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Proceeding with a clear understanding and agreement in principle: The key elements of the LOI should be negotiated beforehand and can be used as a guideline to prepare the purchase agreement. It should state that, if all information during due diligence confirms what was represented, that the buyer intends to complete the purchase under certain conditions. The key elements should include:

HOW VALID, OR OTHERWISE, ARE THESE USUAL RATIONALE BY SELLERS OR THEIR AGENTS? Ironically, while oil sellers and their agents frequently demand that prospective "serious" buyers involved in crude oil transactions should first offer an LOI, the buyers, on the other hand, are not generally enamored of that idea.

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