This article appeared online at TheNewAmerican.com on Monday, July 17, 2017:
EnerVest Ltd., a Houston-based private equity firm run by John Walker, is being taken over by Wells Fargo, one of its largest lenders, to satisfy its unpaid debts. The firm raised capital from large investors, foundations, and pension plans and bought existing oil wells, improved them, and sent the dividends back to the investors.
In 2011, it had come off a very successful year. It owned 19,000 onshore oil wells on four million acres of land in 12 states. Its previous investments delivered a compounded annual return of 36 percent, a track record that made it relatively easy for Walker to raise additional capital. In a classic understatement, Walker said, “We had an outstanding year.” He explained just how he and his company did it; he bought cheap and sold dear, without using borrowed funds: