Douglas A.

Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Lisa Murkowski

709 Hart Senate Office Building
Washington, D.C. 20510
Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear ENR Chairman Murkowski,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From your usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman
of FERC) it is not clear to me how you as ENR Chairman differentiate between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Lamar Alexander

455 Dirksen Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Alexander,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator John Barrasso

307 Dirksen Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Barrasso,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Shelley Capito

5 Russell Senate Oce Building Courtyard

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Capito,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Bill Cassidy

703 Hart Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Cassidy,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Steve Daines

1 Russell Senate Oce Building Courtyard

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Daines,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Jeff Flake

368 Russell Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Flake,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Cory Gardiner

B40B Dirksen Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Gardiner,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator John Hoeven

338 Russell Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Hoeven,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Mike Lee

316 Hart Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Lee,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Rob Portman

448 Russell Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Portman,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator James E. Risch

483 Russell Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Risch,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Maria Cantwell

511 Hart Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Cantwell,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Al Franken
309 Hart Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Franken,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Martin Heinrich

702 Hart Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Heinrich,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Mazie Hirono

330 Hart Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Hirono,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Joe Manchin

306 Hart Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Manchin,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Debbie Stabenow

731 Hart Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Stabenow,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Elizabeth Warren

317 Hart Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Warren,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Ron Wyden

221 Dirksen Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Wyden,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Bernie Sanders

332 Dirksen Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator Sanders,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
Page 3 of 4

Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

Page 4 of 4

Douglas A. Grandt

PO Box 6603
Lincoln, NE 68506
(510) 432-1452
May 19, 2015

Senator Angus King

359 Dirksen Senate Oce Building

Washington, D.C. 20510

Re: Oil Refining - Considering future eventualities versus the myopia of the present (letter #12)
Dear Senator King,
This is my twelfth letter to you expressing deep concern about an imminent conflict between
1) Corporate Officers and Boards of Directors fiduciary duty in the face of insolvency, indeed
their termination of unprofitable refining operations, and 2) national interest or public interest.
Does Congress interpret in the national interest and in the public interest to mean
protecting and preserving all aspects of the commonwealth, the common-wealth, the common
weal, the common well-bring, public welfare? From my research, free-trade is the focus.
I have been unable to find an explicit definition of national interest or public interest. No code
or law defines either. The closest thing to a definition I have found is in Delaware Riverkeeper
Networks recently published paper TPP and Fast Track: What they mean for our Environment
and our Country. The following portrays most of what I have read by FERC, DOE, and GAO:
The Natural Gas Act (15 U.S.C. 717b) prohibits the import or export of natural gas, including
liquefied natural gas (LNG), to or from any foreign country without receiving prior approval from
the U.S. Department of Energy (DOE).
In order to receive approval of an application for export of natural gas to a foreign nation, Section
3 of the Natural Gas Act requires DOE to first make a determination that the proposed export of
natural gas will not be inconsistent with the public interest.14 A public interest determination
includes consideration of both environmental and economic impacts. Section 3(a) thus
establishes DOEs authority to deny an application requesting authorization to export natural gas
to foreign countries upon a showing of inconsistency with the public interest.15
___________________________
14

15 U.S.C. 717b(a).
(a) Mandatory authorization order
After six months from June 21, 1938, no person shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having
secured an order of the Commission authorizing it to do so. The Commission shall issue such
order upon application, unless, after opportunity for hearing, it finds that the proposed exportation
or importation will not be consistent with the public interest. The Commission may by its order
grant such application, in whole or in part, with such modification and upon such terms and
conditions as the Commission may find necessary or appropriate, and may from time to time,
after opportunity for hearing, and for good cause shown, make such supplemental order in the
premises as it may find necessary or appropriate.
15

Id.; see also Sabine Pass Liquefaction, LLC, FE10-111-LNG, DOE Order No. 2961 (May 20,
2011); Sabine Pass Liquefaction, LLC. FE10- 85-LNG, DOE Opinion and Order No. 2833 (Sept.
7, 2010).
BUT ....

Page 1
! of 4
!

Section 3(c) of the NGA requires the DOE to deem as consistent with the public interest any
applications to authorize the import or export of natural gas, including LNG, from and to
nations which have entered into a free trade agreement with the U.S. requiring national
treatment for trade in natural gas i.e. Free Trade Agreement countries, or FTA countries.
As such, applications for authorization to export natural gas to FTA countries is required, by the
NGA, to be granted without modification or delay.16
___________________________
16

15 U.S.C. 717b(c)
(c) Expedited application and approval process
For purposes of subsection (a) of this section, the importation of the natural gas referred to in
subsection (b) of this section, or the exportation of natural gas to a nation with which there is in
effect a free trade agreement requiring national treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or
exportation shall be granted without modification or delay.

I am not a lawyer, but as a former Petroleum Engineer, Industrial Engineer and a Corporate
Planner, I learned early on to clearly document the basis for my work; the assumptions that
defined the system, facility, equipment, process or economic assessment that went to my boss
and the Board of Directors to justify millions of dollars in capital investment. What I have seen
in the documents I have read is that they lack a precise definition that transparently explains
decisions having major impact on the public, local communities, the national economy, or
nation security.
The irony of making decisions and recommendations without a definition of public interest is
clear in The Department of Energy Office of Fossil Energys FE Docket No. 11-128-LNG
(Dominion Cove Point LNG LP) Section II, Summary of Findings and Conclusions, which states:
Based on a review of the complete record and for the reasons set forth below, DOE/FE has
concluded that the opponents of the DCP Application have not demonstrated that the requested
authorization will be inconsistent with the public interest and finds that the exports proposed in
this Application are likely to yield net economic benefits to the United States.

Likely to yield net economic benefitsthats it? Section III, Public Interest Standard goes on:
Section 3(a) of the NGA sets forth the standard for review of DCPs Application:
[N]o person shall export any natural gas from the United States to a foreign country or import
any natural gas from a foreign country without first having secured an order of the [Secretary
of Energy25] authorizing it to do so. The [Secretary] shall issue such order upon application,
unless after opportunity for hearing, [he] finds that the proposed exportation or importation
will not be consistent with the public interest. The [Secretary] may by [the Secretarys] order
grant such application, in whole or part, with such modification and upon such terms and
conditions as the [Secretary] may find necessary or appropriate.
15 U.S.C. 717b(a). This provision creates a rebuttable presumption that a proposed
export of natural gas is in the public interest. DOE/FE must grant such an application
unless opponents of the application overcome that presumption by making an affirmative
showing of inconsistency with the public interest.26
___________________________
25

The Secretarys authority was established by the Department of Energy Organization Act, 42
U.S.C. 7172, which transferred jurisdiction over imports and export authorizations from the
Federal Power Commission to the Secretary of Energy.
26

See, e.g., Sabine Pass, Order No. 2961, at 28; Phillips Alaska Natural Gas Corp. & Marathon
Oil Co., DOE/FE Order No. 1473, Order Extending Authorization to Export Liquefied Natural Gas
from Alaska, at 13 (April 2, 1999), citing Panhandle Producers & Royalty Owners Assn v. ERA,
822 F.2d 1105, 1111 (D.C. Cir. 1987).

Page 2 of 4

While section 3(a) establishes a broad public interest standard and a presumption
favoring export authorizations, the statute does not define public interest or identify
criteria that must be considered. In prior decisions, however, DOE/FE has identified a
range of factors that it evaluates when reviewing an application for export authorization.
These factors include economic impacts, international impacts, security of natural gas
supply, and environmental impacts, among others. To conduct this review, DOE/FE looks to
record evidence developed in the application proceeding.27
DOE/FEs prior decisions have also looked to certain principles established in its 1984
Policy Guidelines.28 The goals of the Policy Guidelines are to minimize federal control
and involvement in energy markets and to promote a balanced and mixed energy
resource system. The Guidelines provide that:
The market, not government, should determine the price and other contract terms of
imported [or exported] natural gas .... The federal governments primary responsibility
in authorizing imports [or exports] will be to evaluate the need for the gas and
whether the import [or export] arrangement will provide the gas on a competitively
priced basis for the duration of the contract while minimizing regulatory
impediments to a freely operating market.29
While nominally applicable to natural gas import cases, DOE/FE subsequently held in Order
No. 1473 that the same policies should be applied to natural gas export applications.30
In Order No. 1473, DOE/FE stated that it was guided by DOE Delegation Order No.
0204-111. That delegation order, which authorized the Administrator of the Economic
Regulatory Administration to exercise the agencys review authority under NGA section 3,
directed the Administrator to regulate exports based on a consideration of the domestic
need for the gas to be exported and such other matters as the Administrator finds in the
circumstances of a particular case to be appropriate.31 In February 1989, the Assistant
Secretary for Fossil Energy assumed the delegated responsibilities of the Administrator of ERA.32
Although DOE Delegation Order No. 0204-111 is no longer in effect, DOE/FEs review of
export applications has continued to focus on: (i) the domestic need for the natural gas
proposed to be exported, (ii) whether the proposed exports pose a threat to the
security of domestic natural gas supplies, (iii) whether the arrangement is consistent
with DOE/FEs policy of promoting market competition, and (iv) any other factors
bearing on the public interest described herein.
___________________________
27

See, e.g., Sabine Pass, DOE/FE Order No. 2961, at 28-42 (reviewing record evidence in
issuing conditional authorization); Freeport LNG, DOE/FE Order No. 3282, at 109-14 (discussing
same); and Lake Charles Exports, DOE/FE Order No. 3324, at 121-27.
28

New Policy Guidelines and Delegations Order Relating to Regulation of Imported Natural Gas,
49 Fed. Reg. 6684 (Feb. 22, 1984) [hereinafter 1984 Policy Guidelines].
29

Id. at 6685.

30

Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14, citing Yukon Pacific Corp., DOE/
FE Order No. 350, Order Granting Authorization to Export Liquefied Natural Gas from Alaska, 1
FE 70,259, at 71,128 (1989).
31

DOE Delegation Order No. 0204-111, at 1; see also 49 Fed. Reg. at 6690.

32

See Applications for Authorization to Construct, Operate, or Modify Facilities Used for the
Export or Import of Natural Gas, 62 Fed. Reg. 30,435, 30,437 n.15 (June 4, 1997) (citing DOE
Delegation Order No. 0204-127, 54 Fed. Reg. 11,436 (Mar. 20, 1989)).

These justifications appear to be circular logic defining public interest with reference to itself.
My previous letters have suggested that we demand petroleum industry CEOs tell us how they
will continue to supply fuels when earnings and dividends fall to critical levels, share price
plummets, they are no longer financially viable in the marketplace, and they become insolvent.
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Up to now, I have believed that Congressspecifically the Senate Committee on Energy and
Natural Resourceshas the rightful authority to conduct such an inquiry, as both FERC and
DOE carry out the laws that Congress passes, laws which are spawned in your committee.
Now, having discovered a conundrum which would make the results of any such investigation
meaningless, given the lack of a precise definition and standard for national interest or public
interest, I suggest that you first come up with suitable, complete and relevant definitions,
and be prepared to hold the petroleum companies accountable to those definitions.
Only then can we compel them to share their visions and results of their economic models, and
to explain their business strategies in context with their definition of Corporate Citizen. That will
be an interesting juxtaposition with what you declare to be in the national and public interest.
From her usage in the enclosed June 4, 2014, letter to Cheryl LaFleur (then Acting Chairman of
FERC) it is not clear to me how ENR Chairman Murkowski differentiates between the two.
I still believe that we must find ways to avert petroleum production and refining companies
going out of business as a result of sustained low commodity prices manipulated by competitive
forces in other parts of the world. I also believe that it is incumbent upon us to change the
paradigm from growing upward to growing in breadth with diversification, from the traditional
and conventional to the innovative and sustainable. We must make our national resources
immune to the manipulations of a commodity to which we have made ourselves vulnerable.
MY ASK: Therefore, I call upon the Senate Committee on Energy and Natural Resources
to guide the petroleum industry to provide a choice of transportation fuels, which will also
enhance their longevity as viable corporations that are intended to live forever.
We must be precise as to what we are demanding of the industryclear expectationswhen
we demand that they make decisions in the national interest and public interest.
What do we mean by national interest or public interest while corporate profitability is in the
balance, and we face insolvency of the industry? Our predicament is self-induced vulnerability.
We have brought it upon ourselves by a laissez-faire attitude with industry behaving according
to free market conventions. We have allowed a lack of innovation through our investment tax
credits and other subsidies. Now we must level the playing field, force innovation and let true
competition see that the cream will rise to the top. Oil certainly is no longer black gold.
As I suggested yesterday, we must now choose whether to battle foreign manipulation of crude
supply and price, or to shift our national policies and human energies away from such conflicts.
I believe our only choice is to step into the future with the pizzazz of the burgeoning electric car
offerings and innovation of battery and other not-ready-for-prime-time high tech portable fuels.
Sincerely yours,
Doug Grandt
answerthecall@mac.com

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