Bellatorum Resources LLC, a veteran owned and operated firm, has announced the launch of its $100m Sentinel Energy Investments, LP fund. Capital raised for the Sentinel fund will be used to purchase oil and gas royalties in the Permian Basin, Eagle Ford Shale, Haynesville Shale, and Barnett Shale, all located in the State of Texas where Bellatorum has a proven track record of success. Sentinel is Bellatorum’s eighth fund.
The minimum investment in Sentinel is $10,000 and up to 2,000 accredited investors will be allowed to participate. Investors will receive an 8% preferred annualized return before Bellatorum is able to start sharing in the profits. After the preferred return is met, all profits will then be split at a rate of 80/20 with 80% going to the investor, and 20% to Bellatorum. A 15-20% IRR, or annualized return for investors, is being targeted by Bellatorum. Investments into Sentinel are being accepted thru the week of December 14th. A specialized online deal room for Sentinel has been created to provide a seamless investment process.
Capital invested in Sentinel may be locked in for five years with two, one-year discretional extensions. However, it is possible that an exit could happen much earlier, as has been the case in previous funds managed by Bellatorum. The strategy behind the five year lock up of capital is necessary to ensure the ability to navigate market cycles typically found in the commodities arena, especially oil and gas. Most partnerships on the market last less than 3 years.
Commenting on the investment opportunity in the Sentinal fund, Chris Bentley, Founder, President and CEO of Bellatorum said, “Right now, we are seeing discounts in the marketplace like never before so the barriers to entry are low for investors. Obviously, the uncertainty and down market won’t last forever, so now is the time to buy. Investing in oil and gas royalties has always been one of the most attractive and least risky ways to gain exposure to the US onshore oil and gas market. The Sentinel fund provides a great opportunity to gain exposure to this niche asset class, which still exists in an extremely inefficient market with high levels of information asymmetry.”
Bellatorum mitigates its risk profile by investing in mineral rights with current oil and gas production and cashflow. “The advantage in this approach is that we are not taking any speculative risks and have an immediate free cash flow component in our investment strategy,” explains Bentley. “This tactic provides a lower risk exposure in the energy sector because these assets are real property and ownership is perpetual. There is no liability associated with the maintenance and operation of the oil and gas wells.”
Governance and compliance are of great importance to Bellatorum and all funds and their performance are independently audited.
