Mining billionaire Gina Rinehart has consolidated her status as the biggest shareholder in a small Victorian oil and gas company, just 24 hours after Victoria extended a ban on the sort of unconventional oil and gas it plans to extract.
Mrs Rinehart moved on Friday to convert a note that one of her subsidiaries - Timeview Enterprises - purchased in January, into $3.5 million of shares in ASX-listed Lakes Oil.
The transaction delivers to Mrs Rinehart a 19.53 per cent stake in the small company, whose shares were fetching 0.5¢ on Friday morning and closed at 0.6¢.
Lakes' shares were fetching about 0.4¢ when Mrs Rinehart's company purchased the convertible notes in January.
The stock had traded as high as 0.7¢ earlier this month, as investors speculated that the Victorian government would relax its ban on unconventional oil and gas.
Those hopes were partly fuelled by a bullish speech delivered by Victorian resources minister Nick Kotsiras on October 30.
But Lakes shares have drifted lower in recent days, and the decision to convert may be prompted by a desire to cash in before the share price drifts lower on the back of the ban extension.
The notes did not need to be converted into shares until November 30, 2014, but could be converted earlier at the discretion of the holder.
Lakes Oil boss Robert Annells welcomed Mrs Rinehart's transaction.
"We are absolutely delighted she has converted to equity, it demonstrates her faith in what we are doing," he said.
Extension of the gas ban does not prevent Lakes Oil from going ahead with some operations, given the company also conducts some conventional oil and gas work in Victoria.
Mrs Rinehart still holds convertible notes in the company, with Friday's transaction converting about 80 per cent of her holdings.
ASX-listed Armour Energy also holds convertible notes for Lakes Oil, and when all notes are converted into shares Mrs Rinehart's stake will stand at under 20 per cent.
Mrs Rinehart's main company Hancock Prospecting is a substantial shareholder in Fairfax Media, owner of this publication.