Petrofac and First Reserve sign energy infrastructure agreement for $1.25 billion

Petrofac, the international service provider to the oil and gas industry, has entered into a Framework Agreement with First Reserve, the global energy-focused infrastructure investment firm, to create PetroFirst Infrastructure Partners, the company reported in a news release.

The new venture intends to deploy capital both in purchasing a number of existing assets from Petrofac's Integrated Energy Services (IES) division (commencing with the first transaction as described below), as well as in new energy infrastructure projects that utilise Petrofac's development capability.

The new venture is anticipated to be funded 80% by First Reserve and its investors, with Petrofac retaining the balance of ownership. Up to US$1 billion is expected to be committed by the First Reserve Energy Infrastructure Funds and its investors and Petrofac expects to contribute up to a maximum of US$250 million in the form of existing assets and cash. The gross investment capacity of the new venture is expected to be significantly increased through debt leverage available to infrastructure investments.

Source: Petrofrac, 2014.