EnCap Investments announced the closing of a continuation vehicle for PennEnergy Resources, with over $2 billion in capital commitments, marking the largest continuation vehicle formed to date in the upstream energy sector. The transaction enables PennEnergy to continue developing its extensive natural gas portfolio in the Marcellus Shale, while also providing growth capital for future bolt-on opportunities amid a favorable natural gas market.
The continuation vehicle, managed by EnCap, is anchored by funds affiliated with Andros Capital Partners LLC and the Vintage Strategies at Goldman Sachs Alternatives, alongside an equity commitment from EnCap Energy Capital Fund XII, L.P., the EnCap General Partner, and PennEnergy Management. The strong investor demand exceeded the firm’s initial target, demonstrating confidence in both PennEnergy’s operational success and EnCap’s long-term track record in energy investments.
This transaction allows PennEnergy to advance its decades of high-quality inventory and execute on its growth plans during what EnCap described as “a very exciting time in the natural gas sector.” Headquartered in Pittsburgh, PennEnergy remains focused on developing and optimizing production across the Marcellus Shale play, one of North America’s most prolific natural gas formations.
Since its founding in 1988, EnCap has provided more than $40 billion in growth capital across 25 institutional investment funds and continues to manage capital on behalf of over 350 U.S. and international investors. The firm’s experience and strong investor relationships have positioned it as a key partner for energy companies transitioning through growth and market shifts.
Jefferies served as the lead financial advisor to EnCap, with Stephens also serving as a financial advisor. Kirkland & Ellis provided legal counsel to EnCap on the continuation vehicle transaction. Vinson & Elkins LLP advised the PennEnergy management team on general partner formation and related matters.
KEY QUOTES:
“We are grateful for the continued confidence our limited partners have shown in EnCap. We are appreciative for the opportunity to continue supporting the entire PennEnergy team as they continue to build a premier business during a very exciting time in the natural gas sector. The capital raise was bolstered by the high-quality nature of the business that PennEnergy has built over the last decade and the strong investor relationships that EnCap has fostered for many years. We remain very optimistic about the PennEnergy business plan and look forward to continuing to build on our successful track record of deploying capital and delivering value for our partners and portfolio companies.”
Jason DeLorenzo, Managing Partner, EnCap Investments
