Annual report pursuant to section 13 and 15(d)

INVESTMENT IN AL MASANE AL KOBRA MINING COMPANY (AMAK) (Tables)

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INVESTMENT IN AL MASANE AL KOBRA MINING COMPANY (AMAK) (Tables)
12 Months Ended
Dec. 31, 2012
INVESTMENT IN AL MASANE AL KOBRA MINING COMPANY ("AMAK") [Abstract]  
Initial Investment in AMAK
The Company accounted for its contribution of these assets to AMAK, net of the $11 million liability, as the contribution of non-monetary assets to a joint venture, and recorded the transfer based on the lower of the cost or market value of the transferred assets. The Company determined that cost was less than market value, with market value being based on the contribution of cash of $60 million by the other investors in AMAK in exchange for their 50% interest.  In addition, the Company confirmed that market value was greater than cost based on the cash flow projections based on the proven reserves and market mineral prices. The Company's initial investment in AMAK was comprised of the following:

 
(thousands of dollars)
 
Accumulated costs of mineral Interests in Saudi Arabia
 
$
40,290
 
Contribution of AMAK organization costs
 
 
3,712
 
Loan payable assumed by AMAK
 
 
(11,000
 
Net initial investment in AMAK
 
$
33,002
 
Summarized Results of Operation and Financial Position for AMAK
The summarized results of operation and financial position for AMAK are as follows:
 
Results of Operations

Years Ended December 31,
2012
2011
2010
(Thousands of Dollars)
Sales
$ 37,407
$ -
$ -
Gross Profit
6,846
-
-
General, administrative and other expenses
6,325
2,613
2,130
Net Income (loss)
$ 521
$ (2,613)
$ (2,130)

 
 
Financial Position

December 31,
2012
2011
(Thousands of Dollars)
Current assets
$ 92,529
$ 98,365
Noncurrent assets
252,283
237,167
Total assets
$ 344,812
$ 335,532
Current liabilities
$ 81,568
$ 61,636
Long term liabilities
46,979
54,223
Shareholders' equity
216,265
219,673
$ 344,812
$ 335,532
Equity in Income or Loss of AMAK Reflected on Consolidated Statement Of Operation
The equity in the income or loss of AMAK reflected on the consolidated statement of operations for the years ended December 31, 2012, 2011, and 2010, is comprised of the following:

2012
2011
2010
Company's share of income (loss) reported by AMAK
$ 192
$ (1,018)
$ (874)
Amortization of difference between Company's investment in AMAK
and Company's share of net assets of AMAK
674
-
-
Equity in income (loss) of AMAK
$ 866
$ (1,018)
$ (874)