News

Caiman Energy II Secures $800 Million in Equity Commitments

July 10, 2012
Caiman Energy

Company expands management team, will build midstream system in the Utica Shale

DALLAS – July 10, 2012 - Caiman Energy II, LLC announced today that the company has secured $800 million in equity commitments for the development of midstream infrastructure in Ohio and Pennsylvania’s Utica Shale. Funding for Caiman’s initiatives in the Utica and other potential regions will be provided by Williams Partners (NYSE:WPZ), EnCap Flatrock Midstream of San Antonio, Highstar Capital of New York, and management.  

Caiman Energy was founded in 2009 and backed with equity commitments from EnCap Flatrock Midstream, EnCap Investments L.P. and Highstar Capital. From 2009 through the first quarter of 2012, Caiman focused its operations in the liquids-rich region of the Marcellus Shale where the company built a sizable rich gas system.  In April 2012, Caiman sold its wholly owned subsidiary, Caiman Eastern Midstream, LLC, substantially all of its Marcellus assets, to Williams Partners for approximately $2.5 billion. The acquisition established Williams Partners’ Ohio Valley Midstream system.  Williams Partners expects significant growth in gathering volumes and NGL production.

Caiman Energy II is being funded to provide for the continued high level of full midstream services to producers developing the Utica Shale and other potential shale plays. Caiman’s ability to bring significant capital, experience and knowledge devoted to new midstream facilities in the new shale regions will continue to provide producers with the ability to optimize the exploitation of their acreage.

Chairman’s Perspective
“We're very proud of the expansive system we built in the Marcellus and the great relationships Caiman developed with producers and the people of West Virginia. We look forward to continuing our work in new regions, especially the Utica Shale.  The development of this vast, liquids-rich resource will require similar midstream infrastructure as we built out in the Marcellus,” said Jack Lafield, Caiman’s chairman and CEO. “Working alongside Williams and our other equity partners, the active exploration and production companies, and the people living in this region, we will draw on our important experience in the Marcellus and our proven ability to execute with integrity and exceptional results.”

From Caiman’s Equity Partners
“With this new venture, we can leverage the commercial relationships and success of Caiman’s management and investors, along with Williams Partners’ long experience in successfully constructing and reliably operating large-scale midstream infrastructure,” said Alan Armstrong, chief executive officer of Williams Partners’ general partner.

“We are very pleased to partner with the team at Caiman Energy for the second time,” said William R. Lemmons Jr., one of EnCap Flatrock’s three managing partners and a member of Caiman Energy’s board of directors. “The Utica is one of the most exciting plays in the country, and Caiman has an outstanding team in place that has already proven itself in the Marcellus, where they had remarkable results for their producer customers, the people of the region and our investors.  EnCap Flatrock is very excited about Caiman’s future and we look forward to working with Williams Partners and Highstar Capital to ensure Caiman’s continued success.

“We’re very excited to work with the same dynamic management team. Caiman has a track record of impressive results, and we are confident that record will continue in a region as exciting as the Utica Shale,” said Highstar Founder and Managing Partner Christopher Lee.

Caiman Expands Senior Leadership Team
Caiman Energy also announced five significant promotions and two additions to the company’s senior management team. Caiman’s founder, Jack Lafield will continue as Caiman’s chairman and chief executive officer. Richard D. Moncrief has assumed the role of president of the company and will remain its chief operating officer. Stephen L. Arata has been promoted to executive vice president and will continue to serve as chief financial officer. Tony Strehlow, Caiman’s chief accounting officer, has also been promoted to senior vice president.

Scott Williams has been named senior vice president of commercial development and Daniel Wentworth has been promoted to senior vice president of engineering and operations.  A new addition to Caiman Energy’s management team, Mr. Williams has 35 years of energy industry experience. Prior to joining Caiman, he served as the president of TPF Gas Services where he was responsible for the development and staffing of the company and oversaw all of the day- to-day activities. From 2002 to 2011, Mr. Williams worked for Crosstex Energy Services, where he served in numerous senior management roles.

Daniel Wentworth’s 12 years of energy experience has been focused on business development, engineering design, construction, gas gathering and processing operations.  He joined Caiman Energy in 2010 as director of engineering and later served as vice president of engineering.  Prior to Caiman, Mr. Wentworth worked for Regency Energy Partners (NYSE: RGP), a midstream natural gas service provider. 

“There isn’t a more experienced and skilled management team in the midstream sector.  I am very proud of what this group accomplished in the Marcellus Shale and, with the addition of Scott Williams, we are very well positioned to create a similar success story serving producers in the Utica Shale,” said Caiman Chairman and CEO Jack Lafield.

About Caiman Energy
Caiman Energy is a midstream energy company focused on the design, construction, operation and acquisition of midstream assets. The company is currently focused on midstream projects in the Utica shale and serves producers by providing natural gas and condensate gathering, compression, dehydration, measurement, treating and conditioning, processing, liquids transportation and fractionation services.  For more information, visit www.CaimanEnergy.com. 

About EnCap Flatrock Midstream
Based in San Antonio, EnCap Flatrock Midstream is a private equity firm founded in 2008 by EnCap Investments L.P. and Flatrock Energy Advisors. The firm provides value-added private equity capital to proven management teams focusing on midstream energy infrastructure opportunities throughout North America. With more than 100 years of midstream experience, the principals at EnCap Flatrock Midstream have been directly involved in a total of approximately $7.5 billion in energy transactions and investments. Visit www.efmidstream.com for more information.

About Highstar Capital IV LP
Highstar Capital is an independently owned and operated private equity firm with an operationally focused, value-added strategy. Based in New York, the firm was founded in 1998 and currently manages more than $5.6 billion on behalf of its managed funds and co-investment vehicles in a diversified portfolio of energy, transportation and environmental/waste management assets and businesses. For more information visit www.HighstarCapital.com.

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