Global alternative asset manager, Carlyle Group announced today it is committing an equity line up of $500 million in Magna Energy Ltd, an upstream oil and gas start-up by Mike Watts and Jann Brown, both of whom worked with Cairn Energy till a year back.
Magna is eying opportunities in marginal fields of Oil and Natural Gas Corporation. The government is planning to bid out marginal fields which are small discoveries which do not offer economy of scale but become viable only when oil prices are stable. It has 45% interest in Oilex’s Cambay block.
The company is targeting the building of acreage positions in the Indian subcontinent, particularly India and Bangladesh, with the objective of creating a full-cycle oil and gas company through acquisitions and local licensing rounds. Magna’s primary focus will be development and production with a secondary focus on exploration, Watts said in a conference call today.
“The new government has hit the ground running,” Watts said adding that the Indian economy has strong potential. Funding for the investment will come from Carlyle International Energy Partners (CIEP), a fund that focuses on oil and gas exploration & production, midstream, and refining and marketing in Europe, Africa, Latin America and Asia. This investment is led by Managing Director and Head of CIEP Marcel van Poecke and Managing Director Bob Maguire.
The Carlyle Group is a global alternative asset manager with $193 billion of assets under management across 130 funds and 156 fund of funds vehicles as of March 31, 2015. Maguire said the investment in Magna would be made in two phased of $250 million after its team analyses the value of assets being acquired by Magna.
Carlyle currently invests across four segments – Corporate Private Equity, Real Assets, Global Market Strategies and Investment Solutions – in Africa, Asia, Australia, Europe, the Middle East, North America and South America. It has also launched a broad-based energy investing platform (currently with over $10 billion in capital to deploy) offering investment opportunities, including international energy investing in oil and gas exploration and production, mid and downstream, refining & marketing and oil field services.
Established in May 2013, the CIEP team focuses on oil and gas exploration and production mid- & downstream, refining and marketing and oil field services in Europe, Africa, Latin America and Asia. CIEP current investments include: Varo Energy, a Swiss-based refining, storage and distribution business operating in Germany and Switzerland; Discover Exploration, an oil and gas exploration company based in the UK that focuses on Africa, Latin America and Asia; Midia Resources, a Romanian based gas production group; Neptune Oil & Gas which focuses on large-scale oil and gas opportunities in the North Sea, North Africa & South-East Asia and HES International, a European liquids, dry-bulk storage and handling business.
Magna is a private, value focused energy company founded initially as a passive investment vehicle by Mike Watts and Jann Brown in 2013. Watts has a career history of nearly 50 oil and gas discoveries (in Pakistan, Thailand, Myanmar, Bangladesh, and India), cumulatively resulting in more than 500,000 boepd of production, to which recent Cairn discoveries in Senegal (2014) will eventually be added. In addition to Shell, he worked with Burmah Oil, Premier Consolidated Oilfields, Holland Sea Search, Command Petroleum, Snyder Oil International and Cairn Energy Plc throughout South Asia and the Far East.
