A nugget of truth way out west

As anybody with a cursory knowledge of the sharemarket knows, Western Australia is the well-spring of discovery and invention.

There are more companies invented in Perth and listed on the Australian Securities Exchange than in any other state. We are not merely talking about mineral exploration either, but also of scientific endeavour.

Perth is indubitably the epicentre of the biotechnology world, as its sheer number of listed biotech stocks attests. One even advised the ASX a few years ago that it had discovered a cure for ... wait for it ... pain. It is surely just a matter of time before some intrepid pioneers from Leederville or Nedlands discover a pill for eternal life - after a long lunch on St Georges Terrace. The ASX would give the story a good run, and facilitate a backdoor-listing into a mining shell after a brief stint with some friendly insolvency practitioners.

And so it was no surprise to learn this week that gold does actually grow on trees.

If that sounds like the latest WA broker float, it's not. Contrary to hallowed West Australian traditions, it really is real. And somebody in WA did verifiably discover it!

That somebody is geochemist Ian Crawford.

The paradox is that some east coast interlopers have hogged the glory. On Wednesday, scientists with the CSIRO published the findings in a study in the journal Nature Communications.

Using X-ray imaging technology at the Australian Synchrotron in Clayton, Victoria, they found gold in the leaves and the bark of eucalyptus trees. The roots suck up the yellow stuff from deep beneath the surface.

"As far as we know, this is the first time that anyone has seen gold in any biological tissue, and it just happens to be a eucalypt leaf," one of the CSIRO team members told the media.

It was a good bit of work by the science organisation. The only problem was that, like Captain Cook and Van Diemen, somebody had beaten them to the punch.

Crawford was slightly miffed to learn of the CSIRO claim, since he had spent hundreds of thousands of dollars of his own money and years of research to find, three years ago, that gold grew on trees.

Collaborating with the Nagrom metallurgical labs in Perth, the veteran geochemist had found gold, not merely in eucalypts, but in acacias and spinifex too. He had already trademarked his process GeoVeg TM.

So he shot off a note to the CSIRO this week, telling them about it. Most of the field work had been conducted in the Yilgarn Craton - the oldest surface land mass in the world, apart from a corner of Greenland - some 900 kilometres north-east of Perth. He had also proved up a big manganese deposit in Turkey after finding flora that was visibly yellow with metal.

"Your work is not the first to demonstrate gold in living plants," his email said. "So kindly refrain from declaring your work as being totally original. Your work does demonstrate by X-ray methods something we have been proving by ICP assay for years."

Readers be warned. Before you rush out and start assaying eucalypti in the Yilgarn, you are unlikely to find commercial quantities of bullion in trees.

Though, according to Crawford, his is a handy technology to accompany soil sampling since soil can be washed away by rain and trampled on by roos.

"We use it as a cheap 'first pass' in isolated regions to work out our drilling strategies," Crawford says. "You don't get much change out of $100,000 to drill a hole these days. So we offer it as a reliable sampling and exploration alternative to MMI [SGS' Mobile Metal Ion]."

And it is good for mineral assays for other metals too, such as nickel, copper and zinc.

Moral of the story? Just because somebody works in mineral exploration in Western Australia, it doesn't mean they are gilding the lily.

To great moments in pay. The AGL remuneration report got up this week despite a rude protest vote against it. A good thing too, as it showed verve and imagination.

The AGL board pretended that "normalised" earnings included the $240 million of carbon tax compensation for Loy Yang B (even though the carbon tax seems likely to be abolished) and forgot about the $290 million in impairments to a bunch of assets on which they had splashed shareholder cash - not to mention irksome items such as a $50 million stamp duty on the Loy Yang B purchase. The result: short-term incentives (STIs) paid out at 60 per cent of max and the long-term incentive (LTI) hurdles were lowered.

As pay has been relatively constrained this year - at least in light of the euphoria of the past two decades - the focus in this season of annual meetings has been on complexity.

Malcolm Broomhead, one of Australia's best-regarded directors, set the tone early on with an inspired thought bubble. Unfortunately, people were listening. Executive pay, he said, was too complex, the two-strikes regime was overblown and LTIs should be simplified by simply gifting a quantity of shares to chief executives on appointment (that vest immediately). They either get more (if the share price goes up) or less (if it goes down).

Given Broomhead's involvement in one of the most complex pay schemes known to the ASX, the Orica one, we are happy to meet his call. Long-term incentives ought to be an incentive, not an entitlement.