Strike Energy Faces Shareholder Vote on Critical Carnarvon Investment
Carnarvon Energy is set to invest up to A$88 million in Strike Energy through a two-tranche equity placement, positioning itself as Strike’s largest shareholder. This strategic move aims to accelerate development of Strike’s key Perth Basin assets, with production milestones targeted by 2026.
- Carnarvon to acquire up to 19.9% stake in Strike Energy via A$88 million placement
- Strike to raise up to A$10 million through a non-underwritten Share Purchase Plan
- Funds earmarked for development of South Erregulla and West Erregulla projects
- Carnarvon gains board representation and participation rights with escrow and standstill conditions
- Shareholder approval required for second tranche placement and Share Purchase Plan
Strategic Partnership Strengthens Strike Energy
Strike Energy Limited has secured a significant strategic investment from Carnarvon Energy Limited, marking a pivotal moment for both companies. Carnarvon will invest up to A$88 million through a two-tranche equity placement, acquiring nearly a fifth of Strike’s shares. This infusion of capital is designed to underpin Strike’s ambitious development plans in Western Australia’s prolific Perth Basin.
Alongside this, Strike plans a non-underwritten Share Purchase Plan (SPP) to raise up to A$10 million, with the potential to accept oversubscriptions. The combined funding will provide Strike with the financial flexibility to advance its core projects, notably South Erregulla and West Erregulla, which are on track for first production by October 2026 and a final investment decision in the second half of 2026, respectively.
Funding Growth Amid Energy Transition
The strategic placement comes at a time when Strike is focused on delivering reliable and flexible energy solutions to support Western Australia’s energy transition. The capital raised will not only fund development but also provide contingency to pursue the highest-return opportunities within Strike’s portfolio, including the Walyering project.
Strike’s chairman, John Poynton, welcomed Carnarvon as a strategic partner, highlighting the complementary nature of their asset bases and the enhanced financial capacity this partnership brings. Carnarvon, an established player with interests in Australia’s largest undeveloped offshore oil resources, gains a foothold in Strike’s onshore operations, diversifying its exposure within the energy sector.
Governance and Shareholder Considerations
As part of the agreement, Carnarvon will have the right to nominate a director to Strike’s board, subject to maintaining a minimum shareholding. The placement shares will be subject to a 12-month voluntary escrow, and Carnarvon faces standstill restrictions limiting further share acquisitions for a year post-placement.
The second tranche of the placement and the SPP require shareholder approval, with an extraordinary general meeting scheduled for mid-September 2025. The placement price of A$0.12 per share represents a nearly 20% discount to recent trading prices, reflecting the strategic nature of the transaction.
Looking Ahead
With this capital injection, Strike is well-positioned to advance its development pipeline and contribute meaningfully to Australia’s future energy security. Meanwhile, Carnarvon retains a strong balance sheet to continue its own offshore projects, including the Dorado liquids project and upcoming exploration drilling.
Market watchers will be keen to see how shareholders respond to the proposed placement and SPP, and how effectively Strike leverages this partnership to meet its production targets and strategic goals.
Bottom Line?
Carnarvon’s investment marks a new chapter for Strike, but shareholder approval and execution risks remain key watchpoints.
Questions in the middle?
- Will Strike shareholders approve the second tranche placement and Share Purchase Plan as planned?
- How will Carnarvon’s board representation influence Strike’s strategic decisions going forward?
- Can Strike meet its ambitious production targets amid evolving market and regulatory conditions?
