THE oil industry veteran credited with Cairn Energy's bumper drilling success in India has secured heavyweight private equity backing for his latest venture, which aims to build a portfolio of assets in the Indian subcontinent.
Mike Watts and Jann Brown, who left their senior executive roles at Edinburgh-based Cairn last April, have lined up The Carlyle Group to provide backing of up to $500 million for Magna Energy.
Magna is aiming to build up acreage positions in the Indian subcontinent through acquisitions and participating in local licensing rounds. The objective is to create a full-cycle oil and gas company with a primary focus on a development and production. Magna will have a secondary focus on exploration.
The funding will come from Carlyle International Energy Partners (CIEP), a fund focused on oil and gas exploration and production, midstream, and refining and marketing in Europe, Africa, Latin America and Asia.
Bob Maguire, managing director of CIEP, reportedly said that the unit will provide an initial $250m, with up to the same again depending on projects brought by the company and rubber-stamped by Carlyle.
Mr Watt stepped down as deputy chief executive and Ms Brown left her roles as managing director and chief financial officer at Cairn last year as part of what the company termed as long-term succession planning.
They welcomed the backing for Magna from Carlyle, and said in a statement: "We believe there is strong growth potential in countries such as India, Bangladesh and Myanmar, which seek to grow their local energy markets.
"Furthermore, we are excited at the prospect of helping to drive economic growth in the Indian subcontinent by bringing new technology and capital to the local oil and gas sector. India, in particular, is set to emerge shortly as the world's fastest growing major global economy."
Marcel van Poecke, managing director and head of CIEP, said: "We are pleased to partner Jann Brown and Mike Watts, who have a long history of success in the Indian subcontinent. CIEP will provide capability and support through its global energy platform as we seek to participate in the economic growth of India and neighbouring countries.
"Our investment will help fund Magna's development and production plans allowing it to focus on cash generative and organic growth opportunities in the oil and gas sector across the subcontinent."
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