Northern Energy Capital (NEC) and Roundtable Capital Partners have completed the initial closing of NEC Fund I Canadian at approximately USD45 million.
The fund will be wholly focused on investing in oilfield services and related industrial businesses in Canada.
With a pool of almost 5,000 investable oilfield services businesses in both the private and public arenas of the sector, the opportunities are substantial with valuations at 30-year lows.
The oilfield services sector is struggling through one of the most significant downturns in its history, and the financial and operating capabilities of many of the participants have been severely damaged. At the same time, there are clear signs of an upturn in both oil and natural gas supply/demand fundamentals.
While the pace and degree of this recovery remains uncertain, the demands on key services as the sector recovers will be very high, both from an operational and technological perspective.
The potential for a strong recovery in activity and profitability provides an opportunity to participate in the recovery of the sector. Funding the operational recovery and industry creativity are key opportunities for the fund.
The fund will be managed by Roundtable, whose portfolio team includes Miles Lich (Northern Plains Capital Corp.), Jim Allan (Roundtable) and industry veteran Ken Mullen (Savanna Energy Services Corp.).
“Smart investing is understanding the fundamentals of a sector, the fundamentals of key industry participants in that sector, and tolerating the volatility of activity and economic results. With a five-year term on the fund, we are excited by the potential returns we can generate for our investors,” the team says.
A roster of investable opportunities are already under consideration.
