Gina Rinehart’s Hancock Energy has upped its bid for Perth Basin gas player Warrego Energy by almost 30 per cent to $440 million, or 36 cents a share, after fellow WA billionaire Chris Ellison’s Mineral Resources reportedly bought about 15 per cent of its target for 35 cents.
At stake is the West Erregulla gas field 230 kilometres north of Perth that promises inexpensive gas close to market in a state that for decades has relied heavily on Australia’s cheapest gas for power generation and processing of minerals but faces a tighter market for the fossil fuel this decade.
The escalating battle for Warrego and its 50 per cent stake in West Erregulla started in November with an all-scrip offer from Strike Energy, which owns the other half of the gas field. Kerry Stokes’ Beach Energy quickly followed with a 20 cents a share cash offer but pulled out of a bidding war when Gina Rinehart’s Hancock Energy offered 28 cents a share for Warrego.
Gina Rinehart’s Hancock Energy has upped its bid for Perth Basin gas player Warrego Energy by almost 30 per cent.Credit:Getty
Mineral Resources is understood to have bought a 15 per cent stake in Warrego on Wednesday, forcing Hancock Energy to further increase its offer. Mineral Resources – a diversified miner, mining contractor and gas explorer – is yet to confirm the purchase.
In a bidder’s statement released on Thursday, Hancock Energy said its 36 cents a share offer extended to Warrego shareholders that had earlier accepted its lower offer, but was conditional on Hancock achieving 40 per cent acceptance.
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Hancock Energy also warned Warrego shareholders that have backed Strike’s scrip offer that they may not get capital gains tax rollover relief, given that Hancock Energy already owned more than 25 per cent of Warrego.
Mineral Resources is already involved in another Perth Basin acquisition: a $400 million all-scrip offer for Norwest Energy and its 20 per cent stake in the promising Lockyer Deep discovery that Mineral Resources owns the rest of.
Ellison said in November that he was interested in developing gas to supply his mines and lithium refineries as well as future developments.
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