2 Lessons from NAPE

A Little Bit About Skip

Skip would describe himself as a self made swashbuckler. A soldier of fortune that never gets hung up on pussy shit like morals or ethics. If there is a deal to be had he would fuck over every one of his friends to get a bigger share, and then he would laugh about it in front of them at the bar. Mention his boots and he’s going to tell you the price tag. Most people would say “he’s kind of a dick.” There is no place he hasn’t been, fish he hasn’t caught, duck he hasn’t shot, or story you could ever tell that he’s not going to one-up. If you say you’ve been successful, he’s going to ask exactly how much money you’ve made. He’s made more. Also, since you haven’t given him any deals, you’re probably just a pussy. His boots cost more than your whole fucking paycheck. There are rumors that his family has old money, but also rumors that they lost it all when the housing market tanked. He’s got a fishing boat named “The Office” that he allegedly won in a high stakes poker game with one of the Hunt heirs. You’re far more likely to find him “in the office” than sitting at a desk.

If there is an open tract in the middle of his client’s prospect, he’s going to be negotiating to buy that lease (directly or indirectly). He might offer it to the client, or if he’s got a decent offer he’ll flip it to another flipper. There are no lines he won’t cross to get paid, and if you don’t have an ironclad contract in place you’re probably going to get cut out of the deal. For those of you who have sat through the AAPL videos during a certification exam, when you say “seriously, who the fuck would do that?!” because of the sheer ridiculousness of the situation…yes, Skip is the guy who did it. One of the stories people like to tell about Skip is when he got sent out to buy a lease one morning, and by that afternoon he had purchased the old lady’s minerals, negotiated a lease with a buddy of his to flip (to Skip’s client), and then flipped the minerals with a valid oil and gas lease and a damn close to guarantee of production in the next 12 months. Sounds like a busy day. Also, wouldn’t surprise anyone…

One of the benefits of not giving a shit about anything except the money is that he attracts similar minded people. “Shady” might be a good term, but shady people need to get things done just like everyone else. Captain Skip’s contact list spans from janitors at the offices of major E&Ps to county officials and all through the C levels of any company you’d ever be interested in. If you’re not shy about doing a deal with the devil, anyone that judges you for it is obviously just too scared to do it themselves. When he gets wind of a potential deal, he’s almost always got a contact that can help him push things through…or at least knows someone that can facilitate an introduction. When he brings someone into a potential deal you can guarantee that there are strings attached and he’s not going to beat around the bush…the man is going to get paid. He’s the only person you can’t cut out of the deal. Anyone with a brain knows that.

Anyone with a brain. Not all of us have them.

The Setup

Captain Skip got wind of a potential project. He had worked with some Russian investors on a couple of deals, and one of the partners contacted him about wanting to put together a new prospect. The thing was going to be done on a shoestring budget because it was the red headed stepchild of a wildcat well, but the principals in the deal had all of the seismic and well log reports of the previous wells in the area and were confident they could make this one work. Captain Skip just needed to find the right landman to put them in touch with…he needed someone that could be discreet and wouldn’t budge an inch getting all the leases signed. The time frame was aggressive just like the budget. By the time Skip got all the details the clock had already started ticking. He needed a motherfucking Jack Bauer.

“Jack, it’s Skip. You still working as a fucking title monkey?”
“Yeah…I guess so. I’m in East Texas now doing curative work.”
“Well, I got a deal for you. Need you to sign this NDA and get it back to me.”
“Skip, haven’t heard from you in a long time. How are things going?”
“Busy. Don’t fuck me on this thing. When I get the NDA I’ll send you the info, if you can’t do it I need to know by tomorrow morning.”
“Alright…I’m interested.”

Working the Deal

The contract had some incentives for Jack to get things done cheaper and faster for a bigger cut. The guys weren’t going to pay him much, mostly just reimbursement for expenses, but were offering two and a half points of an ORRI for their “preferred” terms, but only a point and a half for the minimum terms. Skip told Jack that he wanted a quarter of the override since he had set the whole deal up. There was no oversight needed, Jack was in touch directly with the principals and Skip’s involvement was purely for the introduction. Before agreeing to the terms, Jack called up the Russian partner directly and said he needed another point for the preferred terms and a half point for the minimum terms. There was a long, awkward pause before the man said, “if you can get it done, that is fine. But it will come from Zorro Grande’s share.” Jack didn’t know what the guy meant by that, but thought Zorro Grande must be another one of the partner companies. It had an odd name though, like somebody was trying to get cute with their Spanish. As Jack got to work, he started wondering whether Skip had really earned that finder’s fee or not…

Skip never told his buddy Jack that he had also worked a deal with the Russians, and would be getting a half point from them directly. He came up with the name Zorro Grande for the entity and knew Jack wouldn’t recognize it, so this way he was doubling up on his share if Jack was able to get it done…and then followed through with the agreement. A couple of months later, Jack had the prospect leased up. He wasn’t able to keep the budget low enough or get it done fast enough for the preferred terms, but was still happy to be getting it done at the minimum terms. Since he had re-negotiated the deal that meant he was getting two points. The partners put together their agreements and started drilling. It took months of testing before they were ready to complete the well, but the partners were very optimistic about the data they had received so far. Jack was excited too. Mailbox money is something most landmen just dream about, but here he was on the verge of getting his first “real deal.” Skip was busy with a million other things and had completely forgotten to follow up with Jack to see how things were going and to remind him about their deal. He didn’t think that Jack would be dumb enough to fuck him over…

The well was completed and the deck finally got put together for division orders. Jack thought about his deal with Skip, and again debated whether he actually owed the guy a quarter of his share. I mean, Jack spent over a year working on all of this shit and Skip just made a few phonecalls…so maybe Jack could just…forget about it? Things were slow for everyone, and people were saying it was going to be a worse downturn than 2014 “this time.” Jack didn’t know that the extra half point he had negotiated was actually the other part of Skip’s share. The Russians figured somebody had to lose a little, it wasn’t going to be them, and as far as they were concerned it was between Jack and Skip. As NAPE approached a couple months later, Jack thought Skip must have forgotten about the whole thing. The guy was always wheeling and dealing, and this was probably just small potatoes, right? Until he got an invitation to a party Skip’s company was hosting…but obviously the partners had taken care of Skip some other way, so there wouldn’t be any hard feelings…right?

The Showdown

When Jack walked into the party, he got a beer at the bar and said hello to a couple of people. He was dressed a bit too formal for this crowd, wearing a suit and tie since he had an important lunch meeting earlier that day. Maybe he could have ditched the tie, but he never had a problem with being the best dressed guy in the room…even though it made him self conscious in this setting. Most of the people were pretty casual, and Jack could tell that everyone had been drinking heavily. The entire mood of NAPE so far had been…somber. Somber people tend to drink a lot. NAPE people tend to drink a lot. He was thinking about that when he heard “HEY JACK!” he instantly knew who was booming across the room before he turned around. Skip strolled through the crowd with a big grin on his face, high fiving a couple of guys as he passed by, still booming, “NICE OF YOU TO JOIN US! WAS WONDERING WHERE YOU BEEN?!?” Obviously Skip was drunk, but Jack still didn’t get the sense that anything was wrong…

“Yeah man, just been busy…how about you?”
“Waiting on that override man, I heard ya’ll completed that well. What’s the deal?”
“…what do you mean? They didn’t give it to you?”
“You were supposed to be the one that made sure I got it. You OWE me.”
“I wasn’t in charge of all that…”
“Really? Kind of seems like you were. You put it all together…didn’t think to mention my name, or to just make sure I got what you agreed to give me? It’s not too late, you can give it to me now…plus interest. How about that? Be a pal. I mean, I’d take 20 grand if you just wanted to buy me out…” The sinister grin on Skip’s face made Jack’s skin crawl.

Jack stepped back and laughed, his face turning red. He was starting to sweat, and everyone in the room was staring at him. Hope that Skip was just giving him a hard time was fading fast…the awkward tension continued to build. This wasn’t a joke, Skip wanted Jack to hand over 25% of his share just for making that phonecall! Why had Jack ever agreed to that in the first place? All of these thoughts were running through Jack’s head like a freight train without any brakes. Was it too late to re-negotiate? Maybe he could offer Skip a reasonable one time buyout…20 grand was obviously a joke…but Jack hadn’t gotten paid much on the well yet and couldn’t afford to throw out a number that would appease the shark standing in front of him. It was a fight or flight moment going through his head as he sneered “fuck you Skip. Not my problem.” There was blood in the water now. Jack could feel everyone in the room closing in on them…waiting to see what was going to happen.

2 Lessons from NAPE

“You know…it’s interesting that you say that. I talked to the Russians about my share, and they said that you re-negotiated the deal.” Jack’s stomach was turning, he could feel sweat dripping down his neck now. The tone of Skip’s voice was calm, but menacing.
“Well yeah, I did all the work, so I told them I needed something more…you would’ve done the same.”
“And when they told you that your extra share was coming from Zorro Grande…what did you say then? Didn’t think to ask ‘WHO’S ZORRO GRANDE?!'” The light bulb went off in Jack’s head. Oh fuck. It was Skip. Big Fox. Of course! Jack’s eyes must have gotten wide as the moment of realization manifested on his face. Things seemed to move in slow motion for the next 60 seconds.

Skip reached out and grabbed Jack by his tie with one hand, yanking him closer. His other hand was already cocked back, balled into a fist, and he slammed into Jack’s face. Jack tried to back away, but Skip had a vice grip on his tie and continued to hit him in the face as he started to fall to the ground. Every time Jack tried to raise his hands to protect his face, Skip would land a punch from another angle. Things were moving so fast Jack couldn’t figure out how to defend himself, and he couldn’t escape. A random thought flew through Jack’s mind right then…the tie was a bad idea. Skip only let go once Jack actually hit the ground on his back. Out of breath, Skip stood over his conquered foe, before reaching down to grab his tie one last time, shoving Jack down to the ground again.

“Two lessons. First lesson, don’t EVER fuck me over in a deal again. Second lesson, don’t wear a tie to NAPE you fucking loser. Get out of my party!”