Former Liberal Party leader Matt Birney is hoping ASX-listed Coretrack can become a player in the US unconventional oil and gas industry.
Former Liberal Party leader Matt Birney is hoping ASX-listed Coretrack can become a player in the US unconventional oil and gas industry.
MATT Birney says the political fraternity is a bit like the mafia in that “they never really let you go”, but he’s far too busy furthering his business interests to consider a return to parliament.
Mr Birney spends much of his time running his West Perth-based investor and government relations firm Birney Corporate, which he established in 2009.
His other main focus is in his role as chairman of ASX-listed Coretrack, to which he was appointed in 2010.
The company recently agreed to a deal with the privately owned Queensland-based Ecopropp, under which the companies will work to commercialise technology the latter has developed for the unconventional oil and gas industry.
Ecopropp has produced a prototype proppant, which are about the size of a grain of sand and are a fundamental part of the fracking process of shale oil and gas deposits (see breakout box).
Mr Birney said the Ecopropp proppant had been developed from fly ash – the waste from coal-fired power stations – and was superior to traditional proppants as it was lighter, stronger and cost less to produce.
“Most proppants in the world are made from clay and bauxite so this is a real departure from what is the norm,” he said.
Coretrack hopes to break into the burgeoning unconventional oil and gas sector in the US, which makes up the lion’s share of the $2.5 billion global proppant market, according to Mr Birney.
“The American unconventional oil and gas industry has already gone through the roof, and fracking is commonplace over there to the point where it is supporting whole towns,” Mr Birney said.
As part of the deal between the two companies Coretrack will complete a $3 million capital raising to fund further development of the fly-ash proppant, which will largely be used to build a small-scale plant in Queensland.
“The (Ecopropp) proppants produced out of the (laboratory) meet the American ISO standards already; our challenge now is to scale it up and prove that we can also make them commercially and still meet all those ISO standards – that’s the next stage for the company,” Mr Birney said.
The move into proppants marks a change in focus for Coretrack, which has been attempting to commercialise its patented coring technology for nearly a decade.
The company completed its $4.1 million IPO in 2006 on the back of the technology, which seeks to improve the efficiency of coring, a method used to make reserve and production estimates for oil and gas deposits.
“I think everybody would agree, it was a lot more difficult to develop than first thought some years ago,” Mr Birney told Business News.
Coretrack has chosen to hand over the further development of the coring technology to West Perth-based oil and gas consultant Aztec Well Construction.
Under the agreement, Aztec will gain the worldwide exclusive licence to develop, operate and sub-license the product, with Coretrack receiving a royalty from any commercial revenue.
“Its (the coring technology) best opportunity going forward is for it to reside with a company like Aztec, who are in oil and gas market all day every day,” Mr Birney said.
“It also frees us to focus on the proppant market.”
Mr Birney is confident about the longevity of the unconventional oil and gas sector, despite vocal opposition to the industry in Australia from activists and farmers.
“The unconventional oil and gas market in Australia is certainly in its infancy but it will develop, there is nothing surer than that because there is big money in it,” he said.
“Unconventional is producing opportunities for people the likes of which we haven’t seen for many years.
“We don’t expect the market in Australia to burgeon overnight, but it will certainly happen in due course.”
As for politics, Mr Birney, who quit parliament in 2008 after 12 months as opposition leader, brushed off suggestions of a return anytime soon.
“It’s not something that has occurred to me recently,” he said.
“I probably do (miss it) a little bit, but not enough to go back right now. A lot of my mates are ministers these days and others are still in parliament, so I am never far from it.”
