Australian digital rock technology company Lithicon has been acquired by US company FEI for $76 million.
The company, which was set up as a joint venture between the Australian National University and UNSW, was previously known as Digitalcore, and set up to develop advanced computational approaches to solving fluid behaviour oil reservoirs.
In doing so it developed techniques to produce digital 3D images and simulations of fluids in rock samples.
It merged with Norwegian company Numerical Rocks AS last year.
“The Lithicon story is one of taking world-class research from two of Australia’s best universities and turning it into a growing business. In the process we have created a whole new industry segment based on high-value, intensive, knowledge-based services. It’s exactly the sort of thing we should be doing in Australia and we need more of it,” Lithicon general manager Victor Pantano said.
Regarding the purchase, FEI’s president Don Kania stated that “the acquisition of Lithicon and the microCT tool completes our digital rock workflow for the oil and gas market”.
“This will significantly accelerate the growth of our served available market. We will integrate both Lithicon and the microCT product with the automated mineralogy capabilities in our Natural Resources business, the advanced 3D visualization and modeling expertise in our Visualization Sciences Group (VSG) and our electron microscopy leadership to provide a unique and powerful workflow solution for both conventional and unconventional oil & gas markets. Another important benefit will result from the expansion of microCT equipment sales into our other markets, where we believe there is a large demand for this technology and associated workflows."
Pantano added that “combining with FEI gives Lithicon added financial strength, distribution capabilities and complimentary technical know-how to continue the company's growth”.
“We believe digital rock technology is a needed breakthrough for the oil and gas industry, and the acquisition by FEI will allow Lithicon to take full advantage of this opportunity."
Under the agreement ANU will receive $11 million and any royalties from FEI under a licensing and development agreement.