While the "Pickens Army" continues to add new members daily to fight for the cause of energy independence in the United States, billionaire T. Boone Pickens said last week the recent drop in energy commodity prices -- especially natural gas -- has led him to scale back his mammoth wind farm project in Texas.
Speaking at the Edison Electric Institute (EEI) convention last Tuesday, Pickens said the collapse in natural gas prices has forced him to put his wind farm project for Texas on hold, according to the Associated Press (AP). However, he noted that energy commodity prices would be ramping back up soon, making his plan more viable.
Whether the project is to be scaled back or put on hold altogether, the move comes as no surprise after energy commodities crashed from their summer highs. When Pickens launched his wide-ranging plan in July that focused on more wind power and natural gas use in order to relieve the U.S. dependence on foreign oil (see NGI, July 14), front-month crude futures had hit an all-time high of $147.27/bbl and front-month natural gas futures were trading at $13.694. As of Tuesday's close, both commodity values have been cut drastically, with December crude futures closing at $59.33/bbl and December natural gas finishing at $6.705.
"I think I've done a pretty good job," Pickens told EEI attendees.
Pickens' wind farm project in question is known as the Pampa Wind Project and would span Roberts and adjacent counties in the Texas Panhandle. Through his Mesa Power firm, the 4,000 MW project was filed in August 2007 with the Electric Reliability Council of Texas. Reports at that time had the project -- which would be the world's largest wind farm -- costing upwards of $6 billion.
According to the AP, Pickens told Tuesday's convention audience that he did not see natural gas and oil prices getting "any lower" than they are right now, adding that he expects oil to be back to $100/bbl within a year, bringing all the other energy commodities back up as well.
Looking toward Barack Obama taking over as U.S. president in January, Pickens said he expects to know within 100 days whether the new administration is going to adopt all or part of his energy plan.
Unveiled on July 8, the Pickens Plan is a detailed solution for ending the United States' growing dependence on foreign oil, which costs the country $700 billion per year. The plan calls for investing in power generation from domestic renewable resources such as wind and using the country's abundant supply of natural gas as a transportation fuel. On Tuesday Pickens said he thinks both can be accepted by the Obama administration within the first 100 days.
Blogging on www.pickensplan.com about the utility trade group's reception, Pickens noted that not everyone in the audience was a huge supporter of his plan.
"Some of the guys think the existing grid is just fine and we don't need to spend money upgrading it," he said. "Others don't much like the part of the plan calling for using natural gas as a transportation fuel because they use natural gas as a fuel in their generation plants and they're afraid it will drive the price of natural gas up. They're right. It will. But domestic natural gas will still be cheaper than foreign oil. And it will always be an American resource."
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