Orica has made a $20 million-plus investment in mining technology by purchasing WA companies RIG Technologies, from Wallis Drilling, and Hopper Industrial Group.
Orica disclosed today it had paid $12 million upfront for RIG, with Wallis having potential to earn further payments tied to sales of RIG’s technology over the next five years.
Business News understands Orica paid a similar amount for Hopper Industrial Group, which was majority owned by Mr Hopper and his family members.
Wallis chairman Graeme Wallis said the sale would enable RIG Technologies to leverage its first mover advantage.
“The timing is right given where we have positioned the RIG Technologies business,” he said.
“Orica has the financial resources, global customer base and distribution network to market and scale its product suite.
“For Wallis, the sale allows us to increase the rate of investment in our main drilling business.”
Wallis added that the sale delivered a strong return on its investment in RIG, which is focused on the development of Reverse Circulation Logging While Drilling (LWD) technology.
The business was established in 2016 as a joint venture with NMR Services, which is part of Hopper Industrial Group.
Wallis moved to full ownership in 2019 though Mr Hopper has continued to run the business.
RIG has grown to have a team of 33 engineers, technical and field staff.
Its technology includes downhole behind-the-hammer geophysics sensors (Gamma-Ray and Gyro), drill rig-based sensor platforms and a cloud-based data management system.,
Its product suite is in the early phase of commercialisation and is being utilised by large resource companies.
Wallis and RIG Technologies will retain a five-year technical partnership to ensure continued testing and real-time deployment of the tools and other associated products in a field operating environment.
Wallis chief executive Mark Crumby said the development of RIG and its sale to Orica was another example of the company’s success in innovation and commercialising new technologies for the mining industry.
“Our ongoing partnership with RIG Technologies means Wallis will continue to provide our customers with this industry-leading technology,” he added.
The RIG deal, which closed last month, comes three months after Orica bought Balcatta-based Hopper Industrial Group, which comprised two companies in the geophysics sector.
NMR Services’ flagship product was a borehole magnetic resonance tool for the mining and water industries while Surtech Systems was a wireline company specialising in mining and groundwater borehole surveys.