Russia: Iran Nuke Plant Project at Risk

Iranian woman displays a new 50,000 Rials (about US$5.40) banknote released by the Central Bank of Iran in Tehran, Iran on Monday, March. 12, 2007. Iran issued a bank note emblazoned with a nuclear symbol, seen in centre, on Monday, in a move seen as an assertion of the national will in the face of international sanctions over its insistence on enriching uranium. (AP Photo/Hasan Sarbakhshian) (Hasan Sarbakhshian - AP)

MOSCOW -- The Russian state-run company building a nuclear plant in Iran warned Wednesday that Iranian payment delays may cause "irreversible" damage to the project _ another strong signal of Moscow's annoyance with Tehran.

The Atomstroiexport company said it was having difficulties trying to appease subcontractors who had demanded urgent payments.

Russian nuclear officials said Monday the Bushehr nuclear plant it is building in Iran would not be launched in September as planned because of Iranian payment delays. As a result, Atomstroiexport said, it would not ship the uranium fuel needed to power the plant to Iran this month, as earlier expected.

The statement angered Iranian officials, who denied any payment delays and accused Moscow of caving in to Western pressure to take a tougher line on Tehran.

But Atomstroiexport insisted it had received no payments since mid-January.

"If the Iranian side doesn't resume funding for the project, the process could become irreversible," the company said.

"The Iranian party's claims that it had provided $12.7 million on March 1 are absurd," Atomstroiexport Vice President Yevgeniya Neimerovets said in the statement.

The company said it was continuing work in Bushehr, "relying on Iran to show common sense and resume funding."

U.S. Deputy Energy Secretary Clay Sell said he and Russian officials discussed the Bushehr issue this week, adding that Washington and Moscow share similar concerns about the Iranian nuclear program in general.

Sell told reporters on a trip to Moscow that Russia's actions were "consistent with our common interests and common concerns as to what's going on in Iran." He did not clarify if those actions included Russia's stance on the Bushehr payment issue.

The U.S. and its Western allies have been pressing Iran for more transparency in its nuclear program, fearing it is trying to develop nuclear weapons, and the U.N. Security Council has demanded Tehran halt its uranium enrichment program.

Iran insists its enrichment program is peaceful and aimed solely at producing nuclear energy, and has refused to halt the program.

In December, the U.N. Security Council voted unanimously to impose limited sanctions against Iran for its refusal to cooperate and recently has been considering a new package of harsher sanctions. The five permanent Security Council members _ Russia, the United States, China, Britain and France _ have been joined by Germany in the negotiations with Iran.

Diplomats voiced optimism Tuesday that they were moving closer to agreement on new sanctions, likely including an embargo on arms exports and an asset freeze on more individuals and companies linked to Tehran's nuclear and missile programs.

Russia and China, which have close commercial ties with Iran, have opposed the U.S. push for tougher sanctions. Russia supported the December resolution on sanctions only after the Security Council removed restrictions on the Bushehr plant.

Moscow's recent tough line on Bushehr appeared, however, to signal increasing annoyance with Iran and a possible warming on Western-proposed sanctions.

Russia's Federal Nuclear Power Agency head Sergei Kiriyenko dismissed Iranian claims that Moscow violated its contract obligations by refusing to supply fuel.

Kiriyenko told Russian news agencies that the plant's launch scheduled for September had been pushed back by "two months at the minimum" because of Iran's payment delays and its failure to get the necessary equipment for the plant from unidentified third countries.

"We will ship the fuel six months before the launch," Kiriyenko was quoted as saying by the ITAR-Tass, Interfax and RIA Novosti news agencies on a trip to Italy, where he was accompanying President Vladimir Putin. "It's not a political action, it's technical requirements."