T. Boone Pickens On Our Energy Future

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Welcome to Politics Bites, where every afternoon at It's A Free Country, we bring you the unmissable quotes from the morning's political conversations on WNYC. Today on the Brian Lehrer Show, T. Boone Pickens, oil and gas executive , discusses the Pickens Plan and the promise of natural gas.

While a candidate, President Obama promised as part of his campaign to end US dependence on oil from the Middle East within ten years. Three years later the country remains dependent while unrest in the Middle East is pushing up both the price of gas and a general economic anxiety among many Americans.

T. Bone Pickens — oil billionaire, philanthropist, former political donor — has made the issue of energy independence his own. Pickens recently released his Pickens Plan to reduce oil dependence, mostly through dramatically increasing domestic drilling for natural gas. The Pickens Plan featured goals such as generating twenty-two percent of the country's energy from wind power, promoting natural gas, and encouraging people to make their homes and businesses more energy-efficient. The energy magnate said his plan has now become a House bill and is gaining momentum.

We’ve seen a great amount of progress but not enough. We got the bill entered on April 6th, and we have 178 co-sponsors. It’s House Bill 1380, and it was entered by [Rep. Kevin] Brady, a Republican, [Rep. John] Sullivan, a Republican, [Rep. Dan] Boren and [Rep. John] Larson, Democrats, and it’s gotten great interest and I’m confident the bill will pass, because it’s the first step to get us off of just exactly what the president said he was going to do, get off of oil from the Middle East.“

Powering the Nation's Roads

The natural gas bill calls for a billion dollars a year in tax incentives for five years for natural gas development, which Pickens explained was a subsidy to offset the costs of switching over trucks from diesel to natural gas.   The incentive, a tax credit, would sunset after five years.

You have to replace OPEC oil, or Mid East oil, with something. And the only thing we’ve got to replace it with is more oil in America, which our oil companies have been doing a good job of finding… but they cannot replace the five million that he’s talking about. That’s five million barrels out of thirteen we import everyday comes from the Mid East.  And that’s what he wants wiped out, that’s what I want wiped out. And the only resource we have that can take it out is natural gas.

The Suadi Arabia of Natural Gas

The US has been called the Saudi Arabia of natural gas. Pickens said in terms of barrels-of-oil equivalents, the US has 300 billion barrels, exceeding the amount of oil in Saudi Arabia. Currently the most pressing goal of alternative energy is to find an alternative for powering the nation's transportation needs. Pickens thinks that there is no reason that natural gas cannot move beyond just house heating and meet that transportation need. Trucks that now run on diesel would run on natural gas, Pickens said, pointing to California, where trash trucks were already converted to natural gas in order to address pollution problems. One diesel truck off the road, according to Pickens, provides the same air quality results as removing 325 cars, while converting from diesel to natural gas cost an incremental difference of $50,000.

That is exactly the same model I want to do on the eight million eighteen-wheelers in the United States. Don’t worry about the infrastructure, that’s a way for people to make money and hire people and everything else, so that’ll happen just naturally.

Though Pickens’ plan had originally called for substantial increases in wind energy, it has since been modified and the wind-energy component greatly reduced. Pickens defended the move toward continued reliance on fossil fuels by stating that wind would never replace oil. 

A battery will not move an eighteen-wheeler. But that energy is good, from the wind, and I’m in for wind projects now. So I didn’t abandon it... Wind is going to be a factor at some point, but it won’t replace transportation fuel.

Natural Gas and New York

Two recent studies on the process of natural gas extraction called hydro-fracturing, or fracking, found the process may have environmentally disastrous results with severe ramifications for public health. Carcinogens such as benzene, used in fracking, are at levels nearly one hundred times higher than those currently found in diesel. Pickens is unconcerned. He pointed to decades of fracking done in Oklahoma and Texas without catastrophic results, but said he does think that the companies doing fracking should disclose what chemicals they use. Still he dismissed concerns about the danger. Regarding the controversy over fracking here in New York, Pickens said if Governor Andrew Cuomo is uncomfortable with fracking it is right for New York to proceed carefully.

New York, bless your heart, it has so much to do with America and all, but not much to do with the gas business. You don’t have one-tenth of one percent of the natural gas in the United States, and so if you decide you’re not going to use it, well, so be it. But this is what I believe will happen, it may take you a little while, you’ll get comfortable with it. The hydrofracking will be acceptable and nobody will get hurt by it and it’ll go forward.

A study from Cornell University out this month found that the methane emissions from extracting natural gas from shale are higher than from oil, coal or conventional gas. The report suggests that natural gas may not be such an environmentally-benign alternative. Pickens agreed. “There’s no question that it’s a hydrocarbon, and a fossil fuel, nobody has tried to hide that.” But historically, he said, the California model still shows reduced emission.

Peak Natural Gas?

The cost of extraction for natural gas has been relatively low. Pickens has endorsed the peak-oil theory but doesn’t think peak natural gas is something the United States will need to worry about for a long time. 

You have four-thousand-trillion cubic feet of natural gas in America and that’s equivalent, barrels of oil equivalent, to twice what the Saudi’s have in oil. So that’s a hundred year supply, and maybe a two-hundred year supply. And I don’t see this as a final fuel…  it’ll be a bridge fuel to somewhere and where do you go? Probably, I’m more of a person that believes you’ll end up with a battery, is what it’ll be.  It’ll be a small battery and the technology will advance dramatically from where we are right now.

While Pickens admitted to be somewhat skeptical about climate change, he said that does not prevent him from addressing the possibility of global warming. 

I will say this, there’s a lot of stuff we’ve put up in the ozone over the last hundred years, and I would rather start to make moves from this point forward to where, if we made a mistake and if we are effecting the climate we will be making moves to offset that. I want to mitigate what has happened, if something has happened. I don’t want to find out twenty years from now that — hey, we should’ve done something because it really was true. So make the move now, and, if you’re wrong, don’t worry about it, you didn’t hurt yourself, you helped yourself.

Pickens believes firmly that the next decade will certainly see a shift toward domestic resources.

We’re going to go down in history as the dumbest crowd that ever came to town, if we don’t use our own resources. Our resources are cleaner, cheaper, abundant, and ours, and can you imagine that we’re using dirty oil from the enemy when we don’t have to?