Energy Capital Briefs

ABN AMRO names UK branch managing director

ABN AMRO Lease has appointed Richard de Keijzer to managing director for its UK branch. Richard de Keijzer has been involved with ABN AMRO Lease's international activities for years, serving first as Program Manager International, followed by roles as sales director and managing director a.i. for the UK. Prior, he served in various commercial and managerial positions within corporate banking at ABN AMRO Bank over a period of 14 years. ABN AMRO Lease delivers asset-based solutions (i.e. equipment lease) to SME's, a broad range of national and international operating corporates and the public sector. ABN AMRO Lease is active in the Netherlands, Germany, the UK and Belgium. ABN AMRO is a Dutch bank for retail, corporate, and private banking clients.

Percussion Petroleum, Carnelian Energy Capital management partner

Percussion Petroleum LLC has closed an equity commitment from Carnelian Energy Capital Management LP through Carnelian's fund, Carnelian Energy Capital LP. Percussion, headquartered in Houston, was formed to pursue an acquisition and exploitation strategy in select onshore basins in North America. The founders of the company, John Campbell III, Lupe Carrillo and Brian Zwart, previously worked together at two private-equity backed ventures, QR Energy LP and Rockcliff Energy LLC. Carnelian is a private equity firm based in Houston, Texas. Carnelian focuses on lower and middle market energy investments requiring between $35 million and $75 million of equity capital in the North American upstream, midstream, and oilfield services sectors.

Warren Equity Partners, Multifuels establish new midstream company

Warren Equity Partners, a middle market private equity firm, has partnered with Multifuels LP to build a midstream pipeline platform. As part of the transaction, Multifuels LP is contributing an existing natural gas pipeline that supplies a utility service area in Texas, and Warren Equity is contributing approximately $20 million of cash and equity commitments. Multifuels Midstream Group will own, operate, and develop midstream projects in North America, with an emphasis on lateral distribution pipelines. These laterals will transport natural gas from main lines to end users under long-term contracts. The company is headquartered in Houston, Texas and will be led by Randy Gibbs as CEO.

Energy pressures set to drive Canadian dealmaking in 2016

A new study by Citi shows that Canadian M&A activity is expected to accelerate in 2016, as low energy prices attract buyers to the market. The appetite for deals is broadly projected to rise: 70% of respondents predict a higher level of M&A activity in the next 12 months, with 20% expecting a significant increase.

The report found that the proper market conditions appear to be taking hold for an increase in deal volume in 2016. The primary driver will be the slump in commodities prices according to 38% of respondents, followed closely by private equity demand (36%).

"2016 is shaping up to be an interesting year," says Grant Kernaghan, Managing Director of Canadian Investment Banking at Citi. "In addition to the continuing demand from private equity, we are expecting higher activity levels in the mining and energy sectors, and a number of factors are converging that suggest an increase in hostile takeovers may be on the horizon."

Other key findings from the report include:

• The biggest increases in Canadian M&A activity are expected in domestic and inbound deals. Forty-eight percent of respondents predict an uptick in domestic deals and 81% believe that inbound deals will increase, while only 33% foresee a rise in outbound M&A.
• The greatest challenge to Canadian M&A in 2016 will be the valuation gap between buyer and seller according to 68% of respondents, trailed closely by volatility in global commodity prices (62%).
• When asked what sectors they think will see the most Canadian M&A activity, respondents identified Energy (50% for Domestic M&A, 48% for Inbound M&A) and Mining (34% for Domestic M&A, 28% for Inbound M&A) in 2016.
• Citi commissioned Mergermarket to survey 50 Canada-based senior executives directly involved in M&A decision-making for the study.

Intervale Capital backs Entegra

Intervale Capital, an energy-focused private equity firm, has invested alongside a management team to form Entegra LLP, which provides in-line inspection (ILI) services to the energy industry. Entegra currently has engineering, R&D, and ILI tool fabrication resources in Toronto, Ontario, Canada, with sales and field operations based out of Houston, Texas, and Indianapolis, Indiana. The company plans to expand its footprint to offer pipeline inspection and integrity services in all active pipeline markets in the US and Canada.Mark Olson serves as Entegra's president. He brings more than 25 years of pipeline integrity experience to the company, and leads a team of veteran engineering, operations, and sales professionals. Olson previously led the team that formed Cornerstone Pipeline Inspection Group (CPIG) in 2001, which pioneered an MFL/Caliper combo ILI tool, or "smart pig." CPIG was acquired by Baker Hughes Inc. in 2003.

Cheniere Partners engages institutions to arrange project debt refinancing

Cheniere Energy Partners LP has engaged 13 financial institutions to act as joint lead arrangers, mandated lead arrangers, and other participants to assist in the structuring and arranging of senior secured credit facilities in an aggregate principal amount of up to approximately $2.8 billion.

Proceeds from these new credit facilities are intended to be used by Cheniere Partners to prepay the $400 million senior secured term loan at Cheniere Creole Trail Pipeline LP (CCTP), redeem or repay the approximately $1.7 billion senior secured notes due 2016 and the $420 million senior secured notes due 2020 that were issued by Sabine Pass LNG LP (SPLNG), pay associated transaction fees, expenses, and make-whole amounts, if applicable, and for general business purposes of Cheniere Partners and its subsidiaries. SPLNG and CCTP are both wholly owned subsidiaries of Cheniere Partners.

The 13 arrangers and other participants are The Bank of Tokyo-Mitsubishi UFJ Ltd., ABN AMRO Capital USA LLC, Société Générale, Industrial and Commercial Bank of China Ltd., New York Branch, Intesa Sanpaolo SPA New York Branch, JPMorgan Chase Bank NA, Mizuho Bank Ltd., Sumitomo Mitsui Banking Corp., Morgan Stanley Senior Funding Inc., Bank of America NA, Credit Suisse, HSBC Bank USA NA, and Commonwealth Bank of Australia.

Blackhill Partners completes TransCoastal restructuring

Blackhill Partners, an investment bank specializing in complex situations, has completed a restructuring for TransCoastal Corp., including guiding the company through a prepackaged bankruptcy in 36 days. TransCoastal, a Dallas, Texas-based independent oil and gas company focused on the acquisition of producing oil and gas properties, retained Blackhill Partners to evaluate assets, identify strategic alternatives, and negotiate a restructuring with its senior lender. TransCoastal's assets include primarily operated and non-operated properties located in the panhandle and north central regions of Texas.

Black Mountain Oil and Gas partners with NGP

Black Mountain Oil & Gas LLC has closed a $150 million equity commitment from Natural Gas Partners (NGP) through NGP Natural Resources XI LP, the most recent NGP private equity fund focused on natural resources.

The Black Mountain management team combines expertise in geology, engineering, land, and A&D in conventional and unconventional oil and gas reservoirs. The company is applying its multi-disciplinary approach across the most prolific producing regions in the US Lower 48 with a current focus on the Delaware Basin in Texas and New Mexico.

Black Mountain is an independent oil and gas company based in Fort Worth, Texas. The first Black Mountain company was founded in 2007; since that time, it and its successors have leased over 200,000 acres in various resource plays across six basins and five states, and acquired mineral and royalty interests in more than 10,000 oil and gas wells covering 800,000 gross acres in 11 states.

Canadian private capital activity climbed in 2015, but investment in oil and gas declined

Canadian private capital continued its climb in 2015: venture capital activity saw amounts invested and fundraising increase substantially, with exit values reaching historical highs. Private equity saw solid fundraising numbers and large increases in volume. These are some of the main findings from the Canadian Venture Capital & Private Equity Association's private capital market activity reports for 2015. That being said, the impact of low oil prices was felt in 2015 as the number of deals and the amount invested in oil and gas declined from 82 deals and $13.1 billion in 2014 to 48 deals across $8.6 billion in 2015. While oil and gas remains the highest in terms of amount invested, it is now fourth in terms of volume after industrials, ICT, and mining. Data collected from a comprehensive survey of CVCA members shows that the vast majority (67%) agree that depressed oil prices will worsen business outlooks for 2016.

Fountain Quail Water Management secures private equity commitment

Keller, TX-based Fountain Quail Water Management LLC has secured a private equity commitment of up to $40 million to expand its North American operations. Fountain Quail specializes in treating and recycling produced and flowback water generated in oil and gas plays. Fountain Quail's two proprietary systems, ROVER™ and NOMAD™, are designed to cut oil and gas producers' water-specific operating costs by eliminating the need to transport and dispose of wastewater and to source and transport fresh water. Fountain Quail developed the mobile ROVER system to recycle wastewater into clean brine for reuse during hydraulic fracturing. Each ROVER system is capable of recycling 10,000 barrels of clean brine per day. Fountain Quail's NOMAD system converts wastewater into surface-discharge-quality fresh water. Each NOMAD system is capable of generating 2,000 barrels of distilled, surface-discharge-quality fresh water per day.

Lucid Energy Group II Secures $350M Equity Commitment from EnCap Flatrock Midstream

Lucid Energy Group II LLC, a full-service midstream provider based in Dallas, has secured an initial equity commitment of $350 million from EnCap Flatrock Midstream and the Lucid II management team. Lucid II was formed by the team that leads its predecessor company, Lucid Energy Group LLC (Lucid I), also backed by EnCap Flatrock. Lucid I has developed a midstream footprint in the Midland Basin. Lucid II is pursuing organic development projects and strategic acquisitions in other producing basins. Lucid II was advised by Locke Lord. EnCap Flatrock was advised by Thompson & Knight.