Private equity funds invest in companies and management teams.  Direct Energy Funds, by contrast, are opportunities for institutional investors to own oil and gas reserves directly as a member of an LLC or as a Limited Partner.

In this case, the management company acts as a managing member or general partner.  The advantage to which is that direct energy funds are historically an inflation hedge as they do not correlate normally with stocks.  They also provide institutional investors long-term (10-12 year) investments.