The funding package for Energy Development Partners will give Kinch the financial firepower to take on up to 10 new North Sea projects. Venture capital giant 3i - which already owns 25% of the business - is investing £60m to £70m as part of the fund-raising. SCF - whose backers include Stanford University, the Carnegie Corporation and the Howard Hughes Medical Institute - is raising the remaining £120m from a number of US institutions. Although the Houston-based firm is not believed to be investing any of its own capital as part of the deal, it is taking a small stake in EDP as part of the deal. One oil industry source said: "Theres no ink on the paper yet, but theyre close to raising finance of about $300m to $350m. There are a number of investors involved - US institutional investors and 3i. If you take the bank debt on top of that, theyve got firepower of about $500m (£265m)." Another industry insider said: "SCF are effectively acting as a broker for a number of US pension funds, university endowment funds, family funds and that type of thing. Theyre not putting in any money of their own, but they will be taking a very small stake in the company - a single figure stake." Aberdeen-born Kinch became a multi-millionaire through the sale of his first business, Petroleum Engineering Services (PES) to Halliburton and the flotation of his second business, Venture Production. He set up EDP last year with industry veteran Mike Robinson and Tom Reynolds, formerly of 3i. Its specific remit is to exploit opportunities in the North Sea, particularly with older oil fields. The company targets fields which are not being developed by their owners, then volunteers to fund a drilling and production programme on the field in exchange for a healthy share of the profits. It does not seek to buy oil fields itself - a strategy which has proved fruitless for many smaller exploration and production companies in the North Sea over the past 18 months due to the sky-high crude prices. EDP struck its first deal with BP last year, which saw it take operational control of the Wareham and Kitteridge fields. It is understood that Kinch has already lined up more than enough deals to invest all of the money being raised with the new fund. Although commonly associated with brown-field developments, Kinch is also taking on projects from smaller companies - many of which have emerged from the DTIs Promote licence scheme - which are unable to fund drilling programmes themselves. Kinch is said to believe that EDP has the potential to take on deals worth billions of pounds. An oil industry source said: "There will be eight to ten deals done with this fund. There are at least three times that many potential projects on the table right now, which are being whittled down. "There are two new projects that are already signed up, past the memorandum of understanding stage." One of the two deals close to completion is believed to be with Shell, which has spoken extensively about the need to review its North Sea portfolio. PIN//Scotsman