The new Mehdiabad “production” agreement is not an achievement (as trumpeted in the annual report): it scalps the entire economic rent associated with Mehdiabad in a way that enables us to be treated less favourably than Iranian owners of mines that assist with 'Iran regime' preservation. The fair way to remove the economic rent (if it is a desirable national goal to reduce investment in the mining industry) is through profits taxation and mineral royalties.
We didn't have to accept the new agreement. We already had an agreement: it was just that, as with many other sorts of agreements, the Iranian leadership cannot stick to them. (Our directors for 6 years called the cancellation a “purported cancellation”, and everybody on this thread knew it was not cancelled due to non performance on our part, save Cerhob who, if I recall correctly, suggested our Board may not have fulfilled its obligations in a timely manner when Mr Murdoch was in charge). So we didn't need a new less favourable agreement to remind us that the terminological inexactitudes (lies?) in the "cancellation of agreements" letter from Mr. Harati Nik in December 2006 were untrue. The announcement of the new agreement added nothing to our share price (testament, if any were ever needed, to the ruthless efficiency with which the new agreement deprives us of any of the economic rent associated with Mehdiabad).
Our Board refuses to discuss Mehdiabad (listen to Jordinson at the 30 minute mark into the Board Room Radio recording of the AGM on 13.12.12: “I won't discuss that project [Mehdiabad] in any detail”), and yet he was not averse to selectively diluting us (but not Dr. Al-Bawarmi) out of it, while retaining control of it for himself and simultaneously denying our position would be changed (BoardRoom Radio interview on ?) in exchange for Wonarah) or to selling a stake in it to Dr. Al-Bawarmi at a fraction of the cost expended on it (except that he cunningly wrote it down first, having chosen such an accounting policy himself), when plainly if he had bothered to use legal action to enforce the old agreements, Mehdiabad was in reality worth a fortune. And then we have our chairman trumpeting Dr. Al-Bawarmi's generosity in investing in us at a “premium”, a premium only made possible by Jordinson's incompetence in getting the true value of Mehdiabad put into the share price (it really does take monumental incompetence to fail to get value added to our $14m market cap on account of a legal entitlement to a 48% earned prospective share of 19 BILLION DOLLARS worth of recoverable metal in the ground that has been verified independently as being feasible to extract both technically and economically in a country with a 28% unemployment rate. Mr Jordinson doesn't appear to have the confidence to discuss anything to do with Iran in his quarterly reports (and worse he is reliant on our Iranian partners who, charming as they are, are beholden to the leadership in that country and its low quality of decision making: it has taken the leadership 6 years to decide on the terms of production sharing agreement they wish to impose on us for example.
I just hope Jordinson and Ross get their backsides bitten by one of those Eastern brownies (the venom kills in seconds?). I didn't vote my shares. The “performance rights” (LOL) voted to Jordinson and Ross are a disgrace. They are totally unfit to oversee a project in Iran with the level of knowledge on Iran they are willing to exhibit. All in my opinion. DYOR.
Note Obama's former Iran advisor's comments yesterday (Dennis Ross) on a likely change in Khamenei's position this coming year. I, as a failed forecaster of Iran regime change for god knows how long, am sticking to my belief regime change is still imminent. I am very pleased to see my forecast about Bashar Al-Assad's rule coming to an end soon is coming right (not that one needed more than a single brain cell to get that right). It is a pity our Board have such little interest in Iranian politics, and that its deficiency in that respect has, more probably than not, cost us hundreds of millions of dollars. We now have only 24 years and 10 months of the new agreement left.
But there’s a good case to be made that next year will finally bring a break in the Iranian stand-off — by means of a military confrontation, the appearance of an Iranian bomb or a diplomatic deal of some kind. And interestingly, one of the people making that case is President Obama’s first-term adviser on Iran, Dennis Ross, who has worked on the Middle East in five administrations.
Ross, who left the Obama White House at the end of 2011, concedes that prognosticators of an Iran crisis have a long losing streak. His reasons that next year will be different boil down to three: an approaching Iranian “breakout” capacity; Obama’s stated determination to prevent it; and the slow emergence of an economic and political climate in Iran that could prompt Supreme Leader Ali Khamenei to change course.
Full article at http://www.iranfocus.com/en/index.php?option=com_content&view=article&id=26686:will-2013-see-action-on-irans-nuclear-program&catid=33:iran-in-the-world-press&Itemid=32
Oh yes, and Jordinson's comment that UCL has a ratio of market cap to phosphate content of 0.2 compared with Sloanegate Agricom's of 1.8 may be because we are not in production whereas Sloangate Agricom presumably are.
UCL Price at posting:
14.0¢ Sentiment: None Disclosure: Held
