If you are a company that wants to exploit the stores of oil somewhere but does not have the drilling capability to actually make the most of the opportunity, you might need to contract with a drilling contractor. In order to make sure that the boundaries of the contract are clear, you will need to establish and negotiate a Master Service Agreement (MSA). The MSA lays out the responsibilities of both the contractor and the person who needs his or her services. Here are some tips for negotiating the MSA.

1. Make Sure All Functions That You Need Covered By the Drilling Company are Explicitly Stated

Your first step is to talk to your drilling contractor and get them to run you through every action that they are able to do for you. As they speak, either take notes or ask them to provide you with a list of all of these jobs. Then, ask them to run through the drilling process with you if you are not totally familiar with it. If you hear any extra services that are going to need to be covered that the contractor did not explicitly state, bring it up to the contractor. You can't assume that the contracting company will be able to perform all of the services. Make a list of all of the services that the drilling company needs performed but is unable to perform themselves and see if you have the capability to do any of those. If not, make plans to hire another company. Write all of the services mentioned by the drilling contractor in your MSA.

2. Create a Termination Clause

Your next step is to create a clear termination clause, or a clear set of circumstances that will lead to the termination of the contract. You want to be sure that you cover the terms of the project's completion, as well any circumstances that would cause the contract to terminate early. Make sure that the language for the breach of contract and subsequent termination is abundantly clear in order to make your project go smoothly.

3. Make Sure That Worker Responsibility Belongs to the Contracting Company

Finally, be sure that the responsibility for any workplace accident belongs to the contracting company, rather than to your own company. You aren't a professional who knows drilling but the drilling contractor is. He or she is going to best know how to make sure that his or her own workers are able to stay safe.

For more information, talk to a company that specializes in drilling, like GeoTek Alaska Inc.

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