Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


NZ Super Fund eyes North American energy market with US$250M

NZ Super Fund eyes North American energy market with US$250 mln investment

By Paul McBeth

March 21 (BusinessDesk) - The New Zealand Superannuation Fund will invest up to US$250 million with New York Stock Exchange-listed KKR to gain exposure to the growing disruption in North American energy markets created by shale oil and gas resources.

The so-called Cullen fund, named after former Finance Minister Michael Cullen who designed it, will invest up to US$175 million in KKR energy private equity investments ranging from natural gas exploration, production, and upstream, midstream and downstream activity, with the remainder going into the KKR Energy Income and Growth Fund, which focuses on unconventional gas and oil resources in North America.

Matt Whineray, the fund’s general manager of investments, told BusinessDesk the move seeks to latch on to the opportunity thrown up in North America where gas increasingly replaces coal as an energy source as a result of the increasing use of hydraulic fracturing, or fracking.

“The opportunity we see provides capital for that transition to gas and gives more control and information over the investment,” he said. “We don’t want to force particular allocations to it, we want to take advantage of KKR’s expertise from this particular opportunity.”

The other leg of the Super Fund’s energy strategy is in alternative energy investments, such as its stakes in US wind turbine maker Ogin.

Whineray said KKR is a signatory to United Nations-backed principles for responsible investment, and that the mandate gives the fund the ability to manage and measure the environmental, social and governance risks.

The mix of assets across the sector meant the investment was more a medium-risk, he said.

KKR Australian head Justin Reizes said the increase in gas supply and subsequent fall in price meant the sector was hungry for capital to fund new initiatives, with the growing potential for the US to become a net energy exporter.

While the sector is still developing, shale gas differs from oil exploration in that it’s easier to determine the size of potential gas finds, Reizes said.

KKR has been an investor in the energy sector for more than 20 years, and has been at the forefront of the shale gas transition since 2009, he said.

(BusinessDesk)


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Must Sell 20 Petrol Stations: Z Cleared To Buy Caltex Assets

Z Energy is allowed to buy the Caltex and Challenge! petrol station chains but must sell 19 of its retail sites and one truck-stop, the Commerce Commission has ruled in a split decision that acknowledges possible retail price coordination between fuel retailers occurs in some regions. More>>

ALSO:

Huntly: Genesis Extends Life Of Coal-Fuelled Power Station To 2022

Genesis Energy will keep its two coal and gas-fired units at Huntly Power Station operating until 2022, having previously said they'd be closed by 2018, after wringing a high price from other electricity generators who wanted to keep them as back-up. More>>

ALSO:

Dammed If You Do: Ruataniwha Irrigation Scheme Hits Farmer Uptake Targets

Enough Hawke's Bay farmers have signed up for water from the proposed Ruataniwha Water Storage Scheme for it to go ahead as long as a cornerstone institutional capital investor can be found to back it, its regional council promoter announced. More>>

ALSO:

Reserve Bank: OCR Stays At 2.25%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2.25 percent, in a decision traders had said could go either way, while predicting inflation will pick up as the slump in oil prices washes out of the data and capacity pressures start to build in the economy. More>>

ALSO:

Export Values Down: NZ Posts Biggest Annual Trade Deficit In 7 Years

New Zealand has recorded its biggest annual trade deficit since April 2009, reflecting weaker prices of agricultural commodities such as dairy products, beef and lamb, and increased imports of vehicles and machinery. More>>

ALSO:

Currency Events: NZ's New $5 Note Wins International Banknote Award

New Zealand’s new Brighter Money $5 note has been named Banknote of the Year in a prestigious international competition. The $5 note was awarded the IBNS Banknote of the Year title at the International Bank Note Society’s annual meeting. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news