Gina Rinehart-led energy company to process Strike’s share at $1.5b project

Hancock Energy has agreed to process Strike Energy’s 50 per cent share of gas from the West Erregulla field, one of three at the Gina Rinehart-led company’s $1.5 billion-plus Belisama gas project in WA’s Mid West.

The project is based around the onshore Lockyer gas field about 350km north of Perth, which the Hancock Prospecting subsidiary acquired from Mineral Resources for $1.1b in 2024.

The companies have also inked a deal whereby Hancock is providing funding support to Strike of up to $30 million.

Under the arrangements, all West Erregulla gas will be processed through Hancock’s planned $850m Belisama central processing facility, with operatorship of the field transitioning from Strike to Hancock upon a final investment decision being made.

Strike described the deal as a major breakthrough in the commercialisation of the gas field, giving it a clear pathway to development.

The joint venture is targeting an upstream FID in the 2027-28 financial year and first gas production in mid-2029.

When the West Erregulla project was a joint venture between Strike and Warrego Energy, the plan was begin output in 2024, but a three-way battle to take over the latter company unfolded and Hancock emerged the victor in early 2023.

The gas processing deal comes less than four months after former Fortescue chief executive Nev Power was elevated to become Strike’s chair, while the iron ore miner’s former chief operating officer Shelley Robertson became chief executive.

Mrs Rinehart expressed concern with the Federal Government’s controversial gas reservation policy, which is yet to be finalised.

She said Hancock was prepared to spend significant private capital to boost WA’s domestic gas supply, but added that projects of Belisama’s scale needed “stable and sensible Government policies that encourage investment and development”.

“Belisama, subject to approvals, is planned to be a major investment in West Australia, creating jobs and bringing much-needed new gas supply,” Mrs Rinehart said on Monday.

Hancock Energy estimates that at full capacity, the Belisama project will supply up to 20 per cent of WA’s domestic gas demand over a 25-year life.

The Statutory Planning Committee approved the Belisama project, subject to conditions, earlier this month. The Environmental Protection Authority approved it in June.