Bloomberg
James Hackett, former CEO of Anadarko Petroleum Corp. (NYSE: APC) and current partner with Riverstone Holdings, helped lead the deal to form Mexico's first independent upstream energy company.
Private equity players in Houston have teamed up to form what is being dubbed Mexico's first independent oil and gas exploration and production company.
Houston-based EnCap Investments LP and New York-based Riverstone Holdings LLC, which has a major Houston presence, are each investing $225 million in the formation of Mexico City-based Sierra Oil & Gas S de RL de CV. Mexico's Infraestructura Institucional, which helps develop infrastructure, pumped in another $75 million to create a total investment of $525 million. All three investors retain the option to double their existing commitment once the initial equity has been fully invested.
Mexico is in the process of opening the country up to private energy exploration for the first time in 75 years and eliminating the monopoly of state-owned oil giant Petróleos Mexicanos, or Pemex.
Houston-based Riverstone Partner Jim Hackett, who previously was CEO at Anadarko Petroleum Corp. (NYSE: APC), said the firm is "delighted" to partner for the investment in Mexico.
"We have been very impressed with the progress of the energy reform and look forward to contributing to the growth of a vibrant private energy sector in the country, as we have done in the U.S., Canada and elsewhere," Hackett said in a prepared statement.
Sierra will be led by Ivan Sandrea, who most recently was a senior partner at EY in London. He also has worked for upstream energy companies. He has assembled a team of professionals from both the Mexican and international oil and gas sector.
"Our equity commitment to Sierra reflects the confidence that we have in Ivan and his team, as well as our belief in the potential for significant growth in Mexico's oil and gas sector,"Jason DeLorenzo, partner at EnCap, said in a statement to the Houston Business Journal.
The company plans to participate in exploration, development and production optimization opportunities in Mexico. Additionally, Sierra may consider opportunities in oil and gas transportation, storage and processing.
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