By Peter Milne
Australia’s richest person Gina Rinehart has wasted little time in putting a firmer offer on the table for Warrego Energy, escalating her stoush with Kerry Stokes’ backed Beach Energy for control of the resources minnow.
While Warrego is yet to produce a molecule of gas and few had heard of it a few months ago, Beach and Rinehart’s Hancock Energy are both amping up their pursuit of the company and its prized 50 per cent interest in the West Erregulla onshore gas field.
Beach’s revised 25 cents a share offer, put forward on Friday, was promptly countered by Hancock’s new offer at 28 cents a share, which values Warrego at $342 million.
Gina Rinehart and Kerry Stokes are among those battling for control of Warrego Energy.Credit: Getty Images/Phillip Gostelow
Warrego’s shareholders, whose investment has risen 40 per cent or $100 million in three days, were first courted less than a month ago when Warrego’s equal partner in the West Erregulla field Strike Energy revealed an all-scrip offer with an implied price of about 19 cents a share.
At stake is a promising gas field that can quickly be brought into production without controversial hydraulic fracturing to supply a market that is expected to tighten after decades of relatively low prices due to enforced supply from WA’s huge gas export projects.
The battle for Warrego Energy is heating up.
An added bonus would be the opportunity to export gas through Woodside’s underutilised North West Shelf LNG plant. However, that would require an exemption from the McGowan Government’s ban on the export of onshore gas.
The only exemption to date was given to Mitsui and Beach Energy’s Waitsia field in 2020. The decision was controversial as Kerry Stokes, the owner of WA’s only newspapers and dominant TV channel, was an indirect beneficiary through his interest in Beach Energy.
Credit Suisse energy analyst Saul Kavonic said acquisitions in the Perth Basin were just starting.
“There may still be more would be consolidators who may reveal their hands,” he said.
Mineral Resources chief executive Chris Ellison, whose company has acreage in the Perth Basin, last week said he has his eyes on corporate moves in the area.
“I’d be lying if I said I wasn’t interested,” he said.
Santos, the biggest supplier of gas to WA from its offshore fields, and Mitsui which owns Waitsia with Beach, have also been discussed as possible buyers.
Warrego shares closed on Friday at 26.2 cents each In the month before Strike Energy’s initial bid Warrego shares had an average price of about 14 cents.
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