Roughly a year after the successful sale of Three Rivers III’s position in the Delaware Basin, Mike Wichterich is back for his next venture in the prolific Permian Basin.
Three Rivers Natural Resource Holdings IV LLC emerged earlier this month following an equity commitment of up to $500 million from funds managed by energy private equity firm Riverstone Holdings LLC and additional amounts from the company’s management team, the companies said in a joint press release.
Based in Austin, Texas, Three Rivers IV represents the fourth partnership between Riverstone and Three Rivers IV’s management team. Similar to Riverstone’s three prior successful partnerships with Three Rivers IV management, the company will continue to focus on oil and gas acquisition opportunities in the Permian Basin, where its management team has a proven track record of success, according to the joint release.
“We are excited at the opportunity to form another partnership with Riverstone,” said Wichterich, who will continue to lead the Three Rivers IV team as CEO. “Our longstanding relationship with the firm has enabled us to be uniquely responsive to a rapidly changing environment for energy investments, and we look forward to prosecuting our plan of targeting high-quality assets that will benefit from our team’s financial and operating expertise.”
The first two Three Rivers companies sold Permian Basin assets for a combined $2 billion, including a 2012 sale of 200,000 net Midland Basin acres to Concho Resources Inc. (NYSE: CXO) for $1 billion.
More recently, Three Rivers III sold its 59,000-net-acre position in the Delaware Basin to Admiral Permian Resources. The privately-held E&P, which is majority-owned by Ares Management LP and backed by Pine Brook Partners, acquired the Three Rivers III position for roughly $640 million in February 2018, according to Parkman Whaling LLC. Three Rivers III also sold its midstream assets to Salt Creek Midstream in January 2018.
Robert Tichio, partner at Riverstone, said in a statement: “We are pleased to continue our successful partnership with Mike and his team. This investment underscores Riverstone’s strategy of developing long-term relationships with management teams whose unparalleled, basin-focused operating expertise and a proven track record of investment success through commodity cycles position our funds to capture attractive risk-adjusted returns. We look forward to the company’s continued success.”
In addition to Wichterich, the Three Rivers IV team includes CFO Drew Pinzur, David Goodman as vice president of land and Leanne Churchward as vice president of business. The team has significant experience in managing both upstream and midstream assets, in both the Permian Basin and other regions of the U.S., the release said.
Bracewell LLP represented Three Rivers IV in its equity commitment. The Houston-based law firm previously represented Three Rivers I, Three Rivers II and Three Rivers III in those sales, as well as in oil and gas acquisitions, financing transactions and other matters.
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The transfer-of-rights contract dates back to a 2010 deal between the government and Petrobras linked to a large share offering made by the company that would have diluted the Brazilian government's stake.