Lime Rock Capital

“There's an anchoring effect in private equity, like in every area of investing, that is not rational. It's a very real and tangible thing. In our business, That's manifested by people looking at a three bagger or five bagger and saying, well, that's a great de…”

“And at that point in time, we were producing a little under 40,000 barrels a day, and we had projections to get well over 150,000 barrels a day if we held it for another five years. We briefly got over 160,000 barrels a day right before we sold the investment.”

“The flip side of that was the business had been so successful that we got to a size that very few companies could afford to bid in that process. And the deal that John was talking about with Exxon taking out Pioneer, that took two of our best buyers off the ta…”

“I think their biggest differentiator relative to every other management team that we've ever dealt with is Tim Dunn and his lieutenants and partners had a greater respect for capital than any other management team I've ever met.”

“We owned an oil sands company in Canada, first deal we did. We owned a shallow water jackup drilling company in the Gulf of Mexico, and our second fund outsized ROIs in both cases. In both cases, within five years of our exit, those companies were bankrupt.”

“2007 U.S. Oil production as a share of global production hit its absolute minimum that we've seen over a 70 year time span. And at the moment that we sold it hit a local maxima that spanned 30, 40 years.”

“Well, ultimately every employee of Crown Rock was an equity holder. I mean, that was a big part of the overall compensation scheme that we had there. Well over 200 millionaires were kind of birthed from the Crown Rock investment.”

“We had already sold forward in the financial markets, 90% of our next year's crude oil production, so we had a lot of ballast and resiliency through that period.”

“If you looked at the E&P oil and gas index, the XOP of independent producers over the ownership period of Crown Rock, where we realized on that one specific investment, a 79 X ROI, The return on that index was .9 X. You lost 10% of your money.”

“There are attributes of the people, the Midland Basin, that you just don't replicate. It's a very special case, and there's probably some danger in thinking there's an application in a postmortem for everything we do going forward, because there's certainly no…”

“We committed seventy-five million dollars. The management team contributed twenty-five million dollars in properties, so the only primary equity that was ever invested in the business was a hundred million dollars.”

“I think we're very driven by conditions in the industry today, and ironically, that is probably creating an overall lower ROI scenario, but one which on a risk-adjusted basis, we think is among the most attractive periods of investing that we've seen.”

“There's only so much resource that you're ultimately going to recover, and we just felt like we were getting closer to the sort of maximum economic recovery point, and that, that changed the risk calculus. You had this big asset, you had market risk in retaini…”

“Most of the time, management teams are so focused on growth and so uninterested in the cost of capital it takes to achieve that growth. They end up making really poor decisions along the way”