Colleague's grant application resembles my PhD thesis A colleague/friend has asked me to review his application for a very large grant, which appears to resemble my PhD thesis. 

The backstory is as follows. My PhD thesis was the first detailed study of Phenomenon X. My colleague works in Context C. Phenomenon X is present in Context C. 

Three years ago, while we were both PhD students, I suggested to my colleague that we put together a postdoc grant proposal to study Phenomenon X in Context C. We talked informally about being co-PI on the project but made no agreement.

Two years ago, my colleague told me that it would be better if he worked on the grant with someone more senior because we would have less chance together as two fresh PhDs. The idea was that I would be written into the project. My colleague asked me to send him a literature review on Phenomenon X, which I did.

Now, my colleague has sent me the draft of his grant application asking for some assistance and comments. The research questions in the application are nearly word-for-word the same as those in my PhD thesis and the application claims that Phenomenon X has not been studied before. My PhD thesis on Phenomenon X is not mentioned, nor is other relevant work. The literature review in the grant application uses the same sources as my PhD literature review. My name does not appear anywhere in the grant.

What are some appropriate courses of action here? My idea at the moment is to give my colleague the benefit of the doubt - maybe it was unintentional oversight or he had planned to add these details later. I would respond suggesting the grant application includes other work on Phenomenon X, including my PhD thesis, and to make the research questions more original. But I'm worried this will seem too territorial.
I suggest three things. First remind him of your dissertation and send a link to it, noting that there is similar wording that might become an issue. Second, I would, under the stated circumstances, offer to help in the application. It seems like it might be an attempt to extend your work, rather than to plagiarize it. That is always appropriate. And you could also assure that you aren't plagiarized if you are in the loop throughout. 

But, if you have the time and energy, I suggest that you offer to be a consultant on the grant as it progresses. This would get you named specifically in the application, at least. Your actual participation could be minimal, or not, but you could at least see how the work progressed and get more involved as time went on. It might not be impossible to be paid a bit for consulting work, depending on the agency and its rules. Consultant on a grant is a CV line, if nothing else.