A new crop of start-up exploration and production companies is being planted, with the help of some big money. • Legend Natural Gas LP, Houston, has been formed by former North-Central Oil executives James A. Winne III, Michael Becci, William E. Deupree and others. Their money-$100 million-comes from The Carlyle Group, Washington, D.C., and Riverstone Holdings LLC, New York. It recently made its first purchase: producing gas properties in South Texas and on the Texas Gulf Coast from Anadarko Petroleum. (For more on this, see "Capital and Lots of It" in this issue.) • Bill Barrett has started Bill Barrett Corp., Denver, with Frank Keller, Bob Howard and others, with a Rockies focus. Their big money is more than $200 million from Warburg Pincus, Goldman Sachs Capital Partners, JPMorgan Partners and others. (For more on this, see "Starting Over, Aiming Higher," June 2002.) • Mitch Solich, formerly of Shenandoah Energy Inc., and Geoff Solich, formerly of Cody Energy LLC, have formed Ox Bow Energy Corp., Denver, with a focus on the Rockies, Midcontinent and Permian Basin. • R. Graham Whaling, Glenn Hart and other ex-Michael Petroleum Corp. senior managers have started Laredo Energy, Houston, with a South Texas focus. Their money comes from EnCap Investments LLC, Houston. • EnCap has also invested in Sawtooth Energy Partners LLC, Fort Worth, which has been formed by ex-Union Pacific Resources managers Marty Searcy, Matt K. Coughlin, Randol Rodgers et al. • And it has invested in Ovation Energy LP, North Richland Hills, Texas, which has been formed by former Encore Acquisition Co. executives Kyle Schultz and Wes Welch, and ex-XTO Energy executive Jeff Heyer. • Meanwhile, Rockford Energy Partners LLC, Tulsa, with a focus on the Midcontinent, has been formed by ex-Sapient Energy Corp. officers Chuck Perrin and Robert W. Von Rhee, with seed money from Quantum Energy Partners, Houston. • And, Greystone Petroleum LLC, Houston, formed by retired Kelly Oil officer Joe M. Bridges, has received $130 million from Shell Capital Inc. and First Reserve Corp., using it to buy Devon Energy's interests in the Sligo Field in North Louisiana. Cameron Smith, senior managing director, Cosco Capital Management LLC, New York, estimates just 14 U.S. and Canada-based private capital providers have approximately $7 billion to invest right now. Of course, the figure includes $5.3 billion managed by Warburg Pincus and it is unlikely that all of it will be invested in energy-related companies. However, any portion of it could be, should there be more opportunities in energy than elsewhere. In Canada, J.C. Anderson, former chairman of Anderson Exploration, has formed Anderson Energy, which has raised C$80 million to explore in western Canada. Of the amount, C$10 million comes from Natural Gas Partners. • Barry Jackson, formerly of Crestar Energy Inc., and Randall Pardy of Tethys Energy Inc., have started Resolute Energy Corp. • Doug Kay, ex-Cabre Exploration Ltd., has formed Segue Energy Corp. • Mike Rose, founder of Berkley Petroleum Corp., has started Duvernay Oil Corp. • Clayton Woitas, formerly of Renaissance Energy Ltd., is leading Profico Energy Management Ltd. • And, Larry Macdonald and Alan Archibald, formerly of Westpoint Energy Inc., have started Pointwest Energy Inc. (For more on this, see "New Canadians Under Way," April 2002.) But don't expect as many Canadian start-ups as in the past, according to Adam R. Waterous, senior managing director, Waterous & Co., Calgary. "I'm bearish on the prospects for small [start-up] companies in Canada," he said at a recent Crossborder M&A conference in Houston, hosted by InSight. The common thinking among Canadian investment bankers is that a whole new crop of intermediate E&P companies will be grown, all over again. "It's wishful thinking," Waterous said. There are less than half as many under-$50-million E&P companies in Canada as in the U.S.; the latter is now a much better hunting ground for nonorganic growth, he said. "There are going to be big layoffs in the investment-banking business in Calgary because of this," he added. More Canadian start-ups will have to find their growth organically. "If you wanted to be sold in Canada, you probably already have been." -Nissa Darbonne, Managing Editor