He has never been one to mince words. That trait was on display when T. Boone Pickens, oilman, entrepreneur and natural gas advocate, spoke at Hart Energy’s 3rd annual Developing Unconventional Gas-East Conference and Exhibition in Pittsburgh in November. His opening remarks updated the audience on the Pickens Plan, which promotes greater use of natural gas, and the NAT GAS Act working its way through Congress. Then, he participated in a question-and-answer session with Oil and Gas Investor editor-in-chief Leslie Haines.

About the only topic the candid Pickens preferred not to speculate on was how his beloved Oklahoma State Cowboys, aiming for a national bowl appearance, might do. “I don’t want to jinx it,” he said. (The team ultimately won a berth in the Fiesta Bowl, playing Stan-ford University.)

Pickens has crusaded many times in the past, first for greater corporate responsibility toward shareholders in the 1980s, then for greater natural gas prices and consumption in the 1990s. Since July 2008, U.S. energy policy has been his crusade in the form of the Pickens Plan, which calls for 18-wheel trucks to convert to natural gas from diesel. He has spent close to $60 million of his own money on a national media campaign and logged 600 hours on his personal jet. More than a million people have signed up as members of the Pickens Army at his website, pickensplan.com? .

We were pleased to welcome him to the DUG conference stage in Pittsburgh. Here is a summary of his remarks, followed by excerpts from the live Q&A.

On national security

If we can recover half of the…gas reserves estimated in the U.S., that would roughly equal 700 billion barrels of oil equivalent. We have the equivalent of three Saudi Arabias. So our energy outlook is vastly different than it was five years ago. Shale gas showed up at a time when we can use our own resources and save ourselves. We’re in a position now where we can pull up to the big table for world energy and we haven’t had a chair at that table for a long, long time.

But Washington doesn’t understand it yet. They don’t realize what we have in this country and how we can negotiate things we have never been able to negotiate before.

I sat next to Condoleezza Rice at an event in California a year ago. She said, “Boone, if you are right about this, you are sure going to make the job of the State Department easier.” I said, “Did you find yourself in a spot when negotiations came around to energy?” She said, “I never got out of that spot. Energy was always part of negotiations for the State Department.”

If you look back…(this came from a recent study by the Milken Institute), since 1976 we have spent, for oil imports, and including military and protecting the sea lanes, $7 trillion. Seven trillion. And our debt is going to hit $15 trillion today or tomorrow, or at midnight or noon or sometime….By the time the election comes up in November, it’ll be $16 trillion. If you look at the last 10 years, we’ve spent $1 trillion on OPEC. At $100 a barrel, in the next 10 years it’ll be $2.5 trillion. The cost to us, taxes to us, the military, it’s huge.

On natural gas

Yesterday four Senators entered a bill, 1863, to use natural gas for heavy-duty trucks. We have that same bill in the House with 185 cosponsors, but they haven’t voted on it yet. All of this could happen quickly. We have 8 million trucks…and let those go to natural gas. They’re going anyway because of the difference in the cost of fuel. Natural gas is a dollar and half cheaper than diesel. This is happening fast in the country, but if you pass a bill, oh maybe we could do it in four years instead of eight.

I don’t want a subsidy. You pay for it by taxing the users at the pump. No subsidy, no cost to the government. The “pay-for” is the one using the natural gas.

Anytime you get Sen. Tom Coburn (R-OK) to go along with you, I promise you it’ll have a pay-for provision. Tom and I both went to Oklahoma State. We’re doing pretty good in football—I hope you noticed that!

The Senate and House bills will come together pretty quick because they are very similar. We could have a good possibility these bills will be put into appropriations or something else. I think we’ve got a 50-50 chance…in 2012. I’m optimistic about that.

On oil

On the oil picture, ConocoPhillips is selling its half interest in the Seaway pipeline to En-bridge and their portion from the Gulf Coast to Cushing. They will shut the pipeline down to reverse the flow from north to south. It’s going to take them six months, so by June or July that should be on production and that takes that bottleneck out. I think it’ll be 250,000 barrels a day.

This puts a lot of pressure on TransCanada to do that Keystone XL Pipeline. That line should be built and we should capture the oil from Canada, but the government says this will not be acted on until 2013. I promise if they wait that long, Enbridge will build a pipeline out of Fort McMurray and go west to Kitimat, (British Columbia), where the oil will go to the Chinese. If that happens, we are complete fools in this country, because we should capture everything in North America that we can, to cut off our purchases from OPEC and to use our own resources.

I lived in Calgary in the ’60s and I made a lot of friends there and made a lot of money. Making money makes friends, have you noticed that? There are so many opportunities at this time to develop jobs.

On jobs

I was in North Dakota three weeks ago. They are looking for 31,000 people to go to work there.

Truck drivers are making $110,000 a year. A really bright woman was standing on a rural road and she had a stop-go sign—she had a lot of power on that road. We talked for 30 minutes while some oil-tanker trucks were going by, tying up the road. She said she moved from Idaho to North Dakota and that job was paying $50,000 a year.

I was in Williamsport, Pennsylvania, making a speech last month and a reporter told me, “We’ve got a lot of problems up here. There’s not enough housing.” I said that’s a high-class problem to have. Building houses means jobs. He said, “Trucks are tearing up the roads.” I said, “Well fix them, that’s jobs. That’s not a problem, that’s turning the economy up here around.”

Gov. Tom Corbett has balanced the budget off what’s happening in the Marcellus. That’s good. There’s going to be drilling in this area for years…

There is so much for us to work with in this country. The saddest part is, I’m 83 years old and I may not get to see it all. I’ll see some of it: I still work out at 6:30 every morning.

So I think it (the energy picture) looks good. I like it. The energy industry is going to carry the ball. The first industrial revolution was built on the back of cheap energy and we are back to that same crossroads today. We have the cheapest oil and the cheapest gas…the cheapest energy in the world. If we’re willing to work…you’ll see a lot of industry coming back to this country. Cheap energy is the hook.

T. Boone Pickens, shown here with Investor editor-in-chief Leslie Haines at DUG-East, says, “The first industrial revolution was built on the back of cheap energy and we are back to that same crossroads today.”

Investor: You’ve been a lot of places, been a business man, a philanthropist. From those perspectives, in your mind, which will occur first: OSU going all the way, or oil at $150 a barrel?

Pickens: $150? We’re going to know whether OSU goes all the way…soon. I’m not gonna’ stick my neck out. But I think oil at $150 in 2012…it could happen. It’ll be about a one-in-three chance.

Investor: Would BP Capital put any money on that?

Pickens: I’ve got to be a little more convinced…but, we’ll place the bet in the first quarter of 2012.

Investor: It’s been three years since you launched your personal campaign to promote natural gas. What’s been the reaction as you go around the country; what do people say about energy?

Pickens: People are somewhat surprised that natural gas is the lowest price here of anyplace in the world. They don’t know it until I tell them, and then they ask a lot of questions. I’ve had 40 town-hall meetings. I’ve talked from Fargo, North Dakota, to Monroe, Louisiana. I can tell you, they are better informed than Washington is, they truly are.

I’d appreciate if you’d go sign up at pickens? plan.com? , and we’ll be in touch forever after, and you’ll be in the Pickens Army.

Investor: You have met with President Obama.

Pickens: I met with him when he was still a senator running for president. His staff briefed me and said, “Tell him all you know about energy...but you only have half an hour.” That would be like him drinking from a fire hose.

We met for an hour and a half. He asked a lot of questions…I wrote on a tablecloth with a Sharpie. I seriously thought about writing on the wall, but didn’t. If I have another chance, I’ll write on the wall. I know it got his attention.

Investor: You are a free-enterprise guy, par excellence, so should the government be picking winners and losers in energy, in terms of tax incentives?

Pickens: I’m not trying to make the government pick a winner, I’m trying to get them to focus on the assets we have in America, and if you don’t, then you are picking OPEC and OPEC wins.

Investor: Should we pick winners and losers for natural gas?

Pickens: I don’t think there’s any reason to incentivize gas. Natural gas is selling around the world for $13 (an Mcf) so they’ll figure it out and the market will balance over time. If I was the government, I’d start figuring out ways to use gas in the U.S. If we send clean natural gas out of the U.S. and import dirty oil from OPEC, we’re the dumbest people on the planet. This does need some leadership.

Investor: You oppose exporting gas as liquefied natural gas?

Pickens: Cheniere has permits to…move LNG into global markets. Same thing is going to happen in Kitimat, B.C., from the Horn River Basin in Canada. Would I stop it from going out of the country? Not at this point. But at some point, we might have to stop it.

Investor: On the campaign trail, do you see anything hopeful out there?

Pickens: I’ve talked to most of them and talked energy with all of them. You can’t talk to Newt about it though, because he knows everything about everything and he’ll tell you. But…we’re all pretty well in agreement. How can anybody say we can’t use our own resources? Nobody’s going to say that. We’re all Americans trying to help our country, so what’s your idea? If your idea’s better than mine, I’ll throw in with you. Energy should be part of the debate. I’m not kidding you.

Another thing…King Abdullah of Saudi Arabia is 86 years old, 300 pounds, and has diabetes. You tell me what the actuarial table looks like on him. That’s just a fact. Tell me what’s going to happen there?

They have to get more than $90 a barrel because of their social commitments—that has nothing to do with their production costs. So if he dies, where do we go from there? If Libya is still shut down, and the Saudis need more money for social reasons…we could have $300 oil.

Investor: We are out of time.

Pickens: Well, you didn’t even get to page two of your questions.

Investor: I know! We’ll just have to have you back again.