Vitol Backs New Shale Firm with Formation of VTX Energy Partners

Vitol recently announced the formation of VTX Energy Partners LLC—a new U.S. shale platform looking to build a large-scale upstream position possibly in either the Permian or Williston Basin.

“The VTX partnership underscores our continued interest in growing our upstream portfolio in the U.S. Lower 48,” Ben Marshall, head of Vitol Americas, commented in a Feb. 2 company release.

Vitol is the world’s largest independent oil trader, trading 7 million barrels of crude oil and products a day. VTX does not represent Vitol’s first upstream venture. The company already established its Vencer Energy subsidiary, which made its debut last year with the acquisition of Hunt Oil’s Midland Basin position.

“VTX will complement Vencer Energy, our existing upstream partnership in the Midland Basin,” Marshall added.

VTX Energy Partners will be the successor company to Austin, Texas-based ATX Energy Partners LLC, whose management team’s track record dates back to Brigham Exploration. ATX had previously received an equity commitment of up to $780 million as part of a line of equity financing led by Warburg Pincus alongside Yorktown Partners and Pine Brook.

According to the Vitol announcement on Feb. 2, VTX will seek to acquire, develop and operate large-scale upstream assets in established U.S. Lower 48 basins including in the southern Delaware Basin and the Williston Basin where the VTX management team has already demonstrated a track record of success.

“Our team has been focused over the last 12 months on building a large asset position in one of the established U.S. Lower 48 basins,” said Gene Shepherd, CEO of VTX Energy Partners.

A founder of Brigham Resources, Shepherd served as CEO of the company from 2013 until the sale of substantially all of its southern Delaware Basin assets to Diamondback Energy for $2.4 billion in February 2017. Prior to that, he served as CFO of Brigham Exploration Co. from 2002 until its sale for $4.7 billion in December 2011.

At the time of its sale to Statoil—a Norway-based company that now goes by Equinor, Brigham Exploration held approximately 375,000 net acres in the Williston Basin producing 14,000 boe/d.

“We are ecstatic to partner with Vitol on this effort, from both the standpoint of their access to capital and the highly developed insights and expertise their organization brings in commodity markets, including all activities immediately downstream from our drilling, completion and operational activities,” Shepherd added.

Other members of the VTX management team include Erik Hoover, president and COO, and CFO Graham Bayley. Richard Winchester also serves as executive vice president of land for VTX.

Previously, Hoover built the Brigham Resources operations department from the ground up as its executive vice president of operations, according to the VTX company website. He also notably served as operations manager at Brigham Exploration, where his involvement was crucial in developing the optimal drilling and completion formula that unlocked previously untapped economic potential in the Williston Basin, the company website said.

Bayley had joined ATX in 2018 after starting his career in investment banking in the global banking and markets group at Scotiabank in Houston, focusing on M&A, A&D, capital markets and strategic advisory services across the energy industry.

Meanwhile, Winchester spent over 12 years at Hilcorp Energy Co., prior to joining ATX, in roles of increasing responsibility. The majority of his prior experience came through Devon Energy and Conoco, where he provided land and commercial expertise for exploration and asset teams in South Texas, the Texas Gulf Coast and the Permian Basin.