Noreco receives £50m equity financing from 3i, HitecVision and Lyse Energi
Norwegian Energy Company (Noreco), a newly established independent oil company today announced an agreement with three new investors to provide equity funding to the company. 3i, Europe's leading private equity and venture capital company, specialist energy private equity firm HitecVision Private Equity and Lyse Energi, a Norwegian utility company, have agreed to back the company with £45m of capital. In addition, Noreco's shareholders will commit an additional £5m, giving the company an equity base of £50m. The funding process has been managed by First Securities ASA.
3i's investment builds on its recent oil and gas successes and comes hot on the heels of its $11m investment in Salamander Energy, its $67m investment in Energy Development Partners and its exit from Petrofac, which floated on the London Stock Exchange earlier this month, realising £120m for 3i.
The funding, which represents a financial input of £15m each by 3i, HitecVision and Lyse Energi, will be used to acquire exploration and producing assets in the North Sea area. Noreco will seek to form unique alliances with existing licence holders and will seek to create value by the application of new technologies and innovative solutions.
Noreco, which is located in Stavanger, has a strong management team headed up by Chairman Lars Takla, former MD of ConocoPhillips Norway, and Managing Director Scott Kerr, former MD of BP Norway.
Scott Kerr commented: "We are pleased to have such a strong and experienced group of investors backing the company and to have the necessary capital in place to realise our business plans. Our aim is to build Noreco into a first class independent oil company based on sound business principles and clever applications of its resources".
Mike Hill, 3i Investment Director, commented: "The deal with Noreco presents us with an excellent opportunity to back a proven management team in the Norwegian Continental Shelf, which we believe is an exciting province for start-up E&P companies."
Ole Ertvaag, Managing partner of HitecVision, said: "We feel privileged to be allowed to work with such a strong team as Scott Kerr has assembled. There are great opportunities for independent oil companies in the North Sea, and we believe Noreco will make a strong contribution to the future development of the industry."
Eimund Nygaard, Managing Director of Lyse Energi, added: "For more than 100 years, we have been in the upstream sector of hydro power production. Last year we started to supply customers in the region with natural gas. We consider this as an interesting financial investment and also a great opportunity to get a stronger involvement upstream in this sector."
Notes to editors
Noreco was founded in Stavanger in 2005. The company has ambitions to establish a strong pan-North Sea presence as a base for further international expansion and deliver outstanding value creation for its shareholders through early acquisitions to create sustainable growth, strong sub-surface competence, use of new technology and novel business models. Noreco shall be developed with a long term industrial and international perspective. Find more information at www.noreco.com.
3i is a world leader in private equity and venture capital. The company focuses on Buyouts, Growth Capital and Venture Capital and invests across Europe, the United States and Asia Pacific. 3i's competitive advantage comes from its international network and the strength and breadth of its relationships in business which underpin the value the company delivers to its portfolio and shareholders.
3i has funded 24% of all European oil & gas private equity deals in the last three years and manages an investment portfolio of more than 35 companies in the exploration and production (E&P) and service sectors.
The current oil & gas portfolio includes Vetco International (ABB's former upstream oil and gas business); EDP, an oilfield development project manager; Epcon Offshore, a designer and manufacturer of water treatment systems for the oil and gas industry; Salamander Energy, an E&P company focused on South East Asia and Finnish oil spill response company Lamor Corporation. Previous investments include Petrofac, the international oil and gas facilities service provider, which floated in October 2005; Revus Energy, the independent Norwegian upstream company, which floated in June 2005; John Wood Group plc, the UK's largest oil service company, which was floated in 2002; Venture Production plc, one of the UK continental shelf's newest operators, also floated in 2002; and Sensa, an oilfield technology company sold to Schlumberger.
About HitecVision Private Equity
HitecVision Private Equity is one of the largest private equity investors in Norway, and one of the few in Europe to focus exclusively on the global energy industry. HitecVision is currently investing the NOK 690 million ($110 million) "Energivekst" fund, where investors include major industrial and financial groups.
HitecVision's current portfolio consists of 6 companies in Europe and USA, including Scandpower Petroleum Technology AS, the world's leading provider of multiphase flow simulation software; RigNet, Inc, a provider of advanced broadband solutions to drilling rigs; and Knowledge Systems, Inc., a specialist provider of geophysical pore pressure software and services. Two former portfolio companies, Revus Energy ASA and APL ASA, have been listed on the Oslo Stock Exchange earlier this year.
About Lyse Energi
Lyse is an energy and communications company organised as a group of companies, whose business comprises of the production and sale of energy and telecommunications products as well as the construction and operation of infrastructure.
The shareholders are 16 municipal authorities in the Greater Stavanger Region. The head office is in Stavanger, but the group's operations are spread throughout the southern part of Rogaland County and other parts of the country where Lyse delivers broadband services to business partners.
Lyse's shareholders have a long-term, industrial perspective for the development of the group, where profitability and return from operations are given high priority.
Operating income in 2004 was 2627,5 million NOK with profit of 298,5 million NOK. Lyse is a regional supplier of natural gas and has invested 922 million NOK in the natural gas and heating business.