Warburg Pincus LLC is leading a group of investors to fund up to $1.125 billion in a new Gulf of Mexico (GOM) deepwater explorer helmed by a former Nexen Inc. executive.
Venari Resources LLC, which is to be headquartered in Dallas, would be backed by Warburg, Kelso & Co., The Jordan Co., and Asian investment giant Temasek Holdings.
Venari's CEO is Brian Reinsborough, formerly the chief of Nexen's U.S. operations. He joined Warburg last year as an executive-in-residence and helped to formulate the start-up's business plan. At Nexen Reinsborough helped to develop and execute Nexen's deepwater GOM plans for 15 years.
"The deepwater Gulf of Mexico remains one of the most attractive basins in the world to search for large oil reserves," he said. "Being part of one of the largest private financings for a start-up company in the oil and gas sector is a tremendous testament to the team and to the future of the deepwater Gulf of Mexico."
Venari, which is Latin for "hunt," plans to target subsalt reservoirs, which are pockets of oil and natural gas that had been obscured by salt layers until advances were made in seismic imaging technology. Initial investments of 10-25% are to be made in GOM exploration blocks, with Venari providing technological expertise to majority lease owners.
"We have long identified the Gulf of Mexico as an attractive area of high geologic potential," said Warburg Managing Director Seon Hwang, who is leading the start-up's investment team. "Today with the establishment of new environmental protocols and the revival of drilling and permitting activity, the basin offers a safer operating environment and an attractive opportunity to build a meaningful business."
Venari is Warburg's sixth investment in a GOM-focused producer. U.S. offshore investments include Gryphon Exploration Co., now part of Australia's Woodside Energy (see Daily GPI, Sept. 2, 2005), as well as Spinnaker Exploration Co., which is now in Statoil ASA's portfolio (see Daily GPI, Dec. 19, 2006; Sept. 20, 2005).
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