Equity Commitments to Caiman Energy, LLC Increase to $400 Million
Dallas, Texas – Caiman Energy, LLC announced today that the company has secured equity commitments totaling $400 million to support its growing inventory of midstream development projects in the Marcellus Shale. Caiman also has secured approximately 400,000 acres in contractual acreage dedications from Marcellus producers in West Virginia and Pennsylvania. The increased financing and acreage commitments will enable the company to continue to expand its gas gathering and processing capacity in this prolific play.
"The need for midstream infrastructure for the Marcellus Shale, especially in the rich gas areas of northern West Virginia and southwestern Pennsylvania, has presented Caiman with numerous opportunities," said Jack Lafield, President and CEO of Caiman Energy, LLC. "This increased equity commitment will allow us to continue to expand our rich gas presence and aggressively pursue similar opportunities in lean gas regions of the Marcellus Shale," he continued.
"The projects we have implemented to date, along with the additional projects in progress, will provide our customers with the much-needed, reliable, high-capacity gathering options necessary to expand development in the Marcellus. Additionally, the processing facilities we are constructing will add significant value to the already exceptional developmental economics for the producer," said Lafield.
To date, Caiman Energy has completed and is operating 30 miles of gas gathering lines in Marshall and Wetzel Counties, West Virginia, as well as 30 MMcfd of gas processing facilities at its Ft. Beeler site, also in Marshall County. Construction projects underway in Marshall and Wetzel Counties in West Virginia and Greene County, Pennsylvania, include an additional 75 miles of gas gathering lines, up to 24 inches in diameter, along with the addition of another 30 MMcfd of processing facilities to be in service this summer. These new lines will gather rich gas volumes associated with Caimanfs extensive acreage commitments. Caiman also is expanding its 20 miles of pipeline for gathering condensate. The condensate gathering facilities are designed to mitigate environmental concerns associated with production and reduce the impact on the community by greatly reducing the amount of truck traffic required to transport the production.
Construction of a new Ft. Beeler Processing Plant, a 120 MMcfd cryogenic processing facility, is expected to be completed and operational in November 2010. Caiman has begun the construction of natural gas liquids (NGL) handling facilities, which will include a 25-mile NGL pipeline to a terminal and fractionation facility located on the Ohio River. Caiman also is finalizing arrangements to begin building additional gas gathering lines in southwestern Pennsylvania and northern West Virginia focusing on leaner gas supplies.
The capitalization increase was led by EnCap Flatrock Midstream and includes almost 20 institutional investors. EnCap Flatrock Midstream manages the EnCap Energy Infrastructure Fund (EEIF), Caimanfs initial equity sponsor. EEIF provides growth capital to proven management teams focusing on energy infrastructure opportunities throughout North America and has institutional investor commitments totaling approximately $792 million. With this expansion, EEIF more than doubled the size of its initial commitment to Caiman to a level approaching $120 million. The remaining commitments were anchored by various limited partners of EEIF and funds managed by EnCap Investments L.P.
"Caiman already has had tremendous success in pursuing the development and acquisition of gathering, transportation and processing assets in the Marcellus. We are pleased that we were able to offer our limited partners the opportunity to co-invest alongside us," said Bill Waldrip, Managing Partner at EnCap Flatrock Midstream. "We look forward to a long and productive relationship with Caiman Energy as we work together to pursue the many opportunities for development in this exciting shale fairway," he continued.
About Caiman Energy, LLC
Caiman Energy is a midstream energy company focused on designing, building, owning, operating and acquiring midstream assets to provide services to producers such as natural gas gathering, compression, transportation, measurement, treating/conditioning and processing. Caiman Energy was founded in February 2009 by partners Jack Lafield, Danny Thompson and Rick Moncrief, who have more than 90 years of collective industry experience. Caiman Energy is currently pursuing midstream projects in emerging resource plays throughout the US.
About EnCap Flatrock Midstream
EnCap Flatrock Midstream partners with EnCap Investments, L.P. to manage the EnCap Energy Infrastructure Fund (EEIF). EEIF provides private equity capital to proven management teams focusing on midstream energy infrastructure opportunities throughout North America including:
- Natural gas gathering, treating, compression, processing and storage operations;
- oil gathering and transportation;
- natural gas liquid fractionation, storage and transportation;
- produced-water handling and disposal;
- CO2 gathering, transportation and sequestration.
The EnCap Flatrock Midstream team is led by Dennis Jaggi, Billy Lemmons and Bill Waldrip, who have worked together for virtually all of the past 30 years in the midstream sector of the oil and gas industry. With more than 93 years of midstream experience and 125 prior advisory clients, EnCap Flatrock Midstream principals have been directly involved in a total of approximately $4.1 billion in energy transactions and investments. Since 1988, EnCap Investments, L.P. has been a leading provider of private equity to the independent sector of the U.S. oil and gas industry, closing more than $7 billion of principal investments and corporate finance transactions and managing capital on behalf of more than 150 prestigious U.S. and European institutions. EnCap is managed by its four founding partners David B. Miller, Gary R. Petersen, D. Martin Phillips and Robert L. Zorich. For more information, visit www.efmidstream.com and www.encapinvestments.com.