Press release

- THIS ANNOUNCEMENT INCLUDES INSIDE INFORMATION -

Riverstone Energy Limited

Final results for the year ended 31 December 2016

London, 1 March 2017: Riverstone Energy Limited ("REL" or the "Company") announces its Year End Results from 1 January 2016 to 31 December 2016.

Summary performance

Highlights

§ As of 31 December 2016, REL had a NAV per share of $20.11, representing an increase of $4.16 or 26 per cent. versus NAV per share at 31 December 2015. On a Sterling basis, the NAV per share increased by £5.47 or 50.5 per cent. compared with the end of 2015.

§ REL continues to execute on its strategy and now has a strong portfolio of sixteen active investments in the United States, Canada, Mexico, and Europe, covering both onshore and offshore as well as conventional and unconventional exploration & production, midstream and credit.

§ REL completed its first realisation, the sale of Rock Oil Holdings LLC, resulting in a Gross MOIC of 2.1x and a Gross IRR of 78 per cent on the $114 million investment².

§ The Company invested a total of $536 million during the year, bringing total net capital invested as of 31 December 2016 to $1,172 million, or 76 per cent. of net capital available³.

§ During 2016, REL committed $268 million to Centennial Resource Development, Inc. and made five additional commitments to existing companies, totaling $269 million, as well as reduced commitments to two companies, totaling $188 million, bringing current commitments as of 31 December 2016 to $1,928 million, or 126 per cent. of net capital available³.

§ REL's largest exposure is to the Permian basin and Eagle Ford, where it has invested $448 million or 35 per cent. of its capital, with Centennial being its largest investment, representing 21 per cent. of capital invested and 27 per cent. of the gross unrealised value of the portfolio.

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Commitments and Investments

During the year, the Company made the following commitments:

§ Committed $268 million to Centennial Resource Development, Inc.

§ Committed an additional $100 million to Carrier Energy Partners II, LLC

§ Committed an additional $75 million to Canadian International Oil Corporation

§ Committed an additional $42 million to Liberty Resources II, LLC

§ Committed an additional $33 million to Meritage Midstream Services III, L.P.

§ Committed an additional $17 million to Eagle Energy Exploration, LLC

During the year, the Company reduced the following commitments:

§ Commitment reduction of ($150 million) to Rock Oil Holdings LLC

§ Commitment reduction of ($38 million) to Sierra Oil & Gas Holdings LLC

During the year, the Company made the following investments:

§ Invested $268 million in Centennial Resource Development, Inc.

§ Invested $73 million in Carrier Energy Partners II, LLC

§ Invested $65 million in Three Rivers Natural Resources Holdings III, LLC

§ Invested $38 million in ILX Holdings III, LLC

§ Invested $27 million in Liberty Resources II, LLC

§ Invested $17 million in Rock Oil Holdings, LLC

§ Invested $13 million in Eagle Energy Exploration, LLC

§ Invested $12 million in Meritage Midstream Services III, L.P.

§ Invested $24 million to other investments including Riverstone Credit Opportunities, L.P., Castex Energy 2014, LLC, Fieldwood Energy, LLC and Origo Exploration AS

Manager Outlook

§ The Investment Manager believes that energy producers in low-cost basins with an oil-weighting will continue to outperform.

§ Energy market fundamentals remain supportive following sharp declines in capital expenditure and drilling activity.  

Richard Hayden, Chairman of Riverstone Energy Limited, commented:

"2016 was another volatile year for the energy industry. However, REL performed strongly with the successful sale of Rock Oil, NAV growth of 26 per cent. and share price appreciation of 70 per cent. Today's announcement demonstrates that REL's disciplined build-up oriented investment strategy can deliver strong results for shareholders."

David M. Leuschen and Pierre F. Lapeyre Jr., Co-Founders of Riverstone, added:

"REL continued to capitalise on attractive opportunities in 2016, investing over half a billion dollars, of which approximately two-thirds was deployed in the Permian Basin. This aligns with Riverstone's strategy of backing best-in class management teams in premier, low-cost areas of hydrocarbon production. In addition, the Portfolio benefitted from several operational successes, such as the completion of Meritage III's initial midstream infrastructure and strong well results from Eagle II and ILX III. With 16 active investments, over $250 million of cash and a strong presence across some of the most attractive basins globally, REL is well positioned to continue to execute its strategy and reward investors."   

- Ends -

Riverstone Energy Limited's 2016 Annual Report is available to view at: www.RiverstoneREL.com.

The Investment Manager will host a conference call with investors at 12:00pm GMT today. Dial-in details are as follows:

Dial-in (UK): 0800 028 8438

Dial-in (Intl.): +44 (0) 203 107 0289

Conference ID: 64249793

4Q 2016 Quarterly Portfolio Valuations

Previously, on 30 January 2017, REL announced its quarterly portfolio summary as of 31 December 2016, inclusive of updated quarterly audited fair market valuations:

Realisations

About Riverstone Energy Limited:

REL is a closed-ended investment company that invests exclusively in the global energy industry, with a particular focus on the exploration & production and midstream sectors.  REL aims to capitalise on the opportunities presented by Riverstone's energy investment platform.  REL is a member of the FTSE 250 and its ordinary shares are listed on the London Stock Exchange, trading under the symbol RSE.  To date, REL has made 17 investments spanning conventional and unconventional oil and gas activities in the Gulf of Mexico, Continental U.S., Western Canada, the U.K. North Sea, the Norwegian Sea, Mexico and credit.

For further details, see www.RiverstoneREL.com

Neither the contents of REL's website nor the contents of any website accessible from hyperlinks on the websites (or any other website) is incorporated into, or forms part of, this announcement.

Media Contacts

For Riverstone Energy Limited:

Note: 

The Investment Manager is charged with proposing the valuation of the assets held by REL through the Partnership. The Partnership has directed that securities and instruments be valued at their fair value. REL's valuation policy follows IFRS and IPEV Valuation Guidelines. The Investment Manager values each underlying investment in accordance with the Riverstone valuation policy, the IFRS accounting standards and IPEV Valuation Guidelines. The Investment Manager has applied Riverstone's valuation policy consistently quarter to quarter since inception. The value of REL's portion of that investment is derived by multiplying its ownership percentage by the value of the underlying investment. If there is any divergence between the Riverstone valuation policy and REL's valuation policy, the Partnership's proportion of the total holding will follow REL's valuation policy. There were no valuation adjustments recorded by REL as a result of differences in IFRS and U.S. Generally Accepted Accounting Policies for the year ended 31 December 2016 or in any period to date. Valuations of REL's investments through the Partnership are determined by the Investment Manager and disclosed quarterly to investors, subject to Board approval.

Riverstone values its investments using common industry valuation techniques, including comparable public market valuation, comparable merger and acquisition transaction valuation, and discounted cash flow valuation.

For development-type investments, Riverstone also considers the recognition of appreciation or depreciation of subsequent financing rounds, if any. For those early stage privately held companies where there are other indicators of a decline in the value of the investment, Riverstone will value the investment accordingly even in the absence of a subsequent financing round.

Riverstone reviews the valuations on a quarterly basis with the assistance of the Riverstone valuation committee as part of the valuation process.

The Audit Committee reviews the valuations of the Company's investments held through the Partnership, and makes a recommendation to the Board for formal consideration and acceptance.