Why has the BPH Energy share price exploded 310% in 2 days?

The company has committed to ensuring that all the gas produced from the project is available for Australian domestic supply.

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Key points

  • BPH Energy share price leaps 310% in 2 days 
  • In his self-appointed role as Resources Minster, Scott Morrison nixed the approval for BPH Energy's PEP11 offshore gas exploration project 
  • The company is reviewing its legal options in light of whether that decision might have been beyond Morrison’s legal powers 

The BPH Energy Ltd (ASX: BPH) share price is on fire.

The ASX energy share is up another 11% today, putting it up an eye-popping 310% since Monday's closing bell.

So, why are investors sending the BPH Energy share price skywards?

What's piquing ASX investor interest? 

The BPH Energy share price has former prime minister Scott Morrison to thank for its stellar performance.

Well. Sort of.

As you're likely aware, during the COVID-19 pandemic Morrison secretly appointed himself minister for home affairs, treasury, health, finance and resources.

Last week it emerged that in his self-appointed role as Resources Minster, Morrison nixed the approval for BPH Energy's Petroleum Exploration Permit 11 (PEP11) offshore gas exploration project in the Sydney Basin.

Asset Energy (a wholly owned subsidiary of BPH's investee Advent Energy Ltd) holds an 85% stake in the project; Bounty Oil & Gas NL (ASX: BUY) holds the other 15%.

So how is Morrison helping send the BPH Energy share price rocketing?

Here's what the company reported yesterday:

In light of the recent media coverage regarding former Prime Minister Scott Morrison's use of ministerial powers to block the PEP-11 gas exploration licence, the company is currently undertaking a full review of its options, including potential for legal channels, as part of its strategy to protect shareholder value.

Asset Energy had already commenced proceedings in the Federal Court of Australia in June. The company alleges that Morrison "was biased and failed to afford procedural fairness in his decision not to grant an extension of term and a suspension and variation of the minimum work requirements under PEP-11".

BPH Energy noted that Prime Minister Anthony Albanese has sought advice regarding whether Morrison's "appointments and decisions, which includes the PEP-11 decision, were beyond power".

The company also said the PEP-11 project and proposed carbon storage project have "potential national significance".

According to BPH Energy:

It addresses both current gas shortages and the objective of Net Zero Emissions. Advent has committed to ensuring that all the gas produced from the project is available for Australian domestic supply.

BPH Energy share price snapshot

With the recent big gains, the BPH Energy share price is up 160% in 2022. That compares to a year-to-date loss of 9% posted by the All Ordinaries Index (ASX: XAO).

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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