Adnan Khashoggi just loves Texas. He finds it a place of such great opportunity.

Back in the 1980s, the Saudi Arabian businessman made enough bad Houston real estate deals to help sink a savings and loan institution.But where else but Texas do they forgive and forget so easily?

Now Khashoggi is back in Houston and ready to make new deals.

Houstonians are standing in line to get to him.

On this day, the Saudi is being feted with a luncheon by Houston businessmen Jerry Allen and Bill Turney. The men have announced that they're going into a new $100 million energy venture with Khashoggi, who will only put in $5 million of his own money. But the Houstonians say this small personal investment is perfectly OK with them. What they're after is the international wheeler-dealer's "nose for opportunities."

At the luncheon at the Ritz Carlton Hotel, Khashoggi is in a particularly expansive mood. He's still celebrating his recent acquittal on fraud and racketeering charges in a New York court. He says this makes him so happy that he can almost forget he's down to his last $50 million.

Gathered for the occasion is a large group of Houston businessmen, including Robert Sakowitz, who has his own financial woes. His retail-store empire is going out of business. Also in the Khashoggi entourage is a beautiful young Middle Eastern woman whom no one introduces and who stays in the background.

Khashoggi is more than willing to comment on his recent financial problems. It's part of his new, more modest image. He says he's not even bitter about having to do without such expensive trappings as the yacht he had to sell to Donald Trump in 1987 for the cut-rate price of $30 million.

He finds this has a positive side. You see, going from being a BILLIONAIRE to a mere MILLIONAIRE has taught him to be humble.

For instance, during the days of his New York trial, Khashoggi rode to the courthouse each day on the subway. He found it enlightening.

"It gave me a chance to rub elbows with real Americans," he explains. "It was some of the happiest days of my life."

He says he was so grateful for his acquittal that he and co-defendent Imelda Marcos, the former first lady of the Philippines, partied into the wee hours of the morning at a New York disco.

The Saudi is still in such a good mood that he even finds nice things to say about his legal problems and brief imprisonment in Switzerland while awaiting extradition to the United States.

His Swiss jailers were so civilized that they allowed gourmet dinners and other luxuries brought to his cell. It made imprisonment so much more palatable.

"It was a nice health farm," he says. "It was all right."

In keeping with this new humble outlook, Khashoggi is calling his new Texas company Phoenix Oil and Gas.

In Egyptian mythology, the phoenix was a desert bird that set itself on fire and then rose, renewed, from its ashes.

"This company will also rise from the ashes," says Khashoggi. "Houston is an exciting place to be. That is why I am here."

But the luncheon wasn't all Texas business. Khashoggi took time to explain that some people misconstrued his part in the Iran-Contra affair. He doesn't think he should be censured for his role as an international arms dealer. He says instead, "I should be decorated for this."

Houston isn't the only place Khashoggi is going back into business. He also will build a retail "warehouse store" in Moscow and have some dealings with Brazil, Sudan and Colombia.

What on earth does he expect to sell in Moscow?

"Well to start with," he says, grinning broadly, "Imelda's shoes."

He says he's still skittish, however, about making real estate deals. But maybe in about six months his cash flow will be better and he will take another look at Houston properties.

Just how bad is his cash flow?

Not to worry.

He's never been so down and out that he's had to fly commercial.