Columbus said shares in a combined Strike and Warrego “would have an enhanced equity market presence, greater liquidity and potentially a stronger institutional share register, all of which could make the combined business a greater target for further takeover activity.”

Interest in the Perth Basin is being driven by relatively low production costs, a forecast gas shortage in WA late this decade, possible downstream processing including a urea plant proposed by Strike, and the opportunity to export gas through Woodside’s North West Shelf LNG plant that will have increasing spare capacity as its own supply dwindles.

Access to export markets will require WA Premier Mark McGowan to grant exemptions to a ban on the export of onshore gas. Currently, the Waitsia field owned by Beach and Mitsui, has the only exemption with exports planned to start in late 2023.

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