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Tuesday
Oct202009

UPDATED Iran's Nukes: The Real Story on Vienna Talks and the Deal for Uranium Enrichment

Iran-US-Russia Deal on Enrichment, The Sequel
The Latest from Iran (20 October): Green Waves or Green Mirage?

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IRAN NUKES

UPDATE 1930 GMT: Talks have ended for the day, to be resumed tomorrow. IAEA head El-Baradei said that negotiations were moving forward though more slowly than he had expected.

Julian Borger of The Guardian has a useful summary.

UPDATE 1825 GMT: Yep, that's where the not-so-silly games are heading. Iran, wanting France out of the loop, is talking directly to the US delegation, according to Lara Setrakian of ABC News.

Press TV gives more details: An Iranian source confirms the "positive and constructive" bilateral discussions, adding, "It was agreed that more studies should be held on...renewing the secondary, control and electronic facilities" of the medical research reactor, the source added.

UPDATE 1810 GMT: Oh my, the Iranians are playing silly games now. Having wound up the media with their pre-talk threats, Tehran's delegation decided today to give France a poke in the eye by never showing up at discussions. Other diplomats are insisting that this is not a walkout, and the French Foreign Ministry maintains, "It is a meeting of experts, in which we are participating." However, Iranian officials via Press TV are declaring, "The elimination of France from the deal's draft is certain."

There is a likely explanation for this rather comic manoeuvring. Under the "third-party enrichment" proposal backed by the US, Iranian uranium is to be enriched by Russia and then sent to France to be shaped into metal plates. Tehran may be insisting that Paris is cut out of the process, with Russia sending the uranium, raised to 19.75 percent, directly back to Iran.

Some of the media coverage of yesterday's opening of the Vienna technical talks on Iran's uranium enrichment was beyond hopeless.



It was unsettling to see international broadcasters suddenly and excitedly discovering that there were talks and then, when those talks did not produce an outcome within hours, suddenly and not-so-excitedly proclaiming disappointment. At least, however, that produced comic moments such as CNN's Matthew Chance, like a boy discovering there was no candy in the shop, sinking from "lot of anticipation" to "jeez...all day silence...now the talks have broken up".

Far worse this morning is the spectacle of reporters, despite having some time to collect information and consider, repeating distracting and irrelevant spin as "analysis". The Wall Street Journal goes off on a tangent into nuclear Never-Never Land, "Iran Drops Deal to Buy Uranium in France". Swallowing Iran's eve-of-talks posturing rather than understanding it, The New York Times and David Sanger declare, "Iran Threatens to Back Out of Fuel Deal" with Tehran's "veiled public threats".

Really? Then how does Sanger explain the comment of the head of the International Atomic Energy Agency, Mohammad El Baradei, "We're off to a good start" in the second paragraph of his story? Maybe he could reflect a bit more on the quote handed to him by "a participant" (fourth paragraph):
This was opening-day posturing. The Iranians are experienced at this, and you have to expect that their opening position isn’t going to be the one you want to hear.

The real story, which EA has reported since Glenn Kessler's breakthrough story in The Washington Post last month, is that the deal to ship 80 percent of Iran's low-enriched uranium for processing in Russia and to use that uranium in a medical research facility (rather than for bombs) is on the table. Yesterday's public chest-puffing by Tehran does not change that agenda.

Indeed, both Time magazine and Sanger add details to that deal (although Time, in particular, does not have the professional decency to acknowledge Kessler's original article). Approaching the IAEA, Iran revived the idea --- broached by other countries months earlier --- of third-party enrichment of its uranium stock for the medical facility, and the Obama Administration ran with it during the President's trip to Moscow in early July. The top US official for nonproliferation, Gary Samore, put the proposal to the Russians.

Discreet talks between Iran, the IAEA, Russia, France (which would shape the enriched uranium as metal plates before it was returned to Tehran), and the U.S. followed. On three occasions, twice with El Baradei and once with Russian President Dmitri Medvedev, President Obama stepped in to confirm and advance the initative. The deal was considered at the first direct talks between Iran, the US, and the other "5+1" countries at Geneva on 1 October, producing the agreement for further technical discussions in Vienna.

The very fact that the Administration would be is leaking so much information to well-placed reporters should indicate that the real story here is that the US, irrespective of Iran's public posturing, is going to persist with this proposal. That trumps any misleading headlines from journalists who yearn for drama to break "all day silence" and are prone, beyond the details in their own articles, to the image of a talk-stalling, deal-breaking Iran.

Reader Comments (10)

We've been rightly worried about these talks giving Ahmadi legitimacy. I still worry about that.

But wouldn't it be ironic indeed if THIS regime cut a deal w/ the US? In the medium term, doesn't that betray Ahmadi's (dwindling) base? Think Samuel ;). What else would they have left to justify their existence?

October 20, 2009 | Unregistered Commenterkevina

Do you really think France is out ? Do you really think M. Obama has an interest with bilateral talks ?
Remember... M. Sarkozy is very near from Israeli positions... ;-)

October 20, 2009 | Unregistered CommenterNorman

Norman,

I don't think France is "out", since I'm not sure US wants uranium shipped directly back from Russia to Iran, but if that is Iran's firm condition for a deal, who knows how far Washington will move?

S.

October 20, 2009 | Unregistered CommenterScott Lucas

You all have missed the point of the poke in the eye to France. In the context of the 1970's agreement that Iran signed with France to pay for and was entitled to enriched uranium from the European Enrichment initiative. This agreement was unilaterally suspended by France in the 1980's and Iran was never compensated. This move in essence means that the compensation for that broken agreement is tied to the proposed solution. It is a big win for the Iranians. If France wants to stay in the game, it has to compensate Iran for the past broken agreement, if it does not, it is out and Unitied States will have to find an alternative to the French (Iran's ideal choice would be USA, and then Iran would move to remove Russia too) hence it becomes a billateral agreement payed for by USA.

Second big development was that the research reactors control and support systems have been raised as needing improvements. It seems Iran is angling to get a new research reactor from USA and some compensation etc. all for the price of giving up its stockpile of enriched uranium More the better.
I would feel that they should also move to ask compensation for the new nuclear reactors that were never built but paid for.

October 20, 2009 | Unregistered Commenterwhereismyvote

Look at the following article.
http://en.wikipedia.org/wiki/Nuclear_program_of_Iran

Iran has paid to USA, Germany and France for
Plutonium processing plant
10% stock and production of Eurodif
Completion of Busher plant

These past issues will be directly tied to any solution seek by the west. Iran will essentially demand that any new deal consider these past debts and that it be repaid for them.

October 20, 2009 | Unregistered Commenterwhereismyvote

WIMV,

This is invaluable. I have to be honest --- I never considered this as part of the equation. Is there any supporting link for Iranian Government's position on compensation?

S.

October 21, 2009 | Unregistered CommenterScott Lucas

Scott
They will not openly publish their game play in a research paper like Western governments do, but certainly much of what Iran seeks for compensation are well documented within the context of the Hague legal framework / court setup.
The issue with Germany and France is that there is no such legal framework setup with them, but don't forget that France, Britain, Germany, Israel and many other countries own Iran loans, debt, services etc. because of their governments change in policy post revolution. All these items will be raised by Iran during the negotiations with the west, cause it will be a framework for addressing all these issues.

The case of Iran and USA is different cause much of the issue has been well documented in the Hague but not so w.r.t Israel debt to Iran, French broken contracts, Britain and Germany. Expect these all to come to play. Post France will be Germany's turn.

October 21, 2009 | Unregistered Commenterwhereismyvote

WIMV,

Many thanks for this.

S.

October 21, 2009 | Unregistered CommenterScott Lucas

WIMV,

I believe that France compensated Iran for the Eurodif deal in 1991.

Short summary is that in 1974- Iran made a $1 billion loan to Commissariat a l’Energie Atomique (CEA) to build a uranium enrichment plant at Tricastin, France for the Eurodif consortium. In return, Iran would receive a 10% stake in the plant.

Iran cancelled its agreements with Eurodif during the Islamic Revolution in 1979 and demands full repayment of the $1 billion loan- Iran also cancelled contracts for 2 French reactors to be built at Darkhovin. Eurodif claimed $739.4 million in damages because Iran withdrew from the consortium (As part of the loan conditions, Iran agreed to pay part of the plant’s operating costs and take 10% of the enriched uranium produced)

1986

The Iranians say the Eurodif project owes them some $500 to $700 million in interest on top of the loan itself. France claims nearly $2 billion in losses on the power station contracts and a $1.3 billion loss of revenue for enrichment services. The French agreed to an initial installment on the loan repayment of around $330 million

25 October 1991

Iran and France sign a $1 billion agreement settling a financial dispute over Iran’s involvements in the Eurodif uranium enrichment plant. France will pay $1 billion to cover the balance of repayment plus interest, and Iran will retain a small share of the Eurodif consortium. This may cancel the possibility of reimbursement to French firms for claimed damages cause by Iran’s cancellation of a nuclear plant contract.
—R. Jeffrey Smith, Washington Post, 30 October 1991

However…

August 1991
The International Court of Arbitration rules that Iran owes French firms $710 million for the cancellation of a contract for two 900MW pressurized water reactors, which were under construction at Darkhovin. [Note: In January 1991, the court ruled French firms had to pay Iran, and on 28 February, a French court blocked the payment. See January and 28 February 1991.]
—Nuclear News, November 1991, pp. 26

2 October 1991
Iran is ordered by an arbitration court in Switzerland to pay 4.06 billion francs to a French consortium of Framatome, Alcatel Alsthom, and Spie-Batignolles for canceling a contract to build a nuclear power plant in Darkhovin.

As far as I understand, the Germans cancelled their contract to build a reactor in Bushehr in 1979. Both sides initiated litigation. Iran seeking 2.1 billion DM in compensation from the German Kraftwerk Union for withdrawing from the nuclear power project in Bushehr. The GKU seeking 1.8 billion DM for the machinery it has produced but has never delivered because of the cancellation of the contracts.

A resolution appeared likely until the Iran-Iraq war intensified and Germany refused to resume work until after war ends. Iraq then bombs the plants- damaging them severely.

There is a useful timeline of Iran’s pre and post revolutionary nuclear deals with the US, France and W Germany here:

http://www.nti.org/e_research/profiles/1825_1826.html

October 21, 2009 | Unregistered CommenterChrisE

Thanks Chris for this information.

It is far more detailed than what I understood, I am reading and will be sure to pass this information to others also

October 21, 2009 | Unregistered Commenterwhereismyvote

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