More and more, the pools of private capital aimed at the energy space are swelling. One might even say they're at flood-stage. But that isn't altogether good news for the small fry of the energy sector. The problem is that as institutional investors continue to pour more dollars into private-capital funds, the investment threshold of those funds is correspondingly rising. Thus, whereas a private-equity provider may have considered a few years ago committing $25 million or less to a start-up E&P, midstream or service-sector entity, the burgeoning level of institutional capital available to that same fund today dictates making commitments in the $50- to $100-million range, or even higher. Fortunately, however, a number of new private-capital funds-and intermediaries of those funds-have emerged in the past five years with a bias toward smaller-cap companies. What's particularly notable about these capital sources is that they have an appetite to provide needed energy-related equity or debt backing in much smaller amounts-even in the $1- to $10-million range but certainly below $50 million. For more on this, see the July issue of Oil and Gas Investor. For a subscription, call 713-260-6441.

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