Kerogen Capital raises $1b for debut energy fund
Kerogen Capital has reached a final close in excess of $1 billion for its debut energy-focused fund. Investors include North American foundations and endowments, family offices, fund-of-funds, an affiliate of a Middle East sovereign wealth fund, and investors in Singapore and China.
Kerogen Energy Fund will provide growth and development capital to junior upstream oil and gas companies that focus on global emerging oil and gas basins and unconventional assets.
It will primarily bet on Asian demand, particularly in geographies of strategic importance to China. According to the International Energy Agency, China is expected to account for over 50% of the net increase in world oil demand over the next 25 years.
Kerogen was set up by former executives from J.P. Morgan's Asia energy and natural resources team who subsequently moved to Indonesia's Ancora Capital. It has a strategic alliance with China National Offshore Oil Corp. (CNOOC). The PE firm is one of relatively few GPs in Asia looking for direct exposure to natural resources.
"Based on known reserves today, Asia doesn't have sufficient resources to meet its current and projected demand. As a result, the trend for sourcing investment opportunities in geographies that are further afield will continue," says Jason Cheng, Kerogen's co-founder and managing partner, told AVCJ earlier this year. "Chinese private equity that is able to invest overseas has been increasingly drawn to this thesis, but it is still relatively nascent."
Kerogen has already completed two investments: AJ Lucas Group, a drilling services company in Australia that has exposure to European shale gas; and NewAge, which focuses on emerging basins for oil and gas discoveries within sub-Saharan Africa and Kurdistan.
Forbes Private Capital Group, the wholly-owned distribution business of G2 Investment, advised on the global distribution of the fund.
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