GE Energy Financial Services, of Stamford has formed a partnership with a Union Gas Corp. subsidiary and related investors to acquire oil and gas reserves from two fields in East Texas and the Texas Gulf Coast for $115 million.
GE is investing $104 million as the 90 percent limited partner.
“Our new partnership combines the Union Gas team’s exploration and operating experience with the know-how and financial strength of GE,” said Randy Lowry, president of Union Gas Corp., in a written statement. “Allying with a strong institutional partner allows us to accelerate the development of our reserves to grow our production and cash flow at reasonable costs.”
Union Gas is investing as the 10 percent general partner and operator.
The new alliance, Union Gas Production Partners L.P., plans to invest an additional $29 million to develop and produce proven reserves over the next two years.
“This new investment demonstrates the unique value proposition of our monetization and development partnership, an excellent growth opportunity for Union and GE Energy Financial Services,” John Schaeffer, managing director and head of the oil and gas unit at GE Energy Financial Services, said in a prepared statement. “Combining Union’s expertise in the complete oil and gas development cycle and GE Energy Financial Services’ industry knowledge and commitment should create strong operating results enhanced by attractive related drilling projects.”
Since 1991, GE”™s Oil and Gas unit 16 professionals have provided $3 billion in partnership equity for its independent private and public oil and gas partner-operators in the United States. Based in Stamford, the Oil and Gas unit is active in all major onshore basins and shallow water Gulf of Mexico. Its 22 partnership investments produce an estimated 88 million cubic feet of natural gas and 9,400 barrels of oil daily.
