ASX-listed Matrix Composites & Engineering Ltd has agreed to build four prototype transport systems that could significantly increase the freight load capacity of bulk transportation, according to the company’s CEO Aaron Begley.

The A$2.4 million ($1.8 million) contract, for the largest combined rail freight company in Australia, Pacific National, will see Matrix use composite materials that have lightweight, rigid and fabrication advantages over traditional steel materials.

It follows on from a January letter of intent between the two companies that originally envisaged a $2 million contract for up to 10 prototype systems.

Pacific National has expertise in coal, in particular, with nearly 6,000 specialised coal wagons, 600 locomotives and 10,000 people in teams throughout Australia.

Matrix will start manufacturing the prototypes at its Henderson facility in Western Australia, with the initial stage expected to be completed in the second half of 2019. A second stage to manufacture 110 units is also planned, subject to a successful functional commercialisation assessment of the prototypes.

Begley said the contract is suited to Matrix’s expertise: “This contract is perfectly in line with our strategy to combine Matrix’s proven capabilities in advanced materials, with our state of the art composite manufacturing facility to develop lightweight composite structures for the large and growing transportation market here in Australia and overseas.”

Under the contract, Matrix has been awarded a 20-year licence to market the product to other potential customers in Australia and to extend this internationally.

The company said other opportunities for lightweight transportation structures are also being pursued with discussions having commenced with major bulk transport and freight transport companies for fleet upgrades.