Spectraseis, a provider of exploration services to the oil and gas industry, has secured a CHF36m (USD32.5m) investment from private equity firm Warburg Pincus, a leading energy investor.<
Spectraseis, a provider of exploration services to the oil and gas industry, has secured a CHF36m (USD32.5m) investment from private equity firm Warburg Pincus, a leading energy investor.
Warburg Pincus has taken a significant minority stake in Spectraseis, providing new equity to finance the company’s growth plans. StatoilHydro Venture Capital, part of the oil group majority owned by the Norwegian state, will continue to own part of the company along with Spectraseis’s management team.
Established in 2003 in partnership with leading European universities and based in Zurich, Spectraseis is a technology and service provider in the field of low-frequency passive seismic geophysical surveys.
Spectraseis aims to help oil and gas companies find and extract hydrocarbon reserves more efficiently than through conventional surveying and seismic techniques. Customers include Petrobras, StatoilHydro, Pemex and other operators in the Middle East and North America.
‘This move is a major milestone for Spectraseis,’ says chief executive Ross Newman. ‘It signals our transition from an R&D-focused start-up to a commercial industry player, and it is also a confirmation of the huge opportunities low frequency seismic technologies bring to the upstream exploration and production business.
‘To have one of the world’s top private equity firms commit this size of investment to us is a strong endorsement of our technology, business model, growth plans and people. From recruitment to technology development to growing our customer relationships, we look forward to continuing to commercialise the next generation of geophysical information.’
Warburg Pincus managing director Jeffrey Harris says: ‘We believe that Spectraseis is well-positioned to succeed as a leader in its industry. The company’s technology and track record of R&D and service delivery are compelling. The company is led by a strong management team and operates within a market environment in which the industry is demanding reduced risk and greater returns on exploration activities.’
Harris, who leads Warburg Pincus’s investment activities in the energy sector, and Henry Makansi, head of Warburg Pincus’s European energy activities, will join the Spectraseis board following the transaction.
On behalf of oil companies around the world, Spectraseis researches and applies proprietary technologies, on land and offshore, to acquire and analyse low frequency seismic background waves continuously present in the Earth’s subsurface in order to identify attributes indicating the likely presence or absence of hydrocarbons within a survey area.
The resulting information can greatly reduce the risk and improve the success rate of costly oil exploration and drilling activities and improve decision-making throughout the life of a field.
Spectraseis claims that broad adoption of its technology by the global oil and gas exploration and production industry could save the billions of dollars currently expended each year on non-productive exploration surveys and dry wells, as well as significantly improving the industry’s environmental performance.
Warburg Pincus has been a private equity investor since 1971 and currently has around USD20bn in assets under management. It invests worldwide in sectors including energy, technology, media and telecommunications, financial services, healthcare and life sciences, retail, consumer and industrial and real estate from offices in Beijing, Frankfurt, Hong Kong, London, Mumbai, New York, San Francisco, Shanghai and Tokyo.
The firm has raised 12 private equity investment funds that have invested more than USD27bn in some 575 companies in 30 countries. It has been an active investor in the energy sector for more than 20 years, investing more than USD2.5bn in 31 energy companies.
Warburg Pincus currently manages a portfolio of 17 companies spanning almost every segment of the energy sector including oil and gas exploration and production, oil field services, power, midstream companies, coal service businesses and alternative energy, including Bill Barrett Corp, MEG Energy, ElectroMagnetic GeoServices and Kosmos Energy.
