Then came the economic downturn and credit crisis. After plunking down $150 million toward the first 700 wind turbines, he's been unable to obtain financing for the rest of the wind project. "Now, the money isn't there," he says as he lunches on goat cheese salad and Diet Coke at the Ritz-Carlton. He adds, "I'd like to have my 150 million back," but, "I've got to carry it through."
Without capital to build a high-voltage line to transport his wind energy to East Texas population centers, Pickens is now looking to scuttle the giant wind farm. Instead, he'd like to team with other developers to disperse fewer total turbines among 10 or so smaller projects. "It's causing you to scramble, but hell, we've been there before," he says.
Another momentum-killer came when crude prices plunged from $147 last July to about $50, siphoning some of the public's anger about imported oil. "People are not outraged," Pickens says, though "they understand the price is going back up."
The value of his energy hedge fund, BP Capital Management, fell 97%, or more than $1 billion, during the last three months of 2008, Bloomberg News reported.
Meantime, Fred Smith, CEO of FedEx, whose fleet includes 80,000 cars and trucks, has extolled the virtues of hybrids, saying it would be too difficult to build a vast distribution infrastructure for natural gas vehicles.
Pickens now has a more modest goal: converting 350,000 of the nation's 6 million heavy-duty, diesel-power trucks to natural gas. Batteries aren't viable options for big 18-wheelers.
"I haven't changed anything," Pickens insists. "You don't shoot for the moon from the start."
Winning some, losing some
He has notched some victories. When AT&T CEO Randall Stephenson trumpeted plans last month to spend $350 million to buy about 8,000 compressed natural gas fleet vehicles, he gave a nod to Pickens. So did Lee Scott, CEO of Wal-Mart, which is testing four liquefied natural gas trucks at its Apple Valley, Calif., distribution center. At a recent Washington, D.C., conference, Scott credited Pickens' "ability to twist an arm," adding, "Boone, so please don't call me anymore."
Pickens' hardball tactics fell flat when he tried to convince Bill Graves, CEO of the American Trucking Association, that all new long-haul trucks should run on natural gas. Graves says natural gas trucks are at least $40,000 more costly than diesel models. They have more limited range. And there's no national network of fueling stations.
When Graves resisted, according to The Wall Street Journal, Pickens leaped: "Bill, I just want to warn you on this. I'm going to make you look unpatriotic for supporting foreign oil."
Says Graves: "I thought it was a little outrageous. … I think Boone has kind of an idea that it's one size fits all."
Pickens says his warning "was a joke." Yet, he adds that Graves eventually will "come with me, because truckers are like Marines. They're Americans."
The oil magnate has faced similar headwinds as he seeks to turn his ideas into law. A California referendum to spend $5 billion promoting natural gas, sponsored and funded heavily by Clean Energy Fuels — which kicked in $19 million — was soundly defeated last November.