UPDATE 1-BlueGold manager Andurand plans new $500 mln oil fund

Tue Jan 22, 2013 2:28pm EST

By Barani Krishnan

NEW YORK Jan 22 (Reuters) - Pierre Andurand, manager of BlueGold hedge fund who called the peak of the oil market before the financial crisis then closed after heavy losses in 2011, said on Tuesday he will start an energy fund in London next month that aims to raise at least $500 million in capital.

The Andurand Commodities Fund has already received pledges of $200 million and expects to secure $300 million more over the next two months, Andurand said in an email to Reuters. He said it was mostly targeting former investors of BlueGold who had stuck with the fund until its closure last April.

"I expect the fund to raise around $500 million in the first 3 months, and then soft close at $1 billion," Andurand wrote.

Andurand Capital Management LLP, the holding company for the fund on central London's Brompton Road, already has 14 employees who expect to start the fund on Feb. 1.

Funds that are closed do not accept any more money from investors. For those performing a "soft close," existing investors can still increase their holdings.

French-born Andurand, 35, started as an oil trader at Goldman Sachs. He later climbed the ranks at Bank of America and Swiss oil trading giant Vitol before co-founding BlueGold with Vitol colleague Dennis Crema in 2008.

With Andurand as its sole manager and Chief Investment Officer, BlueGold made a 210 percent gain in its launch year, 2008, by predicting the top of the oil market in 2008 just before the global financial meltdown.

It rose a further 55 percent in 2009 and 13 percent in 2010.

BlueGold's fortunes crashed in 2011 when it finished as one of the worst performers among commodity hedge funds with a 34 percent loss. By the time it closed in April, its assets had shrunk to $1 billion from a peak of $2.4 billion a year ago.

Andurand was not the only energy fund manager who suffered in 2011, a year of particularly volatile oil prices, with London's benchmark Brent crude rising 23 percent in the first quarter before giving back half of those gains in the next six months.

Andy Hall, another prominent oil trader who manages nearly $5 billion at Connecticut-based commodities fund Astenbeck, also saw his first annual loss that year.

As a gesture to BlueGold investors who had supported him to the end, Andurand said they would not pay any performance fee if they invested with his new fund within its first 3 months and until they earned their money back.

"The new fund will honor BlueGold's high-water mark for the investors who stayed in BlueGold until the end," he said.