T. Boone Pickens
Legendary investor T. Boone Pickens has been called the Warren Buffett of energy investing, and over the years he has built up quite a legacy.
From his days as a wildcatter drilling in unknown oilfields, Pickens went on to start his own oil company, Mesa Energy, take on the likes of Exxon Mobil Corp. (NYSE: XOM), and manage a hedge fund, BP Capital.
As the head of Mesa, Pickens became known as a corporate raider, caught up in the deal-crazy days of the 80s. His first deal was to purchase energy company Hugoton Production Co. - a move made famous by the fact the company was 30 times the size of his own.
And today, at age 84, Pickens is still buying up energy stocks.
When you analyze his current top 10 holdings, it becomes clear natural gas companies are among his favorites.
We here at Money Morning certainly agree natural gas companies are primed to profit from the surge in U.S. natural gas production, largely a result of fracking, which has dramatically changed our country's energy outlook.
Less than 10 years ago, it was estimated that as much as 15% of our domestic gas would have to be imported in liquefied natural gas (LNG) form by 2020.
But now, the U.S. is projected to be a net exporter of gas by 2020, accounting for 9%-12% of global LNG trade.
And by 2040, U.S. consumption of natural gas is projected to rise more than 25% from 2010 levels, and domestic natural gas production is expected to climb more than 45% during the same period, Exxon Mobil said in a recent energy outlook.
So how do investors best tap into this trend?
Natural Gas: Following T. Boone Pickens into the Energy Patch
An iconic Southwestern energy patch player, T. Boone Pickens has built a legacy over the decades that proves the old Texas saying: "It's not the size of the dog in the fight, but the size of the fight in the dog."
In the wild days of the 1980s, made famous by a generation of traders who emulated the likes of Gordon Gekko, few could ever match the Pickens eye for the big deal.
Never eat anything bigger than your head?.... Pickens never heard that one.
As the head of Mesa Energy, his first deal was to purchase the Hugoton Production Company - made notable by the fact the company was 30 times the size of his own.
His thirst for Goliaths continued for decades to come. He once even went after Gulf Oil, which is now Exxon Mobil.
The point is Pickens has never shied away from risk when he saw reward. And for all his bold achievements there is always less "crazy" there than there seems to be.
And if you're looking for a guy who knows:
- How Wall Street traders and Texas wildcatters think.
- Who can read a geological map.
- Who can manage a hedge fund.
- And who can make money in a volatile industry... Pickens is your guy.
That's why there is more there than meets the eye in his unique venture into the natural gas market with Clean Energy Fuels Corp. (Nasdaq: CLNE). Pickens is its founder and largest individual shareholder.
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T. Boone Pickens Loses "Big" in Alternative Energy
No, he didn't lose a donkey.
But T. Boone Pickens lost a synonym for the animal and a whole lot of money in the wind industry.
"I'm in the wind business..." said Pickens yesterday on MSNBC's Morning Joe. "I've lost my ass in the business."
Pickens didn't blame his own investment for the current situation. He acknowledged that the technological shift in shale oil and gas development has greatly changed the game for American energy, and has made drilling more practical and affordable.
But the statement was just a precursor to his observations that Washington has little priority to setting a national energy policy that is both sustainable and affordable to Americans.
On the show, Pickens hammered home the point that the current administration not only lacks an intelligent energy policy. "They don't have an energy policy."
Why this statement is shocking to anyone, especially the hosts, shouldn't confuse anyone.
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Former Oilman T. Boone Pickens Makes a $2 Billion Bet on Alternative Wind Energy
By Jennifer Yousfi Managing Editor T. Boone Pickens made his fortune in oil. But now the Dallas oilman and famed former corporate raider is betting $2 billion that he can have the same success with a new source of energy – wind. Pickens' Mesa Power LLP yesterday (Thursday) unveiled the first phase of an eventual [...]