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Investors in Natural Resources Funds

by Joanna Nye

  • 06 Dec 2011
  • PE

North American investors give greater attention to natural resources funds than investors based in other regions.

The largest number of LPs making commitments to natural resources-focused funds are North American.  A number of North America-based investors have recently made commitments to Natural Gas Partners’ tenth fund, Natural Gas Partners X. This fund has a focus on oil and natural gas production and is targeting over USD 4 billion in commitments. A number of North American LPs have made the decision to commit to this fund in recent months, including New Mexico State Investment Council, which plans to commit up to USD 75 million to the fund. Other limited partners that have made commitments to the fund include Minnesota State Board of Investment, committing up to USD 150 million, and Oregon Investment Council, Pennsylvania Public School Employees’ Retirement System and Public Employees Retirement Association of New Mexico, each committing up to USD 100 million.

Preqin’s Investor Intelligence database currently tracks 3,704 active investors in private equity, and of these, 13% have shown a preference for investing in natural resources funds. Of the 13% of investors that have indicated an appetite for natural resources vehicles, three quarters (75%) are based in North America. Comparably, European LPs represent 16% of investors with an interest in natural resources, and the remaining 9% of LPs are based in Asia and Rest of World. LPs based in Europe and Asia and Rest of World make up 49% of all investors monitored on Preqin’s Investor Intelligence database, and just 3% of this group of LPs have shown a preference for making commitments to natural resources funds. Comparably, 19% of all North America-based LPs have shown a preference for natural resources, and make up the remaining 51% of investors tracked by Preqin.

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