Gina Rinehart’s Hancock Prospecting has increased its takeover bid for Warrego Energy after Mineral Resources (MinRes) entered the fray for the Perth Basin gas player.
The activity surrounding Warrego is evidence of mining companies vying for control of WA gas assets.
Hancock upped its bid to $0.36 per share, valuing Warrego at $440 million, after MinRes reportedly bought up 15 per cent of Warrego at $0.35 per share.
Hancock’s sweetened bid represents a 29 per cent increase on its initial $0.28-per-share all-cash offer.
The latest Hancock bid is said to be conditional on the miner gaining control of at least 40 per cent of Warrego stock. Hancock already holds a 25.9 per cent stake in the company.
According to the Australian Financial Review, MinRes has not yet confirmed it holds the 15 per cent stake in Warrego, but managing director Chris Ellison “has made clear his desire to control onshore gas assets in the Perth Basin to power downstream processing”.
That desire is further underlined by MinRes’ recent $403 takeover bid for Norwest Energy, another gas player in the Perth Basin, which Ellison calls a “no-brainer” for Norwest shareholders.
Warrego Energy has proven to be an especially hot commodity in WA, with Hancock Prospecting currently in a battle with Strike Energy for control of the Perth Basin company. Kerry Stokes-backed Beach Energy had also previously been in the takeover mix, but bowed out of the race in December 2022.
The jewel in the Warrego takeover crown is the West Erregulla gas field 230km north of Perth.
The site is said to be a source of inexpensive gas for power generation and mineral processing, which will prove especially important as the resources sector faces a more difficult fossil-fuel market in coming years.