Saturday, August 20, 2016

Exxon Mobil Fraud Inquiry Said to Focus More on Future Than Past - The New York Times

New York Attorney General Eric Schneiderman faces a backlash for investigating Exxon Mobil’s public and private statements about climate change. (Credit: Mike Groll/Associated Press) Click to Enlarge.
For more than a year, much of the public scrutiny of Exxon Mobil was captured by the #Exxonknew hashtag — shorthand for revelations about decades-old research on climate change conducted by the company while it funded groups promoting doubt about climate science.

Articles about that research have energized protests against Exxon Mobil and the fossil fuel industry and had a role in initiating queries by at least five attorneys general, led by Eric T. Schneiderman of New York.

Early on, his office demanded extensive emails, financial records and other documents from the  company, leaving many observers with the impression that a deeper look into the company’s past was the focus of the investigation.

But in an extensive interview, Mr. Schneiderman said that his investigation was focused less on the distant past than on relatively recent statements by Exxon Mobil related to climate change and what it means for the company’s future.

In other words, the question for Mr. Schneiderman is less what Exxon knew, and more what it predicts.

For example, he said, the investigation is scrutinizing a 2014 report by Exxon Mobil stating that global efforts to address climate change would not mean that it had to leave enormous amounts of oil reserves in the ground as so-called “stranded assets.”

But many scientists have suggested that if the world were to burn even just a portion of the oil in the ground that the industry declares on its books, the planet would heat up to such dangerous levels that “there’s no one left to burn the rest,” Mr. Schneiderman said.  By that logic, the Exxon Mobil will have to leave much of its oil in the ground, which means the company’s valuation of its reserves is off by a significant amount.

“If, collectively, the fossil fuel companies are overstating their assets by trillions of dollars, that’s a big deal,” Mr. Schneiderman said.  And if the company’s own internal research shows that Exxon Mobil knows better, he added, “there may be massive securities fraud here.”

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