EnCap Closes $6.4B for E&P Fund, Including Co-investments

EnCap Investments LP said Oct. 21 it has successfully closed EnCap Energy Capital Fund XII LP with capital commitments of $5.25 billion, exceeding its initial target and hitting its hard cap.

Combined with $1.2 billion in co-investments, Fund XII raised a total of $6.4 billion in funds for Fund XII so far.

Fund XII currently includes investments in 12 portfolio companies, 10 of which are managed by teams the firm has successfully partnered with in previous funds. Fund XII portfolio companies are working across major U.S. oil and gas basins.

EnCap hasn’t mentioned the specific basins in which the companies will be working, but an EnCap spokesperson told Hart Energy the following companies already have investments under Fund XII:

• Grayson Mill III;
• Double Eagle;
• Ridge Runner Resources;
• Black Swan II;
• Paloma Resources VII;
• Novo II;
• Pegasus Resources III; and
• Verdun Oil Co. III

In addition to Fund XII, EnCap recently finalized fundraises for its two other investment verticals, EnCap Energy Transition Fund II and EnCap Flatrock Midstream Fund V. Collectively, the three EnCap platforms achieved final close this year and raised approximately $9 billion of capital collectively.

EnCap will use the capital to provide attractive risk-adjusted returns for its investors by partnering with experienced management teams.

“We are pleased to announce the closing of Fund XII, significantly exceeding our initial target and ultimately hitting the hard cap,” said EnCap Investments Managing Partner Doug Swanson. “We see this fundraise as a strong demonstration of support for our longstanding investment strategy and are extremely grateful to our long-term investors who partnered with us in Fund XII. We are also very excited to add a significant number of high-quality new investors as partners, with approximately 40 percent of the capital commitments stemming from new relationships with both institutional investors and large family offices.”

Managing Partner Jason DeLorenzo added, “The Fund XII capital raise was assisted by the strong performance of EnCap’s existing portfolio with over $22 billion of distributions returned to EnCap’s investors since the beginning of 2021. We remain very optimistic about the investment landscape for upstream oil and gas in North America and look forward to continuing to build on our successful track record of deploying capital and delivering value for our partners and portfolio companies.”

Vinson & Elkins served as legal counsel to EnCap in the formation of Fund XII.