; how many government agencies would have an involvement in that? I think that's a good example.

T. Boone Pickens: Energy in America, there's no office that you can go to and talk to them. You say, "Well, the Department of Energy." Well, the Department of Energy, they spend most of their time managing nuclear facilities in the United States.

Is it a government agency that has a purpose? I'm not sure. If you go back and see the charge for the agency, I believe that the Department of Energy came into existence in '78, in the Carter administration. Their primary charge was to get off of imported oil -- "As best you can, come up with a plan." I've never seen anything come out of the Department of Energy.

But now we come down to the Keystone Pipeline, look who's going to make the decision on the Keystone Pipeline. The State Department, because it's from Canada to the United States. It's an international crossing, so the State Department has the issue. Well, they can't make the decision. They struggle with it.

But now if we export oil, then we're talking about that because we have a lot of light sweet crude, and our refineries have been ... not rebuilt, but they've gone to ...

Hall: They're set up to handle the stuff out of the Middle East, right?

Pickens: Exactly. Heavier crude, dirtier crude. Venezuelan crude comes in, we process it in the United States. So, we have a lot of light sweet that's available and now we're talking about exporting that. Well, that decision, I'm told, will be made by the Commerce Department.

So you say, "Who is it that has the responsibility for managing oil and gas imports, exports, reserves, what have you?" It goes around the curve. There's no plan, is where you find yourself.

Hall: Right. That doesn't even take into consideration our foreign military interests, that exist in a lot of ways to protect oil assets for other countries.

Pickens: If you go to Washington and talk to some of the Senators, I say, "Look, you ought to get on your own resources, and we have an abundance of resources in America -- they just need to be reviewed, looked at, decide how you're going to manage -- but all the heavy-duty trucks should be over to natural gas because, one, it's 20-30% cleaner, it's cheaper, it's domestic ... it's ours."

They say, "No, that's picking winners."

Picking winners? Hey, look at the Mideast. Fifth Fleet is there, protects the Straits of Hormuz. Fifth Fleet, United States -- you're protecting the oil shipped out of there for a cartel. OPEC is a cartel. Here the Fifth Fleet is, protecting a cartel's oil.

Seventeen million barrels a day comes through the Straits of Hormuz. How much of that comes to the United States? Ten percent -- 1.7 million. Where does the rest of the oil go? China. Europe.

I ask them at the Pentagon. I say, "Gosh, can't we charge them for protecting the oil to go to China and to Europe?"

They said, "Yeah, you can charge them. They won't pay you."

Okay. Why do we do that? Why are we the nice guy -- or the stupid guy, I don't know which -- to do that? Because if you put the cost of the Fifth Fleet on the oil that comes to us from OPEC ...

Now, not all OPEC comes from the Mideast; Nigeria, Angola, Venezuela, are all OPEC countries. But nonetheless, if you put the cost of the Fifth Fleet on there, now we have really expensive oil.

Hall: Right, and that's something that I don't know that everyone necessarily considers, but that's a real cost.

Pickens: It is a real cost.

Hall: It's absolutely a real cost.

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T. Boone Pickens isn't the only super-investor with his eyes on the American Energy Boom. Warren Buffett is so confident in this company's can't-live-without-it business model, he just loaded up on 8.8 million shares. An exclusive Motley Fool report details this company that already has over 50% market share. Just click HERE to discover more about this industry-leading stock.

 


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Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On June 26, 2014, at 5:07 PM, martinbrasear wrote:

    why has this "super-investor's" fund, BP Capital, not filed the required 13F, since November of last year ?

    http://goo.gl/1BwCXg

  • Report this Comment On June 26, 2014, at 7:37 PM, burgermcshame wrote:

    Pickens is using Jason just like he does every other human being he comes in contact with, to further his own interests, period, end of story.

  • Report this Comment On June 27, 2014, at 3:38 PM, TMFVelvetHammer wrote:

    martinbrasear,

    A basic understanding of what 13F filing requirements are answers this question. From the Securities Exchange Commission (SEC) website:

    "An institutional investment manager that uses the U.S. mail (or other means or instrumentality of interstate commerce) in the course of its business, and exercises investment discretion over $100 million or more in Section 13(f) securities (explained below) must report its holdings on Form 13F with the Securities and Exchange Commission (SEC)."

    Pickens personally holds a large stake in Clean Energy Fuels, disclosed on Form 4, as is required.

    I've addressed this with you before, and I realize you are only posting to malign Pickens, and not in any genuine interest or concern. Simply an attempt to point at supposed smoke, where there is no fire.

    My response is for the benefit of other readers.

    BP Capital's PE funds are primarily investing in private companies and energy futures, not publicly traded companies.

    So no need for a 13F filing until and when the total value of stock holdings, stock options, and debt notes that are convertible to stock, exceeds $100 million.

    This is for the hedge fund investments, not Pickens' personal wealth. These are two different things.

    And mcshame, I appreciate your concern for my being used by Pickens, but you should consider this: Maybe I'm using Pickens to further MY interests...

    -jh

  • Report this Comment On June 27, 2014, at 8:07 PM, burgermcshame wrote:

    Your admission explains all - thank-you for explaining that you're comfortable with Pickens using you, because you're "using Pickens to further MY interests"

    Two sorts in this world, givers and takers - you and Pickens are takers - now you know why you're life looks like it does.

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