TA Associates of Boston and Madrone Capital Partners of Menlo Park, Calif., made an investment in MicroSeismic Inc., Houston, Texas-based provider of microseismic data acquisition, analysis and interpretation to the oil and gas industry. The firms said the investment was substantial, but specific terms were not disclosed. Goodwin Procter LLP serves as legal counsel to both TA Associates and Madrone Capital.
TA Associates, a leading growth private equity firm, along with Madrone Capital Partners, a private investment firm, today announced a substantial investment in MicroSeismic, Inc. (MSI), a leading provider of microseismic data acquisition, analysis and interpretation to the global oil and gas industry. Terms of the investment were not disclosed.
Founded in 2003, MSI is the pioneer in monitoring microseismic activity utilizing surface and near-surface arrays. Both the FracStar® and BuriedArray™ data acquisition services eliminate the expense of offset monitoring wells, allow multi-well to field scale evaluations from a single installation, and provide the most comprehensive microseismic-based visualization and interpretation services in the market. MSI’s patented Passive Seismic Emission Tomography (PSET®) technology provides real-time information on fracture location and geometry helping operators increase production and recovery while decreasing cost and risk. The company is headquartered in Houston, Texas, with offices in Denver, Colorado, Calgary, Alberta, Beijing, China and Warsaw, Poland.
“I am extremely pleased to welcome TA Associates and Madrone Capital Partners as new investors in MicroSeismic,” said Dr. Peter Duncan, CEO, MicroSeismic, Inc. “Their confidence in MSI is recognition of the maturing of this company as well as its impact on the industry. Our new partners’ capital and global business connections will allow us to continue to innovate and expand, to serve our current client base more effectively and to take advantage of the growing international demand for our services.”
“MicroSeismic is an exceptional company that is providing groundbreaking solutions to exploration and production operators,” said Hythem El-Nazer, a Principal at TA Associates who will join MicroSeismic’s Board of Directors. “MSI’s superior technology, paired with its experienced management team, has enabled the company to be among the first to provide customers with the data required to accurately, safely and cost-efficiently extract natural gas and oil from unconventional reservoirs. We look forward to working with MSI’s management team to continue to grow the company.”
“MicroSeismic has established itself as a clear technology leader for seismic monitoring and analysis in unconventional shale reservoirs,” said Jamie McJunkin, a General Partner at Madrone. “We believe the company will play an important role in enabling economical, intelligent, and safe development of these tight reservoirs, a vast energy source.”
MicroSeismic is well positioned to take advantage of the emergence and growth of unconventional shale plays in the oil and gas market. With the evolution of hydraulic pressure pumping technology and horizontal drilling, shale plays offer superior returns to exploration and production operators as compared to conventional assets. According to Baker Hughes, the share of U.S. rigs drilling horizontally has increased from 7% in 2002 to over 60% today. Resource rich regions such as the Bakken and the Eagle Ford are seeing tremendous growth in capital spending and production with several industry analysts projecting more than 40% growth in active drilling rigs in 2011. Leading oil and gas research firm, Spears & Associates, estimates U.S. unconventional oil and gas wells to continue on their growth trajectory and total over 17,000 in 2015, up from 12,000 in 2010.
“There is a significant growth opportunity in unconventional natural gas and oil production, both in North America and internationally,” said Kurt Jaggers, a Managing Director at TA Associates who will also join MicroSeismic’s Board of Directors. “Recent technological advances have resulted in successful unconventional reservoir development, and MSI is uniquely positioned for continued growth due to its strength in management, innovative technologies and product differentiation.”
Goodwin Procter LLP provided legal counsel to TA Associates and Madrone Capital Partners. Webb & Lauterbach, PC served as legal advisor to MicroSeismic.
MicroSeismic, Inc. (MSI) is a geophysical service company providing real-time monitoring and mapping of hydraulic fracture operations for the development of unconventional oil and gas plays. Founded in 2003, MSI is the pioneer in monitoring microseismic activity utilizing surface and near-surface arrays. These arrays eliminate the expense of offset monitoring wells, allow multi-well to field scale evaluations from a single installation, and provide the most comprehensive microseismic-based visualization and interpretation opportunity in the market. MSI’s technology provides real-time information on fracture location and geometry helping operators increase production and recovery while decreasing cost and risk. MicroSeismic is headquartered in Houston, Texas, with offices in Denver, Colorado, Calgary, Alberta, Beijing, China and Warsaw, Poland. For more information, visit www.microseismic.com.
About TA Associates
Founded in 1968, TA Associates is one of the largest and most experienced middle market private equity firms. The firm has invested in over 400 companies and manages more than $16 billion in capital. With offices in Boston, London, Menlo Park and Mumbai, TA Associates leads buyouts and minority recapitalizations of profitable growth companies in the technology, financial services, business services, healthcare and consumer industries. More information about TA Associates can be found at www.ta.com.
About Madrone Capital Partners
Madrone Capital Partners, a private investment firm affiliated with Rob Walton and his family, invests with a concentrated, long-term philosophy. The firm is based in Menlo Park, California.