Yes an engineer but lets call it a TECH Engineer. Compressed air technology is its main business, develops industrial air compressors and Gas seals and whats more it provides them for the OIL and GAS industry.
Very close to commercialisation now with its compressors and seals and todays deal ( see below ) should bring that very close.

Charges upfront payments, continuing royalties and development contracts so revenues are not lumpy.

It as a market cap circa off the top of my head 20 million(hope my calculator is now working) and as circa of 5 million cash on the books, very nice.

Some very big names as customers.

Heres todays announcement...........

Corac Group Plc
26 May 2004


For Immediate Release 26 May 2004


Corac Group plc ('Corac')

Joint Industry Programme for Downhole Gas Compression

Corac, the intellectual property and licensing company specialising in
compressor technology, is pleased to announce the signature today of a Joint
Industry Programme ('JIP') for the development of its unique, patented downhole
gas compression technology.

Following the recent successful completion of a Shell funded feasibility study
which evaluated both the technical and economic viability of the technology,
considerable industry interest has been generated, culminating in the addition
of a further four major international oil and gas operators to the project.

The participants of the JIP comprise ConocoPhillips, ENI, Husky Energy,
Repsol-YPF as well as Shell, all of whom have gas assets worldwide which they
believe could benefit from this game changing technology. As well as covering
the development costs for the next phase, the participants will also make
substantial resource available to ensure the final product specification meets
the requirements of the industry.

Corac's downhole gas compression concept involves the coupling together of a
number of axial compressor modules in a single compression train for
installation in the well bore in close proximity to a gas reservoir. In this
location, a modest uplift in pressure results in a very significant increase in
gas production compared with conventional methods using surface compression,
thereby accelerating gas production and cash flow from a producing asset.
Potential production rate enhancement of up to 40% has been demonstrated through
the application of downhole gas compression during a number of gas field case
studies carried out over recent months.

Placing the compressor downhole could also have the effect of being able to
lower the reservoir abandonment pressure which in turn would materially increase
the ultimate recovery from a gas field, thereby further enhancing the economic
benefit from the installation of this novel application of existing technology.

Phase 1 of the JIP is scheduled for completion by the end of 2004, with further
engineering and development work leading to the manufacture and testing of a
prototype downhole in a producing gas well within the following two years.

Commenting on the JIP, Professor Gerry Musgrave, Chairman, said:

'The support from such eminent oil and gas companies vindicates Corac's
development to date of the downhole gas compression project and gives the Group
another product line to bring to the market using its core technologies. It is
the start of a major business development opportunity which is expected to have
significant international ramifications throughout the upstream natural gas
industry.'ENDS.

Although loss making at the moment it shouldnt be very long before this one turns the corner.

Outlook

The Company has a loyal, talented workforce dedicated to the innovation and
exploitation of the technology. Successful trials have demonstrated the
commercial performance in Corac's industrial air compressor and its seals. The
Board is striving to deliver the right manufacturing and sales licences which
will yield the best returns in the long term.

We are confident that a number of deals, which have been subject to recent
intensive negotiation, will be successfully concluded in the near term.

Short to medium term investment, and anyone interested should DYOR and please remember you are responsible for the timing of your buying and selling actions.

cheers GF.

nice find notlob--I hope to add to my small holding as and when.

cheers, mp
looking to top up myself.

Thanks Notlob - v interesting article

i am a fan of the sector, especially PFC which has a proven track record and a well-deserved reputation ..... CRA may be worth further investigation as a seondary investment, but its cap is tiny (illiquidity problems for trading!) and the indicated spread is 4p = 8% which is unacceptably high ..... of course one may be able to deal inside that

NMS is a paltry 5000 shares = 2750

I would suggest that Corac is not a trading share then, Cynic, for the reasons you suggest.
The cap is tiny (we agree on something!)

Corac looks to me as presenting an excellent risk/reward, viewing it as a medium or long term investment.

The technology has the ability to generate very significant increases in gas recovered, it is a unique and patented technology that is fully backed by Repsol, Conoco Philips and ENI.

The total market for DGC has been estimated at c.100,000 gas wells. The DGC units are expected to sell for 1m a shot, with a significant recurring revenue element from refurbishment every two or three years.Margins for Corac are expected to be high.

With a prototype operating in Cumbria to the satisfaction of the major oil backers and the first units slated to go downhole in 2008, then Corac looks good for 2008.
This technology, when fully proven, could well be worth over 1bn, although I suspect one of the oil service co's, like Petrofac, could well look at taking Corac out. Hopefully that will not be less than a couple of quid.

everyone trades, or at least they should do! ...... trading and investing are synonymous, just as are escort and hooker! ...... all 2/4 are trying to make money!! ..... just because i am active, does not make me a day trader - far too frightening, though i do sometimes do so with the indices, but that is rather different ...... to sit on shares mindlessly is not a sensible course of action.

each to their own, Cynic.
I am not a trader, never have been.
No problem with folks that are.
But i have found I make far better returns with a buy and hold policy, with much less stress and hassle, least as far as I am concerned.
I can sail off to wherever I like and not have a care about open positions, margins, as all my shares are fully paid for.

For the avoidance of doubt, the above is not a dig at you in any way!
As I said, whatever suits.

because i deal almost exclusively in CFDs, one must or at least should be very much more vigilant and be prepared to act ...... i am now much better at cutting losses though i still sometimes allow sentiment to get in the way - e.g. DOO (still hold) and RTN (cut a while back but have just bought back in - think their figures due 9th Jan will be pretty tasty!)

A number pf people seem to be very upbeat about this stock & I have been watching it for some time.There is no doubting the technology is going to be in demand if it works, but with the DGC units selling at 1m each, reliabilty is going to be crucial.
Just on the question of the figures, what is the profit margin per DGC unit? Also what happens to the huge R & D costs already incurred? I do agree that the service contracts should be big cash generators (as with many products) but that is way in the future. Lots of figures in the above posts, but I can't see any that mention profit margins.

this is indeed an interesting stock, but please take good note, especially fans of VIY, that is has already taken 3.5 years from when this thread was first started (read opener!).

anyway, perhaps that is long enough for trials to be completed, and certainly the chart is not discouraging ...... not good break above both 25+50 dma and that 200 dma has not been threatened for several months ..... next real challenge will be the all time high of 60 .... i post both 5 year and 1 year

now go to Pro Active Investors and read their analysis ...... looks to me as though Corac could be 1/2 or even 3/5 more years away from having these DGCs fully tested and marketable

The margins of DGC units are north of 70% , according to a previous Numis brokers report.
The R&D costs to date have largely been met by the three oil/gas companies.
The arrangement is that Corac retains 100% of the IP, they are free to sell the units outside of the three backers, if they wish.
The backers (ie Repsol, ENI and C.Philips) are first in the queue for the units, they receive a discount on the units of around 5%. In addition, there is a small levy on each unit sold to third parties (in the region of 2%), payable to the backers, and continues until all their costs have been paid.

All in all, a remarkable deal , but one that suits all parties. Corac get that essential field knowledge from the big three partners, as well as initial sales and, ofcourse, their financial backing.

The time-scales have been well set out and are available for anyone who reads the Corac reports-it ain't difficult!

The first live deployment is set for late 2008. Although labelled as a 'trial', it is important to note that these initial units are going into live producing gas fields that are important to their respective companies.

Volume sales of DGC units are anticipated in 2009.

If volume sales were aniticipated tomorrow, I respectfully suggest that a proven ,unique and fully patented technology capable of releasing billions of pounds of stranded gas would be selling for considerably more than 45m.

Please also realise that Corac have an Industrial Air division, where initial sales have been made and where volume is expected to ramp up in 2008.

Could Cynic also please note that this Company is not profitable and is not expected to be so for some time. Don't want him throwing his toys out the pram again when his trade doesn't work!

don't revert to being a naughty boy!
does one buy today for jam tomorrow?
quite hard to call, though the downside is unlikely to be below 46 ......
on balance, assuming that one concurs that this is a good sector to be in, then i would suggest that PFC should (arguably and a biased view!) form a core with a much more modest exposure here - say 80/20 and certainly no more than 60/40

cynic
that was one of my nice posts, factual stuff in there as well, what more do you want!

Happy New Year to you!

have just added a bit for you! ...... was checking some numbers etc

no problems.
for me its all about risk/reward and what any individuals overall financial position is.
I am very happy to have a decent exposure to Corac, albeit my in-price what much lower than the current one.
I tend to go in large on the ones I like, it can mean large losses or large gains, but,overall, the gains have far outweighed the losses.
If others adopt a more cautious stance, I have no problem with that.

right with you nl, I have been building a larger than (my) average holding in these and haven't sold any yet,nor do I intend to, I trade all my other holdings but I am clearly expecting bigger things here.

Thanks for the clear response, notlob. Imo, if you are already holding then this is certainly worth keeping, but if not already in then other investments may see a better return in the short term.
Remains on my watch list - Just hope I don't miss the boat!

i am undecided on this one .... there are a few which are similarly tempting for one reason or another, like AIE and PVCS

going nicely today

a detailed write up on Corac has been posted on the fool.co.uk site, as part of the share competition over there

http://boards.fool.co.uk/Message.asp?mid=10853100&bid=51144