Cheniere Energy co-founder dishes out two ways the US has strong advantages in natural gas

Cheniere Energy co-founder dishes out two ways the US has strong advantages in natural gas
Cheniere Energy co-founder dishes out two ways the US has strong advantages in natural gas

After an unusually warm winter this year, some investors might think the natural gas in the U.S. could struggle. However, Tellurian co-founder and Chairman Charif Souki says the country is uniquely set up for two very strong advantages versus the rest of the globe.

The first advantage is the more than 100 years' worth of reserves of natural gas that the U.S. has, thanks to production innovation.

"Three years ago, I thought they had finished improving, but no, they continue to lower the cost of production in the U.S. dramatically by a factor of 15, 20 percent every year," Souki told "Mad Money" host Jim Cramer on Wednesday.

Watch the full segment here:

show chapters

Souki was the co-founder and CEO of Cheniere Energy, the nation's top exporter of liquefied natural gas. He was ousted from the role after a spat with activist investor Carl Icahn and the company's board of directors in December of 2015.

Since that time, Souki founded a new company called Tellurian Investments, with the goal of finding new ways to profit on the cheap price of natural gas in the U.S. compared to the rest of the globe. In the beginning of February, Tellurian acquired Magellan Petroleum in a deal that took the company public.

Tellurian is also working to build a new liquefied natural gas facility called Driftwood LNG, which is estimated to cost about $12 billion and will have the capacity to export approximately 26 million tons of LNG per year.

"The key thing is we are going to grow at our own pace. We are not going to worry about what everybody else is doing. And we have a formula that has worked in the past," Souki said.

Souki outlined the approach for the company to first work with its suppliers as a part of the team, and then work with them to cut time and cost. The second element is to pay employees well based on performance, so they are inspired to produce results.

And no, he isn't worried that the company won't be able to raise enough money needed to build its LNG facility.

"I've done it once when I had debt and I was in a hole, and this time I have a great advantage. I have no debt; I am starting with a fresh slate. And it's not that hard. Plus we have our experience behind us and our track record behind us," Souki said.

Questions for Cramer?
Call Cramer: 1-800-743-CNBC

Want to take a deep dive into Cramer's world? Hit him up!
Mad Money Twitter - Jim Cramer Twitter - Facebook - Instagram - Vine

Questions, comments, suggestions for the "Mad Money" website? madcap@cnbc.com

CNBC

Get the latest news delivered to your inbox

Follow us on social media networks