Gina Rinehart-backed Lakes Oil loses fight to beat Victorian gas ban
Junior explorer Lakes Oil — which is 11 per cent owned by Gina Rinehart’s Hancock Prospecting — has lost its fight to overturn Victoria’s ban on gas exploration.
In a decision handed down late on Friday afternoon, the Victorian Supreme Court rejected Lakes Oil’s claims that the Victorian Government’s state‐wide moratorium on on‐shore gas exploration was unlawful or ineffective.
In a statement late on Monday, Lakes said it was disappointed with the judgement, which it says will delay the restart of onshore conventional exploration activity in Victoria until mid-2020, when the ban expires.
It’s considering whether to appeal.
“While we are very disappointed with the Judgement, the transformational initiatives implemented by the company over recent months, particularly the takeover of Rawson Oil & Gas, mean there are exciting near term opportunities to be pursued in advance of a resumption of Victorian exploration,” said Lakes chairman Chris Tonkin.
Gold and lithium miner Dark Horse Resources (ASX:DHR) — which owns a third of Lakes Oil — told investors of the news on Monday morning. Lakes Oil did not make an initial statement, but re-published a Dark Horses ASX announcement.
“Dark Horse has no further information at this stage, but will update the market once Lakes Oil have publicly commented on the case and its intentions.”
Lakes chairman Chris Tonkin told Stockhead last week — prior to the court decision — that “it’s likely that we would appeal if it did get to that situation, but there’s been no decision made by the company as to which way we’ll go at this point.”
Lakes shares are in a trading halt. It’s priced at 0.2c, valuing the company at about $60 million.
Last year Victoria suspended conventional onshore gas exploration until 2020 and permanently banned unconventional exploration including hydraulic fracturing (or fracking) and coal seam gas.
Lakes had been undertaking gas exploration in Victoria prior to the ban, spending more than $80 million in the state.
“We believe we’re in the right here and the government has done something that is very wrong,” Lakes chairman Chris Tonkin told Stockhead last week.
While Lakes battled it out with the Victorian government, it decided to launch an all-scrip takeover bid for fellow ASX-listed junior Rawson Oil & Gas (ASX:RAW).
The deal would give Lakes Oil a gas-prospective landholding in South Australia targeting the same structure that lies within its Otway-1 well across the border in Victoria.
Rawson’s Nangwarry-1 well would allow Lakes Oil to finally move towards production and the tie-up would help Rawson fund the drilling of the well.
Lakes has so far amassed a 87.47 per cent stake in Rawson.