Orrick Advises Investors on First Joint 144A / 4(a)(2) Upstream Energy Securitization

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Orrick advised investors on the first joint 144A / 4(a)(2) oil and gas wellbore securitization by PureWest Energy, a leading natural gas producer in Wyoming. The offering, valued at $600 million, marked the largest upstream energy securitization completed to date and comprised a combination of $300 million 144A Class A1 Notes and $300 million of Class A2 Notes offered and sold as a 4(a)(2) private placement.

The $600 million in asset-backed notes were collateralized by a portion of PureWest Energy LLC’s producing natural gas assets. PureWest’s differentiated ESG and cost performance were two key components in building demand for the offering, which received an investment-grade rating of “BBB+” from Fitch Ratings.

Orrick represented the private placement investors in the transaction. The matter is Orrick’s fifth rated securitization of oil and gas wellbore interests, in each deal representing the investors. This is the first transaction that included 144A and 4(a)(2) investment tranches.

In September 2019, the firm advised the noteholders on the first rated securitization of oil and gas non-operated wellbore interests, issued by Raisa Energy. Since then, Orrick has been engaged in representing ABS investors in all subsequent publicly-announced transactions and is currently engaged in several upcoming energy securitizations.

Orrick’s Structured Finance and Oil & Gas teams collaborated on the matter with a team led by partners Leah Sanzari and Jonathan Ayre and included Darrell Thomas, Thomas Mitchell, Steve Jackson, and Rich Paladino, among others.