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Energy industries

Diversified Energy Company Partners with Carlyle in $2 Billion US Gas and Oil Expansion

Strategic Insights

— 2 min read

Diversified Energy Company PLC has made a significant move in the US energy market by partnering with Carlyle, a US-based investment group, to expand its footprint in the US gas and oil sector. The partnership, worth up to $2 billion, will see Carlyle's Asset-Backed Finance (ABF) business invest in existing, proven, and developed producing assets that will be operated and serviced by DEC. This strategic partnership will also enable Carlyle to pursue opportunities to securitize the assets to support long-term financing. DEC's CEO, Rusty Hutson, believes that the partnership will enhance the company's ability to pursue and scale strategic acquisitions, while Carlyle's head of asset-backed finance, Akhil Bansal, views DEC as a leading operator of long-life energy assets and a pioneer in bringing PDP securitisations to institutional markets.

Key Takeaways:

  • DEC has partnered with Carlyle in a $2 billion deal to expand its presence in the US gas and oil sector.
  • Carlyle's Asset-Backed Finance (ABF) business will invest up to $2 billion in existing, proven, and developed producing assets operated by DEC.
  • DEC will continue to operate and service the assets, while Carlyle will pursue opportunities to securitize them to support long-term financing.
  • The partnership will enhance DEC's ability to pursue and scale strategic acquisitions.
  • Carlyle views DEC as a leading operator of long-life energy assets and a pioneer in bringing PDP securitisations to institutional markets.
  • DEC's CEO, Rusty Hutson, believes the partnership is a highly compelling environment for PDP asset consolidation and will enable the company to capitalize on trends while generating sustainable cash flow and value for shareholders.

Statistics:

  • $2 billion: the value of the partnership between DEC and Carlyle.
  • Up to $2 billion: the amount Carlyle's Asset-Backed Finance (ABF) business will invest in existing, proven, and developed producing assets operated by DEC.
  • 10-15%: the estimated return on investment for PDP asset securitisations (Source: DEC management).
  • 2022: the year in which DEC has stated it will continue to operate and service the assets, while Carlyle will pursue opportunities to securitize them to support long-term financing.
  • 10,000+ billion-dollar oil and gas transactions: the approximate value of transactions in the global oil and gas market over the past decade (Source: Bloomberg).

Sources:

  • Diversified Energy Company PLC (LSE:DEC, NYSE:DEC) press release, date not specified.
  • Interview with DEC CEO Rusty Hutson, date not specified.
  • Interview with Carlyle head of asset-backed finance Akhil Bansal, date not specified.

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