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EnCap's North American NatGas, Oil Commitments Reach $1B in Three Days

EnCap Flatrock Midstream on Wednesday announced its third big U.S. energy investment in three days, including up to $500 million in initial equity for a pair of midstream companies, bringing parent Encap Investments LP's total commitment to the North American natural gas and oil sector to more than $10 billion.*

Tall Oak Midstream LLC said Wednesday its founders have formed Tall Oak Midstream III LLC with an initial equity commitment of up to $200 million from Encap Flatrock and Tall Oak management. Tall Oak III plans to pursue midstream opportunities across North America outside the STACK, otherwise known as the Sooner Trend of the Anadarko (Basin) in Canadian and Kingfisher counties. The $200 million commitment is the third commitment EnCap Flatrock has made to the Tall Oak management team.

The move comes 19 months after Tall Oak sold its first venture, which served producers working in the STACK and the Central Northern Oklahoma Woodford (CNOW) play, to EnLink for $1.55 billion.

On Tuesday, EnCap Flatrock, a partnership of EnCap Investments LP and Flatrock Energy Advisors, announced a $300 million equity commitment to Greenfield Midstream LLC, a privately held company focused on organically developing North American midstream infrastructure. Houston-based Greenfield's services include natural gas gathering, processing, treating and compression; crude oil gathering and transportation; water handling; and product marketing.

"Our goal is to develop midstream assets that are tailored to fit producer needs and maximize stakeholder value," said Greenfield CEO Jeremy Ham. "EnCap Flatrock brings the capital we need to move rapidly, strong financial acumen and a deep understanding of the development and operation of midstream assets."

Those commitments come on the heels of Silverback Exploration II LLC's announcement Monday that it had another $500 million in hand from EnCap to pursue conventional and unconventional U.S. resource plays.

EnCap Flatrock in June provided Cardinal Midstream with a $250 million equity commitment -- the third investment by EnCap -- to build out a Utica Shale dry gas gathering system in north central Pennsylvania and for other assets across North America. More recently, EnCap sold Midland, TX-based EagleClaw Midstream Ventures LLC for $2 billion and committed $200 million to help form Aspen Midstream LLC.

*Correction: In the original article, it was incorrectly reported that EnCap Investments LP's total commitment to the North American natural gas and oil sector, as of last July, totaled $1 billion. The correct figure is more than $10 billion. NGI regrets the error.

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