Broader Mandate For NGP Energy Capital’s New Fund

Irving, Texas-based NGP Energy Capital Management LLC has begun raising the 10th fund in its main complex of funds, and has held a $568.3 million first close toward its $4.75 billion target, according to a regulatory filing reviewed by sister publication Buyouts.

The new fund, NGP Natural Resources X LP, is the successor to a ninth fund that closed in 2007 at $4 billion, above its $3 billion target, according to the Thomson One database maintained by Buyouts publisher Thomson Reuters.

The new fund has a slightly broader investment strategy, according to a source familiar with the firm’s approach: In 2010, NGP Energy Capital launched a new initiative, NGP Global Adaptation Partners, focused on investment opportunities in water resources and the food and agriculture industries.

Under that effort, based on worldwide economic trends—such as people eating more meat in developing nations such as India and China—NGP Energy Capital will dedicate as much as 10 percent of Fund X to investments outside its historic oil and gas markets.

NGP Energy Capital operates a variety of funds, all focused on the natural resources sector and totaling $9.5 billion under management, according to the firm’s Web site. Its central operation, the Natural Gas Partners private equity fund complex, is a fund family with $7.3 billion of total capital since its inception in 1988. The firm invests the funds in private energy enterprises and co-invests in direct oil and gas property interests alongside portfolio companies.

The firm also operates NGP Energy Technology Partners, established in 2005. The business has $496 million under management and has a broader mandate to invest in oil and gas, power, energy efficiency and alternative energy sectors.

Another fund, the $1.4 billion NGP Midstream & Resources LP, makes direct investments in the midstream energy sector as well as the mining, minerals and related power sectors. The firm’s Web site says that the 2007-vintage fund in this family is essentially fully invested and has entered its harvest period.

In addition, the firm has a debt-financing affiliate, NGP Capital Resources Co., a publicly traded business development company that focuses on providing senior debt and mezzanine capital to the energy industry.

NGP Energy Capital declined comment.

Steve Bills is a senior editor at Buyouts Magazine. Any opinions expressed here are entirely his own. Follow him on Twitter @Steve_Bills. Follow Buyouts tweets @Buyouts. For information on how to subscribe, contact Greg Winterton at greg.winterton@thomsonreuters.com.