While banks continue to work on their books and retrench from the market, one alternatives shop is picking up where they’re leaving off.

Ridgefield, Conn.-based New Stream Capital has launched a specialty energy finance fund focused on lending to the North American oil and gas sector. The New Stream Energy Solutions fund provides working-capital loans to exploration and production and distribution companies. The fund has approximately $100 million in assets and commitments.

Energy Solutions will invest across the full spectrum of the capital structure—from senior debt to direct ownership—in order to tailor investments that fit the unique funding needs of each project, and will focus primarily on transactions between $5 million and $40 million. It recently completed a $10 million financing deal for a natural gas producer in Kentucky, a $16 million loan to an oil and gas producer in Texas and a $28 million loan for an oil and gas producer in Texas.

“The launch of this energy finance fund enables investors to gain exposure to the energy markets without taking the directional risk normally associated with more typical trading strategies,” said David Bryson, managing partner.  “The energy sector offers a unique opportunity for investors.  A significant number of lenders have scaled back due to the ongoing credit crisis precisely at the time when energy producers need to increase capacity.”

New Stream currently manages over $1 billion of total assets.