Page 88 - Forbes - USA (October 2019)

→ Over his 60-year career Phil Anschutz
has owned oilfields, railroads, fiber-optic
84
networks, tungsten mines,
Z Anschutz slogged through a decade of permitting,
T construction is under way. Workers have built 95
U
H movie theaters and even
C the first phase of turbine installation, which could
S
N a pancake manufacturer.
A
L
I pocket and is looking for equity partners or to raise
H
P He owns the L.A. Kings NHL team, nearly a
E third of the NBA’s Lakers, and the Staples Cen-
L
I ter, where they both play. He runs the Coachel-
F
O la music festival, The O2 arena in London and
R
P The Broadmoor, the historic 784-room hotel in
Colorado Springs. He bankrolled the Chronicles
of Narnia movies and was backing Michael Jack-
son’s comeback tour when the pop star died. An-
schutz doesn’t just love unique businesses—he’s
obsessed. “My wife calls it a psychosis,” he says
with a laugh.
Anschutz has a soft spot for oil, as that’s where
he got his start, and fossil fuels form the basis
of his estimated $11.5 billion fortune, placing
him at No. 41 on The Forbes 400. Unwrapping
a fresh box of Swisher Sweets cigarillos, he ex-
plains the favored attributes of the 500,000 acres
his oil company has been exploring in Wyoming’s
Powder River Basin, where his team has drilled
and fracked enough wells to be convinced they
are sitting on more than a billion barrels. This
could yield a bigger payday than the $2.5 billion
he made in 2010 selling other oilfields. The best
part, he says, is the way that his acreage “interfin-
gers” with the holdings of bigger oil companies,
which might like to buy it. He links his fingers to-
gether, half-chewed cigar in hand, to illustrate.
Anschutz, 79, has never been a roughneck.
He’s 5 feet 9, slim, well coiffed and sounds like
the actor Lorne Greene (more Battlestar Galacti-
ca than Bonanza) as he explains that his next—
and perhaps last—big investment will not be in
oil at all. Instead, fossil-fuel king Phil Anschutz is
building America’s biggest wind farm.
It will cost $5 billion to erect 1,000 turbines at
the Chokecherry and Sierra Madre Wind Ener-
gy Project on Anschutz’s 320,000-acre Overland
Trail Ranch near Rawlins, Wyoming. Plus anoth-
er $3 billion to construct a 730-mile direct-current
transmission line to deliver that power (enough
for 1.8 million homes) to the California grid. After
F O R B E S . C O M
miles of work roads and prepped 115 pad sites for
begin in 2020 and finish in 2025. Anschutz has
bankrolled the first $400 million out of his own
debt to finance the rest. Just don’t expect him to
give up control. “I want to see it built,” he says.
Is he doing this to greenwash his reputation?
“No. We’re doing it to make money.” Though he
believes excess carbon dioxide in the atmosphere
“is a problem,” it’s “not as extreme as some would
think.” What’s extreme is California’s new law
mandating the transition to 100% renewable en-
ergy by 2045. He intends to profit from it.
Anschutz says the hardest work is already over.
The permitting process culled a quarter of the
planned turbines—in the windiest area, there will
be 157 instead of 325. The only time he thought
about selling the land and walking away was when
the pro-coal factions of the Wyoming legislature
succeeded in pushing through a new wind-gener-
ation tax of 0.1 cent per kilowatt hour—the first in
the nation. Even little numbers add up when you
plan on putting out 12 billion kWh per year.
In some ways, the permitting slog was a bless-
ing in disguise. Over the last decade, turbines
have improved in size, power and efficiency. Ac-
cording to Lazard, the all-in cost of generating
a kilowatt-hour of wind power, without subsi-
dies, has fallen from 13.5 cents a decade ago to
4.3 cents. Factor in federal renewable-energy-in-
vestment tax credits (a $2.8 billion value over the
first ten years) and Anschutz’s costs should drop
to 2 to 3 cents per kWh. California gets about
a third of its energy from renewables and 40%
from fossil fuels. For wind, which makes up 11%
of supply, it’s been paying 3 cents per kWh, ac-
cording to the Department of Energy. Anschutz’s
long-term bet is that as tax credits expire and
California’s 2045 target date approaches, wind
power pricing will go up.
Anschutz has long been familiar with the fe-
rocity of Wyoming winds. Fresh out of college
in the early 1960s, he started working at his fa-
ther’s Circle A drilling company, which owned a
handful of rigs in the vast, wind-scrubbed lands
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