First Lime Rock LBO vehicle gets funded

Lime Rock has closed on $450m for its inaugural Lime Rock Resources buyout fund. The new vehicle joins a growing class of energy funds to get capitalised in 2005.

Another day, another energy vehicle. This time Westport, Connecticut-based Lime Rock has completed the fundraising for its Lime Rock Resources fund, a $450 million vehicle that will acquire lower-risk oil and gas properties in the US. The Resources group is based in Houston.

The fund deviates from Lime Rock’s primary vehicle, the Westport, Connecticut-based Lime Rock Partners III, a 2004-vintage, $425 million fund that makes growth financing investments. The Lime Rock Partners fund primarily plays in the upstream segment of the market, namely oil services, select technology and the exploration and production areas of the energy space.

Lime Rock launched the Resources group to go after “long-lived, producing, [and] primarily proved” oil and gas assets with additional opportunities for future development. To spearhead the new effort, the firm recruited former Goldman Sachs managing director Eric Mullins and Charles Adcock, who had served as a senior vice president of The Houston Exploration Company.

The fund close comes just one day after NGP Energy Capital Management announced it had closed on $1.7 billion across three sector funds, while Energy Investors Funds corralled $750 million for its latest vehicle last month. Not to be outdone, the Carlyle/Riverstone energy partnership recently amassed roughly $2.45 billion for its still-open Fund III, according to SEC documents, and Tenaska Capital Management took in over $800 million for its power fund earlier this fall.

The Lime Rock Resources group started marketing the new fund in April of this year, and held its first close in July. Monument Group served as placement agent for the fund.

According to Mullins, who serves as a managing director, the Resources group has begun scanning the space for investments, although the firm has yet to notch its first deal. “We have already analyzed in depth dozens of properties for potential acquisition,” he said in a statement, adding, “We are confident that our selective strategy will allow us to find the right properties to meet our investors’ goals.”