A Canberra-based tech company that provides digital rock technology services and pore-scale micro computed tomography (microCT) equipment to oil and gas exploration companies has been sold for AU$76 million to US-based imaging technology company FEI Company.
Lithicon, which was set up by the Australian National University (ANU) and the University of New South Wales (UNSW), uses a technology that produces 3D images and simulations of fluids in rock samples to help companies work out the best way to extract oil and gas.
Under the sale to FEI, ANU will receive AU$11 million from the sale proceeds, representing a five-fold increase in its original investment, and UNSW will receive AU$4 million. In addition, ANU will receive additional royalties from FEI under a licensing and development agreement.
ANU pro-vice chancellor of innovation and advancement and director of Lithicon professor Michael Cardew-Hall said the sale is the most significant commercial spin-off for ANU in the past decade.
"The deal proves that Australian universities can grow a startup company and work cooperatively with industry to build a successful business," he said.
Previously known as Digitalcore, Lithicon was initially set up in 2009 to develop an advanced computational approach to rapidly solve fluid behaviour in oil reservoirs. It founded a high-resolution 3D imaging technique, which was able to be market tested as a result of a research consortium that the ANU and UNSW researchers created with 14 multinational oil and gas companies prior to the startup.
In 2013, Digitalcore merged with Norwegian company Numerical Rocks, a company originally considered to be a major competitor.
Lithicon general manager Dr Victor Pantano said, "This is a model example of university — industry interaction and the benefits it can bring."
FEI president and CEO Don Kania said the acquisition completes the company's digital rock workflow for the oil and gas market.
"We will integrate both Lithicon and the microCT product with our automated mineralogy capabilities, our advanced 3D visualisation and modelling expertise, and our electron microscopy leadership to provide a unique and powerful workflow solution for both conventional and unconventional oil and gas markets," he said.
"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."