Mineral Resources managing director Chris Ellison has presented a $1 billion challenge to the government of Western Australia regarding its domestic gas reservation policy. Ellison asserted that MinRes will not proceed with construction of a significant gas plant in the Perth Basin, unless the WA government abandons the limitations on gas exports from onshore projects.
The company is fervently lobbying the government ahead of an imminent investment decision scheduled for early next year. MinRes is proposing to export gas from a plant capable of producing 250 terajoules per day for approximately five years, before addressing a predicted shortage in the domestic market.
However, the WA government maintains its stance against permitting gas exports from the Perth Basin, with the exception of the Waitsia project, which involves the Kerry Stokes-backed Beach Energy (ASX:BPT).
This ultimatum comes as MinRes prepares to host a Labor fundraising event, priced at $6,000 per seat, as a gesture of gratitude to former premier Mark McGowan, who now serves as a consultant for the company.
Azure Minerals acqusition "dead in the water"
In a separate development, Ellison declared the $1.6 billion acquisition offer for Azure Minerals by SQM (NYSE:SQM) as "dead in the water." This comes amidst a contentious battle for control over the exploration target.
MinRes seeks a significant stake in Azure’s Andover project in WA, diminishing the likelihood of SQM (NYSE:SQM)'s successful takeover attempt. Ellison highlighted that a consortium of organisations holds almost the entire stake in Azure, with a mixture of potential sellers and buyers.
Ellison also dismissed suggestions of collaboration with Gina Rinehart’s Hancock Prospecting in securing lithium assets in WA's Pilbara and Goldfields regions.
MinRes recently commenced operations at the Bald Hill lithium mine, adding to its portfolio of lithium mines and processing plants in WA. Details of the transaction for Bald Hill were not disclosed, with Ellison indicating it to be inconsequential, a statement that may disappoint Alita Resources' shareholders, who were anticipating a substantial deal.