One of America’s richest families has become the subject of a dark tell-all blog written by one of their own. Family members say it’s deceitful libel designed to extort millions from patriarch T. Boone Pickens. Inside the lawsuit:
Tag Archives: Boone Pickens
If You Want to Invest In Energy, Don't Follow Warren Buffett
By Tyler Crowe, The Motley Fool
Filed under: Investing
I may be committing investing heresy by saying this, but following Warren Buffett in the energy space is not the way to go.
Yes, Warren Buffett is head and shoulders above the rest in the investing community and has a few decent energy investments the Berkshire Hathaway portfolio. If you are looking for possible investments in the energy space, though, you should look at another investor: T. Boone Pickens. He’s been in the energy industry for more than 60 years, and his hedge fund, BP Capital, is dedicated almost exclusively to energy investments. Let’s take a deeper look into BP Capital’s portfolio and see if there are any themes that can help us with our own investment decisions
Don’t be afraid of natural gas
While getting into the natural gas market only last year might have seemed like a losing proposition, today several companies are selling at pretty deep discounts to their underlying assets. Pickens and his team have a portfolio with more than 60% of of their exploration and production assets centered almost exclusively on natural gas. Both Southwestern Energy and Range Resources, two almost pure natural gas plays, make up more than 18% of BP Capital’s total holdings.
Anyone who has followed Pickens shouldn’t be surprised. Aside from his holdings with BP Capital, he also has a 20% personal stake in Clean Energy Fuels and has for several years been advocating for increased natural gas use through his Pickens Plan. It’s comforting to see that he and his partners at BP Capital are putting their money where their mouths are when it comes to natural gas.
Diversity is the spice of life
According to a recent energy report by Barclays, capital expenditures for exploration and production are set to reach a record $644 billion in 2013. With so much money pouring into the oil service industry, it would almost seem foolish to not be a part of it. Clearly, BP Capital sees a great opportunity in this sector, because it has bumped its holdings of National Oilwell Varco by 74% and picked up a considerable amount of shares in Weatherford International . Overall, BP Capital increased its total exposure to the oil services industry from 12% to 21%.
The big jump in oil services was part of a transition for BP Capital. Over the past quarter, it reduced its exposure to the E&P space from almost 75% to just under 60%. The bulk of that change was a transition toward services companies, but the group also picked up a pretty large share in Freeport McMoRan , the only company in the group’s holdings that isn’t considered a pure energy play.
No love for midstream
Probably the most glaring omission from BP Capital’s portfolio is midstream and pipeline companies. There are two possible reasons:
- Much of the midstream business is in a mad scramble to build out pipeline networks across the United States, and the massive buildout to accommodate the boom …read more
Source: FULL ARTICLE at DailyFinance
Do We Still Need the Strategic Petroleum Reserve?
By Matthew DiLallo, The Motley Fool
Filed under: Investing
Last week T. Boone Pickens put out a video blog post questioning whether we really needed to keep our vast Strategic Petroleum Reserves, or SPR, stocked with oil. According to Pickens, we have about 750 million barrels of crude oil just sitting in storage. Given the massive oil production growth we’re seeing here in the U.S., he thinks that we should start trimming these reserves. My question is whether that’s really a good enough reason to end this insurance policy.
Before we get to that question, let’s get a quick refresher on the SPR. It was established in the aftermath of the 1973-1974 oil embargo to provide the U.S. economy with a temporary solution to alleviate future oil shocks. Currently, we have just shy of 700 million barrels of oil in the SPR and its current capacity is 727 million barrels of oil. The oil is stored in salt domes at four different sites along the Gulf Coast.
Salt domes are also widely used to store natural gas. These vast underground storage facilities offer both security and are a much cheaper storage option than aboveground storage tanks. When these reserves are needed we can draw down about 4.4 million barrels of per day for about five months.
The reserves, which are owned by the U.S. Government, cost us an average of $29.76 per barrel, which means that Uncle Sam is sitting on quite the paper profit. Boone thinks the reserves are no longer necessary and that its time to start cashing out and sell our stockpile.
The crux of his argument is that the SPR was designed to protect us from an interruption of oil imports from OPEC. He notes that we import about 4 million barrels per day from OPEC, though only about 2 million barrels per day come from the Middle East. According to Boone, with the growth of our oil production we don’t need to protect ourselves from these Middle Eastern supply shocks.
That begs the question: Are we really on pace to produce enough oil to eliminate the need for the SPR? Consider the Bakken: In January of 2011 the shale was producing about 275,000 barrels of oil per day. By last December, production had skyrocketed to 700,000 barrels of oil per day. The Bakken is probably pumping more than 800,000 barrels of oil per day now, and it has an inventory of more than 30,000 future wells that can be drilled.
It’s possible that North Dakota eventually tops Texas as the nation’s leading oil-producing state. Leading Bakken oil producer Continental Resources sees its production and proven reserves tripling between 2012 and 2017. That’s truly breathtaking growth. It’s even more remarkable when you consider that exploration and production companies with a global profile like ExxonMobil and ConocoPhillips only expect production growth to hit around 2%-5% annually over the same time frame. The truth of the matter is that both companies would face a …read more
Source: FULL ARTICLE at DailyFinance
Chinese Firm Invests in U.S. Natural Gas Fueling Stations — Reuters
Filed under: Oil & Gas Industry
Add China’s ENN Group Co. to the rather short list of companies rolling out a network of natural gas fueling stations along U.S. highways. Clean Energy Fuels Corp. (NASDAQ: CLNE) and Royal Dutch Shell PLC (NYSE: RDS-A) have a head start, but there is plenty of room for competition.
Clean Energy Fuels, which is controlled by oilman T. Boone Pickens, got some help in 2011 from a venture fund set up by Chesapeake Energy Corp. (NYSE: CHK) to begin building the natural gas refueling stops. ENN Group plans to build 50 refueling stations this year, according to an exclusive report at Reuters, at a cost of about $1 million per station. The U.S. Department of Energy reports that there are currently just 28 liquefied natural gas (LNG) refueling stations in the United States.
The refueling stations are aimed at supporting the conversion of the long-haul trucks that crisscross the country to LNG fuel. Currently about half the nation’s garbage trucks are fueled by natural gas, but the refueling stations are local. ENN and the others are looking to a far larger market.
ENN Group and its U.S. joint venture, Transfuels, also operate a company called Blu LNG, which plans to build liquefaction plants, according to Reuters. LNG is easier to transport and requires less storage than the compressed natural gas used to fuel most garbage trucks.
The benefit to natural gas producers like Chesapeake and Exxon Mobil Corp. (NYSE: XOM) will come in the form of higher prices for their gas production. In addition to the 50 stations planned by ENN, Clean Energy plans to open 50 to 60 stations this year, and Shell plans a total of about 100 over time.
Filed under: 24/7 Wall St. Wire, Oil & Gas Tagged: CHK, CLNE, RDS-A, XOM
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Don't Fret Chesapeake's Sale of Clean Energy Stock
By Taylor Muckerman and Joel South, The Motley Fool
Filed under: Investing
During its first few years, funding was of the utmost importance for Clean Energy Fuels . If the proposed stock sale by Chesapeake Energy had happened back then, it might have spelled doom for the nascent business. Now, however, some of the biggest companies in the world are buying into Clean Energy‘s vision for a cleaner driving America.
Just recently, FedEx CEO Frederick Smith professed that he sees a major shift for fleet vehicles toward liquified or compressed natural gas over the next 10 years. This support is huge given FedEx’s fleet of around 90,000 vehicles. He was also outspoken about the need for the U.S. to approve exports of LNG, one of the few CEO proponents not employed by the energy sector.
T. Boone Pickens’ brainchild is gathering momentum. Should you climb on board?
The movement toward alternative energy is gaining momentum. One potential opportunity in this field is Clean Energy Fuels, which focuses its natural gas efforts primarily on trucking and fleets. It’s poised to make a big impact on an essential industry. Read all about Clean Energy Fuels in our brand-new report. Just click here to get started.
More details can be found in the video below.
The article Don’t Fret Chesapeake’s Sale of Clean Energy Stock originally appeared on Fool.com.
Joel South has no position in any stocks mentioned. Taylor Muckerman has no position in any stocks mentioned. The Motley Fool recommends Clean Energy Fuels, FedEx, and United Parcel Service. The Motley Fool has the following options: Long Jan 2014 $20 Calls on Chesapeake Energy, Long Jan 2014 $30 Calls on Chesapeake Energy, and Short Jan 2014 $15 Puts on Chesapeake Energy. Try any of our Foolish newsletter services free for 30 days.
We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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Source: FULL ARTICLE at DailyFinance
21-year-old grandson of oil tycoon T. Boone Pickens dies
A 21-year-old grandson of Texas oil tycoon T. BoonePickensdied Tuesday after being rushed to a hospital in Fort Worth, according to police and a family spokesman.
Thomas BoonePickensIV, who went by Ty, was a junior at Texas Christian University.Pickens’ spokesman, Jay Rosser, called the death an “unspeakable family tragedy” and asked that the family be allowed to grieve in private.
Neither Rosser nor Fort Worth police have said what may have caused the death.
Officers were dispatched after getting a report of a dead person at an off-campus location around 9:30 a.m. Tuesday, police spokeswoman Cpl. Tracey Knight said. Police said TyPickenswas transported to a hospital, where he was pronounced dead.
Knight said the Tarrant County medical examiner would determine the cause of death. She declined further comment.
The elderPickensmade much of his fortune in oil drilling but has since become an advocate for alternative energy. The 84-year-old also is active in politics and has donated millions of dollars to his alma mater, Oklahoma State University, and various other causes.
Source: FULL ARTICLE at Fox US News