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T. Boone Pickens

Written By Brian Hicks

Posted December 14, 2007

I learned long ago not to bet against T. Boone Pickens. He’s not one to throw around investment dollars at just any company. A man of his stature is sure to have done plenty of research, and to be well in the know before investing a nickel in any company.

So when a guy, made famous as a corporate raider, inking high-profile deals with Cities Service, Gulf Oil, Phillips Petroleum and Unocal, buys 943,964 of a company, like Interoil (IOC:NYSE) in August 2007, it’s not a shock to see a one-day 20% move.

Fortunately, former Agora readers of mine were well-positioned for that $25 to $40 Interoil move. This was an undervalued, unfairly beaten company developing a liquefied natural gas project in Papua, New Guinea, with hopes that the project would begin production by 2012, with a billionaire investor to boot.

So it’ll come as no surprise when shares of energy fuel stocks take off on Pickens latest 395,000 share investment in $677 million Clean Energy (CLNE). Pickens holds the belief that clean fuel is the “fuel of the future” and knows that Wall Street is unfairly overlooking an under-the-radar stock.

He’s even speculating that natural gas (which sells for 10% to 15% under the cost of diesel) will eventually replace diesel, and that we’ll see $100 oil before $80 – a further boon for the natural gas companies.

Plus, in our opinion, a company like Clean Energy could be the perfect buyout candidate — wild speculation, but not out of the question. This is a small $677 million company, with $89 million in cash and no real debt, flying well under Street radar.

Would it be a shock if a company, like Exxon (which has plans for a floating liquefied natural gas (LNG) terminal on the East Coast) bought CLNE? No.

A major U.S. oil company with LNG dreams could acquire CLNE, instead of going through a process of building new plants on the West Coast. CLNE already has plants in New York, California, Colorado, New Mexico, Texas, Wyoming, British Colombia and Ontario.

If that’s not a good enough reason to buy clean energy stocks I don’t know what is.

Ian L. Cooper


P.S. According to this morning, “Boone Pickens reported a 55.6% stake in Clean Energy Fuels. Pickens’ stake is now 33mln shares (including warrants); he held 21mln shares as of June.”