May 6, 2025 | By: Amy Stipe and Rosie Garner

In the high-stakes world of oil and gas operations, contracts are often the first and best line of defense against costly disputes. Proactively addressing litigation risk at the drafting stage can protect business relationships, reduce expenses, and streamline resolution when disagreements arise. Below are five key considerations to keep in mind when drafting and negotiating contracts in the patch, as recently presented at GableGotwals’ Sixth Annual Energy Market Drivers and Current Legal Issues Seminar.

Top 5 Considerations When Drafting Contracts

1. Be Cautious with Performance Timelines
   Strict deadlines can create traps if not carefully defined. Clarify whether timelines are in business days or calendar days, and outline the consequences for non-compliance. If the timeline isn’t essential, consider using flexible language to avoid unnecessary breach claims.
2. Dispute Resolution Procedures Should Be Practical, Not Overly Rigid
   While structured dispute resolution steps can prevent knee-jerk litigation, overly prescriptive procedures may delay outcomes and complicate compliance. A more flexible approach—such as allowing immediate litigation or streamlined mediation—can sometimes serve all parties better.
3. Weigh the Pros and Cons of Mandatory Arbitration
   Arbitration offers privacy, speed, and finality, but it comes at a cost—literally and procedurally. Consider whether arbitration could be optional instead of mandatory, especially if budget, discovery needs, or appeal rights are important.
4. Avoid Ambiguous or Undefined Terms
   Ambiguity leads to litigation. Be specific in defining services, obligations, and roles, especially when using templates or jargon. A vague term like “services” once led to a weeklong jury trial. Don’t assume shared understanding where interpretation can vary.
5. Think Strategically About Attorney Fees and Force Majeure
   In Oklahoma, contracts for labor or services presume attorney fees are recoverable unless expressly excluded. 12 O.S. § 936. This can significantly affect litigation strategy and settlement incentives. Similarly, ensure force majeure clauses are tailored to potential operational risks, as courts interpret them strictly.

Conclusion

Contracts are more than business paperwork—they are potential litigation roadmaps. Thoughtful drafting, with an eye toward dispute prevention and strategic positioning, can save substantial time and money down the road. When in doubt, ask: “If this goes to court, how will this clause play out?”

If you have any questions, please contact any member of GableGotwals’ Energy, Oil & Gas team.

Amy Stipe
405-235-5512
astipe@gablelaw.com

Rosie Garner
405-235-5502
rgarner@gablelaw.com

This article is provided for educational and informational purposes only and does not contain legal advice or create an attorney-client relationship. The information provided should not be taken as an indication of future legal results; any information provided should not be acted upon without consulting legal counsel.

August 29, 2023 | GableGotwals is pleased to announce our new associates have joined the Firm.

Rosa M. Garner focuses on a broad range of litigation matters, including corporate litigation, energy law, and intellectual property law. Rosie graduated in the top 20% of her class, earning her Juris Doctorate with Distinction from the University of Oklahoma College of Law. She was frequently named to the Dean’s Honor Roll and received the American Jurisprudence Award for Criminal Law. Prior to attending law school, Rosie earned her Bachelor of Science and Master of Science degrees in microbiology and worked as a research assistant focusing on microbial methane cycling in the environment.

Cole T. McDaniel focuses on a variety of litigation matters, including oil and gas, real estate, and commercial law. While at the University of Oklahoma College of Law, Cole was a member of the American Indian Law Review, Business Law Society, and Environmental Law Student Association. Additionally, Cole worked at BancFirst from spring 2018 to summer 2021 as a teller, intern, and extern. As an extern, he reviewed and updated employee and management training materials to reduce legal risks when dealing with customers.

About GableGotwals

GableGotwals is a full-service law firm with nearly 100 attorneys and more than 70 other professionals in Oklahoma and Texas. We represent a diversified client base across the nation, and our connections and reach are global. Fortune 500 corporations, privately-owned companies, entrepreneurs, foundations, and individuals entrust us every day with the stewardship and strategic management of their legal challenges.