Innocents Abroad

OIL & GAS

In a suite in Paris' George V Hotel last week, Texas Oilman Glenn McCarthy, clad in a silk monogrammed shirt and tight-waisted blue slacks, paced the floor. Suddenly the door flew open. In came his lawyer, waving a contract over his head and shouting: "Here, brother, are the crown jewels." Drawled McCarthy to the lawyer: "Another bourbon, and not so much water this time. And a cigarette." Then, glancing at the contract, he added: "I hope it's going to be a big boy when it grows up."

The contract represented the latest gamble in McCarthy's chance-taking career. Under it, McCarthy, now 43, agreed to put up an estimated $2,000,000 for a 51% interest in the National Petroleum Co. of Egypt, a paper company formed two years ago by Egyptians. It holds options on more than 5,000,000 acres of unexploited land near the Red Sea. The contract also sets up a strange partnership: in on the deal is Johnny Meyer, the press agent who supplied strong drink and weak women for Howard Hughes's customers during the war.

Too Busy. It all started last summer, when a Swiss lawyer, representing the Egyptians, approached Meyer. Would Meyer's one-time boss Hughes be interested in taking a flyer? Meyer thought not; Hughes, he felt, was too busy. He phoned McCarthy instead. Said McCarthy: "You got a deal." McCarthy, whose oil properties are being run by the insurance companies to whom he owes about $54 million, was itching for a long shot to get him out of hock. He and Meyer called on the Egyptian ambassador in Washington, last month flew to Egypt where they got the red-carpet treatment. Said Meyer: "It looked like a Shriners' convention." They inspected the optioned desert, thought it looked fine. Meyer's estimate: "Why hell, you can dig it with your shoes." McCarthy's: "Well, there's a lot of sand. And there's oil all right."

When it came to negotiating, McCarthy laid down some hard terms. "I don't mind leaving what money I've got to spend there," he said, "but I want to get my profits out." With that written in, he agreed to raise half the development capital (which he says may run above $20 million), and give the Egyptian government a 15% royalty on all oil produced. But there are some big ifs to the deal. McCarthy may have some trouble raising money, and Egypt must first pass a bill allowing foreigners to own more than 50% of an Egyptian company. They are now restricted to 49%. McCarthy claims to have the assurance of several top-ranking Egyptians that Parliament will do so within a month.

Follow the Leader. McCarthy thinks the Egyptians will not regret opening the door to free enterprise. Says he: "I'm going to get them results they've never heard of. And if that don't convince them, what will?" Said he to Partner Meyer last week: "Johnny, I'm betting you $8,000 to 55-c- I'll have an oil well in operation within 15 days after I move in." Hoping to lose, Johnny Meyer put up the 55-c-.

This file is automatically generated by a robot program, so reader's discretion is required.