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The Tale of O.J. Lewinsky  
Date: May-31-2000


What do independents do? We put together deals, of course. We run with a geologic concept, apply some science, mix in some geophysics, acquire the necessary oil and gas leases, then put everything in a pretty package and try to sell our finished product to fellow industry partners. When that doesn’t work, we try to repackage the deal by massaging the figures and/or just giving the sales package a nicer looking cover sheet. Then we hope the people we’re selling to call us back. If they don’t call us back, we have to hope to get our sales package returned sometime before the new millennium. If that doesn’t happen, we then have to hope they don’t turn around and start buying leases in our project area within the next six months.

Timing is everything in selling deals, and independents have a true knack, a special skill, for bad timing. We will put together the best, most expensive oil deal of our lives and start showing it two weeks after the biggest free-fall in crude oil prices in 15 years.

We get used to hearing things like, “Great deal. It just doesn’t fit our pistol right now,” or, “Our budget just can’t handle a deal like this right now,” or, “We’re focusing on production deals right now, there just isn’t enough well control.” So we start to branch out. We try to find new contacts, try to find someone who believes in our project as much as we believe in it ourselves. Call us the champions of lost causes.

Take the case O.J. Lewinsky.

We get a new lead. It’s from a friend-of-a-friend-of-an-associate’s-sister-in-law. But he sounds knowledgeable, eager to see the deal, and asks us to mail it to him. Generally, we like to show it in person, but we’re desperate, so we FedEx a packet down to O.J. Lewinsky (not his real name) in Houston, Texas (not the real city).

We’re prepared to give him a few days to digest the whole thing, to think it over before we try and call him and start our usual routine of telephone tag when O.J. calls us the next day. Wow! O.J. says he likes the deal. He wants to take the whole 3 million dollar project on terms asked, and he wants to fly up in his private plane next week to finalize the deal and to meet us face-to-face.

Is this guy for real? We should be suspicious, but his story sounds good. Besides, we want to sell our deal, so we agree to meet.

We scramble. We work around the clock to get everything together on time—an 80-page agreement, a 50-page lease schedule, copies of files, assignments, AFEs, lists of seismic companies, drilling contractors, pumpers… the whole works. O.J. arrives as promised with his pilot and confidant—let’s call him Stan.

These guys are for real, and they apparently have BIG bucks behind them. They give us names. They tell us their “money guy” is Billy Bob, one of the richest guys in the world but a guy you’ve never heard of because he’s so low key (and of course we’ve never heard of him, neither has anyone else). And, best of all, they say they want to close next week so they can start “diggin’ a hole.” We fine tune the terms of the deal and they hop back on their plane to go get a signature and the money.

Next week arrives. We call O.J. He says he’s going over to Billy Bob’s house (really rich guys work out of their house) to pick up the check. He’ll call us tomorrow with wiring instructions.

Tomorrow comes. No word from O.J, so we call him. He says that Billy Bob has the funds, but they’re tied up in Eurodollars. The funds won’t be available for 30 days. (At this point, a rational businessman would read the handwriting on the wall and move on. But remember, we’re independents!.)

Thirty days pass. We call O.J.

He isn’t in, so we call Stan, who says O.J. will be over at Billy Bob’s house this afternoon to get the money. Stan says O.J. will call tomorrow with wiring instructions. We remind him we already gave the instructions to him, and that we even have an escrow agreement set up. “Oh, yeah, that’s right,” he says.

Tomorrow comes and goes. Our partners are anxious. What’s going on?

The next day we call Stan, who says O.J. told him that Billy Bob claims he didn’t get his Eurodollars because they got tied up in some vault or something in the back of the bank and he couldn’t get them out in time before the automatic rollover. We’ll have to wait another 45 days when the rollover window comes around again.

Forty-five days come and go. We call Stan, who says O.J. is at Billy Bob’s house today and that O.J. will get back to me.

The next day, Stan calls. Good news: the money’s coming! Bad news: the Eurodollars were sent to a bank in Montreal and Billy Bob needs to personally fly up to get the money.

Another week passes. Another phone call. Stan says that Billy Bob is having problems with Canadian Customs. He has to fly up there next week with O.J., who again just happens to be over at Billy Bob’s house right at that moment.

Ten days pass. Stan calls. There are more problems, he says, serious problems. The Canadians have frozen the funds, claiming Billy Bob owes taxes, BIG taxes. We’re talking BIG funds on which they want to collect taxes, in the 500 million dollar range, so our measly 3 million dollar deal is just a drop in the bucket

Another week comes and goes. O.J. calls. He says Billy Bob is now in Montreal and should have the money in a couple of days. This is now about six months since we first sent him the deal. I tell O.J. we have a big option coming up on the deal and we need to know whether he is in or out so we can decide whether to find another buyer. He says of course he’s in and not to worry, the money will be there next week. And because we have been so patient, he’s decided to “sweeten the pot” a bit.

Another 10 days pass without a word. Then, out of the blue, Stan calls. He apologizes for the delay, but we can’t close this week. Apparently, O.J. is in the hospital. He got drunk, fell off his deck, and landed in his swimming pool. He’s okay, but we’ll have to close as soon as O.J. returns home.

Another week. Stan calls. O.J. had a problem with his son, who just had open heart surgery, but closing should be in a week. Again, I tell him our option is coming up. He informs me that the “sweet pot” O.J. promised will get juicier. We wait.

Stan calls. The deal’s dead. It turns out Billy Bob was leading he and O.J. on the entire time. Oh really? We never would have guessed. But again, we’re independents. Still, it was fun while it lasted, about as fun as a root canal on every tooth in our whole mouth.

We still call Stan once in a while, especially when we feel like hearing a new story. As far as we know, O.J. has recovered from the pool incident and his son is okay. We like to imagine Billy Bob being tortured in some third world jail after being convicted for tax evasion, but he’s probably just down in the Bahamas trying to get his 500 million bucks on a tax free basis.

 

Author: Tab McGinley

 

Source: 

 

 

Reprinted with Permission by the Author or Publisher :Tab McGinley