Bushehr's Half-Life
// Russia and Iran Trade
Negotiations between Atomstroiexport and Atomic Energy Organization of Iran began March 7 in Moscow. Neither side expects anything more than a declarative protocol to come out of the talks. Even so, the talks were bitter from the very beginning. On March 8, in spite of the official holiday in Russia, Atomstroiexport representatives spent the day discussing the situation with the Iranians. By the morning of March 9, the text of the protocol had been agreed upon. However, Friday during the day, the Russians firmly refused to endorse any documents.
The reason for their harsh stance was a statement made by the head of the Iranian delegation and vice president of the Atomic Energy Organization of Iran Mohammad Saidi that formally had no relation to the negotiation. “We hope that Atomstroiexport and Rosatom will fulfill their obligations to supply nuclear fuel before the end of March 2007,” Saidi told ITAR-TASS, “and guarantee the physical launch of the reactor in September, as specified by the contract.” The mention of deadlines immediately blew the situation up. “The head of the Iranian delegation grossly violated the negotiation process by making this morning's statement, which directly contradicted the sense of the discussion,” a source at the negotiations told Kommersant. “Signing joint documents has become senseless for us.” Atomstroiexport also confirmed that Saidi's comments were the cause of the collapse of the talks.
Kommersant has learned that there were two related questions discussed in the negotiations. Those are the financing of Atomstroiexport's operating costs in Bushehr and the deadlines for the delivery and installation of refrigerating equipment for the atomic plant's safety system. Formally, the Atomic Energy Organization of Iran is right when it says that it has no debts for Bushehr. Under the Atomic Energy Organization of Iran and Atomstroiexport contract, the $200-million last tranche is to be paid by Iran after the station is running. During Federal Atomic Energy Agency (Rosatom) head Sergey Kirienko's visit to Iran in December 2006, Iran took on the obligation to finance the construction at a level of not less than $25 million per month. That requirement is not recorded in the 1995 contract, however. Finally, at the beginning of 2007, the deal was converted from dollars to euros by the Iranians. As a result of that, according to Atomstroiexport, it has not received any money from the Iranians since January 17.
The second question is the delivery of the refrigerating system. Kommersant has learned that it was stated at the negotiation that, because of the absence of the refrigeration systems, the safety systems at the plant cannot be installed any sooner than the end of the year. The companies that are holding up the deliveries have not been named. Kommersant learned earlier that Iran refused to purchase that equipment in Russia and placed an order for it in an Asian country.
A source at the negotiations said that the Atomic Energy Organization of Iran has admitted to a problem with financing and with the equipment, but it refused to record those details in the protocol. “By signing the protocol, the automatically admit the absence of financing for the construction work is their fault,” an Atomstroiexport source said. It was after admitting to those problems that Saidi spoke of fuel delivery deadlines at the end of the month.
At Atomstroiexport, Kommersant was told that Saidi's claims are untrue. According to that company's information, the schedule signed by Rosatom in September 2006 includes only one deadline for Bushehr – the physical launch of the station in September of this year. As a rule, fuel is delivered to a plant half a year before it is launched, if all the necessary equipment is in place.
For Iran, the receipt of the fuel is highly politicized, aside for the issue of using it to produce power. Fuel cells on its territory would give Iran new status in negotiations with the international community and IAEA on enriching uranium. In any case, Russia and Iran both have ample grounds for accusing the other of breaking the contract. Judging from statements by Atomstroiexport representatives, it would seem that Russia does not intend to supply fuel for Bushehr this month. Saidi hinted at that and the company does not deny it. “We will determine the deadline for the launch of the atomic power plant mathematically, not politically,” an Atomstroiexport source said. “Of financing is being held up for at least two months, the launch of the plant and all other operations, including delivery of the fuel, will be delay by the same amount of time at a minimum.” The exact work being done by the Russian company in Bushehr is not known right now, but it seems that at least some of the work has been rolled back.
It is clear in any case that September 2007 is not the deadline for launch the plant any longer. Even if the third party delivers the equipment, and Iran pays Atomstroiexport the $50 million for the last two months, the physical launch of the plant will take place earlier than November and the plant will come into use next year. The only question is what form that announcement will take.
They were unable to reach an agreement on that form in Moscow. New negotiations on Bushehr will begin today in Tehran, but only “on the expert level.” It can be noted that authorities in both Iran and Russia find the scandal in its current form convenient. Iran is able to freeze the entire project at Bushehr and make reference to its partner's problems. Russia can point to Iran's refusal to pay for the plant as the reason for the missed deadlines. Only Atomstroiexport is unhappy. The company is emphasizing that it is negotiating only from the utilitarian side.”
Alena Kornysheva, Dmitry Butrin
All the Article in Russian as of Mar. 12, 2007
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