By: David French – Reuters – Double Eagle, a team of prolific oil and gas developers focused on the Permian basin, have raised more than $1.7 billion from a group of investors to fund their latest venture, according to a statement to Reuters on Sunday.
The sum is one of the largest pools of capital dedicated to oil and gas development raised since the pandemic, after many investors turned their backs on the U.S. oil patch in recent years due to a mix of poor past returns from the industry and increasing environmental consciousness.
The Double Eagle team though, led by co-chief executives Cody Campbell and John Sellers, have established a track record of building high-quality companies with strong returns. Its last project, DoublePoint Energy, was sold in May 2021 for around $6.4 billion to Pioneer Natural Resources (PXD.N). read more
This will be the fourth iteration of Double Eagle. Much of the cash is coming from private equity firm EnCap Investments, with contributions from fellow institutional investors Apollo Global Management (APO.N) and Magnetar Capital, as well as other backers including Double Eagle’s management.
The $1.7 billion will be split between Double Eagle Energy Holdings IV LLC, aiming to replicate the success of DoublePoint by developing a new oil and gas producer, with the rest going towards Tumbleweed Royalty IV LLC, which will acquire mineral and royalty rights, the statement added.
“Together with the financial strength of our partnership, our track record of success, and our world-class operating team, we can confidently and aggressively pursue very large acquisitions while continuing to organically assemble smaller opportunities and undertake an ambitious development program,” Campbell and Sellers said.
Both Double Eagle IV and Tumbleweed will be focused on the Permian basin, the area of Texas and New Mexico known as the heart of the U.S. shale industry.
Permian production is expected to reach a record of 5.316 million barrels per day in July, according to the U.S. Energy Information Administration.
