Abram Chayes and Antonia Handler ChayesTwo-party, four-issue negotiation between representatives of a Central American country and an international petroleum corporation over the terms of an offshore drilling project
The Federal Republic of Meridia, located in Central America, is negotiating to sell off-shore oil leasing rights along its Eastern coast. the capitol of Meridia, Quintaro, is on the Western coast. Its population is 500,000. Meridia’s Western coast already has a number of off-shore drilling facilities, but this would be the first in the East. The Government has high hopes about the effect these newly discovered oil fields will have on that region. The city of Guaca, which dominates that region, was just involved in a six-year civil war. Meridia has many offers by contenders. Petrocentram, from Venezuela, is one of those three.
Negotiations between Meridia and Petrocam have been going on for about a month. A “final” negotiation session is about to begin. If a decision is not reached today, Meridia will begin negotiations with other companies.
- This exercise is an excellent vehicle for comparing principled negotiation and positional bargaining. Depending on the skill of the other negotiator, both approaches can do well. Both parties should be risk averse, however, and wary of an adversarial approach that might get out of hand.
- The knowledge that one’s BATNA is weak often leads people to negotiate much less vigorously than they otherwise would. Is this ever justified? If so, under what conditions? The case presents a good opportunity to point out that any such analysis should be based on a consideration of the parties’ relative BATNA’s.
- Since the case does have a strong competitive element, there is ample opportunity to explore techniques for indirectly and directly extracting information from the other side. Likewise, techniques of protecting oneself from “giving up” the possibility for gains that were unforeseen can be explored and discussed.
Meridia and Petrocentram Attributes
- Time required:
- 1-2 hours
- Number of participants:
- Teams involved:
- Agent present:
- Neutral third party present:
- Teaching notes available:
PON Teaching Negotiation Resource Center
Soft copy vs. hard copy
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If you select the hard copy option, you will receive paper copies of this role simulation via the shipping method you select.
For additional information about the soft copy option, please visit our FAQ section, or contact the PON Teaching Negotiation Resource Center at email@example.com or 800-258-4406 (within the U.S.) or 301-528-2676 (outside the U.S.).
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Ordering a single copy for review
If you wish to review the materials for a particular role simulation to decide whether you’d like to use it, a PDF, or soft copy, version of the Teacher’s Package for the simulation is available as a free download from the description page of most role simulations and case studies. All Teacher’s Packages include copies of all participant materials. In addition, some Teacher’s Packages (but not all) include additional teaching materials such as teaching notes or overhead masters.
Ordering copies for multiple participants
To order multiple copies of a role simulation for use in a course or workshop, simply enter the total number of participants in the box next to “Quantity.” There is no need to calculate how many of each role is required.
If you are ordering hard copies, the Teaching Negotiation Resource Center will calculate the appropriate numbers of each role to provide, based on the total number of participants. For example, if you wish to order a 2-party role simulation for use with a class of 30 students, you would enter “30” in the box next to “Quantity.” You then would receive 15 copies of one role and 15 copies of the other role, for use with your 30 participants. As another example, if you ordered 30 participant copies of a 6-party role simulation, you would receive 5 copies of each role.
In the event that the number of participant copies you order is not evenly divisible by the number of roles in the simulation, you will receive extra copies of one or more roles. Participants receiving the extra roles may partner with other participants playing the same role, thus negotiating as a team. So, for instance, if you ordered 31 copies of a 2-party role simulation, you would receive 15 copies of the first role and 16 copies of the second role. One of the participants playing the second role would partner with another participant playing that same role, and the two would negotiate as a team.