After indicating last fall that it was looking for more joint venture (JV) partners, Los Angeles-based California Resources Corp. (CRC) found another one on Wednesday in Development Capital Resources LLC (DCR), which agreed to infuse $800 million for natural gas infrastructure.

Under the agreement, DCR invested $750 million in CRC and purchased 2.34 million shares of common stock for $50 million, or $21.33/share, based on a recent volume-weighted average price.

The JV includes the 500 MW Elk Hills, CA, natural gas-fired power plant and a 200 MMcf/d cryogenic gas processing plant near Bakersfield. Under a long-term commercial agreement with the JV, CRC agreed to purchase power and gas processing.

Capitalized by funds managed by private equity (PE) company Ares Management LP, DCR said the JV would operate the assets.

CRC, whose main focus today is exploration and production (E&P) in California, would retain a significant JV ownership interest.

CRC officials reiterated that JVs provide an opportunity for the company to prudently accelerate sustainable profitable initiatives. JVs were inked last year to boost E&P options with Benefit Street Partners LLC and Macquarie Infrastructure and Real Assets.

“CRC will continue to identify opportunities to invest in high-return projects while also continuing to strengthen its balance sheet,” a spokesperson said.

CEO Todd Stevens called Ares a “strategic partner,” whose equity investment “validates the strong positioning of our world-class assets and flexible business model. With our ongoing focus on value creation, we intend to deploy transaction proceeds toward the best available alternatives to drive shareholder returns over the long term.”

Stevens said $297 million of the transaction proceeds would be used to repay debt.

“We believe CRC has one of the premier oil and gas management teams in the industry and a world class asset base to match,” said DCR President Ronnie Scott. “We are excited to partner with CRC to invest in these midstream assets and support CRC’s proven upstream operating capability. We believe this transaction demonstrates CRC’s confidence in DCR’s and Ares’ ability to be constructive joint venture equity partners.”

DCR, with offices in Houston and in West Texas, was formed to provide capital to North American E&Ps. The CRC investment is the third project involving DCR and Ares, following a $300 million drilling partnership with Endeavor Energy Resources to develop Permian Basin wells and a $150 million drilling JV with an undisclosed onshore operator. DCR’s total JV investments in E&Ps to date are more than $1 billion.