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Weapons of Mass Destruction (WMD)

Russian official urges Iran to comply with NPP contract terms

RIA Novosti

16/03/2007 17:13

MOSCOW, March 16 (RIA Novosti) - Russia's top civilian nuclear official urged Iran to comply with the contract terms on the Bushehr nuclear power plant that Russia is building in the south of the Islamic Republic.

The $1 billion project being built under a 1995 contract has been in jeopardy after Atomstroyexport, the Russian contractor, said Tehran has not received any payments for the NPP construction since mid-January, and that by the fourth quarter of 2006 the project had only received 60% of the required funding. The company warned that the launch of the NPP and nuclear fuel deliveries could be delayed as a result.

Iran has denied the non payment, accusing Russia of being pressured by the West, which is trying to force Tehran to end its nuclear program.

"Financing must be provided [by the Iranian side], we should stick to regular commercial relations," said Sergei Kiriyenko, head of the Federal Agency for Nuclear Power.

He said commercial issues surrounding the contract could not be solved through mass media discussions, and that nuclear power plants could not be built without payment.

Tehran said Wednesday it had paid Russia over $75 million and another $6 million in its national currency between October 10, 2006 and March 14, 2007, including a $12.7 million installment March 1.

However, Russia denied receiving the payment, saying Tehran had only paid $5.1 million in January and had not transferred any money in February.

"We are holding talks in Tehran and we are ready to receive Iranian negotiators [in Moscow]," he said.

Moscow warned the plant could not go into service in September as planned, and that nuclear fuel would not be supplied to the NPP in March - six months before the launch - due to the financial problems.

Atomstroyexport said Friday that it expected talks on the financial problem to yield results by the beginning of the coming week. "Talks are underway, but the funds have not been transferred to Atomstroyexport's accounts," a spokesperson for the Russian company said.

The plant is scheduled to be commissioned in the second half of 2007, after the original date, the end of 2006, was put back. To date, the commissioning date has been postponed five times. The project was originally started by Germany's Siemens in 1975, but work stopped with the 1979 Islamic Revolution.

The Islamic Republic, already under limited international sanctions, is facing tougher penalties from the UN Security Council over its refusal to halt the uranium enrichment that some countries fear could be used in nuclear weapons production. Iran has insisted its nuclear program is only for electricity generation.

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