Close imminent on Blue Water Energy Fund II – Exclusive

The fund, which focuses on mid-market oil and gas assets, will close above its $1bn hard cap in June.

Blue Water Energy Fund II, which invests in the mid-market energy space, is to close in three to five weeks on between $1.1 billion and $1.3 billion, a source with knowledge of the fundraising tells Private Equity International.

The fund’s initial target was $1 billion. It launched in May 2016 and held its first close in September at $800 million, according to PEI data. Investors in Fund II include University of Michigan, which invested $50 million.

Asante Capital Group is acting as placement agent for the fund, PEI has learned.

Blue Water Energy makes investments in mid-sized energy companies, primarily in Europe, and has shown particular interest in the North Sea. In 2014, Blue Water and Blackstone jointly invested $500 million in Siccar Point Energy, an oil company that targets the assets of majors and supermajors looking to divest assets in the region, PEI reported at the time.

“E&P is a key part of our fund strategy. We have a strong belief that there are continuing opportunities in the North Sea for well managed companies with a clear strategy and access to capital,” Graeme Sword, a partner at Blue Water Energy, told PEI at the time.

Fund II has already invested in assets in Norway, the source confirmed.

In May 2013 Blue Water Energy Fund I reached close at $861 million after less than a year in market, above its $750 million target. Investors include University of Michigan with a contribution of $20 million and Ohio Public Employees Retirement System, with $125 million, according to PEI data.

Blue Water Energy was set up in 2011 by Graeme Sword, a former partner and head of oil and gas at 3i Group; Jerker Johansson, a former chief executive of UBS Investment Bank; and Thomas Sikorski, former head of the London office at First Reserve Corporation.

Blue Water Energy did not reply in time for publication. Asante declined to comment.