Analysis tool a stepping stone for XRF

One of the world's rarest elements, thulium, could have a big impact on the nickel industry if a revolutionary analysis technique developed by little-known company XRF Scientific takes off.

XRF's nickel ore analysis technique is the world's first known commercial use of thulium.

The Osborne Park company has been granted a 20-year, worldwide patent for the technique, which director David Brown says has the potential to save mining companies millions of dollars.

If all goes to plan, it will become the world standard for the analysis of nickel ore.

Almost as rare as thulium are the people who've heard of XRF, a relative newcomer to the Australian Securities Exchange, having listed in November 2006.

With a share registry of about 500 investors and a market cap of just $9 million, Mr Brown said it was fair to describe the company as sitting in on the bottom rung of the ASX.

"We've been all about organic growth until now, and that growth has been significant, but to grow to the next tier we need to look outside," he said.

"We have an acquisition strategy in place and we plan, over the next few years, to lift ourselves into that next tier," he said.

"We've got a lot of world-first technology in the existing six manufacturing arms of the business, and we are actively looking for other companies that do complementary work or have products that fit with our core business."

With an issue price of 20 cents a share, XRF rose to a high of 26 cents on its first day of trading but then took a bumpy ride down to five cents a share by May 19 this year.

An ASX announcement on the thulium patent sparked a rebound to 12 cents by June 3, before settling back to 10 cents at last week's close.

Mr Brown said the share price was not a surprise given the tightly held nature of the company's shares.

"Most of the shares are held by the owners of the original six companies that came together under the umbrella of XRF and those shareholders understand the value of what they're holding," he said.

Mr Brown came into XRF as the owner of the company X-Ray Flux Pty Ltd, which he founded in 2001 to commercially manufacture X-ray flux - the material that is melted with ore to allow X-ray analysis.

The other businesses that come under the XRF Scientific banner are involved in the supply of equipment and technology for X-ray ore analysis.

Mr Brown said the companies had a range of world-first technologies on the drawing board, including a revolutionary method of analysing ore samples using laser instead of X-rays.

"The X-ray machines currently used are huge big multi-million dollar pieces of equipment, whereas the laser machines we're developing are just little desk-top jobs that we anticipate will be able to do a similar job at a much reduced cost," he said.