HM Capital Partners, a Dallas-based private equity firm focused on the energy, food and media sectors, has acquired SunTerra Resources, a newly-formed oil exploration and production com
HM Capital Partners, a Dallas-based private equity firm focused on the energy, food and media sectors, has acquired SunTerra Resources, a newly-formed oil exploration and production company.
SunTerra will use under-balanced drilling techniques and under-balanced horizontal drilling to extract oil and gas from acreage with proven producing reserves. Financial terms have not been not disclosed.
Under-balanced drilling techniques are an alternative well completion method that enables exploration and production companies to reduce their overall finding and development costs and optimise their reserve base.
It involves drilling while keeping the pressure in the wellbore lower than the reservoir pressure in the formation being targeted, leading to enhanced drilling speed and reduced formation damage.
The acquisition of Houston-based SunTerra builds on HM Capital’s investment history in the energy sector. Since 2004, the private equity firm has invested in various energy platforms, including BlackBrush Oil & Gas, TriDimension Energy, Regency Energy Partners and TexStar Field Services.
Edward Herring, a partner of HM Capital, says: ‘The acquisition of SunTerra Resources reflects HM Capital’s continued confidence in the long-term fundamentals of the energy sector and demonstrates the firm’s commitment to the continued pursuit of low-risk exploration and production plays.
‘We believe that the application of UBHD techniques in proven basins can significantly reduce our portfolio companies’ finding and development costs and enhance their well productivity. Given the continued volatility in the commodity markets, we feel SunTerra’s expertise will give us a competitive advantage in drilling wells with attractive return profiles. We are very pleased to get started with SunTerra’s experienced and proven management team to build the company’s value.’