MinRes, which is currently Norwest’s largest shareholder owning 19.9 per cent of its shares, wants to acquire the full stake in the oil and gas exploration company.
The miner intends to offer one MinRes share for every 1367 Norwest shares, valuing Norwest shares at $0.06 with an equity value of $403 million. This represents a 33 per cent premium to Norwest’s closing share price ($0.045) on December 15.
Norwest is MinRes’ minority joint venture (JV) partner in the Lockyer Deep gas project. The company also has a non-operating interest in onshore Perth Basin exploration permits EP 368 (20 per cent) and EP 426 (22.22 per cent).
MinRes and its subsidiaries are the owners of the remaining interest in EP 368 and EP 426.
“MinRes has become one of Australia’s most successful companies because of our ability to identify and act early on opportunities that benefit all of our shareholders,” MinRes managing director Chris Ellison said.
“We started accumulating what is now the largest acreage position in the onshore Perth and Carnarvon Basins in 2015 with a clearly articulated strategy to lock in a low-cost, long-life energy supply for our operations.
“This strategy also aligns with MinRes’ pathway to reducing our carbon emissions by 50 per cent by 2035 and net zero emissions by 2050.”
MinRes believes Lockyer Deep could be the largest onshore gas find in Australia and the company is eager to accelerate its development. The takeover will consolidate the project’s ownership.
“The scrip-based offer for our JV partner Norwest will consolidate Lockyer Deep’s project ownership and provide Norwest shareholders with exposure to a bigger prize,” Ellison said.
“It is also a natural progression that can create lasting value for both groups of shareholders under the MinRes ownership umbrella.”
MinRes’ energy division is led by Shelley Robertson, former managing director and chief executive officer of Norwest.
As part of its energy strategy, MinRes is looking to drill six wells over the next two years across its Perth Basin permits, as well as fast-track Lockyer Deep appraisal and development studies.