Is it a buy or not?You'll have to make up your own mind.Pros1....

Is it a buy or not?

You'll have to make up your own mind.

Pros
1. Strong Board with cautious CEO, who seems to choose his words carefully, and with great effect. Recall his first presentation and how he described the situation in Iran: doctrinaire appointments, rubber stamping officials, opaque decision making and no process. He tells it as it is?

2. A willingness on the part of Iranian Govt. to get the Mehdiabad project into production (based on the number of press releases in Farsi). The issue then is will they do it with or without us?

3. The willingness to negotiate with us despite having cancelled the agreements for "non compliance" many years after the alleged non-compliance, and at a time of high zinc prices, may suggest to some people this is a negotiating stance to obtain a bigger share of the profits. There is value to come from Mehdiabad? Only the gloomy view that we are contract breakers has been communicated to the ASX. (The truth is more complicated than that?).

4. The phosphate project appears to have a competitive cost advantage over similar land based projects (minimal infrastructure required, lower transport costs and lower processing costs). The rocket science element of sucking up sediment from the seabed puts people off. The science bit is not rocket at all: it is an engineering problem. The weight of the air bubbles, water and sediment in the vacuuming tube is less than the weight of the displaced water, so the sediment rises up the tube without any help from an impeller. Check out youtube on "airlift pumps" to see a film of one working.

Cons.

1. The company has minimal cash left and no revenue to pay the bills. One of the major shareholders, RAB Capital, has just started to sue Lehmans (well, the administrators) for about $50m (please check that figure - it is from memory). So there might be a question mark over whether RAB Special Situations can put more money into this company.

2. The share bashers will make a lot about the wealth destruction that has taken place in this company (and infer that the Board is crap), but corporate news is randomly good and bad. What is clear is that we have had exploration success that has not been paid for yet, but before getting carried away with indignation about that, it is worth remembering it is running out of cash or not that matters (point No. 1).

I like the Board (although I haven't met them) so I will continue to hold and will disregard the downpointing chart.