Money dispute holds up completion of Iran's reactor

Monday, February 16, 2004

MOSCOW Russia has acknowledged the failure to resolve a dispute that has delayed completion of the Bushehr nuclear reactor for Iran.

Russian officials said the disagreement has resulted in the cancellation of a meeting of the nuclear chiefs of Moscow and Teheran scheduled for this week. The Russian delegation, led by Atomic Energy Minister Alexander Rumyantsev, has delayed its visit to Teheran by at least two weeks.

Rumyantsev said the dispute regards Iran's refusal to return spent nuclear fuel for the Bushehr plant to Moscow. Iran insists that Russia bear the costs of securing the spent nuclear fuel as well as its transfer from Bushehr to Moscow.

The minister said another disagreement concerns the price of the Bushehr project, reported at $1 billion. The project is said to have overrun its original price by 25 percent.

"The disagreement is over price," Rumyantsev said.

Rumyantsev said he hoped negotiations with Iran would be completed within two weeks. Over the last 18 months, the minister has repeatedly asserted that delays and disagreements regarding Bushehr were being resolved.

But the Russian minister acknowledged to significant delays in the Bushehr project. He said Moscow plans to deliver fuel to Bushehr by mid-2005. This would be followed by the operation of the reactor in 2006.

As late as 2003, Rumyantsev asserted that Bushehr would begin operations by the end of 2004.

The United States has pressed Moscow not to complete Bushehr without an Iranian agreement to return the spent nuclear fuel. In December 2003, Iran signed the Additional Protocol of the Nuclear Non-Proliferation Treaty, which calls for rapid and intrusive inspections of suspected nuclear facilities.

In a related development, Iran has acknowledged that it concealed blueprints for an advanced centrifuge from the International Atomic Energy Agency. U.S. officials said the concealment of the design of the so-called Pak-2 centrifuge violated an Iranian pledge in October 2003 to fully declare its nuclear activities and temporarily suspend uranium enrichment.

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