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Douglas Grandt answerthecall@icloud.com

Does debt solve "the glut of supply and lack of materially growing demand"?
August 3, 2016 at 3:05 PM
David Cleary (Sen. Alexander) David_Cleary@alexander.senate.gov, Dan Kunsman (Sen. Barrasso)
Dan_Kunsman@barrasso.senate.gov, Joel Brubaker (Sen. Capito) Joel_Brubaker@capito.senate.gov,
James Quinn (Sen. Cassidy) James_Quinn@cassidy.senate.gov, Jason Thielman (Sen. Daines)
Jason_Thielman@daines.senate.gov, Chandler Morse (Sen. Flake) Chandler_Morse@flake.senate.gov,
Chris Hansen (Sen. Gardner) Chris_Hansen@gardner.senate.gov, Ryan Bernstein (Sen. Hoeven)
Ryan_Bernstein@hoeven.senate.gov, Boyd Matheson (Sen. Lee) Boyd_Matheson@lee.senate.gov,
Mark Isakowitz (Sen. Portman) Mark_Isakowitz@portman.senate.gov, John Sandy (Sen. Risch) John_Sandy@risch.senate.gov,
Travis Lumpkin (Sen. Cantwell) Travis_Lumpkin@cantwell.senate.gov, Jeff Lomonaco (Sen. Franken)
Jeff_Lomonaco@franken.senate.gov, Joe Britton (Sen. Heinrich) Joe_Britton@heinrich.senate.gov, Betsy Lin (Sen. Hirono)
Betsy_Lin@hirono.senate.gov, Patrick Hayes (Sen. Manchin) Patrick_Hayes@manchin.senate.gov,
Bill Sweeney (Sen. Stabenow) Bill_Sweeney@stabenow.senate.gov, Jeff Michels (Sen. Wyden) Jeff_Michels@wyden.senate.gov,
Michaeleen Crowell (Sen. Sanders) Michaeleen_Crowell@sanders.senate.gov, Kay Rand (Sen. King) Kay_Rand@king.senate.gov
, Joe Hack (Sen. Fischer) Joe_Hack@fischer.senate.gov, Derrick Morgan (Sen. Sasse) Derrick_Morgan@sasse.senate.gov,
Angela Becker-Dippmann (Senate ENR Ctee) Angela_Becker-Dippmann@energy.senate.gov, Ginger Willson (Sen. Sasse)
Ginger_Willson@sasse.senate.gov, Ali Aafedt (Sen. Hoeven) Alexis_Aafedt@hoeven.senate.gov,
Colin Hayes (Senate ENR Ctee) Colin_Hayes@energy.senate.gov, Michael Pawlowski (Sen. Murkowski)
michael_pawlowski@murkowski.senate.gov

Dear Chiefs of Staff:

Please read these excerpts from Josh Arnold's critique "Even Exxon Mobil Is In Trouble
"Total earnings were $825M but weaker refining margins cut earnings by $850M during the quarter. This is the problem
that XOM and others are facing in this horrible environment for oil companies; the glut of supply and lack of materially
growing demand has destroyed their ability to extract profits from their revenue base. And while XOM is doing a
better job than most, it is susceptible all the same. But unlike at the end of last year when I said XOM was a decent buy
at $82, the situation has worsened substantially but the stock is even higher now.
XOM's 1H2016 cash flow from operations and asset sales was $10.5B, roughly equivalent to the amount it
spent on capex. That means there is quite literally nothing left over to pay the $3.1B it owes shareholders every
quarter in dividend payments. That's not a good situation and it means that XOM is now in a similar situation as CVX....
"So what has XOM done? It has started borrowing, of course.

"... There is no other way for XOM to continue to pay its dividend; it simply cannot afford it. And with the outlook
for oil prices so weak, there is no reason to think that is going to change anytime soon. The one thing I know will not
happen - despite the overwhelming evidence that it should - is a dividend cut. That means XOM will have no choice but
to keep borrowing until it can't.
"Dividends are supposed to be distributions of profits, not the product of borrowing from someone else.
"XOM's cash flow is very concerning at this point and while XOM is still the best O&G player, that isn't saying much. The
entire sector is rubbish at this point because everyone's financial condition is deteriorating rapidly and the
outlook for recovery is bleak indeed."
ExxonMobil is a critical part of Americas energy and economic fabric, and we are observing precursor spasms leading to death
throes in its financial demise. ExxonMobil Management must be reigned in and admonished to act in the National Interest.