A new chief executive took the helm at one of the big US independents, and announced that the future of the company lay in a business development effort to find projects in the Middle East.
Because of the sheer quantity of oil that has been found there, the Middle East has a hypnotic attraction to the oil companies and to people in the business – myself included. But doing business there is extremely difficult.
I had worked extensively for this company in the UK and elsewhere, and knew the lawyers and the new business team. So far as I knew they did not have anybody with business development experience in the Middle East.
So I rang them in Houston to offer my services and suggest that we meet up in either Houston or London. They took a day to consider, and then rang me back with a polite but firm reply. “Thanks Chris, but we don’t need you. We know what we are doing internationally. After all, we succeeded on the UKCS.”
I resisted the temptation of saying that the Middle East is a very different world from the UK. And I did not point out that their “success” in the UK came from the acquisition of a company with existing acreage.
So I watched their business development effort with interest from the sidelines. Things did not work out. After spending a reported $250 million over five years, they had not a single project in the Middle East to show for it. The Middle East business development initiative was abandoned with much less fanfare than the original announcement.
Ground-up business development is cheaper but much more difficult than buying a company or interests in existing projects. And a ground-up business development effort in the Middle East is the hardest thing of the lot.