From: Douglas Grandt answerthecall@me.

com
Subject: Leave behind documents from my Friday "drop by" visit
Date: April 16, 2018 at 4:48 PM
To: Eric Goode (Sen. Duckworth) Eric_Goode@duckworth.senate.gov
Cc: Radha Adhar (Sen. Duckworth) Radha_Adhar@duckworth.senate.gov, Kaitlin Fahey (Sen. Duckworth)
Kaitlin_Fahey@Duckworth.senate.gov, Katie Thomas katie_thomas@sanders.senate.gov

Dear Eric,

First of all, congratulations to Tammy on her baby girl! I am amazed at her facing the multiple challenges of juggling
Senate matters, a brand new baby, at 50 and disabled! Tammy is an inspiration!

When I visited your office Friday, Rahda was in the EPW meeting. The person who greeted me suggested emailing you.
To save you forwarding this, I am copying Rahda—and Kaitlin, mainly FYI. I hope Tammy gets my message.

I have been writing to members of the Senate Energy and Natural Resources Ctee for quite a while, and added Senator
Duckworth to the addressee list when she joined the ENR Ctee.

Visiting DC for the cherry blossoms last week as well as to meet with a handful of special ENR members, I stopped by
your office mainly as an introductory meeting, and to THANK YOU for responding to one of my recent emails to the
Senator (addressed to Kaitlin in hopes of getting some notice).

You see, none of the other ENR members has responded or even acknowledged my three dozen letters and
several dozen emails over the past three years while S.2012 was in the works and evolved to be S1460. I have been
told that I must be a constituent or belong to a group if I hope to meet with this group of 23 Senators.

Last week, my persistence paid off, and I met with Sen. Murkowski’s ENR staff, Sen. Cantwell’s staff and Sen. Sander’s
staff, as well as the ENR Democratic Professional Staff, Scott McKee. The Democratic staff understood and validated
my concerns, but the Republican staff seemed dismissive and suggested I address my concerns to other House and
Senate Committees.

So, huge thanks to the wonderful Democratic staff. I am happy to finally be talking with real live policy makers.

As a matter of introduction and THANK YOU, please see the attachments which were my agenda for those very
compressed meetings. These leave-behinds may be somewhat cryptic, but I would be happy to talk you through them if
you have any questions

The bottom line is, I fear oil & gas production and petroleum refining companies will soon face debt default,
insolvency and bankruptcy, similar to the 30% of drilling companies who went belly up two years ago.

You may understand how low prices or possibly an aggressive and effective carbon price could drive refineries out of
business, especially when their debt has risen nearly ten-fold, as is the case with ExxonMobil (my first employer during
the 1970s). My fear is that EVs, solar electricity, carbon tax and all the right reasons for oil to decline, will drive the
Boards of Directors to exercise FIDUCIARY DUTY in total contradiction of the NATIONAL and PUBLIC INTEREST,
shutting down unprofitable operations prematurely, before we have adequately shifted away from fossil fuels (diesel,
kerosene, gasoline, propane, bunker C, etc.).

Unless we manage oil & gas companies, forcing them to plan and implement a responsible endgame, there could be a
serious gap between supply and demand, which would result in failure to transport groceries and supply-chain materials
for manufacturing. Our economy and society could spiral out of control and collapse in chaos.

We need to make the oil and gas industry march to our drummer, on our time line, in our best interests.

MY ASK HAS BEEN AND CONTINUES TO BE THAT CEOS OF EXXON MOBIL ET AL TESTIFY BEFORE ENR.

THEY MUST ANSWER THE QUESTION: HOW WILL YOU ACT IN THE NATIONAL AND PUBLIC INTEREST AS
YOU EXERCISE FIDUCIARY DUTY IN THE FACE OF DEBT DEFAULT, INSOLVENCY AND BANKRUPTCY?

I will be happy to send you copies of select emails from the recent past which explain repetitively this message.

Attached are the three documents that I handed to the people I met with last week.

Best regards,
Doug Grandt
Putney VY
510-432-1452
 Senate Energy & Natural Resources Committee
Wednesday, April 11, 2018

Doug Grandt, P.O. Box 432 Putney, VT 05346

answerthecall@mac.com • 510-432-1452

Synopsis of Recent Developments that Threaten Oil and ExxonMobil

A. Doug Grandt pertinent credentials

1. Industrial Engineering (major) BS, UC Berkeley, 1970
2. Petroleum Engineering (minor) BS, UC Berkeley, 1970
3. Signal Oil & Gas Co., Petroleum Engineer, summer 1968
4. Humble Oil (Exxon USA), Petroleum Engineer, summer 1969
5. Humble Oil (Exxon USA), Petroleum Engineer, 1970−1972
6. American President Lines - Corporate Planning, 1970s−1980s
7. NYK Line - Japanese Management advisor & Project Mgr., 1990s
8. California EPA - Air Resources Bd. (Production/Refining), 2005−2012

B. A nexus of forces threatens American social & national security

1. Climate change solutions call for abandoning carbon fuels quickly
2. ExxonMobil (XOM) “financial engineering” has become treacherous
a. Declining earnings due to declining production
b. Stock buy-back to reduce outstanding shares
c. Increasing earnings per share = increasing dividends
d. Declining world oil & gas prices have reduced cash flow
e. Dramatic debt increase for stock buy back & to pay dividends

Page 1 of 3
3. Low oil & gas prices threaten bankruptcies and fuel shortages
a. U.S. fracking and directional/horizontal drilling technology
b. U.S. drilling boom and oil & gas production “renaissance”
i. Bakken Shale (North Dakota)
ii. Marcellus Shale (Pennsylvania)
iii. Permian Basin (Texas & New Mexico)
c. U.S. boom puts excess supply onto world market
d. Saudi production responded to protect market share
e. World production surplus increased world inventory glut
f. Investor/speculator response has crashed world prices
g. OPEC negative cashflows are depleting national treasuries
h. Saudi/OPEC attempt to reduce production to increase prices
i. Intention is to increase cashflow for national budgets
ii. OPEC nations are not reducing production successfully
iii. Libya, Iran, Iraq, Nigeria production has been increasing
iv. Global inventory glut has increased to record high levels
v. Global oil & gas prices continue to decline toward the $30s
4. Oil drilling and production companies become marginally profitable
a. Debt default, insolvency, bankruptcy—kills oil patch jobs
b. 30% of drilling and service companies vanished in 2016
5. Feedstocks to heavy- and light-crude refineries likely will decline
a. Refineries cease to operate below ~70% of maximum capacity
b. Fuel shortages for freight (food & supplies) and passenger vehicles
c. Export pipelines fall victim to declining shale oil, gas and tarsands
d. Availability of supply drops precipitously from worldwide closures
6. Unprofitable integrated oil majors default on debt, file Chapter 11
a. Failure to increase dividends leads to eroding share price
b. Debt default and insolvency precipitate a market-wide panic
c. Stock markets begin downward spiral, retirement funds fail

Page 2 of 3
C. My “ask” to avert the threat to American social & national security
1. Advise Senate ENR Chairman Lisa Murkowski of the possible scenario
2. Compel ENR Chairman to prepare for and to take action immediately
a. Educate members of the ENR Committee about oil and gas
i. Worldwide oil & gas production rates (historical and potential)
ii. U.S. conventional and shale oil & gas production rates
iii. U.S. conventional and shale oil & gas boom drilling rig counts
iv. OPEC and non-OPEC agreements relating to production rates
v. U.S. and global oil and gas price history and futures
b. Call XOM and other CEOs and Boards of Directors to testify
i. Historical financial performance measures
• Gross revenues
• Capital expenditures (CAPEX)
• Reserve replacement history and forecast (by year)
• Earnings
• Dividends
• Stock buyback
• Earnings and dividends per share
• Total debt (outstanding amounts accrued)
• Debt servicing schedule (payments)
• Price/earnings ratio
• Debt/earnings
• Stock buyback and dividends funded by debt
ii. Ground rules for exercising fiduciary duty
iii. How fiduciary duty aligns with National and Public Interest
c. Determine whether XOM and other will act in the National Interest
d. Compel XOM and others to submit plans for worst-case scenarios
e. Deliberate how to hold XOM and others accountable to Americans
f. Create and implement strict policies to protect American’s interests

Page 3 of 3
1 B&W Synopsis
- ENR…18.pdf
 Control energy resources
End oil & gas laissez-faire

What America needs now is truly comprehensive

and responsible energy policy that protects and
defends U.S. citizens and the global community
from volatile and deadly energy booms & crashes,
foreseeable & unforeseen emergencies and crises:

Best described by the acronym and title:

W.E.C.A.R.E.
World Energy
Crisis Aversion &
Readiness
Endgame

April 2018 Meetings with ENR Members Doug Grandt - answerthecall@mac.com