When Enron collapsed in the early 2000s, much of the energy industry saw wreckage. Kelcy Warren saw inventory. The co-founder and executive chairman of Energy Transfer has described the fallout bluntly: “Enron was a gift from God, and we took advantage of that.”

Warren made the remarks to Hart Energy, which named him to its 50th anniversary Hall of Fame. The profile shows how the scandal opened the door to the first big growth spurt for a company that had started in 1996 with about 200 miles of East Texas gas lines.

A Flood of Assets

According to Kelcy Warren, the damage spread well beyond a single company. “Because of the Enron collapse, many assets that would’ve never been for sale came on the market very quickly,” he said. “There was a dumping of assets because, people forget, it wasn’t just Enron that had this business plan. There were a lot of Enron wannabes that had copied their plan and were doing a very similar type of approach to business.”

Energy Transfer moved quickly. The company bought much of Aquila Inc., along with the TUFCO System, the Houston Pipeline System and Transwestern Pipeline. Together, those purchases built out a broad natural gas pipeline network.

Luck, Necessity and Timing

Kelcy Warren does not claim to have predicted all of this. He credits a mix of “pure luck,” necessity and business foresight for the company’s success. The early 2000s supplied plenty of the first ingredient. Necessity arrived soon after, when natural gas prices fell sharply and Energy Transfer had to branch out. It expanded into natural gas liquids by acquiring Louis Dreyfus Highbridge Energy after another bid fell through.

That pattern of buying when others were selling would repeat years later. Energy Transfer became a leading consolidator in the midstream sector as demand for pipeline capacity grew alongside rising crude oil and LNG exports.

For Kelcy Warren, the Enron era remains the clearest example of turning another company’s misfortune into a foundation. Visit this page for related information.

Learn more about Warren on https://horatioalger.org/members/detail/kelcy-l-warren/