Capstone II racks up $100 mln

Newly-formed Tulsa-based oil and gas firm Capstone II has secured a $100 million commitment led by Lime Rock Partners. The other backers were Wells Fargo Energy Capital and members of Capstone’s management. Capstone II will focus on the central basin platform in West Texas.

PRESS RELEASE

TULSA, Okla., Dec. 4, 2014 /PRNewswire/ — Capstone Natural Resources II, LLC (“Capstone II”), a newly-formed, Tulsa, Oklahoma based oil and gas company today announced that it has closed on a $100 million private equity commitment led by Lime Rock Partners, alongside Wells Fargo Energy Capital and members of management. Capstone II will be led by certain members of the former Capstone Natural Resources, LLC (“Capstone I”) and Arena Resources, Inc. (“Arena”) management teams. These individuals include: Phil Terry (Chairman), Pat McConn (Chief Executive Officer), Mike Willis (President and Chief Operating Officer), Clint Brian (Vice President – Operations), and Fred Schantz (Vice President – Land). The team will also include Carl Piowaty (Geology Manager) and Kim Nichols (Controller).

The management team will again focus on employing an “acquire and exploit” strategy in the Central Basin Platform of West Texas. The strategy was implemented at both Capstone I and Arena. Capstone I sold its Permian Basin properties in September 2014 to a private operator. Arena, a publicly traded company, was sold to SandRidge Energy for $1.6 billion in 2010.

Pat McConn, CEO of Capstone II, said, “We are very excited about once again partnering with Lime Rock. Their expertise and knowledge of the oil and gas sector proved to be very instrumental in Capstone I. We also welcome the addition of Wells Fargo as an investor. The strong financial commitment and industry expertise of both partners will allow us to actively pursue acquisitions with a goal of building another successful company.”

Jeffrey Scofield, Managing Director of Lime Rock Partners, said, “It was a great privilege to work with the Capstone team in Capstone I, not only because of that company’s success but because of the way in which the team quietly and flawlessly executed its business plan.” Townes Pressler, Managing Director of Lime Rock Partners, added, “We are thrilled to be working together again with Pat and the team on Capstone II. We believe that the Capstone’s team singular focus on the Central Basin Platform and technical expertise and deep relationships earned from that focus will allow the Capstone team to succeed again.”

About Lime Rock
Established in 1998, Lime Rock Management has raised $5.5 billion in private equity funds for investment in the energy industry through Lime Rock Partners, investors of growth capital in E&P and oilfield services companies worldwide, and Lime Rock Resources, acquirers and operators of oil and gas properties in the United States. Lime Rock Partners is a creative investment partner in building differentiated oil and gas businesses, side by side, with entrepreneurs every day. From three locations worldwide, the Lime Rock Partners team brings together specialist finance and operating expertise, global presence, technology leadership, people-centered strategies, and patient hard work with the goal of helping its investors and portfolio company partners profit from operational growth. For more information, please visit www.lrpartners.com.