First Reserve acquires Navigator Energy

The energy-focused private equity firm is acquiring the midstream services company with an equity commitment of up to $250m.

Private equity and infrastructure investment firm First Reserve is acquiring Navigator Energy Services, a Dallas-based midstream services company, with an equity commitment of up to $250 million, the firm said in a recent statement.

Navigator, which provides oil and gas producers with services such as crude and gas gathering, transportation, storage, compression and gas processing, will focus initially on the continued development, construction and expansion of the Big Spring Gateway System (BSGS).

Construction of the project, which will include 250 miles of crude gathering pipeline and 140 miles of transportation mainline, is expected to begin in the first quarter of 2015. Once completed, BSGS will supply crude oil gathering and transportation services to Texas’ Midland Basin.

According to the statement: “First Reserve believes this area has limited pipeline capacity and attractive well economics that should continue to support production through various commodity environments.”

John O’Shea, currently managing director of Tenaska Capital Management, will serve as chief executive of Navigator.

“We are privileged to partner with First Reserve who will provide the necessary financial and development resources to assist us in getting BSGS operational during the second half of 2015,” O’Shea said.

Based in Greenwich, Connecticut, First Reserve has raised more than $30 billion since its inception in 1983. The firm has completed more than 475 transactions, including platform investments and add-on acquisitions, across six continents.

In June, the firm closed its second energy infrastructure fund – First Reserve Energy Infrastructure Fund II (FREIF II) – on its hard cap of $2.5 billion.

Like its predecessor, FREIF II focuses on contracted power, including conventional generation and renewable power; contracted midstream; contracted energy assets; and regulated transmission and distribution.