High risk, high reward. We in the oil and gas industry have been toughened; have been forced to learn to traverse the risk, and to reap the rewards. Heck, oil and gas exploration and production is practically as synonymous with the “American Dream” as we can get. The plentiful rewards that lie at the end of a successful oil and gas venture lead many into an epic journey fueled by palpable ambition and great effort. We’ve all heard amazing tales tracing the paths of the oil and gas trailblazers, the ones who got lucky, and those who were willing to sacrifice to get there (if not, see “The Prize“). But every possible path to high reward is guarded by a common vault-door: acceptance of high risk.
Unfortunately, as these stories show us, this risk to reward balance can and has lead many to lying, cheating, dishonesty, half-truths and otherwise misleading conversations, deals and agreements (again, see “The Prize”). However, this is all directly in conflict with the prevailing “unspoken rule” in the oil and gas business: honesty and fair dealing. Call it what you will, “old boys club,” “gentlemen’s business,” “good ol’ boys,” etc. The oil and gas industry is undeniably all about the relationships you have built, and the trust and rapport you have developed.
Nevertheless, in helping my clients negotiate and close all sorts of deals and resolve various disputes, I have inevitably ran across several “dirty tricks” and “cheap moves.” The following is an explanation of some of these dirty or cheap oil and gas negotiation tactics, how to avoid them, and suggestions for responding when the tactics are spotted.
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