Oil patch money churn continues

Sure, some folks say we’re headed into a downturn, but deals are continuing in the oil patch. A few items that popped up this week.

hi_j0075 Houston is crackling with energy deals. Chron – Karl Stolleis.

A new energy hedge fund, ETG Capital Master Fund, announced it was in business this week, trading in the power, natural gas and oil markets (and maybe emissions). Don Addison, a trading veteran of Hydro-Quebec, said the fund has raised between $25 million and $50 million from institutional investors and are aiming for $100 million by the end fo the year.
The firm also includes George Lyons, was founder of Houston-based Tractabel Energy Marketing, now part of Suez Energy, and Randall Gibbs, president of Houston-based Multifuels and founder of BTU Brokers, which was sold to Amerex Energy in 2000.
Chalker Energy Partners II sold all of its oil and gas properties to NFR Energy LLC, the joint venture launched by First Reserve Corp. and Nabors Industries last year.
The acquisition by NFR includes 24,000 acres of both producing and undeveloped natural gas properties in the Cotton Valley Trend of East Texas, producing about 23 Mmcfe per day and reserves of nearly 300 Bcfe.
Exact terms of the deal weren’t disclosed, but Chalker said its investors got a 350 percent net return on a $70 million equity investment.
Originally these were assets under the umbrella of Arena Resources that local private equity firm Quantum Energy Partners invested in and put under portfolio company Chalker Energy. BNP Paribas later put up $70 million in senior and subordinated debt to finance an aggressive drilling program.
Contango Oil & Gas Co. will sell its 10 percent limited partnership interest in the Freeport liquefied natural gas project to “a major Asian utility” for $68 million. The sale is subject to the Purchaser’s board approval and customary closing conditions and adjustments.
The sale is part of Contango’s previously announced review of strategic alternatives to enhance shareholder value. Merrill Lynch & Co. acted as financial advisor to Contango in connection with the sale.