Diversified Energy Company PLC, the sector-leading listed natural gas and liquids production company, and global investment firm Carlyle have today agreed a strategic partnership to invest in up to $2 billion of existing proved developed producing (PDP) natural oil and gas assets across the U.S.
This partnership will draw on Carlyle's deep credit and structuring skills, led by Carlyle's asset-backed finance (ABF) group, combined with Diversified's premier operating capabilities and proprietary business model of acquiring and optimizing portfolios of long-life mature oil and gas assets to provide stable production and certain cash flow.
The partnership supports Diversified's sources of capital in an auspicious acquisition climate. Under terms of the deal, Diversified will operate and service the acquired assets. As the investments are made, Carlyle expects to pursue opportunities to securitize the assets, with the aim of realizing long-term, durable capital for this important part of the nation's energy infrastructure.
We are delighted to be co-operating with Carlyle, which is a market leader in asset-backed finance. This deal significantly enhances our ability to seek out and develop strategic acquisitions in what we believe is a highly favorable environment for PDP asset consolidation," said Rusty Hutson, Jr., Diversified Energy's CEO. "We still have a very robust pipeline of opportunities and the growing need for operational scale and efficiency.". With the backing of Carlyle, we are poised to take advantage of these trends in a bid to deliver sustainable cash flow and value to our shareholders."
"Diversified is a high-quality operator of long-life energy assets and a pioneer in selling PDP securitizations to institutional markets," said Akhil Bansal, Carlyle's Head of Asset-Backed Finance. "We are delighted to bring institutional capital to high-quality, cash-paying energy assets that underpin U.S. domestic energy production and energy security. This transaction demonstrates Carlyle's ability to originate differentiated investment opportunities from proprietary sourcing platforms and pursue access to stable, yield-oriented energy exposure."