Texas oil tyco.on Pickens eyes China gas business Thu Jul 19, 2007 9:59AM EDT Email | Print | Digg | Reprints | Single Page [-] Text [+] Featured Broker sponsored link
BY Chen Aizhu
BEIJING, July 19 (Reuters) - Texas oilman and investor T. Boone Pickens, a long advocate of natural gas in transportation, said on Thursday he wanted to invest in China to supply the country's vast vehicle fleet.
Pickens, whose bullish bets on energy prices have made him billions, raised the idea with China's top economic planner Ma Kai and state oil firm CNOOC's chairman Fu Chengyu, during his first visit to China this week.
China, with national income galloping at near 12 percent, is anxious to clean up its air and build a greener economy. One such way is to use more natural gas, now only fuelling three percent of its energy use which is 70 percent reliant on coal.
Pickens and California-based Clean Energy Fuels Corp (CLNE.O: Quote, Profile, Research), of which he is a shareholder, is looking to team up with Chinese firms to build natural gas fuelling stations to supply buses and trucks in a potentially huge market.
"We think that will be very big business in China," Pickens told reporters at Diaoyutai State Guesthouse, an imperial garden turned hotel normally reserved for politicians on state visits.
"I don't like to use natural gas for power generation. It has higher-value use in transportation."
He did not give the names of the Chinese parties but said they would target city buses and heavy-duty vehicles in port cities like Shanghai and Dalian, where he will visit from Friday and meet with their mayors and oil industry people.
His investment ideas were echoed by Fu Chengyu, head of China's third-largest oil and gas company and parent of CNOOC Ltd (CEO.N: Quote, Profile, Research), which built the country's first terminal to import natural gas to the booming south.
Pickens, 79, who began his oil career in 1951 as a geologist before gaining wealth and notoriety with a series of audacious corporate takeover attempts in the 70s and 80s, drew parallel to Fu as both bid for U.S. firm Unocal. Fu studied Pickens's case in graduate school at University of South California.
Ma Kai, head of the powerful National Development & Reform Commission encouraged them to look seriously at developing clean fuel business in China, said Andrew Littlefair, President of Clean Energy who travels with Pickens.
$80 BEFORE 80
Pickens, a staunch bull in oil, reiterated his earlier forecast for $80 barrel crude in the near term and said prices would rise more in the next 2-3 years due to geopolitical concerns and producers' will to hold onto high prices.
"You will see $80 in the next six months," he said, adding he would be turning 80 next May. He was born May 22, 1928.
Oil prices may get there sooner, as London Brent crude (LCOc1: Quote, Profile, Research) soared this week to within 25 cents of its record high $78.65 a barrel on renewed speculative interest in the market.
"I am always long on oil. I have been long in the last three to four years," Pickens said.
Pickens, who now runs Texas-based BP Capital, a $4 billion hedge fund, made personally more than a billion dollars in 2006 and more in 2005, in part by betting that oil prices will continue to rise until conservation efforts and alternative fuels begin to undermine demand.
Last month he announced plans to spend billions building what would be the world's biggest wind farm in West Texas.
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