Mining magnate Ellison joins Perth Basin gas race

Mining billionaire Chris Ellison is looking to join the race to consolidate gas assets in Western Australia’s promising Perth Basin after the nation’s richest person, Gina Rinehart, won a bidding war for control of gas developer Warrego Energy.

Ellison’s Perth-based mining company, Mineral Resources, on Friday confirmed it had plans to make a $403 million off-market bid for the shares it does not already own in oil and gas explorer Norwest Energy, its minority joint-venture partner in the Lockyer Deep project located in the onshore Perth Basin.

Ellison said Mineral Resources believed last year’s gas discovery at Lockyer Deep may be the “largest onshore gas find in Australia”, and wanted to develop and commercialise the resources as quickly as possible.

“The scrip-based offer for our joint-venture partner Norwest will consolidate Lockyer Deep’s project ownership and provide Norwest shareholders with exposure to a bigger prize,” he said.

Mineral Resources — a $15 billion iron ore, lithium and mining services company, which has plans to expand across WA — already has a 19.9 per cent stake in Norwest. The company intends to offer one share for every 1367 Norwest shares, which implies an offer price of $0.06 per Norwest share.

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“This offer presents a compelling and unique opportunity for Norwest shareholders to join the Mineral Resources family and be part of the next chapter in our significant value creation,” Ellison said.

The news comes just a week after Rinehart’s Hancock Energy outbid an offer from the media mogul Kerry Stokes’ Beach Energy to buy Warrego Energy and its prized 50 per cent interest in the West Erregulla onshore gas field.

Analysts on Friday said Norwest appeared a sound strategic fit for Mineral Resources as it targets growth.