Payment queries over Bushehr

27 February 2007

Claims by Russian officials that Iran has failed to meet payments for the VVER-1000 Bushehr nuclear plant have been denied by the Islamic republic, despite suggestions that the project may be delayed as a result of the fracas.

Coming amidst growing concerns over Iran’s nuclear programme - the country has just missed a UN deadline to suspend nuclear enrichment activities – the suggestion that relations with long-time supporter Russia are becoming strained is leaving Iran looking increasingly isolated on the world stage.

Under the terms of the deal with Atomstroyexport to complete the Bushehr facility, fuel shipments are due to begin in March with the reactor due to commence commercial operations towards the end of the year. However, the Russians are already backing UN sanctions over uranium enrichment and may resist delivering nuclear fuel as the US adopts a hard-line stance towards Iran, particularly in light of the expiry of the UN deadline.

Without explicit IAEA backing, any attempts by Russia to deliver fuel which may, the west fears, becoming more highly enriched would be provocative and a ‘contractual’ dispute may prove an ideal ruse to avoid a politically embarrassing situation. The issue is believed to relate to a switch in payment from dollars to euros by the Iranians, without prior agreement, which has led to a failure to record the transactions since January. Further delays are understood to stem from a requirement for some auxiliary equipment to be manufactured in Russia as some countries refuse to deliver such equipment to Iran. Mohammad Saeedi, the deputy head of the Atomic Energy Organisation of Iran, has reportedly said: “Iran has had no delay whatsoever in making payments for the Bushehr nuclear power plant to the Russian company.”


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