Union Share Discussion Threads

[nobull] 16/12/2008 13:09

The latest news is that two major shareholders have been selling down. I presume they are RAB Capital and Lundin. So it is bust or major dilution.

[nobull] 16/12/2008 11:02

Some broker research that shows what our share price will be (32 cents) if the phosphate project comes good. The target price mentioned for us (we are called UCL.AX in Australia) is a bit unrealistic (it perhaps assumes Standard Moroccan Rock Phosphate will be worth $350 a tonne for ever more. A bit unlikely.





If it is the phosphate project you like, then you should look also at BON.AX (I've already bought a few of those). Then there is SKR (Sunkar Resources) which seems to require a lot of capital. Also the popular one is MAK.AX (Minemakers) but I don't rate that much. It needs port facilities at Darwin, and also it is miles from Darwin (transport costs will be high: road transport to Tennent Creek and then rail to Darwin: ugh, and then there may be permitting issues). The best with lowest opex and capex are UCL (and if you wish to avoid the liquidity risk and anything to do with Iran) then BON.AX maybe the one (it has a profitable cash flow stream from diamond mining to support its company making phosphate project).

[encarter] 15/12/2008 23:08

nobull i've done a bit of research and it scared me off. The deal they announced is for the plant only, URL have said previously that without the mine the deal is unworkable. They extended the rights issue twice which indicates a poor take up and who would when the offer price is double the sp? The directors have never put a penny into the company and are not likely to do so. They can't raise $2m so where will they find $60m?

Having said all that there may be something going on that's not in the public domain, so i'll keep watching. Good luck.

[nobull] 15/12/2008 11:04

Encarter, I have lived and worked in Iran (during the most violent part of its modern history), so I don't have the normal reservations that most people have. The headlines in the press about Iran are dire (and all of them are true of course, including all the stuff about building an atom bomb, at least as far as I am concerned). The directors are not just a bunch of Ozzie con artists (descendents of transportees and all that). No. Far from it. I am very impressed with them. Dr Reid is a Geochemist who has worked in Saudi Arabia (advising the Saudi Govt. on the privatisation of Ma'aden: a very large company). Then there is Norman Lamont, a honourable sort of fellow IMO, who wouldn't associate himself with some spiv outfit [Recall he is former UK chancellor of the Exchequer]. Also Lundin mining own a great deal of the company, and what they don't know about zinc can't be worth knowing. This is really quite an exceptionl company with mega liquidity (risk of running out of cash) and dilution risk already in the price (if the rights issue fails the company could go belly up, and the rights issue closes in a matter of days and the rights price is far above the market price, so it all looks massively dangerous. But I've put my order on for 2m overnight (strictly limited of course). There can't be many £1m companies with the prospect of becoming $1.2bn companies, but this is one. How will they raise the finance with sanctions on Iran? Good question. I don't know the answer to that, but the Presidential elections are due in June 09 and it is possible the current mayor of Teheran, Mr Qalibaf, will be elected and that Obama will reach some sort of deal with a new regime in Teheran. Also there are plenty of countries who wouldn't take any notice of UN sanctions on Iran: Russia, South Korea - they just want to do business and make money. Mehdiabad is the largest undeveloped zinc mine in the world, and we aren't going to go looking for zinc on the moon because the Iranians are too difficult to deal with, are we? A compromise will have to be reached. The reasons given for the cancellation of all the agreements were a load of codswallop. Just a dispute about how to share the profits. Canny hagglers the Iranians. Try buying a carpet off them: you get Persian carpets cheaper in John Lewis. Mehdiabad will be built.

Finally the company has a very attractive phosphate project. Phosphates are a non-renewable resource, like oil. Unlike oil,they are essential for life: Tricarboxylic acid cycle: ADP and ATP and all that biochemistry rubbish? Plants take them out of the soil, and we eat the plants but it is not convenient for all office workers to deposit their "phosphates" back on the soil where they are needed (it's against modern office etiquette?- except in Australia, and they can't produce enough phosphates to cover their land), so there is a deficit and subsequent plant yields drop off unless phosphates are put back into the soil (fertiliser). Sucking the phosphates up off the seabed (phosphatic sediment) is cheap and easy (no crushing as with land based rock phosphate mines). Anyway in short these are a mulibagger in the long run, and it's very nice to be the only nutter in the UK who has bought shares in this company. I have great faith in it. DYOR. I hope my holding is more than 3m tomorrow. Good luck. Seriously though I would advise having an interest in all things Iranian, otherwise the offputting news headlines about Iran will make you a weak holder, and then the volatile share price and the long down trend will get to you, or yes they might be insolvent next week. All the best.

[encarter] 15/12/2008 06:50

nobull hi, i got wind of this deal on Friday. I hope you can recoup some of your loses now. I can't see where the money will come from to build the plant though. They can't raise the $2m needed for their other project so $1.2b will be impossible. IMHO it's directors just trying to squeeze the last few drops of blood out of this stone.

[nobull] 06/9/2008 16:40

An article from a web site to do with Yazd (the nearest City to Mehdiabad). It actually mentions us (Union Resources). The words underlined in blue read "Company Iranian-Australian". Not seen that before. It is just possible if this isn't an old article (no date on it and it came up today near the top of a google search) we are going to be in business at Mehdiabad shortly. One for Persian speakers. DYOR.

[nobull] 31/8/2008 11:36

First line is the English equivalent of the Farsi words in the order that they are in Persian (i.e. total unintelligible rubbish). Second line is my fantasy as to what the words might mean in more intelligible English. Verbs in orange, nouns in green, conjunctions and prepositions in purple, "Mehdiabad" in red, interesting words in turquoise, etc. Any help with the translation much appreciated.



Second sentence...



Third sentence is something to do with payments for something.



Fourth sentence doesn't say anything useful



fifth sentence



sixth sentence



twelfth sentence

[nobull] 30/8/2008 05:41

Below is just a sample of the text I've worked on. I expect we will get an announcement on Mehdiabad this week, maybe even on Monday morning. The press release has been slightly altered since I posted it yesterday (the web site now shows it with an official red stamp!). "Mehdiabad" is underlined in red. "Company Australian" is underlined in blue. There is a mention of some other companies. The item ringed in purple is, I think, the mine life: 40 years. The frequency of articles in Farsi about Mehdiabad suggests that Aker Kverner's affirmation that there is no commitment on the part of the Iranian Govt. to get this project going is all balderdash. What they mean is there is no commitment with the present (unsatisfactory from their point of view) profit sharing arrangements. I believe a settlement of the dispute is now imminent. Exciting times ahead. The phosphate project (sucking up phosphatic sediment off the seabed using an airlift pump is just brilliant - no crushing to do - no rocket science since the combined weight of the air, sediment and water in the "vacuuming" pipe is less than the displaced water, hence it is lifted into dredger. No impeller to clog either. So it is just an engineering problem. Phosphate Jorc resource due this week I think. I am hoping for 75m tonnes.

[nobull] 29/8/2008 19:29

New press release out today that mentions Mehdiabad 9 times in the main article(but not in the headline) and once in a line below the main text. The man in the photo is the Head of Impasco, our JV partner. A Farsi speaker on hotcopper.com.au says Mehdiabad has been privatised, but it is unclear if it is the 50% share the Iranian Govt. owns that has been privatised or if they have privatised our 47% of the project as well. It is also possible IMPASCO itself has been privatised. Help please any Farsi speakers out there?

[nobull] 26/8/2008 15:54

The same IMPASCO story about Mehdiabad as above, except the version of it displaying on the IMPASCO web site on 24th Aug. 2008 has had all the dates altered. The privatisation schedule has slipped perhaps. As before, the instances of "Mehdiabad" underlined in red.

[nobull] 10/7/2008 11:35

In case anyone thought Mehdiabad is not on the agenda anymore here's another story from our government partner's web site. Sorry no idea what it is about. The number "120" probably refers to a distance in kilometers(kilometree?). The story is dated 16th Tir 1387. Today is 20th Tir 1387. Underlining of the word "Mehdiabad" in red is mine.






If it is of interest how another western mining company promotes its operations in Iran, here's a link to a story its promoter has perhaps paid to get published. As I understand it, the Chairman?, Mr Teeling, never undersells his companies. It is interesting in that it makes no references to the difficulties of obtaining an exploitation licence or to the problem of pre-agreed profit margins and how such agreements limit the upside considerably. It may also be of interest to geos interested in the Tethyan belt.

[nobull] 30/6/2008 00:48

Same story (as above?) has now appeared on IMIDRO's web site...(26/3/1387 or 15/6/2008)

[nobull] 19/6/2008 15:55

New article out that appears to be dated 26th Khordad 1387 (today is 30th Khordad 1387). No idea what it is about. It mentions Mehdiabad and Angouran.

[nobull] 17/6/2008 11:38

Here is some evidence of how the Iranians think developing a mining project (like ours?) should be financed with preference shares (Talk of "Pre-defined profit" sounds like preference capital to me?). The text is from an article in today's Iran Daily. We took exploration risk and they want to reward us with a pre-defined profit? That is just not good enough, IMO.

"In the early 1990s the buy-back method of transaction (the government buys back the industrial project after the foreign direct investor has recouped his initial investment in the project plus a predefined profit) was introduced to bypass constitutional constraints on foreign investment and avoid potential political difficulties within the country.
The scheme has government support for being an efficient means of attracting foreign capital, services and technical expertise, while reducing foreign exchange expenditures and expanding exports. It is estimated that $20 billion, mostly in foreign investment, will be required for the government to materialize the targets of its 20-year plan, known as Vision 2025 and to improve the mining sector."

Full article below on page 4:

[nobull] 30/5/2008 15:04

Reasons to buy this stock (on the ASX) are, IMV,

1. There is substantial dilution risk and liquidity risk (the risk of running out of cash?) already in the price. (The money runs out in about 3 to 6 months).

2. The Iranians are ripping us off in 3 different ways simultaneously:

a) the exploitation licence has already been issued to our JV Government partner, IMPASCO, and has already diminished our ability to exploit our exploration success by 3 years (the delay in transfering what was a 25 year licence to the JV company: only 22 years left on it - and diminishing by the day)

b) talk of having a public auction and making us bid against competition to win our agreements back is another way to deprive us of the value of our exploration success: it is as if we hadn't had any.

c) sending in Mobin to remove 200m tonnes of ore further reduces our exploration success.

3. The Iranian Govt. appears to acknowledge past promises to us about the right to mine Mehdiabad (see above articles).

4. I think even the Iranians must realise if they want foreign investment in Iran, they will have to improve the terms we are offered from the extreme position we are currently suffering (see points 2 a, b and c). Also the threat of referral to arbitration perhaps is a concern to them.

5. The recent talks between us and the Iranians in Dubai (around 10-12th May) have resulted in continuing negotiations (see company website: shareholders' questions).

My money is on a solution of some sort that restores value to this stock soon: the options expire in March 2009, so that may be another incentive to reach an agreement soon. DYOR.

[nobull] 28/5/2008 09:40

Another version of the same story above in Abrar News of 4th May 08? I've highlighted "Mehdiabad" and "Australians" in blue in the headline...







Another mention of Mehdiabad. There is no date on the article/comment. The 682 figure appears to mean $682m (682 meel-ee-oon dollaree). The headline begins something like "presence (of??) Austrlian company in Mehdiabad mine is? was? will? not become certain/decisive" (Do your own translation please - I am just beginner level).

[nobull] 18/5/2008 22:42

On hotcopper.com.au "bhbhbh" has provided a proper translation of the article above:

Australians have obtained the right to build the factory pending on getting the permission to mine Mehiabad.

An Australian company has obtained the right to build a zinc and lead factory pending on getting the right to mine Mehdiabad. Ahmad Ali Harati-Nick the executive manager of rebuild and development of mines and industrialization of Iran added: The Australian Company wants to obtain the permit to mine Mehdiabad outside the auction, which we can not guarantee that. He added: Such an act is against the mining regulations (in Iran). Based on this regulation any permits of mine should be given by way of an auction and in an auction there is no guarantee that they (UCL) win the contract. According to Harati-Nick whenever the government makes the final decision to allow mining in Mehdiabad, this company (UCL) would have the priority. He also added This Company (UCL) wants some guarantees about receiving the row material they need and we have announced if they establish the factory we will provide with it. The executive manager of Imidro mentioned: Under previous management they (UCL) have been given a promise for the permit to mine zinc and lead. This was put to the ministry for approval and got rejected. He also clarified: We have announced to the Australian company that giving the permit to mine Mehdiabad is not possible at the moment, but they could take part in establishing the factory and they have shown interest and are reviewing the proposal.
_______________________________________________________



The interesting thing about the article for me is that the Iranian Authorities seem to recognise we have been promised in the agreements the right to mine Mehdiabad and that the Ministry is refusing us that right under (newer?) regulations. The fact we had this right seems to be confirmed by what Iran Daily had to say on 13/5/06






and again in Iran Daily on 4/12/05

[nobull] 16/5/2008 13:08

Second sentence part 2



Sorry I can't make sense of this sentence. Can any Farsi speakers help please?

I get

"Ahmad Ali Harati Nik, Director (and Head of?) IMIDRO, added: this Australian company wants .... Mehdiabad mining licence.... a promise to them we cannot owe? keep?"