Financial Times - Man Group has teamed up with an Abu Dhabi-owned investment company to make electricity from the gas produced as a byproduct of oil drilling, which is currently wasted in the form of flaring.

Abu Dhabi will inject the first $300m (£151m) into a new fund, which aims to raise $1.5bn, and will receive a small equity holding in the management company.

The launch of the MENA Associated Gas and Global Environment fund is the latest attempt by Europe’s biggest hedge fund manager to cash in on the boom in environmental investing.

Through MTM, a London subsidiary, it already runs a $600m fund capturing methane emissions from Chinese coal mines, and it is considering launching a Brazilian biofuel fund.

Peter Clarke, Man chief executive, said talks were already under way with countries in the Middle East, north Africa and Asia about working with their national oil companies. He said it already had many expressions of interest from sovereign wealth funds keen to put money in and had the potential to double its size to $3bn if it attracted enough money.

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