Amoco

"Upon arriving, the lawyers’ office felt like a morgue. I met Nick, Mike, their key lieutenant Ted Gazulis, their lawyers, Hovey Kemp and Jim Piccone, and several other executives of the company. They were dejected, watching this deal they had worked so hard on wither on the vine. There was a lot of frustration that a terrific opportunity for the company and its financial partners would fall apart because of an eleventh-hour surprise from Goldman Sachs. I went on to offer my thought that HS was at a disadvantage by committing to a deal with Amoco before having all the money in hand. This allowed Goldman Sachs to push the company up against one deadline after another, resulting in a real negotiating handicap. Having talked with Richard and sensing that the likes of John Snyder wanted in, I felt this transaction had so much value that we couldn’t allow it to fall apart because of Goldman Sachs. I felt that our downside would be covered, so moving forward would be a judicious risk to take. I have to say, though, that Ted Gazulis remembers it differently. He recalled, “I saw black smoke coming out of your ears. You were hopping mad that Goldman was going to either steal or torpedo the deal!” Maybe his recollection has some merit to it. Anyway, I told the team that NGP was prepared to cover the purchase price of the deal and then work out a refinancing without the deadline time pressure on all of us. I put on my best face and said, “Instead of putting up $ 15 million, how about NGP speaks for the full $ 30 million, so we can close it, and then we can work out a refinancing plan without the deadline pressure?”"

"HS Resources was putting together a $ 30 million deal to acquire seventy thousand acres from Amoco for development in Weld County, Colorado, near Denver. As was typical of most deals, companies would line up someone to provide a senior loan covering as much of the deal as possible and then fill the rest of the cash needs with either subordinated debt or equity financing. In this case, the company needed a little over $ 100 million, $ 30 million to close the deal, about $ 60 million for future drilling needs, and $ 17 million to repay debt that existed in the company already. It was a big deal for a small company, one that had the potential to set HS on a long-term growth trajectory."

"In 2001, many years after I had left the board, HS was about to announce a sale of the entire company to Kerr McGee for about $ 2 billion. The night before the announcement, Nick called me at home to let me know and to thank me once again for playing a large part in the original formation of the company. In fact, the first well that the company drilled on the Amoco acreage was named the HSR-Hersh. When they told me that they were naming the well after me, I was petrified. I never was a fan of naming wells after people. Thankfully, the well was a decent producer."

"The other big coup was a surprise package sold by the oil company Amoco. The oil giant had a subsidiary, Canadian Marine Drilling Ltd. (Canmar), in the Olympic city of Calgary. Now nearly ten years since the Olympic games, the city did not have the same pressure, and it was even longer since the oil boom marked the Canadian interior. Canmar was sitting with two drillships, a couple of drilling platforms, a handful of supply ships, and various other equipment. Normally, not many buyers want such a mixed bag, but the oil giant Amoco did not want the hassle of lengthy negotiations for one ship at a time. All or nothing, was the offer. And Fredriksen's rig broker, Stein H. Schie at Normarine Offshore, got the job. He played hard on Amoco's desire to get rid of the whole of Canmar and managed to get the price down to just over 100 million dollars. Then Schie did the job Amoco should have done: One by one, the assets were sold off. The supply ships and a dock brought in 50 million dollars. Thus, John Fredriksen had gotten back half of his money, and was left with the two drillships "Northern Explorer II" and "Northern Explorer III" for just 50 million dollars."