The Strike Energy Ltd (ASX: STX) share price is soaring on Wednesday, up 5%.
Strike Energy shares closed at 34 cents yesterday and are currently trading for 36 cents apiece.
Investors are bidding up the ASX energy share following an update on its increased ownership of Warrego Energy Ltd (ASX: WGO) and the West Erregulla gas field, located in Western Australia.
Here's what the company reported.
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What's happening with Warrego Energy?
The Strike Energy share price is soaring, and the Warrego Energy share price is up 3.2% after Strike said it is increasing its shareholding in Warrego to approximately 19.9%.
This was accomplished via share purchase agreements with a number of Warrego stockholders via the swap of Strike shares for Warrego shares at a 1:1 share exchange ratio.
Once the share swaps are settled, Strike will be the largest shareholder in Warrego, with around 19.9% voting rights.
The Strike share price could also be getting some tailwinds as this will see the company increase its ownership of the West Erregulla gas field to some 60%.
Warrego has been the subject of an ongoing takeover battle that's helped drive the Warrego share price up 103% over the past month.
Atop Strike Energy, two other powerhouses – Beach Energy Ltd (ASX: BPT) and Gina Rinehart's Hancock Energy – have been seeking to gain controlling ownership of Warrego's gas assets.
Perhaps with this in mind, Strike's board stressed it had not yet "formed any intention with regards to any future transaction that may involve Warrego". The company said it is considering all available strategic options.
Commenting on the Warrego buy up driving the Strike Energy share price higher today, CEO Stuart Nicholls said:
Strike has a strong track record of identifying and securing valuable and strategic energy assets at various stages of maturity. The expansion of our ownership of Warrego shares and the resulting look through to an increased economic interest in the West Erregulla gas field is a further demonstration of this.
Strike Energy share price snapshot
The Strike Energy share price is up an impressive 122% over the past 12 months, with Warrego shares having leapt 171% higher. For some context, the All Ordinaries Index (ASX: XAO) is down 2% over that same period.
