Simpson Leads on First Reserve's $1 Billion Energy Buy

Energy-focused private equity firm First Reserve Corporation has tapped Simpson Thacher & Bartlett to advise its Oklahoma City–based portfolio company, Templar Energy, on the latter’s $1 billion acquisition of oil and gas assets from Forest Oil Corporation.

Templar, which invests in mature, liquids-rich producing basins in the midwest, announced Friday that it would purchase assets in the Texas Panhandle and in western Oklahoma with wholly owned subsidiary Le Norman Operating and its joint venture partner Le Norman Fund I, from Denver-based Forest Oil.

The acquisition will allow Templar to produce more than 20,000 barrels of oil equivalent (the amount of energy released when burning one tonne of crude oil) a day, with a reserve base of 145 million barrels, according to the press release announcing the deal. Templar expects its resource potential to exceed 750 million barrels when the transaction closes by November 25, pending certain closing conditions.

Forest Oil president and CEO Patrick McDonald said in a statement that the asset will allow his company to continue developing its core Eagle Ford Shale assets, which are located primarily in Gonzales County, Texas.

The Simpson Thacher team advising Greenwich, Connecticut–based First Reserve and Templar is led by corporate partner William Curbow and also includes tax partner John Creed, environmental senior counsel Michael Isby, intellectual property transactional partner Lori Lesser, real estate counsel Krista McManus, and banking and credit partner Robert Rabalais. The Simpson Thacher associates working on the matter include Jay Blackman and Wabi Jain (M&A); Eddie Bontkowski, Matthew Einbinder, and Erland Modesto (banking and credit); Devin Heckman (tax); Alexander Key (intellectual property); and Timothy Mulvihill (environmental issues).

Simpson Thacher represented First Reserve last month in connection with its acquisition of three subsidiaries of Utility Services Associates, a Seattle-based consulting firm that specializes in water loss management and water system assessment. The financial terms of that transaction were not disclosed. Last October, the firm advised First Reserve on its sale of Norwich, England–based specialist subsea services company Acteon Group to Kohlberg Kravis Roberts for $1.4 billion. And in September 2012, Simpson Thacher helped the private equity firm when it partnered with SK Capital Partners to purchase Houston-based chemical and petroleum product provider TPC Group for $850 million, according to sibling publication Texas Lawyer.