Billionaire activist investor Carl Icahn said Thursday that Oklahoma Attorney General Scott Pruitt will "do the job" as Environmental Protection Agency chief.

Icahn has been a sharp critic of the EPA in the past. He told CNBC's "Power Lunch" on Thursday that the agency is one of the worst-run organizations he's ever seen, and said he initially had doubts about Pruitt.

"I must have met him three or four times because at the first time, I wasn't quite sure that he'd be the perfect guy to really clean that EPA up," he said. "What you have to do here is be very tough."

Pruitt, along with other state attorneys general, is suing the EPA over Obama administration rules, and has repeatedly slammed the agency for what he argues is regulatory overreach. The pick gives a clear signal that Trump could follow through on pledges to roll back climate-related regulations and improve the operating environment for fossil-fuel companies.



Icahn said Donald Trump as president should eliminate "crazy regulations," and lower the depreciation schedule so investment in the U.S. "make sense." In fact, as of September 30, 47 percent of Icahn's portfolio is weighted in the energy sector. Some of his major holdings include CVR Energy and Cheniere Energy.

Regarding the selection of Trump's Cabinet picks, Icahn said he interviewed "four or five very good candidates," and spoke with Pruitt about four times, eventually coming to the conclusion that he was the best candidate. Icahn also said he spoke with Trump's Treasury secretary pick, Steve Mnuchin, and strongly backed him, as well as Wilbur Ross, Trump's pick for Commerce secretary. He wouldn't comment on whether he was interviewing candidates for secretary of state.