Energy Spectrum collects $999m for Fund VI

The Dallas-based mid-market firm has made its first investment from the fund, teaming up with Costar Midstream, says partner Jim Benson.

Dallas-based mid-market firm Energy Spectrum Capital has closed its sixth fund on $999 million, surpassing its $750 million target.

The energy investor came to market with Fund VI in April 2010 and will continue the firm’s longstanding strategy of investing in the midstream oil and gas assets. The fund, which held a first close on roughly $370 million in November 2010, received commitments from both new and existing limited partners. The firm did not use a placement agent.

“We told our LPs we would not go above $1 billion and we stuck to our word,” Energy Spectrum managing partner Jim Benson told PEI. The firm had to turn away commitments from a number of investors, and reduce the size of other LP commitments, Benson added.

Limited partners in the fund include the Virginia Retirement System, which recently committed $75 million to Fund VI.

Energy Spectrum VI has made its first investment from the fund, teaming up with fellow midstream investor Costar Midstream to acquire natural gas processing assets in the Granite Wash area of the Texas and Oklahoma Panhandle.

Energy Spectrum’s previous vehicle closed on $600 million in 2007. Since inception, the firm has raised over $2.3 billion of equity capital from corporate and public pension funds, insurance companies, endowments, banks and other institutional investors.

Energy Spectrum Capital was founded in 1996 to manage private equity funds making direct investments in companies that acquire, develop and operate energy assets.