Pickens was using OPEC revenues between 2003 and 2008 as a model, he said. Those revenues clocked in at $250 billion in 2003, but just five years later they had skyrocketed to $1.250 trillion, five times that of ’03.

“If we don’t do anything,” Pickens said, “in 10 years we will be paying $300 or $400 a barrel for the oil.”

The US is already paying $1 billion a day for crude, he said, and it accounts for two-thirds of the country’s trade deficit. That doesn’t need to happen, though. If the US used its own resources, Pickens thinks the move would lead to job creation, and those dollars would stay at home.

That’s why he’s so bullish on natural gas, a fuel that’s plentiful here in the US. So much so that Cramer called Pickens “one of the biggest boosters of natural gas out there.” But he endorses more than just that one commodity. As part of the Pickens Plan he announced back in 2008, he called for the utilization of all kinds of energy – wind, electric, even ethanol – as long as it was American.

“Anything but OPEC oil,” Pickens told Cramer. “That’s what I don’t want.”

But, of course, today’s discussion was largely about natural gas, as President Obama this week put the full weight of his office behind the commodity during a speech at Carnegie Mellon in Pittsburgh. Pickens took the statement to mean President Obama finally understands that nat gas is the US’s only viable competitor to diesel fuel, that nat gas is both cleaner and cheaper than crude and coal.

“And it’s ours,” Pickens said. “We’ve got to use it.”

To that end, he fully expects the NAT GAS Act presently in Congress to pass. He said Senate Democratic Majority Leader Harry Reid, of Nevada, told him he wanted an energy bill this year, Pickens said, “And that’s going to happen.”

If so, it’s about time. As Cramer pointed out, the major oil and gas companies – especially foreign firms – already have recognized natural gas’ importance, and they are buying up both smaller players and assets here in the States. Royal Dutch Shell joined in on the action just this week, paying $4 billion for a chunk of the Marcellus Shale.

But Pickens sees that as a good thing.

“The majors are moving back into the United States,” he said. “I want them back. I want them spending money here. They will figure out a way to get more recovery out of the shale gas.”

He hoped the majors would call for the use of natural gas in all transportation vehicles. Compared to the diesel being used now, nat gas is incredibly cheap. One thousand cubic feet of gas will do the same work for an 18-wheeler truck as seven gallons of diesel, but the gas costs just $4.50 per MCF while the diesel fetches $21.

“It is a steal for America to switch our heavy-duty [vehicles] over to natural gas,” Pickens said.

The conversation also touched on BP’s spill in the Gulf of Mexico. When Cramer asked what Pickens might do if it were his well that burst, he said that the company and the Coast Guard should be left alone to fix the problem. Any investigations into wrong doing should be held until after the well is sealed.

Pickens also said that a relief well was the only real solution that would work, not the “top kill” or any of the other ideas BP has tried so far.

“The relief well’s the only way you’re going too kill this well,” Pickens said, “unless you got lucky and somehow that it bridged and shut off.” But the chances of that are “one in 100 or one in 1,000.”

But Pickens doubted the relief well would be ready before August, “if you’re lucky.”

WATCH THE VIDEO:

SOURCE:
CNBC.com: “Boone Pickens – Get Ready for $400 Oil?”

The release of a major new study today that boosts estimates of U.S. natural gas resources is shaking debates over the use and regulation of a fuel that could help slow global warming but could create other environmental concerns.

The report by the Potential Gas Committee, a nonprofit group that provides closely watched analyses of U.S. resources, shows a 35 percent jump in domestic gas estimates.

The United States has a total resource base of 1,836 trillion cubic feet (tcf) worth of likely and potential resources, the report says, a sharp jump from the last estimate two years ago of 1,321 tcf, and the highest in the group’s 44-year history.

With the addition of Energy Department estimates of proved reserves, the total U.S. future supply is 2,074 tcf, a rise of more than 35 percent from the committee’s last biennial estimate.

The increase is largely due to the viability of tapping gas from shale formations, such as the Barnett in Texas, the Marcellus in Appalachia, the Haynesville in Louisiana and the Rocky Mountains.

“New and advanced exploration, well drilling and completion technologies are allowing us increasingly better access to domestic gas resources — especially ‘unconventional’ gas — which, not all that long ago, were considered impractical or uneconomical to pursue,” said John Curtis, professor of geology and geological engineering at the Colorado School of Mines, which supports the committee’s work.

But the increasing use of a technique called hydraulic fracturing to access these shale plays has sparked a Capitol Hill battle over regulating the extraction method. Several Democrats have introduced legislation that would bring the technique under Safe Drinking Water Act regulation — reversing an exemption in a 2005 energy law — and require disclosure of chemicals used in the process.

The industry and allied groups are fighting the effort. They say it would slow access to what the new report demonstrates is an abundant domestic energy source.

“Hydraulic fracturing is the Rosetta Stone of natural gas development. With it, otherwordly amounts of shale and tight-pocket gas can be found, produced and delivered to Americans who need it. Without it, those resources remain trapped underground,” said Chris Tucker, a spokesman for Energy In Depth, an industry-backed group that recently launched an effort to fight the legislation.

A spokesman for Rep. Diana DeGette (D-Colo.), the sponsor of the fracturing legislation, said her bill is not about preventing gas production, which she supports, but that the extraction technique must have more oversight and disclosure.

“I would definitely say that she believes it is a necessary technology for the energy market. She also believes we need to ensure the health of the public as these processes are taking place,” said DeGette spokesman Kristofer Eisenla.

Report sparks climate debate

Meanwhile, the report is also significant in light of pending congressional efforts to enact a sweeping bill to place mandatory limits on U.S. greenhouse gas emissions.

House Democratic leaders plan to bring a sweeping climate bill to the floor in the coming weeks that is sponsored by Energy and Commerce Chairman Henry Waxman (D-Calif.) and Rep. Ed Markey (D-Mass.). The greenhouse gas caps in the Waxman-Markey bill would curb U.S. emissions by 17 percent by 2020 from 2005 levels, with an 83 percent cut by 2050.

Burning natural gas currently provides about a fifth of U.S. electric power, and gas produces half the greenhouse gas emissions of coal. However, switching to gas creates concerns about the costs that could accompany increased demand if supplies were tight.

Joe Romm of the Center for American Progress, a liberal think tank, has called attention in recent weeks to the higher U.S. supply estimates driven by shale gas plays. He calls increased estimates a “game changer” and very good news.

Romm said the new report underscores that the 2020 emissions reduction targets in the Waxman-Markey bill are certainly achievable and may even be too weak. That is because with ample supply, gas will remain at a moderate price — around $5 to $6 per million British thermal units — and will keep compliance costs down, he said.

He noted that a key factor behind the cost of capping carbon is the cost to replace existing coal plants. With cheaper natural gas, that can more easily be done with idle natural gas plants built during a overbuild in the 1990s that are connected to the grid system, but the fuel has been too costly to use until now, said Romm, a former DOE official.

“I think this is a big deal,” Romm said of the higher estimates. Additional gas will also encourage more utilities to build wind generation, as natural gas is currently the best backup power for the intermittent energy, he said.

Pickens plan

But others have their eye on these U.S. supplies as a way to power vehicles.

Famed Texas oilman T. Boone Pickens is spending aggressively to promote his plan to transition vehicles such as heavy-duty trucks and city fleets to natural gas in order to curb demands for oil imports. Pickens also supports a major build-out of wind for electricity, which would help free up natural gas for vehicles.

He quickly seized on the new report.

“Obviously, this underscores what Boone has spoken about for well over a year and gives further credibility to a key aspect of the Pickens plan, and that is using natural gas as a transportation fuel alternative to foreign oil, diesel and gasoline,” said Jay Rosser, a spokesman for Pickens.

“This should quiet any skeptic who is concerned about using our abundant supplies of natural gas as an important transitional fuel,” he added.

For more news on energy and the environment, visit www.greenwire.com

Posted by: c. Keddy

Mr. Pickens is the architect of the Pickens Plan aimed at reducing America’s increasing dependence on foreign oil. The plan calls for a comprehensive energy plan that would make better use of our abundant natural resources, including natural gas. . He has called foreign oil dependence — America imports nearly 70 percent of its oil — the greatest economic and national security threat facing our nation. More than 1.5 million Americans have joined this movement through his web site, www.pickensplan.com.

In early 2008, EXCO management decided to convert its fleet of trucks in the EXCO-operated Vernon Natural Gas Field in Jackson Parish to utilize compressed natural gas rather than gasoline or diesel for truck fuel. According to Doug Miller, (Chairman and CEO), “we built our new compressed natural gas fueling station to utilize our locally-produced natural gas for our fleet. Compressed natural gas burns cleaner than gasoline, diesel or propane and we are dedicated to doing our part to help the environment.” The EXCO compressed natural gas vehicle fueling facility is the first of its kind- illustrating EXCO‘s commitment to finding innovative alternative fuel sources for its ongoing operations.

READ MORE ABOUT EXCO

C. Keddy

Developments with the Pickens Plan is the introduction of legislation called the ‘New Alternative Transportation to Give Americans Solutions Act of 2009’. The shorthand is the NAT GAS Act.

The bill covers a number the Pickens Plan elements, including:

-It extends the tax credit for natural gas used as a transportation fuel.
-It provides a tax credit for 80 percent of the additional cost when purchasing a dedicated natural gas vehicle.
-It creates incentives for the major manufacturers to sell natural gas vehicles (which they already produce for overseas markets) in the United States.
-The bill requires that 50 percent of the vehicles the federal government buys over the next five years to run on natural gas.

The US federal government will purchase 162, 500 natural gas powered light trucks and cars over the next five years. That’s a big change from the 645 they have already bought!

Be sure to look for us – Natural Gas for America – on the Pickens Plan website.
You can find us at: www.push.pickensplan.com/profile/NaturalGasForAmerica

By: C. Keddy