EnCap’s Newest Pool Has $5 Billion Hard Cap, Fundraising to Close in Q4

What’s the hottest topic at the Buyouts Dallas conference?

It’s not the fiscal cliff or the lack of M&A but a private equity firm: EnCap Investments.

EnCap, which focuses on oil and gas, is out fundraising for its latest fund, LP and placement sources say. The pool, EnCap Energy Capital Fund IX, has a $4.25 billion target and a $5 billion hard cap, sources say. Fund IX is so hot that EnCap has received $8 billion of interest, an LP says.

“Money is just pouring in over the transom,” one placement agent says.

Fund IX will focus on the upstream sector of the oil and gas space, a source says. News of EnCap’s fundraising comes as the U.S. is expected to surpass Saudi Arabia as the world’s largest oil producer by as early as 2020, the Wall Street Journal has reported.

Bloomberg News reported news of EnCap’s fundraising in September. EnCap will likely complete marketing for Fund IX in fourth quarter, sources tell peHUB. “It’s oil and gas and everyone wants in on that,” the LP says.

EnCap, which has offices in Houston and Dallas, raised $3.5 billion with its last fund in early 2011. That pool is generating an amazing IRR since inception of 79.05%, according to March 31 data from CalSTRS.

Officials for EnCap declined comment.

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