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Ryan O'Reilly contract negotiations: Why this might not be a slam dunk for the Avalanche

It would seem that the popular sentiment is that O'Reilly will sign relatively quickly. I am not so sure.

This marks the 2,000th time we've used this photo at MHH
This marks the 2,000th time we've used this photo at MHH
Doug Pensinger

The lockout is almost over and the Avalanche should be in camp soon and we can all get on with this pathetic little excuse of a season (thanks, Gary!). The Monsters have signed a few forwards and recalled a couple of defensemen from the Cutthroats in what is probably a move to replace the few who get invited to the Avs camp. The schedule should be out soon and before long we'll officially know that P.A. Parenteau will be wearing #15 along with the other number changes. The Avs will start selling tickets which will no doubt sell out instantly, because who doesn't want to watch the team play the Wild and the Flames over and over and over again?

There is, of course, one small matter to clear up and that would be the Ryan O'Reilly contract. Radar, an RFA, did not follow Semyon Varlamov and the rest of the boys home to Denver as he still has no contract with the Avalanche. From perusing the comments on this fine site, it would seem that the popular sentiment is that O'Reilly will sign relatively quickly. I am not so sure.

Clearly, the Avalanche are motivated to sign O'Reilly after his breakout season last year. He led the team in scoring and had great chemistry with Gabriel Landeskog, all while doing the little things like winning faceoffs and playing solid defense. If he's not on the Avs' core foundation list, someone needs to fix the list. He's, like, good and stuff.

But the Avalanche didn't sign him before the lockout and the only thing that really changed during the lockout is that O'Reilly got a second paying job. We talk a lot here about the Avalanche and their, er, reluctance to operate at much more than the cap floor. But I think it's useful to look at the actual money paid out by the Avalanche. According to Capgeek, the actual salary + bonuses paid out by the Avalanche the last 3 years is $48.8 million, $42.7 million and $49.4 million. The dip was in 2010, the season after Joe Sakic announced his retirement. He made $6 million the previous season and he retired 9 days into the free agency period - too late to to add a significant contract in free agency. Suffice to say, they were planning to be up around $49 million for each of the last three years. The Avalanche right now are at $51 million in payroll and that's before O'Reilly signs. If the Avs are under orders to stay around $50 million in payroll - and we don't know that they are, but I strongly suspect it - then they certainly will be motivated to fight hard to keep O'Reilly's salary down. And, while O'Reilly's value can't be questioned, the Avalanche do have a fairly deep group of forwards. Couple that with the short season and I wonder if the Avalanche might be willing to roll the dice for a while with the staff on hand.

On the other side of things, yes, Ryan O'Reilly is in Russia. It's probably not ideal for the guy, but he has some luxuries that contract holdouts normally don't have. And by luxuries I mean a paycheck. We don't know officially what O'Reilly is making in the KHL, but odds are that it is more than the $900,000 he banked last year. Money pressures usually catch up to all holdouts, but cash flow isn't a problem for him at the moment. I am sure O'Reilly is anxious to get back to the states and the most prestigious hockey league in the world (ha ha ha ha ha ha ha ha), but the KHL job gives him a great deal of freedom to wait for an offer that is more to his liking. And this is by no means a permanent exile - the KHL regular season only has about 10 games left, running for about 5 more weeks. O'Reilly could very possibly play out the rest of the year there, collecting the rest of his salary, and then come home and wait by the phone for the Avalanche to call while he thaws out.

I do hope this is one of those frequent occasions where I'm wrong, but I don't love the way this is shaping up. The Avalanche probably have more financial pressure than normal to keep the salary low, and O'Reilly has the luxury of waiting until the deal is right for him. Okay, "luxury" might be a strong word for traipsing around Russia, but you get the idea. He has options. And I haven't even touched on the "oral agreement" he has with his team to void the contract if the Avalanche make him a better offer, an agreement the KHL may or may not honor. Slam dunk? I sure hope so...but I've got a bad feeling about this.