Part I: Its History, 02 October 2003

Part II: Are Nuclear Reactors Necessary?, 03 October 2003

Part III: The Emerging Crisis, 06 October 2003

Part IV: Economic Analysis of the Program, 07 December 2004

Part V: From the United States Offering Iran Uranium Enrichment Technology to Suggestions for Creating Catastrophic Industrial Failure, 22 December 2004

Part VI: The European Union's Proposal, Iran's Defiance, and the Emerging Crisis, 09 September 2005

Part I: Its History

On February 9, 2003, Iran's program and efforts for building sophisticated facilities at Natanz and and several other cities that would eventually produce enriched uranium were revealed. President Mohammad Khatami announced the existence of the Natanz (and other) facilities on Iran's television and invited the International Atomic Energy Agency (IAEA) to visit them. Then, in late February, Dr. Mohammad El Baradei, the head of IAEA, accompanied by a team of inspectors, visited Iran. Since then, the IAEA's experts and inspectors have visited Iran several more times. A preliminary report was published in July, with a follow up report on August 26. On September 12, 2003, the IAEA gave Iran an ultimatum to reveal all the details of its nuclear activities by October 31, 2003.

Iran's nuclear program and activities, though discussed for many years, have come into sharp focus since the February announcement. The information and data that have been obtained by the IAEA, after visiting the Natanz facility and a few other locations, have surprised the United States, the European Union, Russia, and Japan. Similar to the Clinton administration, the Bush administrtation has been suspicious of Iran's nuclear program, arguing that, having vast oil and natural gas reserves, Iran hardly needs nuclear energy. Hence, the Bush administration argues that the primary purpose of Iran's nuclear program is developing nuclear weapons. The EU, which is negotiating with Iran extensive economic and cultural agreements; Russia, which is completing construction of nuclear reactors in Bushehr and hoping to build many more reactors in Iran, and Japan, which is hoping to sign a lucrative oil agreement with Iran for developing Iran's huge Azaadegaan oil field (the largest oil field in the Middle East), have all pressed Iran hard, demanding that it reveal all the secret details of its nuclear program and facilities.

Note that, according to the original IAEA safeguard agreements, Iran did not have to declare the start of construction of the Natanz facility. These agreements stipulate that, only 180 days before introducing any nuclear material, does Iran have to declare the existence of the facility. Therefore, construction of the undeclared Natanz facility was NOT illegal. In addition, the Nuclear Non-proliferation Treaty (NPT) allows Iran to legally build any nuclear facility, including one for uranium enrichment, so long as it is intended for peaceful purposes. Moreover, the NPT allows the member states to withdraw from the agreement, subject to giving a 90 days notice to the IAEA, if they believe that abiding by the terms of the NPT threatens their national security (in the language of the NPT, if it is in their "Supreme Interest").

Aside from the political confrontation that the revelations about Iran's nuclear program have created between Iran on one hand, and the US and her allies on the other hand, the questions that I believe we Iranians must ask and debate, are: Does Iran need nuclear energy, and is acquiring it in its national interests? Before starting to debate these all-important questions, however, we must first decouple Iran's need for nuclear energy from its alleged or real intentions for producing nuclear weapons.

This article represents the first of a three-part series in which these two important questions are discussed, and Iran's nuclear program is described and analyzed in detail. In the present article, the history of Iran's program for nuclear research and development is reviewed. The significance of this review is twofold. (1) History shows that the US and her allies were in fact the driving force behind the birth of Iran's nuclear program in the late 1960s and early 1970s. (2) It is also particularly important to recognize that since the late 1980s, when Iran restarted its nuclear program, the US and her allies have been given every opportunity to participate in the development and construction of nuclear reactors in Iran, which would have provided them with significant control on the reactors and their products, but that they have always refused to do so.

Although various portions of Part I (the present article) have been published before, it may be useful to put all the pieces together in order to present a cohesive and brief review of the historty of Iran's nuclear program, and to make it available through an easily-accesible web site. In this author's opinion, this may be particularly useful for the young generation of Iranians who may be interested in this history, and the important role that the US played in the birth of Iran's nuclear program.

Part II will discuss why Iran must stop relying almost exclusively on oil and gas as her sole sources of energy, and start developing alternative sources, the most advanced of which are nuclear reactors. There are compelling economical, social, and environmental reasons for seeking alternative sources of energy for Iran, which will be described in detail in Part II.

Part III will describe, in simple terms, how violations of the NPT are detected, and what the major issues are at the center of the dispute between Iran and the IAEA. The dispute - some call it a crisis - is in fact mostly between Iran on one hand, and the US and some of her allies on the other hand, with the IAEA being used as a tool in a political battle.

Before embarking on this task, we must recognize that the development of adequate energy resources is a highly important part of the national interests of every nation which, by their very definition, transcend the political system that governs a nation. Both Democratic and Replublican administrations in the US, and their allies, such as Britain, have waged wars, invaded and occupied oil-producing countries, and engineered coups to overthrow the legal, often democratically-elected, governments of oil-producing countries in order to control the world's oil reserves. They have always justified their deed solely based on protecting their national interests and national security. We only need to recall what happened in Iran in 1953, after Dr. Mohammad Mosaddegh nationalized Iran's oil industry, and the recent invasion and occupation of Iraq by the US and Britain, to understand this. The same principles are also applicable to Iran, namely, that she has a fundamental right for securing adequate energy resources - the engine for her development and advancement.

Iran's foray into nuclear research and development began in the mid 1960s under the auspices of the US within the framework of bilateral agreements between the two countries. The first significant nuclear facility built by the Shah was the Tehran Nuclear Research Center (TNRC), founded in 1967, housed at Tehran University, and run by Atomic Energy Organization of Iran (AEOI). This Center has always been one of Iran's primary open nuclear research facilities. It has a safeguarded 5-megawatt nuclear research reactor that was supplied by the US in 1967. The reactor can produce up to 600 grams of plutonium per year in its spent fuel.

Iran signed the NPT on July 1, 1968. After the Treaty was ratified by the Majles, it went into effect on March 5, 1970. In the language of Article IV of the Treaty, the NPT recognized Iran's "inalienable right to develop research, production and use of nuclear energy for peaceful proposes without discrimination, and acquire equipment, materials, and scientific and technological information." The events of the early 1970s were, however, instrumental in shaping and accelerating the development of Iran's nuclear program. The 1973 war between the Arab countries and Israel, and the subsequent huge increase in the price of oil, provided the Shah's government with considerable resources for Iran's development. At that time, a study by the influential Stanford Research Institute concluded that Iran would need, by the year 1990, an electrical capacity of about 20,000-megawatt.

According to declassified confidential US Government documents posted on the Digital National Security Archive (see the article, "The US-Iran Nuclear Dispute: Dr Mohamed El Baradei's Mission Possible to Iran," by Drs. A. Etemad and N. Meshkati, published on July 13, 2003, in the Iran News), in the mid-1970s, the US encouraged Iran to expand her non-oil energy base, suggested to the Shah that Iran needed not one but SEVERAL nuclear reactors to acquire the electrical capacity that the Stanford Research Institute had proposed, and expressed interest in the US companies participating in Iran's nuclear energy projects. Building these reactors, and selling the weapons that the Shah was procuring from the US in the 1970s, were, of course, a good way for the US to recover the cost of the oil that she was buying from Iran.

Since the Shah never read or heard an American proposal that he did not like, he started an ambitious program for building many (presumably as many as TWENTY THREE) nuclear reactors. Hence, his government awarded a contract to Kraftwerk Union (a subsidiary of Siemens) of (West) Germany to construct two Siemens 1,200-megawatt nuclear reactors at Bushehr. The work for doing so began in 1974. In 1975, the Massachusetts Institute of Technology signed a contract with the AEOI for providing training for the first cadre of Iranian nuclear engineers, and the Iranian-Indian nuclear cooperation treaty was also signed (India is now a nuclear power). In addition, the Nuclear Technology Center at Esfahan (Isfahan) was founded in the mid-1970s with the French assistance in order to provide training for the personnel that would be working with the Bushehr reactors. The Esfahan Center currently operates four small nuclear research reactors, all supplied by China.

According to the same declassified document mentioned above, in an address to the symposium, "The US and Iran, An Increasing Partnership," held in October 1977, Mr. Sydney Sober, a representative of the US State Department, declared that the Shah's government was going to purchase EIGHT nuclear reactors from the US for generating electricity. On July 10, 1978, only seven months before the victory of the Islamic Revolution in Iran, the final draft of the US-Iran Nuclear Energy Agreement was signed. The agreement was supposed to facilitate cooperation in the field of nuclear energy and to govern the export and transfer of equipment and material to Iran's nuclear energy program. Iran was also to receive American technology and help in searching for uranium deposits.

The Shah's government had also envisioned building two nuclear reactors and a power plant in Darkhovin, on the Karoon River, south of the city of Ahvaz. Iran signed, in 1974, a contract with the French company Framatome to build two 950 megawatt pressurized reactors at that site. Framatome did survey the area and began site preparation. However, construction had not yet started when the government of Prime Minister Mehdi Bazargan cancelled the contract after the Islamic revolution in 1979. In 1992, Iran signed an agreement with China for building the reactors in Darkhovin, but the terms of the agreement have not yet been carried out by China. Given the proximity of the site to the border with Iraq, it is probably not prudent to proceed with that project at that particular site.

The Shah's government also obtained uranium materials from South Africa in the 1970s. According to Dr. Akbar Etemad, who was the founder and first President of the Atomic Energy Organization of Iran from 1974 to 1978, the TNRC carried out experiments in which plutonium was extracted from spent fuel using chemical agents (see, A. Etemad, "Iran," in, "European Non-Proliferation Policy," edited by H. Mueller, Oxford University Press, 1987, page 9). Note that the only use for plutonium is in a nuclear bomb. It is also believed that the Shah assembled at the TNRC a nuclear weapon design team. Asadollah Alam, the long-time Imperial Court Minister and the Shah's close confidant, wrote in his memoires that the Shah had envisioned Iran having nuclear weapons.

In February 1979, when the Islamic Revolution toppled the Shah's government, the Bushehr-1 (that is, reactor 1) was 90% complete and 60% of its equipment had been installed, while Bushehr-2 was 50% complete. Had the 1979 Revolution not happened, the Kraftwerk Union would have continued its work in all likelihood with the cooperation of the US corporation Bechtel Power, which was its joint-venture partner in many power plant projects around the world. The government of Prime Minister Mehdi Bazargan then decided that Iran did not need nuclear energy, and therefore the work at Bushehr was halted after the victory of the Revolution in February 1979. The German firm had left Iran earlier, anyway.

During its war with Iran, Iraq bombed the Bushehr site six times (in March 1984, February 1985, March 1985, July 1986, and twice in November 1987), which destroyed the entire core area of both reactors. According to officials of Technischer Ueberwachungsverein, Germany's National Reactor Inspectorate, before the bombings, Bushehr-1 could have been completed in about three years. Note, however, that, at the time of the bombings, none of the main equipments had been installed, and in fact two steam generators (that use the heat from the reactors to produce steam to be used in power generators) were stored in Italy, while the pressure vessel for Bushehr-1 was stored in Germany.

The Revolution and its aftermath, and the eight-year war with Iraq which resulted in colossal damage to Iran's infrastructure, reduced temporarily Iran's thirst for electricity. After the war with Iraq ended, however, Iran began to rethink her position regarding nuclear energy and technology, although it would not be unreasonable to believe that Iraq's savage bombing of Iran's main population and industrial centers, and the missile attacks that it carried out against Tehran during 1986-1987, also motivated Iran's leaders to think about nuclear technology. The first reconstruction and development plan proposed and carried out by President Hashemi Rafsanjani's government, coupled with Iran's chronic shortage of electricity that went back to the early 1970s, and the rapid growth of her population, were three major reasons for Iran to restart her neclear program for obtaining electricity.

Rafsanjani's government first approached Kraftwerk Union to complete the Bushehr project. However, under the US pressure, Kraftwerk Union refused. Iran then asked Germany to allow Kraftwerk to ship the reactor components and technical documentation that it had paid for, citing a 1982 International Commerce Commission (ICC) ruling under which Siemens was obligated to deliver all plant materials and components stored outside Iran, but the German government still refused to do so. In response, Iran filed a lawsuit in August 1996 with the ICC, asking for $5.4 billion in compensation for Germany's failure to comply with the 1982 ruling. The issue is still unsettled.

In the late 1980s, a consortium of companies from Argentina, Germany and Spain submitted a proposal to Iran to complete the Bushehr-1 reactor, but huge pressure by the US stopped the deal. The US pressure also stopped in 1990 Spain's National Institute of Industry and Nuclear Equipment to complete the Bushehr project. Iran also tried, unsuccessfully, to procure components for the Bushehr reactors, but her attempts were blunted by the US. For example, in 1993, Iran tried to acquire eight steam condensers, built by the Italian firm Ansaldo under the Kraftwerk Union contract, but they were seized by the Italian government. The Czech firm Skoda Plzen also discussed supplying reactor components to Iran, but, under the US pressure, negotiations were cancelled in 1994. Iran was also not successful in her attempt to buy nuclear power reactor components from an unfinished reactor of Polland.

After years of searching in the West for a supplier to complete her first nuclear power plant, Iran turned to the Soviet Union and then Russia. She signed, in March 1990, her first protocol on the Bushehr project with the Soviet Union. The agreement called on Moscow to complete the Bushehr project and build additional two reactors in Iran, but financial problems delayed the deal.

China, in 1991, provided Iran with uranium hexafluoride (a uranium compound, which is gaseous state, and used for enriching uranium; see Part III) which is, however, under the IAEA safeguard. In addition, Iran recently acknowleged that she also received (again in 1991) from China 1,000 kgr of natural uranium hexafluoride, 400 kgr of uranium tetrafluoride, and 400 kgr of uranium dioxide, without reporting them to the IAEA. Although the amount of the (until-recently undeclared) uranium compounds is small, what has been done with them is more indicative of the real intentions behind obtaining the materials. In 1993, the AEOI and the Russian Ministry of Atomic Energy signed an agreement for the construction of two Russian reactors at Bushehr, but the contract was never carried out as Iran was facing major financial problems.

Finally, Iran signed, in January 1995, a contract with the Russian Ministry of Atomic Energy to finish the reactors at Bushehr. These reactors will be under the IAEA safeguards, and will be capable of producing up to 180 kgr/year of plutonium in their spent fuel. The agreement called for Russia to complete the first reactor at Bushehr within four years, although it is still unfinished; to provide a 30-50 megawatt thermal light-water research reactor, 2,000 tons of natural uranium, and training for about 15 Iranian nuclear scientists per year. Iran and Russia also agreed to discuss the construction of a gas centrifuge uranium-enrichment facility in Iran. However, in May 1995, the US announced that it had convinced Russia to cancel the centrifuge agreement, although Russia later denied that the agreement with Iran ever existed! The light-water research reactor deal has also been cancelled.

After the 1995 agreement was signed by Iran and Russia, the Clinton administration tried, unsuccessfully, to convince Russia to cancel the agreement, but its entreaties were rebuffed by Russia which saw the Bushehr project as an openning for her ailing nuclear industry to get itself into the international market. Having failed in its attempts, the Clinton administration then began charging that the plutonium that the reactors would produce would be used by Iran for making nuclear weapons. However, this issue is also being addressed by Iran and Russia, since they are negotiating an agreement by which the nuclear wastes from the Bushehr reactors would be returned to Russia which has a large facility for storing the wastes in southern Siberia (although Russian environmental laws appear to forbid storing nuclear wastes of another country in Russia), but no agreement has been reached yet. It was reported recently that Iran has demanded payments for returning the spent fuel to Russia, contending that she pays to buy the fuel from Russia in the first place, and therefore she should also be paid for the spent fuel. If ture, this would be an absurd demand, because if Russia is to pay for Iran's nuclear wastes, she should also be paid for keeping Iran's nuclear wastes! The issue of who should pay whom appears to be the only obstacle to reaching an agreement between Iran and Russia concerning the nuclear wastes.

After it appeared that the plutonium issue would be addressed by Russia, the US, under huge pressure by Israel, began claiming that, while the Bushehr reactors cannot be directly used for making nuclear weapons, they will train a generation of Iranian scientists and engineers for operating the reactor, which in turn will prepare Iran for making nuclear weapons. Is there any merit to this charge? Having a nuclear reactor is NOT necessary for obtaining the necessary know-how for developing a nuclear bomb (although it certainly helps). The best example is provided by Iraq. Israel bombed and destroyed Iraq's only nuclear reactor at Osirak in 1981, before it started operating, yet when its nuclear weapon program was discovered after the 1991 Gulf war, Iraq was only months away from making a nuclear bomb!

Most experts believe that the completion of the Bushehr project by Russia is a highly complex task: As mentioned earlier, the Kraftwerk Union has not provided any technical documents to either Iran or Russia. Since Russia plans to install a reactor, her engineers must modify what Kraftwerk Union had left behind to accomodate the Russian reactor and its support system, which differ in many significant ways from the German reactor. For example, the structure of the steam generators in the Russian reactors is significantly different from the original German reactors. The reactor is supposed to start operating in early 2004.

In addition to the what has been described so far, Iran does have a few other nuclear facilities. One is the Bonaab Atomic Energy Research Center (which is south of city of Tabriz), which is a research center for applications of nuclear technology in agriculture. In addition, Center for Agricultural Research and Nuclear Medicine at Karaj (near Tehran) was inaugurated on in May 1991, and is run by the AEOI. None of these is, however, considered to be for military applications.

This concludes the review of the history of Iran's nuclear program. The review reveals three important facts:

(1) Nuclear research, facilities, and reactors, and even the vision for Iran having nuclear weapons, were all conceived and initiated by the Shah and his government, with the direct assistance and encouragement by the US and her allies. This is very much similar to what happened in Israel, which developed her arsenal of nuclear weapons with the direct help of the US and France. They were not conceived or initiated after the Revolution. In fact, for the first few years after the Revolution, Iran rejected nuclear reactors!

(2) It is clear that the US and her allies have had many opportunities to complete the Bushehr project, or to participate in the construction of other nuclear reactors, and, hence, to have significant control on the reactors, but they have always refused to take part.

(3) In addition, the US and her allies could have participated in the Bushehr project by helping Iran improve the safety of the reactors there and, hence, have influence on their operations. As pointed out by Drs. Etemad and Meshkati (see their article cited earlier), there is good precedence for this: The Temelin nuclear power plant in the Czech Republic, the construction of which began during the Soviet Union, when the former communist government was in power in Czechoslovakia, but was halted in 1992. In 1994, with a $317 million loan guarantee from the United States Export-Import Bank, an American company, Westinghouse Electric Corporation, participated in completing the Temelin's reactors.

Hence, there is no way of avoiding the conclusion that the real goal of the United States is dismantling Iran's nuclear infrastructure, regardless of its orientation, and to despatch Iran to the era of nuclear, scientific and technological illiteracy, which is in violation of the letter and spirit of the NPT.

Part II of this series will discuss why Iran must stop relying exclusively on oil and gas, and develop alternative sources of energy, and in particular nuclear energy.

Original URL: http://www.payvand.com/news/03/oct/1015.html

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Part II: Are Nuclear Reactors Necessary?

In the present article, Part II of a three-part series, the need for building nuclear reactors in Iran is analyzed. As was pointed out in Part I, in the opinion of this author, the questions that we Iranians must ask and debate, are: Does Iran need nuclear energy, and is acquiring it in her national interests? It was also pointed out that one must decouple Iran's need for nuclear energy which, as argued in this article, is completely legitimate on economical, social, and environmental grounds, from her alleged or real intentions for producing nuclear weapons.

Recall that the main argument of the United States against nuclear energy for Iran is that, Iran has vast oil and gas reserves, and hence she needs no nuclear reactor. This argument is, in general, not necessarily valid. Many countries that are rich in fossil energy resources, including Britain and Russia (both oil exporters), rely on nuclear power for a significant portion of their energy needs, while Germany, France, Japan, and many other countries, which have no oil or natural gas reserves, have not abandoned nuclear power in favor of more imported oil and gas, even though they can certainly afford this. There are currently 1118 nuclear reactors in the world of which 280 are for nuclear research, while another 400 are used in ships and submarines for producing power. The remaining 438 nuclear reactors are used for generating electricity, of which 104 are in the US, 59 in France, 53 in Japan, 29 in Russia, and 19 are in Germany. Between 1974, when Iran signed her first agreement for building nuclear reactors, and 2000, use of nuclear reactors for generating electricity has increased by a factor of 12!

In the particular case of Iran, the US argument that Iran needs no nuclear energy has no validity at all. While it is true that Iran does have vast oil and gas reserves, she also needs alternative energy sources. I argue that Iran's needs for such alternatives are glaring and indisputable, and I base my arguments on economical, social, and environmental considerations.

We first, however, consider the case for alternative sources of energy on general grounds:

Most of the world's major oil exporters, such as Iran, are developing nations. Thus, these countries must confront the challenge of their demographic explosion without possessing many of the necessary tools, which are strong state structures, rapidly-growing economies, large amounts of investment capitals, numerous entrepreneurs, engineers and inventors, and infrastructres that are reasonably advanced. In fact, we live in a world in which technology and capital are in the countries that are energy-hungry - those that have no major oil reserves of their own (for example, Germany, France, and Japan) or have at best indeaquate sources (for example, the US) - whereas the population growth and social and political turbulence are in the developing countries that are major oil producers (such as Iran, Saudi Arabia, Mexico, Iraq, etc.).

At the same time, oil is a non-renewable national wealth of Iran (and other oil exporters). Once it is produced and exported, it can never be regenerated. One cannot expect Iran (and other oil-exporting countries) to deplete her non-renewable national wealth recklessly, without receiving any lasting products or benefits in return, but this will happen if Iran's sources for energy are not diversified, and she continues to rely almost exclusively on oil and gas for everything from the only source of energy to her annual budget. Except for Norway, every major oil exporter (including Russia) relies heavily on its revenue from oil sales, so much so that if the oil price stays too low for too long, we may have social instability and even revolution in these countries. What would happen to these countries if all of their recoverable oil and gas are rapidly depleted over a few decades, which would be the case if they rely on oil and gas for everything from their annual budget to energy sources?

In addition, a set of practical issues, which are important to the industrialized nations (notably in the Western hemisphere), must be addressed: What would happen to the West's huge chemical industry that uses oil- and gas-derived materials for its production and is an important source of jobs, if the world's oil and gas reserves are depleted too quickly? What would be the fate of the German plastic factories and the US polymer producers (plastics and polymers are some of the most heavily used materials in the world) that get their raw materials from the same source, and to the enormous petrochemical complexes around the world, if oil and gas resources are quickly depleted? Is it not better to develop alternative sources of energy, and use oil and gas more slowly and in more useful ways, by producing oil- and gas-derived materials and products that have much added values? If the answer to this question is yes, then why can Iran not use this argument?

Next, consider the case for alternative energy sources from an economical view point:

Iran's 60 major oil fields are mostly old, with some being depleted altogether. From 1979 until 1997 no major investment was made in Iran's oil industry. A study in 1998 concluded that, out of the 60 oil fields, 57 of them need major technical studies, repairs, upgrading, and repressurizing which would require, over a 15 year period, $40 billion! Although, since 1997, Iran has had considerable success in attracting foreign capital for its offshore oil and gas reserves, it is still far behind other oil exporting countries of the Middle East in terms of developing her fossil energy resources. Iran has not even been able to increase her oil production to the pre-Revolution level of 5.5 million barrels/day. If Iran cannot upgrade her oil facilities and industry on a timely manner, it will lose her market share. While there is no doubt that the solution to the urgent problem of upgrading Iran's oil industry is partly political, lack of any solution will have deep implications for Iran's future, which are discussed shortly.

At the same time, since early 1990s, Iran's consumption of oil has been increasing at an alarming rate of 8% per year, and her total energy consumption has increased from 1.6 quadrillion Btu (quads) in 1980 to more than 5.5 quads at present - an increase of more than 280%. If this trend continues, Iran will become a net oil importer by 2010, a gigantic catastrophe for a country which relies on oil for 80% of her foreign currency and 45% of her total annual budget. If that happens, how will Iran be able to feed her population, estimated to reach 100 million by 2025, and also spend on her development and national security? The fact is that, despite considerable efforts over the past 30 years, Iran's industrial output, aside from her oil industry, accounts for only 15% of her gross domestic product.

In one of the rare occasions that he said something profound, the Shah once stated that a barrel of oil is too precious (he used the word "sharif" in Persian to describe oil) to be used for generating electricity. Paraphrasing him, I would say that a million cubic feet of gas is too precious to burn; natural gas should be used for generating huge amounts of petrochemical products with much added values, which is precisely what Iran has been trying to do: Iran curently produces about $2.7 billion/year worth of petrochemical products. At the same time, in 40-50 years, when oil will no longer be the major source of energy and will be replaced by gas, Iran (the gas reserves of which will last for at least 200 years) will be in an excellent position to be the main supplier to Asia and Europe. Therefore, why should Iran use her hard-earned oil and gas for generating electricity, if she can develop alternative sources of energy?

Looking at this issue from another angle, it is estimated that Iran's known uranium ore reserves can produce as much electricity as 45 BILLION barrels of oil. This is a huge amount by any criterion, but particularly so if we only recall that Iran's known oil reserves are currently estimated to be about 96 billion barrels. In other words, if we can extract all of Iran's known oil reserves (a remote possibility!) and use about half of them just for producing electricity, we will generate as much electricity as what Iran's presently-known uranium deposits can produce! It would therefore be absolutely foolish not to do this!

Consider this problem from a third angle: Iran's present installed electrical capacity is more than the 20,000 megawatt that had been predicted for 1990. However, Iran's annual growth in demand for electricity is 5-8%. Hence, it is estimated that, by the year 2010, Iran will need another 7,000-megawatt of electricity which, ignoring all other factors (see above and below), and even under the best possible circumstances, namely, immediate lifting of the US sanctions against Iran and flow of vast investment capital into Iran's oil and gas industry, cannot be produced by oil and gas alone. Therefore, the question is: What is Iran supposed to do?

One of the main arguments that some of the experts on nuclear weapons present against Iran having nuclear energy is that, it is not economical for Iran to generate electricity using nuclear reactors, because she has vast gas reserves which can be used for producing electricity. To support their arguments, these experts usually cite studies that estimate that the cost to finish the Bushehr nuclear reactors will be $1,000 per installed kilowatt, while the electricity from natural gas-fired power plants costs $600-800 per kilowatt. However, such arguments are not valid. In addition to the necessity of,

(1) using the gas for producing petrochemical products with much added values (see above);

(2) preserving much of Iran's gas reserves for her future generations and to position Iran in 40-50 years as the main supplier of energy to Europe and Asia, and

(3) avoiding the severe adverse effect of burning gas and the resulting carbon emission which is the major culprit in global warming and the greenhouse effect (see below),

the above estimates are simply wrong, because they do not take into account the huge costs of the medical care for people who suffer from the diseases caused by pollution of the environment by oil and gas, as well as the damage to nature caused by carbon emission and the resulting global warming.

In 1990, in a seminar at Gustave E. von Grunebaum Center for Near Eastern Studies of the University of California in Los Angeles (the complete content of that seminar was published later; see, M. Sahimi, "How Much do We Pay for a Barrel of Oil?" in, "Proceedings of the Third International Conference on Non-Renewable Energy Sources," Tehran, Iran, December 1993; see also, M. Sahimi, "Factors Affecting the Development of Fossil Energy Resources of Developing Countries," in, "United States-Third World Relations in the New World Order," edited by A.P. Grammy and C.K. Bragg, Nova Science Publishers, New York, 1996, page 361), this author stated that:

"Typical estimates for the cost of producing electricity and other forms of energy using oil and gas are only based on their market prices. However, these prices reflect only the cost of producing oil and gas (including the costs of of labor and materials used for their extraction from underground reservoirs) and of transporting them to the consumer. But some of the costs of consuming oil and gas are not directly included in our energy bill, nor are they paid for by the companies that sell us energy. These are the hidden costs of oil and gas that we pay indirectly for the health problems caused by air, water and soil pollution resulting from using oil and gas, environmental degradation caused by carbon emission and global warming, and acid rains. Since the producers and consumers do not pay directly for such costs, society as a whole must pay for them. Thus, although such costs are hidden, they are real. For example, according to the American Lung Association, health costs, including, for example, lost potential income, of air pollution alone are estimated to be about $50 billion a year, and the main culprit for air pollution is the fossil fuels, mainly oil and gas, our primary source of energy. Estimating the possible cost of the damage inflicted on Earth by global warming, caused by carbon emission that is the direct result of burning oil AND gas, is currently impossible."

If we take into account such costs, then the cost of producing electricity from gas (and oil) will be much larger than the commercial estimates usually quoted, and very much comparable with what it costs to generate it using nuclear reactors. A recent study by Professors John Deutch and Ernest Moniz of, respectively, the chemistry and physics departments of the Massachusetts Institute of Technology reached a similiar conclusion (see, the New York Times, the Op-Ed page, Thursday August 14, 2003).

Consider now the case for alternative sources of energy in terms of Iran's population growth and her social dynamics:

Since the 1979 Revolution, Iran's population has more than doubled, from 32 to nearly 70 million, while her oil production is only 70% of the pre-Revolution level. This then begs the following question: Why is it that the US and her allies believed, in the 1970s, that Iran needed nuclear reactors and nuclear energy, when Iran's population was less than half of the present and her oil production was much more than now, but they now argue that Iran does not need nuclear energy? How do the US and her allies suggest Iran should feed, house and educate her population, create jobs for her army of educated people, and develop the country, all with oil and gas alone, while she has very significant uranium deposits that can be used for generating electricity?

Consider the case for alternative energy sources from an environmental view point:

Iran is beset by huge environmental problems that have been caused by oil and gas consumption, problems that are reaching catastrophic scales. Although Iran established a Department of Environment in 1971, and even though Article 50 of her current Constitution states that, "In the Islamic Republic of Iran protection of the environment, in which present and future generations should enjoy a transcendent social life, is regarded as a public duty," 8 years of war with Iraq, economic sanctions, careless (with respect to the environment) development after the War, and the 120% increase in the population, have kept the goal of cleaning the environment and maintaining it that way on the back-burner. However, the environment and its health can no longer be neglected.

Since 1980, carbon emissions in Iran have risen by 240%, from 33.1 million metric tons emitted in 1980 to more than 85 million metric tons at present. Note that, whether we use oil (which causes severe pollution problems) or gas (which, compared with oil and coal, is considered as a relatively clean source of energy), carbon emission cannot be avoided. This emission is one of the main culprits behind air pollution in Tehran and all other major cities of Iran that has reached catastrophic levels, so much so that the elementary schools must be closed on many days. Long term effects of the polluted air are blamed for causing 17,000 deaths every year in Tehran alone, as well as causing severe problems for people with asthma, heart, and skin conditions. The cost of medical care for such illnesses is reaching astronomical levels.

Polluted air also severely damages soil and groundwater resources by contaminating the rain water. At the same time, Iran's industrial base, using oil and gas for energy, generates wastes that contaminate a large number of rivers and coastal waters and threaten drinking water supplies. These are separate from oil spills in the Persian Gulf and pollution in the Caspian Sea that continue to contaminate the waters. These are all caused by the fact that, Iran's renewable energy consumption, including hydropower, solar, wind, tide, and geothermal, account for only 2% of its total energy consumption, with the rest supplied by oil and gas.

What are, or can be, alternative sources of energy for Iran? Surely, given Iran's vast central desert, solar power can potentially be very useful for generating electricity and energy. However, this technology is not yet well-developed. In certain parts of Iran, geothermal sources can also be used for generating electricity, but Iran has just started exploring this possibility, and it will take at least 15 years to develop this at any significant scale. That leaves nuclear reactors, which will not solve her chronic shortage of electricity, nor will they solve all of Iran's pollution problems, but they do represent the first important step in diversifying Iran's sources for energy.

Nuclear reactors do have their own problems. One is their management which has to be at a very high level so that the chances of accidents, similar to those that happened in Three-Mile Island in the US (in 1979) and in Chernobyl in Russia (in 1986), will be minimal. In addition, one must deal with protecting and storing the nuclear wastes produced by the reactors which would be radioactive for at least tens of thousands of years. But, these problems are generally believed to be manageable.

In Part III of this series, the dispute between Iran and the International Atomic Energy Agency will be described and analyzed.

Original URL: http://www.payvand.com/news/03/oct/1022.html

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Part III: The Emerging Crisis

This article is the last of a three-part series on Iran's nuclear program. In this Part, the dispute - many consider it a crisis - between Iran and the International Atomic Energy Agency (IAEA) is described.

Recall that after the February announcement of President Mohammad Khatami regarding the construction of the facilities in Natanz for uranium enrichment, and other associated plants needed for this purpose, Dr. Mohammad El Baradei, the head of IAEA, accompanied by a team of inspectors, visited Iran. Since then, the IAEA's inspectors and experts have visited Iran several more times. A preliminary report was published in July, with a follow-up one on August 26.

Before the revelations about the Natanz facility, there had been reports for years that Iran had sought, albeit unsuccessfully, the uranium enrichment technology, both in the international market and from the Russian Ministry of Atomic Energy. Although not definitively established yet, it now appears that the Natanz facility is similar to what Pakistan had built for its nuclear program in the 1980s. Various reports indicate, however, that the Natanz facility is in fact far more sophisticated than both Pakistan's and what was discovered in Iraq after its defeat in the 1991 Persian Gulf war.

The process of converting uranium ore to enriched uranium is actually long and very complex. It has been known for many years that Iran has natural uranium reserves, in the form of uranium ore. In 1985, the Atomic Energy Organization of Iran (AEOI) located over 5,000 metric tons of uranium ore in the desert in eastern part of Yazd province. This represents one of the largest deposits of uranium ore in the Middle East. The ore must first undergo a semiprocess to be converted to a powder, usually called the yellowcake. Iran is building a facility in Ardakan for this purpose. The yellowcake is then further processed to produce uranium hexafluoride (UF_6) which is in gaseous state. The facility for doing this is being built in Esfahan (Isfahan). Uranium has two important isotopes (that is, two slightly different versions of it with slightly different atomic masses) which are uranium-235 and uranium-238 (the numbers represent the atomic masses). It is uranium-238 that may be used in making nuclear weapons, but also in nuclear reactors. The Esfahan facility will also produce uranium oxide and uranium metal, both of which have civilian as well as military applications.

The Natanz facility is equipped with the instruments for what is currently considered to be the standard uranium-enrichment technique, namely, a large number of centrifuges that spin uranium hexafluoride gas at very high speeds. Under such conditions, centrifugal forces help separate the lighter uranium-235 hexafluoride from the heavier uranium-238 hexafluoride. The facility has a pilot gas centrifuge plant that, by the end of 2003, is supposed to house 1000 centrifuges (at the time of the IAEA visit in February, there were 160 centrifuges in the facility), and a large-scale production plant which will house up to 50,000 centrifuges, the installation of which (which is supposed to begin in 2005) will take up to 10 years. Such a facility would then have the capability for producing enough uranium for annual consumption of a nuclear reactor of the Bushehr-type. Note that only 10 countries have access to the centrifuge technology.

Development of a uranium-enrichment facility is an important step (but not the only one) towards making nuclear weapons. For example, the Natanz facility, when complete and in full operation, could produce 500 kgr/year of weapon-grade uranium. As it typically takes about 20 kgr of enriched uranium to make a single nuclear bomb, the produced uranium would be enough to make about 25 bombs every year. We must, however, keep in mind that a uranium-enrichment facility is also utilized for peaceful purposes it can produce low-grade enriched uranium for use in nuclear reactors.

Since, typically, one first tests whether a single centrifuge with a small quantity of uranium hexafluoride works before installing hundreds (or even thousands) of them, one might suspect that Iran does have at least a small amount of enriched uranium, not declared to the IAEA, which, if true, would imply that Iran is in serious violation of the NPT that it signed in 1968. However, such tests can also be carried out by computer simulations and modelling. Recall that even nuclear explosions are simulated completely realistically, and therefore, in principle, one does not need a physical test to check whether the centrifuges work. Whether this is the case in the present situation is not clear.

It was reported on July 18 that the IAEA inspectors had detected the trace of enriched uranium in the samples taken at Natanz, but Iran said that the source of the trace is the equipments brought to Natanz from elsewhere and bought on the international market. Subsequently, it was announced on September 25 that a trace amount of enriched uranium has also been detected at Kaalaa-ye (Kalaye is usually used in the english press) Electric Company in the northwest suburb of Tehran, a non-nuclear site (the Company produces watches, as well as certain components for the centrifuges) that the IAEA suspects Iran is using for her nuclear enrichment activities. Since Iran had declared to the IAEA that the instruments at Natanz had been stored at the Kaalaa-ye Electric site before being transported to Natanz, and given that no trace of enriched uranium has been detected anywhere else in Iran, the Kaalaa-ye Electric discovery may actually confirm Iran's contention regarding the origin of the enriched uranium. But, once again, the situation is not clear, unless Iran provides the IAEA a list of suppliers that provided her with the instruments and equipments.

How are nuclear facilities monitored and violations of the NPT discovered? Inspections of nuclear facilities include the use of a powerful technique, called the isotopic detection, which, in essence, is a method for monitoring the environment and anything that might contaminate it. This technique is based on the facts that, (1) extremely small quantities of a material always escape a process or an industrial plant, and (2) that an equipped laboratory can readily identify the isotopic ratio of a sample that contains extremely small, albeit measureable, amounts of a material, even if it is as small as a billionth of a gram.

Nuclear physics predicts that the ratio of uranium-235 to uranium-238 is essentially the same everywhere. Therefore, when the isotopic detection technique is applied to samples containing uranium, those with ratios lower than the theoretically-predicted value would most probably indicate illegal (from the NPT stand) uranium-enrichment activity. The same technique can be used for detecting any amount of plutonium that is in excess of what is (theoretically) expected, which would then suggest the existence of a reprocessing program for nuclear wastes generated by nuclear reactors, from which plutonium is extracted. This technique is used, under the NPT, in the declared nuclear facilities of the NPT signatories.

As a reaction to the discovery of Iraq's program for developing nuclear weapons, that was discovered by the United Nations inspectors in 1991 after Iraq's defeat in the second Gulf war, the IAEA decided to develop and implement additional procedures for enhancing nuclear safeguards. At the time, the IAEA hoped to have these additional procedures or protocols in place two years later, hence the name "93+2" that is sometimes used to refer to this matter. The Additional Protocol was developed in 1996, and has since been signed by 78 countries (out of the 183 countries that have signed the NPT). Thirty three of these countries, mostly small nations, have also ratified the signing of the additional protocol by their national parliaments, and hence implementing it, although these countries cannot really afford to develop nuclear bomb! Most importantly, the Additional Protocol has not been adopted by the US, its most forceful advocate when it comes to OTHER countries!

The Additional Protocol also gives the IAEA the authority to inspect any facility of any nation that has signed the Protocol, even those that, seemingly, have nothing to do with a nuclear program, any time that the IAEA wishes. This is a problematic aspect of the Additional Protocol, as inspection of non-nuclear facilities may be interpreted as an infringement on the national sovereignty of a country under inspection. However, since Iran's facilities have been under inspections for years, this should be a minor issue.

On Friday September 12, 2003, the 35-member governing board of the IAEA gave Iran an ultimatum until October 31 to prove that her nuclear program is strictly for peaceful purposes, by providing all the deatils of her nuclear program. Iran's reaction was mixed: On one hand, she reacted with indignation, calling the ultimatum "premature" and "unfair," while stating, on the other hand, that she will continue working with the IAEA.

It should be pointed out that even Ms. Melissa Fleming, the spokeswoman for the IAEA, conceded that the ultimatum was "highly unusual" in that it was adopted WITHOUT A VOTE. At the same time, the IAEA itself had conceded that Iran had expanded her cooperation with the Agency, even allowing many sites that are not covered by the NPT, such as the Kaalaa-ye Electric Company, to be inspected. Therefore, the ultimatum has much to do with Iran's poor international standing and isolation, which are, of course, justified.

At the same time, the US is once again using an important international organization to advance her agenda, damaging in the process the credibility and effectiveness of the organization, only a few months after doing the same to the United Nations during the debate over invasion of Iraq (and now going back to it asking for help!). France and Germany, at odds with the US over invasion and occupation of Iraq, but eager to mend their relations with the US, also have joined her in calling on Iran to immediately sign the Additional Protocol, and to reveal all of the details of her nuclear program.

Before analyzing the present situation between Iran and the IAEA, we must keep in mind that,

(1) according to the original IAEA safeguard agreements, Iran was not obligated to declare the start of construction of the Natanz facility. These agreements stipulate that, only 180 days before introducing any nuclear material, does Iran have to declare the existence of the facility. Therefore, construction of the undeclared Natanz facility is NOT by itself a vilation of the NPT.

(2) The NPT does allow Iran to legally build any nuclear facility, including one for uranium enrichment, so long as it is declared to, and safeguarded by, the IAEA, and is intended for peaceful purposes.

Keeping these important points in mind, the problematic aspects of Iran's nuclear program, so far as the IAEA is concerned, are as follows.

(a) The origin of the trace amounts of highly-enriched uranium at Natanz and Kaalaa-ye Electric Company near Tehran is not yet clear. This was already described and discussed above.

(b) Iran declared to the IAEA that since approximately seven weeks ago, she has begun some uranium enrichment activities at Natanz using a single centrifuge. Since this was declared to the IAEA, and because the Natanz facility is now monitored by the IAEA, this activity does not represent a violation of the NPT (although, given the current international conditions, some may regard the timing of this as unfortunate). The important point of contention is: How can Iran be so sure that the centrifuges at Natanz work with high levels of reliability, if no prior (undeclared) tests have been carried out? Iran has countered that she has used modelling and simulation, mentioned above, which is plausible, but does not, of course, exclude the possibility of actual physical tests.

(c) The IAEA has demanded that Iran provide it with all the details of the work at Kaalaa-ye Electric Company. Iran has provided some (but presumably not all) of the details, and has allowed the facility to be visited by the IAEA inspectors, even though this inspection is not covered by the NPT, although, at first, Iran refused to grant the IAEA the permission to visit this site. If Iran does sign the Additional Protocol, then she would have to completely open the facility to the IAEA inspectors.

(d) As mentioned in Part I, in 1991, Iran received from China 1,000 kgr of natural uranium hexafluoride, 400 kgr of uranium tetrafluoride (UF_4), and 400 kgr of uranium dioxide (UO_2), without reporting them to the IAEA. The question then is: What happened to these uranium compounds? Iran has declared that some of the compounds have been converted to other uranium compounds, some of which have medical applications, while others may be of dual use. Given that Iranian medical scientists who work in Iran have published the results of their research involving such uranium compounds, Iran's explanation is plausible, but does not provide an explanation for the fate of all the undecalred uranium compounds.

In this author's opinion, none of these problems is intractable, and so far as their scientific and technological aspects are concerned, can be addressed to the satisfaction of the IAEA. The main problem, in this author's opinion, is that much of the dispute with the IAEA is political, rather than scientific or technological. To see this, consider the following indisputable facts:

(1) As recognized by the NPT, peaceful use of nuclear technology, and in particular nuclear energy, is Iran's fundamental right, so long as her nuclear program is completely transparent to the IAEA.

(2) Article 22 of the agreement between Iran and the IAEA allows for an "arbitral tribunal," if there is still any dispute after Iran provides sufficients details of her nuclear program to the IAEA. Therefore, October 31, 2003 is not necessarily a rigid deadline.

(3) The United States has a selective non-proliferation policy. She allows Pakistan, a country that created the Taliban and her population has provided sanctuary to Osama bin Laden and his terrorisat group; a country whose military is still controlled to a large extent by extremist elements, to develop nuclear weapons. The US has assisted Israel to develop an impressive arsenal of nuclear weapons; has exported nuclear technology to China, and has offered a deal to North Korea regarding her nuclear reactors. The US does not pressure Pakistan, India and Israel to sign the NPT and its Additional Protocol. A little-known fact is that, in early 1995, the German government proposed a plan whereby Kraftwerk Union (a subsidiary of Siemens) would complete construction of the Bushehr reactors (see Part I of this series), subject to Iran's agreeing to extra non-proliferation verification procedures similar to those that the United States negotiated with North Korea, and Iran agreed with the plan. But, once again, immense pressure by the United States scuttled the plan, after which Iran turned to Russia for completion of the Bushehr reactors.

A few other important points must be mentioned here:

(a) In this author's opinion, if acquiring nuclear reactors is in Iran's national interests (see Part II), so is signing the Additional Protocol. However, it is completely reasonable to expect that, in return for signing the Protocol and openning the nation to the IAEA inspections, Iran should obtain access to advanced nuclear technology, which should, however, be monitored and safeguarded by the IAEA. The fact remains that Russian nuclear reactors are inferior to those made in the West. Britain, France, and Germany have already promised to help Iran.

(b) However, in this author's opinion, signing the Additional Protocol, while necessary, may not be sufficient by itself to protect Iran's nuclear assets since this author believes that, unless the US invades and occupies Iran and installs a completely puppet regime in Tehran, she will continue pressuring Iran, using her nuclear program as a pretext, regardless of the future political developments in Iran. Thus, Iran's aim, in this author's opinion, must be addressing the demands of the IAEA with which the European Union also agrees, and to open up all of her facilities to inspections.

(c) The present Iranian leadership, both elected and unelected, must recognize that it has been given no mandate to deprive Iran's furure generations of the most advanced technology, namely, nuclear technology, by acting against Iran's national interests, including resisting stubbornly the legitimate demands by the IAEA. While giving Iran, a sovereign nation, an ultimatum is repugnant, there are many legitimate issues that must be addressed.

(d) It is highly important how Iran responds to the IAEA reasonable demands. She can react by dragging her feet, without having any active, efficient, and logical diplomacy, which will eventually result in agreeing to all the IAEA demands but under highly unfavorable circumstances, hence bringing about severe set backs to Iran's nuclear program, if nothing else (which could include economic sanctions and military threat). Alternatively, Iran can come forward with all the details of her nuclear program, while being firm in demanding assistance for acquiring advanced nuclear technology, in which case the EU, Russia, Japan and the non-aligned countries may help Iran.

(e) Unless Iran addresses the issues that the IAEA has raised, and signs the Additional Protocol on nuclear inspections, she will not only fail in her goal of building a network of nuclear reactors, but will also be under severe international pressure. Iran has already felt this pressure: Japan has slowed down negotiations for development of the Azaadegaan oil field (the largest field in the Middle East with estimated reserves of 26-30 billion barrels of oil), and the Shell Oil Company has withdrawn from negotiations for developing the same field. Under severe international pressure, the task of building a network of nuclear reactors will be set back for many years, if not decades.

With Israel's help, the apartheid regime of South Africa developed extensive nuclear facilities, and even made 16 nuclear bombs. The sixteen nuclear bombs could not, however, prevent the demise of the South African racist regime. While after establishment of a democratic system, the South Arfican government of President Nelson Mandela gave up volunteerly its nuclear bombs, the nuclear technology and know-how, developed during the apartheid regime, now belong to a democratic country and all South Africans.

Nothing protects Iran's national security and interests better than acceptance of her political system and government by Iranian people, which would happen only if a truly democratic system is established in Iran. At the same time, Iran's nuclear infrastructure is part of her national asset, belonging to all Iranians, regardless of their political inclinations. It is ultimately up to Iranian people, like their South African counterparts, to decide the fate of their country's nuclear technology, once such a democratic system is established.

Original URL: http://www.payvand.com/news/03/oct/1039.html

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Part IV: Economic Analysis of the Program

Introduction

Over the past two years, Iran's program for constructing the complete cycle for producing enriched uranium - the fuel for nuclear reactors and nuclear power plants (NPPs) - has been the subject of intense discussions. Over this period, the experts and inspectors of the International Atomic Energy Agency (IAEA) have been visiting Iran on a regular basis to inspect its nuclear facilities. The information and data that have been collected by the IAEA on Iran's nuclear energy program have revealed sustained and determined efforts by Iran since 1985 for developing an advanced program for producing enriched uranium. The Bush administrtation has been arguing that the primary purpose of Iran's nuclear program is developing nuclear weapons. The European Union (EU), which has very extensive commercial relations with Iran; Russia, which is completing the construction of a NPP in Bushehr (on the shores of the Persian Gulf), and Japan, which has signed a lucrative oil agreement with Iran for developing Iran's giant Azaadegaan oil field, have all pressed Iran hard, demanding that it reveal all the details of it nuclear program.

The Board of Governors (BOG) of the IAEA has had periodic special meetings to review the progress in assessing Iran's nuclear program. In its latest special meeting on Iran, which was held on Monday November 29, 2004, the IAEA reported to the BOG its latest findings on Iran's program, and due to the agreement that Iran recently signed with the EU troika - Britain, France, and Germany - for suspending its uranium enrichment program, no further special meeting of the BOG of the IAEA has been scheduled; that is, Iran's case before the BOG has gone back to being a normal, un-urgent case for now.

In a series of articles that were posted on Payvand in early October 2003, the author prsented a brief history of Iran's nuclear program (Part I); described the general outlines of the arguments that may justify Iran's nuclear energy program as economically viable (Part II), and explained the crisis that was emerging at that time in the relationship between Iran and the IAEA (Part III). This article and Part V continue the discussions that were begun in the first three parts of the series and expand on them.

When Part II of this series was first posted in October 2003, many colleagues and readers of the article urged the author to quantify the arguments presented in that article that were supportive of Iran's nuclear energy program as an economically viable program. The goal of the present article is just that: analyzing Iran's program for generating nuclear energy in the context of its energy needs over the next two decades, and carrying out an economical analysis to quantify and support the arguments that were first presented in Part II, using the latest and most accurate statistics on Iran's energy consumption and production currently available.

Another goal of the present article is to debunk - hopefully for the last time - the "argument" that the US neo-conservatives have been making, namely, that given Iran's vast oil and gas reserves, it does not need nuclear energy. The neo-conservatives and their allies, ranging from Israel to Iran's anti-democratic forces (from the group that makes new "discoveries" on Iran's program on a weekly basis to the monarchists), are the last group that are still hanging onto this argument! The analysis and arguments presented in Part II (and its short version published in the International Herald Tribune on October 14, 2003), as well as those presented by numerous others, have already made their impact: Iran's nuclear energy program has been transformed from one not needed by, or suitable for, Iran to a one for which the EU is willing to GUARANTEE the supply of nuclear fuels, provided that Iran "suspends" indefinitely its uranium enrichment program!

At the same time, it should be pointed out that when, under the US encouragement (some say pressure), Iran's nuclear energy program was started by the Shah in 1974,

(a) Iran's population was less than half of the present 70 million;

(b) its oil production was about 5.8 million barrels (MB) per day, compared with the present average daily production of 3.9 MB/day;

(c) it exported about 5 MB/day of oil, compared with the present average daily export of 2.6 MB/day;

(d) its energy consumption was less than one-fourth of the present;

(e) the Shah's government was burning Iran's natural gas for elimination, simply because it had no use for it, and,

(f) unlike now, Iran's oil reservoirs were not in decline, needing re-pressurization (see below) by natural gas injection.

In short, Iran did not need AT THAT TIME to generate electricity using NPPs. This then begs the question: Why is it that, given its present conditions which can justify use of NPPs for producing electricity (see below), the neo-conservatives and their allies believe that Iran does not need nuclear energy, whereas the US strongly pushed the Shah in the 1970s to build NPPs when Iran had no need for them (see Part V)?

In Part V of the series, the important role that the US and its European allies played in starting Iran's nuclear program will be discussed in considerable details. In particular, we will review the history of the US involvement with Iran's nuclear program to show, based on the newly accessed documents, that not only the US strongly encouraged the Shah to buy NPPs from the US, but was also willing to offer Iran, as a sweetener for the deal, the complete facilities for uranium enrichment if Iran agrees to buy eight US-manufactured NPPs! This should be compared with the present state of affairs whereby the US and the EU are trying to stop Iran from utilizing its uranium enrichment facilities and offer, instead, to supply Iran the enriched uranium for its NPPs! In addition, we briefly review the positions of some of the leading neo-conservatives in the US regarding Iran's nuclear energy program which reveal the extent to which they are willing to go, in terms of inflicting on Iran civilian casualties and economic destruction, to stop it from starting to operate the Bushehr reactor. In the opinion of the author, giving wide exposure to this position of the neo-conservatives is particularly important, since Iran's anti-democratic forces are the neo-conservatives allies.

To begin the discussion, we must first decouple Iran's need for nuclear energy from its perceived or real intentions for producing nuclear weapons, since constructing NPPs does not necessarily indicate any intention for making nuclear weapons. Recall that when Iraq's program for making nuclear weapons was discovered by the IAEA after the Persian Gulf war of 1990-1991, it did not have a single nuclear reactor; its only reactor, under construction at Osirak, had been demolished by Israel's bombing in 1981. The apartheid regime of South Africa produced 16 nuclear bombs in the 1980s, without having a single nuclear reactor!

More specifically, the goal of the present article is twofold.

(a) We describe Iran's energy needs over the next two decades when its population may reach 100 million, and the resources that it will and must have in order to secure adequate energy supplies. It is universally recognized that energy security, which includes securing adequate and DIVERSIFIED energy resources, is a highly important part of any nation's national interests which, by their very definition, transcend the political system that governs a nation. Iran, as a sovereign nation, has a fundamental right to diversify and develop its energy resources - the engine for its economic and social development.

(b) Why Iran must stop relying on oil and natural gas as its main sources of energy, and begin developing alternative sources, is discussed next. We show that, in addition to being in its long-term national interests, there are compelling economical, environmental and technological reasons for Iran to seek out alternative sources of energy, instead of relying so heavily on the fossil fuels. Moreover, we argue that a nuclear energy program has many other benefits for Iran in terms of the necessary technology that must be imported into the country, and the educated class of people that will run Iran's nuclear industry.

Whether Iran is trying to make nuclear weapons is beyond the scope of this article and, therefore, will not be discussed.

Iran's Energy Consumption and Resources

Iran's population is currently estimated to be close to 70 million, about 70% of which is below the age of 30. This should be compared with Iran's population of 30 million when the Shah started Iran's program for building NPPs in 1974. Most estimates indicate that Iran's population may reach 100 million by 2025.

According to reliable statistics (provided by not only Iran's Ministry of Power, but also by International Energy Agency, the British Petroleum Annual Statistics, etc.), between 1977 and 2003, Iran's rate of energy consumption has on average increased 5.5% per year, from an equivalent amount of 181 MB to about 740 MB of crude oil. Moreover, since the end of Iran-Iraq war in 1988, Iran's oil consumption has had an annual growth rate of about 8%, while the supply of energy from all of its sources has had an annual growth rate of 6%, hence barely keeping up with energy consumption. Between 1977 and 2001, the electricity production has been experiencing an average annual growth rate of 8.5%. Iran currently produces 31,000 megawatt (MW) of electricity. Most importantly, in 1977 Iran consumed 29.6 MB of crude oil to generate electricity, whereas 265 MB of oil were used in 2003 for the same purpose, representing an average annual growth rate of 8.8%.

If the above trend continues and crude oil is not replaced by another energy source, and if Iran does not increase its oil production significantly, it may become a net IMPORTER of oil over the next decade, a huge catastrophe for a country that obtains 80% of its total export earnings, 45% of its total annual budget, and about 15% of its GDP from exporting oil. It is estimated that during 2004 the average price of Iran's crude oil will be about $30/barrel. It is noteworthy that Iran earns about $900 million/year for every $1/barrel increase in the price of its oil. We now describe in more details Iran's various energy sources.

Oil Reserves

Over the past decade, major discoveries by the National Iranian Oil Company (NIOC) have increased Iran's proven and recoverable oil reserves to about 131 billion barrels, up from 93 billion barrels in 1993. This represents about 11.4% of the world's proven oil reserves, making Iran second only to Saudi Arabia. During the first six months of 2004, Iran produced about 4.1 MB/day, up from an average of 3.9 MB/day in 2003. Iran's SUSTAINABLE oil production is about 4 MB/day. About 70% of Iran's oil (2.8 MB/day) is produced by 9 giant onshore fields, with the offshore fields (in the Persian Gulf) producing another 0.675 MB/day (17% of the total production). Note that Iran was producing about 5.8 MB/day of oil during the last two years of the Shah in 1977-78, but has never exceeded, on an average basis, 3.9 MB/day since the Islamic Revolution, while its population has increased by 130%. Iran's OPEC quota is 3.817 MB/day. Its oil exports average about 2.6 MB/day, mainly to China, Europe, Japan, and South Korea.

Iran spends $3 billion/year to subsidize the price of oil products for its domestic consumption. Another $2-3 billion/year is spent on IMPORTING some oil products (mainly gasoline). To counter the rising rate of consumption of gasoline (10.5% per year), Iran has doubled its price over the past 2 years.

Iran plans to increase its oil production to 7 MB/day by 2025. This would need about $60 billion in foreign investment. Since President Khatami was elected in 1997, Iran has succeeded in attracting about $20 billion in foreign investment for its oil and gas sectors, with its lion share going to the natural gas sector (see below). Since Iran's Constitution prohibits granting of oil rights on a concessionary or direct equity basis, Iran's main mechanism for granting contracts is the Buy-Back scheme, whereby the contractor pays for all the investments, receives compensation from NIOC in the form of an allocated production share, and transfers the operation of the field to NIOC after a fixed period. This arrangement has been criticized domestically (mainly for its guaranteed high rates of return, which is typically 15-18%, and was over 20% for the first 2-3 contracts), and has not made many foreign oil companies very happy either, as they may not be allowed to develop their discovery, let alone operating them. In addition, the short terms of such contracts (typically 5-7 years) are disliked by oil companies. As a result, in January 2004, Iran announced major modifications to the Buy-Back scheme by extending the length of such contracts to as many as 25 years, while allowing for continued involvement of the oil companies after a field's operation is transferred to NIOC.

Natural Gas

Iran possesses about 942 trillion cubic feet (TCF) in proven natural gas reserves - 15.2% of the world's proven reserves - second only to Russia. Of these, about 62% are in mostly undeveloped non-associated fields (associated gas is what one finds in oil reservoirs). Iran's major gas fields include the giant South Pars (with reserves of 280-500 TCF) in the Persian Gulf which is the largest gas field in the world. This field also contains over 17 billion barrels of gas condensates (liquids). In addition, many of Iran's oil fields produce large amounts of (associated) gas. Iran's natural gas production in 2002 was about 2.7 TCF.

Natural gas has increasingly become the main source of energy in Iran. Whereas in 1977 it represented only 8.4% of Iran's energy consumption, it now accounts for more than 53% and is rapidly increasing. This statistics alone should debunk the argument of opponents of Iran's nuclear energy program that it has not tried to use its natural gas a source of energy.

Iran has given the highest priority to development of South Pars field, since it shares it with Qatar. The field is supposed to be developed in 28 phases; 16 phases are currently active. Developing South Pars has attracted over $15 billion in foreign investments, and has generated at least 30,000 new engineering and supporting technical jobs in Iran. In addition to natural gas, gas condensate production from the field should reach about 220,000 barrels/day by 2005, and 630,000 barrels/day by 2015. When South Pars is fully developed, Iran will earn over $11 billion/year for at least 30 years from this field ALONE.

Between 35% to 40% of all the produced natural gas is injected into many of Iran's giant but aging oil fields for pressure maintenance and secondary oil production (see below). The rest is either exported by pipelines or as liquefied natural gas, or is consumed domestically. Iran exports natural gas to Turkey, and has signed agreements, or is negotiating, to sell gas to Armenia, Azerbaijan, China, Georgia, India, Pakistan, South Korea, Taiwan, and the United Arab Emirate. It is also actively seeking to export gas to Europe through Turkey and Greece (an agreement with Greece has been signed), hoping to export 300 billion CF/year of gas by 2007.

Iran also uses its natural gas as feedstock to develop its petrochemical industry, which currently produces nearly $2.7 billion in petrochemical products for domestic consumption and exporting. This generates much added values for Iran's natural gas, hence justifying its use for a set of projects for downstream and commodities production, rather than just burning it as a source of energy. We will come back to this point shortly.

Electric Power

Currently, Iran has a capacity of about 31,000 MW of electricity, of which more than 75% is generated by natural gas plants, 7% by hydroelectric, and 18% by oil-fired plants. The corresponding percentages worldwide are, respectively, 17%, 17% and 8% [1]. Iran currently consumes about 28,000 MW of electricity (the rest of the electrical capacity is exported). The demand for electric power is growing at an annual rate of 8%. Thus, Iran projects needing 70,000 MW of electricity by 2021, of which it plans to produce 7,000 MW by NPPs, representing 10% of its electric power. Currently, 19% of the world's electricity is generated by NPPs, and the IAEA estimates that this will reach 27% by 2030 (see below for further discussions).

Iran does have large potential for hydroelectric power generation, estimated to be about 20,000 MW/year. It is currently building 7 hydroelectric power plants, representing over 63% of its current power generation projects, that will generate by 2007 over 8020 MW of electricity. By 2021 some 14,000 MW of electricity will be generated by hydroelectric power, projected to represent 20% of Iran's electrical capacity. In addition, Iran has some potential for generating electricity from geothermal sources, with its first geothermal power plant going online recently near Ardabil, in northwestern Iran. Several small photovoltaic units that generate electricity are operating in rural areas of Iran.

Nuclear Energy Program

As mentioned above, by 2021 Iran wishes to generate at least 10% of its electricity by NPPs. However, constructing the NPPs is only part of the plan. Iran also wishes to possess the full nuclear fuel cycle for producing enriched uranium, as its has very significant natural uranium reserves in the form of uranium ore. The main reserves are in Saaghand, 300 miles south of Tehran in the Yazd Province (representing one of the largest deposits of uranium ore in the Middle East), and near Bandar Abbas. During 1993-1994, the Beijing Research Institute of Uranium Geology of China aided Iran with uranium mine exploration and operation, but Iran appears now to be self-sufficient in the required expertise.

It is estimated that Iran's known uranium ore reserves can produce as much electricity as 43 billion barrels of oil. This is a huge amount by any criterion, but particularly so if we only recall that if we extract ALL of Iran's known recoverable oil reserves (a remote possibility!) and use fully one-third of them only for generating electricity, we will generate as much electricity as what Iran's presently-known uranium deposits can produce!

The uranium ore is first converted to a powder, usually called the yellowcake. Iran is building plants in Ardakan and Bandar Abbas for this purpose. The yellowcake is then further processed to produce gaseous uranium tetra- and then hexafluoride. The facility for doing so is in Isfahan, which can also produce uranium oxide and uranium metal, the main components of nuclear fuel.

The Natanz facility is to be equipped with the standard uranium-enrichment instrument, namely, a large number of cascaded centrifuges that spin uranium hexafluoride gas at very high speeds and separate the lighter uranium-235 hexafluoride from the heavier uranium-238 hexafluoride. Of every 1000 uranium atoms only 7 are uranium-235. It is uranium-235 which is used in nuclear reactors and also nuclear bombs. Hence, one must have a large number of cascaded centrifuges to produce enough uranium-235. The Natanz facility has a pilot gas centrifuge plant that currently houses nearly 1300 centrifuges, and a large-scale production plant which will house up to 50,000 centrifuges, the installation of which (to begin in 2005) will take up to 10 years. Such a facility would then have the capability for producing enough uranium for annual consumption of a nuclear reactor of the Bushehr-type (producing 1000 MW of electricity). We note that about 20 countries around the globe are active in uranium enrichment.

Three companies, Kaalaa-ye Electric, Pars Taraash, and Faraayand Technique, can produce parts for the centrifuges that are to be used for enriching uranium. Iran also has nuclear waste disposal sites near Qom (Ghom), Karaj, and Anarak. There are three other nuclear facilities in Iran which represent research institutions, and are not directly related to uranium enrichment. It must be emphasized that the IAEA has been monitoring all of Iran's known nuclear facilities.

The Case for Nuclear Energy

The main argument of the critics of Iran's nuclear energy program is that, it has vast oil and gas reserves, hence needing no nuclear energy. The argument is mostly hot rhetoric. Canada and Russia, both major oil exporters, rely on NPPs for a significant portion of their electricity needs. Russia has vast oil and gas reserves (its gas reserves represent about a quarter of the world's known reserves), and Canada exports 1.5 MB of oil to the US every day, yet they both continue building NPPs. Between 1974, when Iran signed its first agreement for building NPPs, and 2000, use of NPPs for generating electricity in the world has increased by a factor of 12! In particular, France is now producing most of its electricity using NPPs.

At the same time, construction of NPPs in Iran is completely consistent with the general trends in Asia. According to the IAEA [2], 23 of the last 31 NPPs connected to the world's power grid have been built in Asia. Of the NPPs currently under construction, 18 of 27 are located in Asia, generating 78% more electricity by 2015 than 1995. In addition, according to the IAEA analysis [2], subject to certain reasonable assumptions, by 2030 27% of the world's electricity will be generated by NPPs, compared with the current rate of 19%. Even in the US, the Bush Administration has been talking about a nuclear power renaissance, and the US nuclear industry has been calling for construction of 50 NPPs by 2020 [3].

However, aside from the above general arguments, one can completely justify Iran's nuclear energy program based on economic, environmental, NUCLEAR EXTERNALITIES, and Iran's long-term national interests. In what follows we discuss each of these aspects.

The Economics of Iran's Nuclear Energy Program

If oil is to be used for generating electricity, then, for every 1000 MW of electricity, Iran must use between 20 to 25 MB of crude oil per year, depending on the oil quality. This implies that, for an average price of $25/barrel (currently the oil prce is much higher, and will presumably remain so for many years to come), Iran will lose $500-625 million/year in oil exports, which should be compared with the operating cost of about $140 million/year for a NPP generating the same amount of electricity. In 2003 alone, Iran used 265 MB of crude oil to generate 18% of its electricity. With a 2003 average price of $26/barrel, this represents $6.89 billion worth of oil exports for A SINGLE YEAR, a staggering figure that can pay for complete construction of at least two Bushehr-type (1000 MW) reactors and their operations for several years at the current prices! When we consider this over the useful life of a NPP (say, 50 years), not only Iran can replace the oil-generated electricity with that generated by NPPs, it will save tens of billions of dollars. Note that constructing NPPs in Iran should, under normal circumstances, be considerably cheaper than in the US or the EU, as the labor force is much cheaper in Iran, and many expensive legal and regulatory aspects of constructing a NPP in the US [4] do not simply exist in Iran.

Burning oil to generate electricity also creates severe environmental problems, as it has been doing in Iran, with very significant economic consequences which will be described in the next section.

Now consider natural gas power plants. As we already pointed out, Iran has already made great strides in using natural gas for its energy needs, with 75\% of its electricity, and 53% of all of its energy consumption being supplied by natural gas, hence debunking, once again, the main argument of the neo-conservatives and other opponents of Iran's nuclear energy program that Iran has not made the necessary effort to use its natural gas for its energy needs. At the same time, there are other areas of needs for natural gas that have priorities that may even be higher than using it for generating electricity, some of which are as follows.

(a) The author has been involved in computer modelling of oil and gas reservoirs for over 25 years [5]. A study in 1998 concluded that, out of Iran's 60 oil fields (at that time), 57 of them needed major technical studies, repairs, upgrading, and repressurizing by natural gas (the author was a member of the group that studied this issue and reached the above conclusion). A typical Iranian oil reservoir is fractured, and is of carbonate-type with a very tight rock matrix. It is well-known that injection of huge amounts of natural gas into almost all of Iran's oil reservoirs is practically the only way of maintaining their pressure to produce oil (a process called secondary recovery). Water injection, another common method of pressure maintenance in oil reservoirs, is not suitable for most of Iran's oil reservoirs [5]. Since, over time, the pressure will decline, the amount of injected gas must also increase to keep pace (at some point gas injection alone will not be effective anymore, and one must start what is usually called the tertiary recovery process). Currently, 35%-40% of all of Iran's natural gas production must be injected into its giant but aging oil reservoirs, without which the production of most, if not all, of them will rapidly decline.

At the same time, consider the following: If the natural gas that one burns annually to produce 1000 MW of electricity (the amount that the Bushehr reactor will produce) is injected into a typical Iranian oil reservoir, it will increase the reservoir's production by at least a few thousand barrels/day, depending on the reservoir's geology and history of production. The earning from exporting the extra oil can pay for and cover part of the operating cost of a 1000 MW reactor ($140 million/year) and reduce its operating cost to a level that makes it economically competitive with the cost of a gas power plant, estimated to be $60-70 million/year, while not polluting the environment by burning oil or natural gas.

We must also remember that, (1) the natural gas that is injected into Iran's oil reservoirs is largely recovered, hence making it even more economical to use NPPs to produce electricity and use the gas for pressurizing the oil reservoirs, and (2) NPPs have ZERO emission of carbons and other pollutants into the air, whereas fossil fuels, including natural gas, emit large amounts of carbon.

(b) As pointed out above, most of Iran's gas fields contain also huge amounts of liquefied natural gas (LNG). Natural gas can also be easily converted to LNG, which is sold at a price much higher than that of natural gas itself. However, the OPEC treats LNG similar to crude oil when determining quota for its members, and as a member of OPEC Iran cannot exceed its quota. Therefore, natural gas production cannot be increased arbitrarily to compensate for the gas that used domestically [6].

(c) As mentioned earlier, Iran is already exporting natural gas to several of its neighbors, and is actively seeking exporting very large amounts of gas to Europe. This is all part of a new emerging global market - natural gas - which is going to have [7] great impact on the world economy with geopolitical implications. By saving as much natural gas as possible for export, Iran will be in a very strong position in this emerging market to play a role similar to that of Saudi Arabia in the oil market, given its gas reserves.

(d) Iran is developing its petrochemical industry, for which the main feedstock is natural gas. The added value generated by producing petrochemical products (which can be up to 100%, depending on the products) - not to mention the jobs and industrial base that it creates, and the foreign currency income that it generates - is much greater than what Iran may gain by simply burning huge amounts of gas to generate electricity. In fact, the world's $500 billion petrochemical industry has been developed precisely for this reason: The added value that one gains from converting natural gas to downstream petrochemical products which, in Iran's case which has vast gas reserves and cheap labor force and energy resources, cannot be ignored.

(e) Unlike the popular belief, burning natural gas does contribute to degradation of the environment - by producing and releasing carbon into the atmosphere and contributing to the Greenhouse effect and global warming. This will be further discussed in the next section.

Environmental Problems Caused by Fossil Energy Usage

"The more we look to the future, the more we can expect countries to be considering the potential benefits that expanding nuclear power has to offer for the global environment and for economic growth...."

The above are what Dr. Mohamed ElBaradei, IAEA Director General, said [2] in advance of a gathering of 500 nuclear power experts in Moscow from 27 June - 2 July, 2004, marking the 50th anniversary of the start of the first NPP. Dr. ElBaradei points out an important fact: NPPs DO NOT POLLUTE THE ENVIRONMENT ON A REGULAR BASIS, but that is exactly what oil and other fossil fuels have been doing to Iran for years. If one is to obtain a true estimate of the cost of using oil, and even natural gas, as sources of energy, one must take into account the huge cost of the medical care for people who suffer from the diseases caused by pollution of the environment by oil and natural gas, as well as their damage to Nature. As early as 1990, in a seminar at Gustave E. von Grunebaum Center for Near Eastern Studies of the University of California in Los Angeles the author stated that [8],

"Typical estimates for the cost of producing electricity and other forms of energy using oil and gas are only based on their market prices. These prices reflect only the cost of producing oil (and gas) and of transporting them to the consumer. However, some of the costs of consuming fossil energy are not directly included in our energy bill, nor are they paid for by the producers. These are the HIDDEN, but real, costs that the society pays indirectly for the health problems caused by air, water and soil pollution r esulting from using fossil energy, environmental degradation caused by carbon emission and global warming, and acid rains. For example, according to the American Lung Association, total health costs, including lost potential income, of air pollution alone are estimated to be about $50 billion/year. The main culprit for air pollution is the fossil fuels, mainly oil, our primary source of energy. Evaluating the economics of the damage inflicted on Earth by global warming, caused by carbon emission that is the direct result of burning oil and natural gas, is currently impossible."

Supplying energy to the world releases six billion metric tons of carbon into the atmosphere every year, with Iran contributing her share. Iran is beset by huge environmental problems, caused by oil and gas consumption, that are reaching catastrophic scales. Although Article 50 of Iran's current Constitution states that, "In the Islamic Republic of Iran protection of the environment, in which present and future generations should enjoy a transcendent social life, is regarded as a public duty," various reasons kept in the back-burner the goal of cleaning the environment and maintaining it that way.

Since 1980, carbon emission in Iran has risen by 240%, from 33.1 million metric tons emitted in 1980 to more than 85 million metric tons at present. Note that, whether oil or natural gas is used, carbon emission cannot be avoided. This emission is one of the main culprits behind air pollution in Tehran and all other major cities of Iran that has reached catastrophic levels, so much so that the elementary schools must be closed on many days. According to Iran's Ministry of Health, and the Organization for Protection of the Environment, long-term effects of the polluted air are responsible, directly or indirectly, for causing 17,000 deaths/year in Tehran alone, as well as causing severe problems for people with asthma, heart, and skin conditions. The cost of medical care for such illnesses is reaching, by Iran's standards, astronomical levels. Generating electricity by NPPs does not directly address such problems, but it does reduce the pollution and environmental degradation caused by burning oil and (in the long-run) natural gas.

Polluted air also severely damages soil and groundwater resources by contaminating the rain water. At the same time, Iran's industrial base, using fossil fuels for energy, generates wastes that contaminate a large number of rivers and coastal waters and threaten drinking water supplies. Iran is actually reaching the stage which is characterized by chronic shortage of clean water - believed by many to be the cause of many future wars in the Middle East.

A recent study by John Deutch and Ernest Moniz of the Massachusetts Institute of Technology [9] argued that even in the US, if certain technological advances are made (expecting to achieve these advances is entirely reasonable), and subject to a modest tax on the carbon emitted into the atmosphere, the cost of generating electricity by NPPs will become competitive with that of gas power plants.

Finally, strict environmental regulations and public opposition have prevented development of significant oil reserves in the US (for example, in Alaska). At the same time, Western European countries have been discouraging use of oil and gas, with some moving towards NPPs. Since 1980, France has increased its production of electricity from NPP by 80% and reduced its oil consumption by 10%. But, the same countries that are reluctant to use oil and gas because they fear damage to their environment, demand Iran to burn oil and gas to generate electricity!

Nuclear Externalities

Externalities are said to arise when decisions of some economic agents affect the interests of other economic agents [10]. A good example is provided by the US space program in the 1960s. Although the program was intended for (and succeeded in) landing men on the Moon, it also resulted in tens of thousands of inventions and technological advances that we now use in our every day lives. What are the externalities of nuclear technology for Iran? One can list at least four major catagories [11]. Iran's nuclear program will result in,

(a) development and nurturing of new and unprecedented capabilities for building technological infrastructures;

(b) cross-fertilization and diversion of nuclear-related know-how, research and development, and supply chain to Iran's other industries, and other branches of science, such as medicine and agriculture;

(c) added-value and versatility of nuclear technology-related training, and

(d) creation of new cadre of managers of technology, technocrats, and organizational system culture.

In the author's opinion, nuclear externalities alone justify a nuclear energy program for Iran. Our contention is perhaps best described by Perkovich who declared that [12],

"Nuclear establishments can be seen as avatars of modernity, national prowess, and power, and the leaders of these establishments are well-positioned to pursuade (political) leaders and public to give them rein and bring greatness to their nations."

Iran's Long-Term National Interests

Iran must confront the challenge of its demographic explosion without having access to many of the necessary tools, which are strong state structures, large amounts of investment capitals, and industrial infrastructres that are reasonably advanced. At the same time, oil and natural gas are Iran's non-renewable national wealth. Once they are burned, they can never be recovered. One cannot expect Iran to recklessly deplete its non-renewable national wealth without receiving any lasting benefits in return, but this will happen if Iran's energy sources are not diversified, and it continues to rely almost exclusively on oil and natural gas as almost the only sources of energy.

Since the 1979 Revolution, Iran's population has more than doubled, from 30 to nearly 70 million, while its present oil production is only 70% of the pre-Revolution level. As pointed out in the Introduction, the question is: Why is it that the US and its allies believed in the 1970s that Iran needed NPPs, when its population was less than half of the present; its oil production was much more than now; its natural gas was being burned uselessly; its energy consumption was about a quarter of the present, and when, unlike today, its oil reservoirs were not in desperate need of natural gas injection, but that, now, Iran does not need alternative sources, including nuclear energy? How should Iran feed, house and educate its rapidly growing population, create jobs for its army of educated people, and develop its infrastructure and industrial base, mostly based on its income from exporting oil and gas, but also use the SAME resources to satisfy its ever increasing energy needs?

The Challenges of Nuclear Energy

To be fair, we must also recognize that NPPs do have their own problems:

(a) Nuclear power plants require high initial capital cost and investment. However, given nuclear externalities and other benefits of nuclear energy described above, the high cost is completely justified in Iran's case.

(b) The second problem of NPPs is their safety which must be at a very high level so that the chances of accidents, similar to those that happened in Three-Mile Island in the US (in 1979) and in Chernobyl in Ukraine (in 1986), will be minimal. The aforementioned MIT report [9] called for maintaining the current standards of "less than one serious release of radioactivity accident for 50 years from all fuel cycle activity," which "should be possible with the new light-water reactor plants" (that is, the reactors that use the heat from nuclear reactions in a nuclear reactor to generate steam for use in a power plant). The fact is that the safety of NPPs is a recurring problem. Even J apan, an advanced industrialized nation, has had many nuclear accidents. Therefore, the nuclear industry can no longer ignore this problem, or claim that it has addressed it in a satisfactory manner.

(c) One must also address the problem of safely storing the nuclear wastes produced by NPPs which will be radioactive for at least tens of thousands of years.

Renewable Energy Sources for Iran?

Iran does have potential for generating significant amounts of electricity using renewable sources (although, in some way, nuclear energy may also be considered as a renewable source). One is hydroelectric which, as pointed out above, should provide 20% of Iran's electricity by 2021. Iran's central desert has the potential to produce some energy using solar technology, but the technology is not advanced enough to act as a major supplier, at least not yet or in the near future. There is also some potential for geothermal energy, but its extent is limited. Altogether, such alternative methods cannot provide more than 25% percent of Iran's energy needs, at least over the next two decades.

Conclusion

Iran's goal of generating, by 2021, 10% of its electricity by NPPS, 20% by hydroelectric, 65% by natural gas, and 5% by other sources is rational and economically justified. The benefits of diversifying Iran's energy sources, and in particular resorting to nuclear power plants for a fraction of Iran's needed electricity, far outweight any possible drawback that it might have, although the author cannot conceive one.

References

[1] The Role of Renewables in Future Energy Directions, International Energy Agency report (October 2002).

[2] See the IAEA Press Release

[3] See, Physics Today (April 2002), p. 54.

[4] G. Rothwell, Triggering Nuclear Development: What Construction Cost Might Prompt Orders for New Nuclear Power Plants in Texas, Public Utilities Fortnightly (May 2004), p. 47.

[5] M. Sahimi, Flow and Transport in Porous Media and Fractured Rock, 1st ed. (VCH, Weinheim, Germany, 1995); 2nd ed. (to be published in 2005).

[6] See also W.O. Beeman and T.R. Stauffer, Is Iran Building Nukes? An Economic Analysis, Pacific News Services.

[7] D. Yergin and M. Stoppard, The Next Prize, Foreign Affairs, vol. 82 (No. 6), 103 (2003).

[8] For expanded content of that seminar see, M. Sahimi, How Much do We Pay for a Barrel of Oil? in, Proceedings of the Third International Conference on Non-Renewable Energy Sources, Tehran, Iran (December 1993), p. 127, and, M. Sahimi, Factors Affecting the Development of Fossil Energy Resources of Developing Countries, in, United States-Third World Relations in the New World Order, edited by A.P. Grammy and C.K. Bragg (Nova Science Publishers, New York, 1996), p. 361.

[9] J.M. Deutch and E. Moniz, The Future of Nuclear Power; see also, Physics Today (December 2003), p. 34.

[10] J. Hirshleifer, Price Theory and Applications, 2nd ed. (Prentice Hall, Englewood Cliffe, 1980).

[11] N. Meshkati, The Nuclear Question, paper presented at symposium on, Politics and Governance in a Changing Iran, Hoover Institution, Stanford University, Stanford, California (November 31, 2003).

[12] G. Perkovich, Nuclear Power and Nuclear Weapons in India, Pakistan, and Iran, in, Nuclear Power and the Spread of Nuclear Weapons: Can We Have One without the Other, edited by P.L. Leventhal, S. Tanzer, and S. Dolley (Brassey's, Washington, 2002), p. 196.

Original URL: http://www.payvand.com/news/04/dec/1056.html

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Part V: From the United States Offering Iran Uranium Enrichment Technology to Suggestions for Creating Catastrophic Industrial Failure

Introduction

In a series of articles that were posted on Payvand in October 2003, the author provided a brief history of Iran's nuclear program (Part I); described the general outline of the arguments that justify for Iran nuclear energy as an economically viable source of energy (Part II), and explained the crisis that was emerging at that time in the relationship between Iran and the International Atomic Energy Agency (IAEA) (Part III). In Part IV, posted on Payvand on December 7, 2004, the author presented a detailed economical analysis of Iran's nuclear energy program.

The goal of the present article is twofold:

(a) We describe in detail the key role that the US played in the 1970s in starting Iran's nuclear program. We show that not only did the US push the Shah to buy nuclear power plants (NPPs) from the US, but was also willing to offer Iran the technology for uranium enrichment if Iran agrees to buy eight US-manufactured NPPs. This should be compared with the present state of affairs whereby the US and its European allies are pressuring Iran to refrain from utilizing its uranium enrichment facilities and, instead, import enriched uranium for its NPP.

(b) We then compare what we describe in (a) with the present positions of the US neoconservatives and their sympathizers, which reveal the extent to which they are willing to inflict CIVILIAN casualties and economic damage on Iran to stop it from starting the Bushehr reactor.

Giving wide public exposure to the neoconservatives' and their sympathizers' thinking is, in the author's opinion, particularly important since, as the author has pointed out in his articles over the past three years, Iran's main antidemocratic forces - the monarchists and cultists - have aligned themselves with these groups. Therefore, it is essential to learn more about the fantasies of the neoconservatives and their sympathizers, which in turn will help us become more informed about the true face and colour of their Iranian allies who are willing to do anything to grab power in Iran.

The United States-Iran Nuclear Relations in the 1970s

It was presumably 1955 when the first discussions on developing a nuclear program for Iran took place. The first concrete step, however, was taken in 1957 when the US signed an agreement with Iran [1] on civilian nuclear cooperation. This was promoted as part of the US Atoms for Peace Program that was supposed to provide technical assistance to the signatories, as well as leasing them enriched uranium, and carrying out joint research on the peaceful use of nuclear energy. In the same year, the Central Treaty Organization (CENTO), that consisted of Iran, Pakistan, Turkey, Iraq, Britain, and the US moved its Institute of Nuclear Science from Baghdad to Tehran (after General Abdolkarim Ghassem's military coup d'etat in 1958, Iraq withdrew from CENTO).

In 1959 the Shah ordered establishment of a nuclear research center at Tehran University, Tehran Nuclear Research Center (TNRC), and began negotiating with the US to purchase a 5-megawatt (MW) reactor for the Center. To this date, the Center remains one of Iran's main nuclear research organizations.

In the late 1950s the US Joint Chiefs of Staff wanted to store nuclear bombs in Iran (presumably due to the victory of the Cuban revolution, the rise of Fiedel Castro to power, and the support that he began receiving from the Soviet Union). In February 1961, shortly after President John F. Kennedy took office, the US State Department opposed the JCOS suggestion; it was never carried out [2].

In September 1967 Iran received from the US 5.54 kgr of enriched uranium, of which 5.16 kgr contained fissile uranium isotopes (which could, in principle, be used in a nuclear bomb), to use in its research reactor at TNRC. In addition, Iran received 112 kgr of plutonium, 104 kgr of which were fissile isotopes [3]. The safeguarded 5 MW nuclear research reactor, a pool-type, water-moderated reactor that was supplied to Iran by the US firm GA Technologies started full operations at TNRC in November 1967, using 5.58 kgr of 93% enriched uranium. The fuel was provided by the US firm United Nuclear Corporation. In addition, the US supplied Iran hot cells which are [4], "heavily shielded rooms with remotely operated arms used to chemically separate material irradiated in the research reactor, possibly including plutonium laden 'targets'." On July 1, 1968, the first day that the Nuclear Non-proliferation Treaty (NPT) was opened for signature, Iran signed the Treaty. It was ratified by the Majles (the Iranian parliament) on February 2, 1970.

The US-Iran agreement, Cooperation Concerning Civil Uses of Atoms, that had been signed in 1957 (see above) was extended on March 13, 1969 for another 10 years. The first announcement on Iran's intention for obtaining NPPs was made in December 18, 1972 [5], when Iran's Ministry of Water and Power began a feasibility study for constructing a NPP in southern Iran.

The 1973 war between the Arab countries and Israel, and the subsequent huge increase in the price of oil, provided the Shah's government with considerable resources. In fact, 1974 proved to be a very busy year for Iran's atomic energy program! The Shah had originally envisioned Iran to produce, by 1990, 10,000 MW of electricity by NPPs. However, a 1974 study by the Stanford Research Institute concluded that Iran would need, by 1994, to produce 20,000 MW of electricity by NPPs. Thus, in March 1974 the Shah announced [6] plans for generating 23,000 MW of electricity, "as soon as possible," using up to 23 NPPs, with a target date of 1994. To achieve his goal, the Shah established the Atomic Energy Organization of Iran (AEOI), appointed Dr. Akbar Etemad, a Swiss-trained physicist, as its first chief, and announced that the AEOI, like everything else, would be run directly under his command.

The Shah had proposed to the US for many years the establishment of a Joint Economic Commission (JEC) for regulating and expanding Iran's commercial relations between the two countries. Up until 1974, the US had always turned down the Shah's suggestion on the ground that, having a free-market economy, the US government had no role to play in the commercial relations with Iran. Instead, the Shah had established many such JECs with the communist countries. However, after the severe increase in the price of oil during 1973-1974, the US was looking for a way to recoup billions of dollars that it was spending on importing oil and, therefore, it suddenly became very interested in establishing a JEC with Iran! In a SECRET letter, dated April 13, 1974, to Amir Assadollah Alam, the long-time Imperial Court Minister and confidante of the Shah, Mr. Richard Helms, the then US ambassador to Iran, wrote [7]:

"On March 14 and April 4, 1974 I discussed in audience with His Imperial Majesty my Government's genuine interest in finding ways to deepen and broaden the already strong ties between the Imperial Government of Iran and the United States. I am pleased to describe to you in more comprehensive detail my Government's views on ways in which we can mutually enrich the relationships between our Governments. I would Greatly appreciate this message being forwarded to its High Destination..... Secretary [of State Henry A.] Kissinger looks forward yo discussing these matters personally with His Imperial Majesty at a fairly early date...."

Mr. Helms then went on to suggest the establishment of a JEC, the same commission that the US had resisted for years (!):

"There is considerable scope for expanded cooperations between our countries in the economic field. In order to provide proper focus and suitable high-level official guidance, we suggest the establishment of a Joint Economic Commission at the Cabinet level. For our part, we contemplate that the United States member of the Commission would be the Secretary of Treasury...."

Mr. Helms then proposed the formation of several working groups that "could address general areas of concern or specific projects," including technology transfer, petrochemical development, communications, and political and security matters. But the first and most important working group that he proposed was the NUCLEAR ENERGY PRODUCTION GROUP, for which he wrote,

"We have noted the priority that His Imperial Majesty gives to developing alternative means of energy production through nuclear power. This is clearly an area in which we might most usefully begin on a specific program of cooperation and collaboration. Accordingly, we suggest that this be the first working group under our Joint Economic Commission. The Chairman of the Atomic Energy Commission is prepared at an early date to visit Tehran with a team of experts to discuss ways and means by which we can most actively cooperate in this field based on our own experience."

As pointed out in detail in Part IV of this series, the fact is that constructing NPPs in Iran in the 1970s had no economic justification whatsoever. This had made the Shah very sensitive to the critics' criticism - which had considerable validity - that nuclear contracts were being imposed on Iran by the US. Mr. Alam, the Shah's confidante, also expressed his grave concerns to him by telling him that [8],

"It is not in the interest of Shahanshah's Independent National Policy that such suggestions [Mr. Helm's] be proposed and be called a contract," to which the Shah responded [8], "We will expand our relations that we already have, and nothing more,"

just as Mr. Helms had suggested to the Shah in their private meeting and mentioned in his letter to Mr. Alam (see the next paragraph). Even from the US perspective, although the Shah was its close ally at that time, selling Iran nuclear technology was also a very sensitive subject, hence the secret nature of Mr. Helms' letter to Mr. Alam. The sensitivity can be seen in a paragraph of his letter where, under the title PUBLIC ANNOUNCEMENTS, he stated that,

"In the ordinary course of events, our joint initiatives in the fields mentioned above will naturally receive a certain amount of attention. Some general reference to our expanded cooperation might well take place during Secretary [of State Henry A.] Kissinger's next visit, but it is my personal view that we should handle these joint endeavors as natural outgrowths of the already close and friendly relations between the Imperial Government of Iran and the United States....."

At the end of his letter, Mr. Helms emphasized the US eagerness to participate in Iran's nuclear program:

"The Secretary [of State Henry A. Kissinger] has asked me to underline emphatically the seriousness of our purpose and our desire to move forward vigorously in appropriate ways...."

In May 1974, Dr. D.L. Ray, the Chairman of the US Atomic Energy Commission, travelled to Iran during which he mentioned the possibility of establishing REGIONAL uranium enrichment and reprocessing facilities for Iran.

The next month, the Shah declared that Iran will have nuclear weapons, "without a doubt and sooner than one would think" [9]. The Shah first backed off [10], but later on qualified his earlier statement, saying [11] that Iran has

"no intention of acquiring nuclear weapons but if small states began building them, then Iran might have to reconsider its policy"!

According to Dr. Akbar Etemad (the first Chief of the AEOI from 1974 to 1978), the TNRC carried out experiments in which plutonium was extracted from spent fuel using chemical agents [12]. Note that the most important use for plutonium is in a nuclear bomb. It is also believed that the Shah had assembled at the TNRC a nuclear weapon design team. According to Mr. Alam [13], in the mid 1970s the Shah ordered the establishment of a ``University of Military Sciences and Technology.'' The mission of this university, which was supposed to be in Esfahan and controlled solely by Iran's armed forces, was to carry out research and development in the area of chemical and nuclear weapons. The Shah had even authorized stealing the necessary science and technology from other countries, if need be, in order for Iran to fully acquire the know-how of making chemical and nuclear weapons. None of these activities did, of course, provoke any reaction by the US.

On March 3, 1975, Iran and the US signed an agreement worth about $15 billion, according to which the US was, among other things, to build EIGHT NPPs in Iran with a total capacity of about 8,000 MW. The agreement was signed by the US Secretary of State Henry A. Kissinger, and Iran's Finance Minister Mr. Houshang Ansari. The fuel for the reactors was to be supplied by the US.

On March 14, 1975, in National Security Study Memorandum 219 signed by Mr. Henry A. Kissinger, President Gerald R. Ford directed [14]

"a study of the issues involved in reaching an acceptable agreement with the Government of Iran which would allow nuclear commerce between the countries - - specifically, the sale of the U.S. nuclear reactors and materials, Iranian investment in the U.S. enrichment facilities, and other appropriate nuclear transactions in the future."

About a month later, President Ford instructed the US negotiators to offer Iran uranium enrichment and reprocessing facilities. Specifically, National Security Decision Memorandum 292, dated April 22, 1975 and signed by Mr. Kissinger, stated [15] that the US shall

"- - Permit U.S. materials to be fabricated into fuel in Iran for use in its own reactors and for pass-through to third countries with whom we have Agreement."

In addition, the US was willing to allow Iran to invest in the US uranium enrichment facility (Iran had proposed investing $2.75 billion in an enrichment facility in the US [16]). This is stated in the Memorandum [15]: The U.S. shall

"- - Agree to set the fuel ceiling at a level reflecting the approximate number of nuclear reactors planned for purchase from the U.S. suppliers. We would, as a fallbak, be prepared to increase the ceiling to cover Iran's full nuclear reactor requirement under the proviso that the fuel represents Iran's entitlement from their proposed investment in an enrichment facility in the U.S...."

The US was also willing to allow Iran to reprocess the spent fuels [15] (whic produce plutonium): The US shall

"Continue to require U.S. approval for reprocessing of U.S. supplied fuel, while indicating that the establishment of a multinational reprocessing plant would be an important factor favoring such approval...."

Around the same time, the Massachusetts Institute of Technology signed a contract with Iran for providing training for Iranian nuclear engineers. At that time, the AEOI had a staff of about 150 nuclear physicists, about half of whom were from Argentina. The Shah increased the 1976 budget of Iran's AEOI to $1 billion from about $31 million in 1975.

In National Security Decision Memorandum 324, dated April 20, 1976 and signed by General Brent Scowcroft, President Ford authorized the following negotiation position for the US with Iran. The US side should [17]:

"Seek a strong political commitment from Iran to pursue the multinational/binational reprocessing plant concept, according the U.S. the opportunity to participate in the project....."

Note that when President Ford was offering Iran such nuclear concessions, Dick Cheney, the present Vice President, was the White House Chief of Staff, and Mr. Donald Rumsfeld was the US Defence Secretary. Therefore, the same Donald Rumsfeld who was closely involved with pursuing a nuclear deal with Iran in the 1976, and the same Donald Rumsfeld who went to Baghdad in December 1983 to inform Saddam Hussein that the US, although officially neutral in the Iran-Iraq war, was going to tilt towards Iraq (after which the US provided strong military and intelligence support to Saddam Hussein), now has a leading role in the invasion of Iraq and threatening Iran with military strikes.

Around the same time, Mr. Jeffrey Eerkens, a US uranium enrichment expert, travelled to Iran to obtain funding for an invention of his for a special laser that could be used for uranium enrichment. In fact, Mr. Eerkens obtained in 1978 a license from the US Department of Energy to sell four lasers to Iran [18]. The lasers were shipped to Iran in October 1978 (only five months before Islamic Revolution's victory!). The IAEA reported recently that Iran had experimented with this technique about 10 years ago. However, apparently, the Eerkens lasers proved to be unworkable as a uranium enrichment instrument [19].

On April 12, 1977, Iran and the US signed an agreement to exchange nuclear technology and cooperate in nuclear safety. In an address to the symposium [20], "The US and Iran, An Increasing Partnership," held in October 1977, Mr. Sydney Sober, a representative of the US State Department, declared that the Shah's government was going to purchase EIGHT nuclear reactors from the US for generating electricity.

During his now-famous trip to Tehran on January 1, 1978, President Jimmy Carter and the Shah reached a new bilateral agreement for nuclear cooperation. The US agreed to grant Iran "most favored nation" status for reprocessing of spent nuclear fuels. Iran agreed to buy 6-8 light-water nuclear reactors from the US (subject to approval by the US Congress).

On July 10, 1978 (only 7 months before the Islamic Revolution's victory) the draft of the US-Iran Nuclear Energy Agreement was signed. The agreement was supposed to facilitate cooperation in the field of nuclear energy and to govern the export and transfer of equipment and material to Iran's nuclear energy program. Iran was also to receive American technology and help in searching for uranium deposits [21]. On October 18, 1978, James R. Schlesinger, the US Energy Secretary, sent the agreement to President Carter for his signature. By then, however, Islamic Revolution had swept Iran, and the Shah had informed the US Ambassador Richard Sullivan that his plans for NPPs were on hold. Finally, in early 1979, the US stopped its supply of highly enriched uranium to Iran. Since Iran started its nuclear energy program in the early 1980s, the US has been completely hostile towards it.

The Neoconservatives' Fantasies for Dealing with Iran's Nuclear Program

We now move the clock forward for about 30 years to the present times to see what the neocons and their sympathizers are saying about Iran's nuclear energy program. We begin with a quote about the neocons [22]:

"The neocons hate two things: To be wrong and to be ignored."

It is now an indisputable fact that Iraq did not have any weapons of mass destruction, including nuclear weapons. But, that never stopped the neocons and their sympathizers from advocating invasion of Iraq, which ultimately succeeded when the invasion began in March 2003. The disaster in Iraq has not, however, discouraged the necons and their sympathizers. They now have fantasies about Iran as if Iranians are not already suffering enough in the hands of Tehran's right wing. Too many articles are being published by the necons and their sympathizers describing their fantasies about Iran. All one has to do is taking a look at what such publications as the Weekly Standard, the National Review, the editorial pages of the Wall Street Journal, the Times of London, the Washington Times, and many other publications and websites contain about Iran, or do a Google search on Messrs Michael Ledeen, Michael Rubin, Reuel Marc Gerecht, and others. The goal of this part of the article is not to review what they write about Iran - it will take books to do so - but only to provide clues to neocons' and their sympathizers' thinking and their "action plans" for Iran's nuclear energy facilities, and compare them with the US policy towards Iran's nuclear program in the 1970s.

Before doing so, however, the author would like to point out that, having been a member of the Union of Concerned Scientists for nearly two decades - an organization dedicated to educating the public about the dangers of weapons of mass destruction, including nuclear weapons - he is only too aware of the danger that such weapons pose against the world, if they are in the hands of extremists. Therefore, the question is NOT whether Iran, under its present political conditions, should or should not have nuclear weapons. Rather, the point of this part of the article is to give wider public exposure to the neocons' and their sympathizers' fantasies about Iran, particularly among Iranians. Since they know very well that Iran is not Iraq to be overrun, and because they were bitten by "allies" such as Ahmad Chalabi and are well-aware that their Iranian allies - the monarchists and cultists - have no base of support inside Iran, they have begun having fantasies!

Exposing the neocons' and their sympathizers' fantasies is also important from another perspective: When it comes to opposing the spread of nuclear weapons (and it is not even certain yet whether Iran is trying to develop nuclear weapons), the US has a double standard. Aside from Israel's arsenal (which includes biological, chemical, and nuclear weapons) which no US politician dares to question or even officially acknowledge, the US does not oppose Pakistan's nuclear arsenal - an immense threat to the stability of that part of the world, because Pakistan is an essentially failed State in a chaotic state. Its nuclear-armed military, populated by Islamic extremists, created the Taliban and still shields many of its leaders. Osama bin Laden could not have hidden for so long without the support of at least some elements of Pakistan's military. Pakistan has a sectarian war in which its majority sunni population has been murdering the shiite minority, and its schools teach Islamic radicalism. Abdul Ghadeer Khan, the founder and owner of Pakistan's nuclear supermarket, could not have operated freely for so long without the support of at least some elements of Pakistan's military. Even now, Pakistan does not allow any foreigners, including experts and inspectors of the IAEA, to interview Mr. Khan. However, instead of trying to alleviate this dangerous situation, the US has granted Pakistan "special friend" status.

But, the US double standards do not end with Israel and Pakistan. The US has exported nuclear technology to China; has offered a non-aggresion pact and economic incentives to North Korea, and never objected to Argentine and South Africa (which developed 16 nuclear bombs in the 1980s) acquiring nuclear technology and know-how. It was recently announced that South Korea and Taiwan both have been involved with enriching uranium, producing plutonium, and even nuclear bomb making, yet the revelation did not provoke any reaction by the US. Brazil, a signatory to the NPT, had until very recently refused to allow the IAEA full inspection of its uranium enrichment facilities that are under construction, yet, although Brazil provided nuclear materials to Saddam Hussein's regime in the 1980s, Secretary of State Colin L. Powell declared on October 5, 2004, that Brazil's behavior "does not concern the US."

Here, we review the positions of two pundits regarding Iran's nuclear energy program. They are not at the American Enterprise Institute, the hotbed of neoconservatism, and may not consider themselves as neoconservative pundits. However, as we show below, their positions resonate nicely with those of the neocons.

The first pundit whose "positions" regarding Iran's nuclear energy facilities we would like to discuss is Mr. Michael Eisenstadt, a senior fellow at The Washington Institute. In a recent book chapter [23] entitled, "The Challenges of U.S. Preventive Military Action," Mr. Eisenstadt suggested the following covert actions, among others, against Iran's nuclear facilities (see pages 121 and 122 of Ref. [23]) (the emphasis with capital letters is mine):

"harassment or MURDER of key Iranian SCIENTISTS or technicians;"

"introduction of FATAL DESIGN FLAWS into critical reactor, centrifuge, or weapons components during their production, to ensure CATASTROPHIC FAILURE DURING USE;"

"introduction of destructive viruses into Iranian computer systems controlling the production of components or the operation of facilities;"

"damage or destruction of critical facilities through SABOTAGE..."

There are at least three important aspects of the above covert options to consider:

(a) One wonders whether Mr. Eisenstadt's suggestion for murdering Iranian scientists or technicians is not tantamount to state-sponsored terrorism. If so, it appears that in Mr. Eisenstadt's view terrorism is committed only by weaker countries or groups against powerful nations!

(b) Likewise, it appears that Mr. Eisenstadt does not consider sabotage as either state-sponsored terrorism, or against international laws. It appears that in his view, international laws are good only so long as they advance the interests of powerful nations!

(c) It is completely clear that Mr. Eisenstadt has no notion of what constitutes a catastrophic failure in an industrial complex. We are talking about a system which includes nuclear reactors and nuclear materials. Any catastrophic accident or system failure in any large-scale industrial complex, let alone a nuclear complex, is one that has immense consequences in terms of loss of lives, long-term health problems, human suffering, and economic and environmental damage. We only need to recall what happened in Bhopal, India - a non-nuclear accident - and in Chernobyl, Ukraine - a nuclear accident - to see the consequences of a catastrophic industrial failure. The people of those areas are still paying with their lives the cost of those accidents, with Chernobyl's total casualty reaching over 30,000.

To further boost his case for the type of covert actions he was proposing, Mr. Eisenstadt stated that [23],

"it might not be possible for Iranian authorities to determine, for instance, whether the death of a scientist was due to natural or un-natural causes, or whether damage to a critical facility was due to an industrial accident or sabotage."

Consider the reasoning: Mr. Eisenstadt seems to be of the opinion that the people who run Iran's nuclear program know nothing about anything. He appears to have forgotten that the same Iranian authorities managed to set up the complete cycle for enriching uranium over a period of 18 years and hide it from the world.

It came to the author's attention that Mr. Eisenstadt, in an e-mail that he sent to the panelists of the panel, "Assessing the Iranian Nuclear Program: Technical Capabilities and Intent," which was part of a workshop entitled, "Iran's Nuclear Program" (held on Tuesday November 9, 2004, at the Woodrow Wilson International Center for Scholars in Washington, D.C.), tried to put a spin on what he had stated in his article quoted above. In that panel Mr. Eisenstadt's proposal for creating a catastrophic failure was questioned and criticized by Professor Najmedin Meshkati of the University of Southern California, an internationally-recognized authority on safety of nuclear reactors. In response to Professor Meshkati's criticism, Mr. Eisenstadt stated the following [24] in his e-mail:

"Had I been there [in the panel] I would have pointed out that the term 'catastrophic failure' is used in industry to describe 'failure, often sudden and without warning, that jeopardizes the acceptable performance of an entire system or assembly.' (This definition is from the ChemIndustry.com website, which describes itself as the worldwide search engine of the chemical industry). "Catastrophic" refers to how the failure affects the operation of the system, not its impact on the people operating the facility or living in its vicinity. There are no doubt ways to sabotage a nuclear power plant (if one were inclined to do so and had appropriate access) to prevent reactor start-up or to force it to shut-down without creating a hazard to the work force or the peoples of the region."

The author has been involved with the chemical and petroleum industry for thirty years. In addition to being a professor of chemical engineering, carrying out research (funded by leading funding agencies in the US) and publishing extensively (over 220 papers and 4 books) in these areas, the author has also been, and currently is, a consultant to many industrial coorporations. Mr. Eisenstadt's "clarification" is, in the author's opinion, nothing but hair spiting and distorting what is widely known, and does nothing but adding insult to the injury of his original suggestions. The suggestion that one can cause catastrophic failure in a nuclear facility "without creating a hazard to the work force or to the peoples of the region" is absolutely outrageous.

Perhaps one of the best responses to the "clarification" of Mr. Eisenstadt, and his claim that he was only discussing some possibilities, was given by Dr. Guive Mirfendereski, an international laws expert and a frequent commentator on Iran and the Middle East. In an e-mail to Mr. Eisenstadt, Dr. Mirfendereski wrote [25]:

"You are not in a scientific conference where all manner of theories are proposed, or in a sci-fi convention. Since the conditions of flawlessness of execution are never met, a catastrophic failure will produce catastrophic consequences. To even suggest such a thing in theory is reckless and without regard to the human toll that it will engender. Assume that the catastrophic failure occurs in Bushehr and before you know it the Iranians [who work there] fail to manage the failure properly - the Bhopal or Chernobyl style cloud or waterborne contamination then begins to waft over into the Persian Gulf and the neighboring countries, which include Bahrain, Qatar, Kuwait, and Iraq, where we [the US] have troops and will have for a foreseeable future. Will you then stand up and say, oops we goofed, the intel was faulty? Instead of coming up with Agent-Orange type solution inspired by an over-exaggerated sense of Bond-esque machismo, maybe the time has come for you and your cohorts to talk about befriending a country without whose friendship in the past twenty-odd years we [the US] have managed to screw up everything we touched in the Middle East - ironically to the ultimate detriment of the welfare of the citizens of a certain country that wags our [the US'] national policy."

The depth of Mr. Eisenstadt's lack of understanding of what is happening in the Middle East and what his proposals might do to that region can be seen where he states in his article that [23]:

"Successful U.S. prevention would require exceptionally complete intelligence; near flawless military execution; and deft post-strike diplomacy to mitigate an anti-American nationalist backlash, deter retaliation, and, most importantly, ensure that military action does not poison pro-American sentiment or derail the movement for political change in Iran. The complex, daunting, and somewhat contradictory nature of these challenges (e.g., successful prevention could harm short-term prospects for political change and complicate long-term prospects for rapprochement with a new Iran) only underscores the importance of exhausting diplomatic options before giving serious consideration to military action."

In other words, Mr. Eisenstadt believes that the US can cause a catastrophic failure in Iran's nuclear energy facilities, with unforeseen human, economic, and environmental consequences, but if the US only has "deft post-strike diplomacy" it can prevent a backlash and piosoning of pro-American sentiment, or derailment of the movement for political change in Iran. What Mr. Eisenstadt is saying is, in fact, rehashing of what all the neocons have been saying: That the reason for the anti-US feelings in the Middle East is just bad public relations, and has nothing to do with what the US has actually been doing there. In other words, as a Bush Administration official recently stated, the US should "create reality" as it goes ahead with its policies in the Middle East.

The second pundit whose position regarding Iran's nuclear energy facilities we discuss is Mr. Patrick Clawson. He is deputy director of the Washington Institute for Near East Policy, a pro-Israel think tank. Similar to Mr. Eisenstadt, Mr. Clawson has been advocating sabotage, and creating industrial accidents in Iran's nuclear energy facilities. In a recent article Mr. Clawson stated that [26]:

"In an ideal world, the United States could disrupt Iran's nuclear program through covert means, such as corrupting software programs."

In another recent article [27] Mr. Clawson was quoted as going further, stating that:

"The idea that the only contingency plan available is to use U.S. air raids is not true. Given the shoddy design of the Russian nuclear plants whose blueprints Iran is using for its facilities, one could well imagine that there could be catastrophic industrial accidents."

However, it was in the Workshop in Washington (mentioned above) that Mr. Clawson stated his position most "eloquently." His remarks followed up Mr. Henry Sokolski's response to Professor Najmedin Meshkati's inquiry about suggestion for sabotaging Iran's nuclear system and Mr. Eisenstadt's written statements quoted above. The following remarks were transcribed verbatim from the C-SPAN live and then re-broadcast of the Workshop on Iran's Nuclear Program. Mr. Clawson said (the emphasis with capital letters are the author's) [28]:

"Look, if we could find a way in which we could introduce computer viruses which caused the complete shutdown of the Bushehr system before it became operational, that would be DELIGHTFUL."

"If we could find ways in which these very complicated centrifuges, which are spinning at such high speeds, could develop stability problems and fly apart, and the cascade [of the centrifuges] could be DESTROYED, I think that would be DELIGHTFUL."

The readers surely note that empty centrifuges do not spin! They only spin at high speeds when they contain uranium hexafluoride which is in gaseous state. So, destroying the cascade of the centrifuges only implies rapidly spreading the uranium compound everywhere, from which Mr. Clawson would derive delight. He continued:

"And, indeed, if we could find a way to create an industrial accident of the scale of the Three Mile Island which did not cause a single fatality, which would prevent Bushehr from becoming operational, I think that would also be very HELPFUL."

So, the contention is that a nuclear accident of the type and scale of the Three Mile Island would not cause any fatality! Clearly, Mr. Clawson has not done his homework. The author invites Mr. Clawson and the interested readers to watch the award-winning video, "Three Mile Island Revisited" [29]. To quote, the video

"directly challenges the claim of the nuclear industry and government that 'no one died' from the core meltdown of the Three Mile Island nuclear power plant in 1979, America's worst nuclear disaster. Through the testimony of area residents and scientific experts, the documentary presents compelling evidence that cancer deaths and birth defects increased in the area surrounding the Pennsylvania plant."

The author also suggests that Mr. Clawson and the interested readers read, "People Died at Three Mile Island," chapter 14 of a seminal book [30] to learn about the chilling facts about this nuclear accident, from birth defects and increased rate of child mortality, to increased cancer deaths in that area.

Mr. Clawson then continued,

"So, there are a whole variety of mechanisms that could be used to stop Iran's nuclear program, that would be much less dangerous than some of the other methods that we are talking about. We are talking about military strikes. I hate to tell you this, but military strikes kill people, and that fact we have to take into consideration."

So, Mr. Clawson was apparently worried about loss of human lives as a result of military strikes. But he immediately revealed his true colour (if he already had not by making the statement about a Three Mile Island-type of accident):

"If we could find ways to bring about industrial accidents, that offer good prospects of not endangering human life, but may UNFORTUNATELY CAUSE SOME COLLATERAL DAMAGE, then that's a plan that we have to consider."

Therefore, Mr. Clawson immediately contradicted himself and conceded that industrial accidents of the type he is talking about do cause some (how much?) collateral damage.

After the 1995 agreement was signed by Iran and Russia for completing the Bushehr reactor, the Clinton administration began charging that the plutonium that one can extract from the nuclear waste that the reactor would produce could be used by Iran for making nuclear weapons. However, this issue was addressed by Iran and Russia, when they negotiated an agreement by which the nuclear wastes from the Bushehr reactor would be returned to Russia. In fact, the Bushehr reactor, at which most of Messrs Eisenstadt and Clawson fury and covert plans are aimed, is believed by many experts to be incapable of producing plutonium suitable for making a nuclear bomb. For example, according to Thomas Stauffer [31],

"The reactor at Bushehr is the wrong kind of nuclear reactor for producing weapons-grade fissile material. It will produce the wrong kind of plutonium.... It can be operated only in the wrong way with regard to yielding plutonium, and it is the wrong kind of reactor as well, in the sense that a facility such as Iran's is easily amenable to close surveillance, not lending itself at all to any covert diversion - of even the wrong kind of plutonium."

However, the neocons and their sympathizers would have none of these. The only thing that would satisfy this group is the complete destruction of Iran's nuclear energy facility, regardless of its human, environmental and economic consequences. Thus, having "successfully" completed their "Project for the New Iraqi Century," the neocons and their sympathizers have begun having fantasies about Iran. We already have neocons among Iran's right wing in Tehran who have been trying to suppress Iran's democratic movement. We should look forward to seeing Iranian neo-monarchists and neo-cultists as well, the US neocons' natural allies.

Conclusion

It is clear that the Frankstein that the US now calls Iran's nuclear program was conceived by the Shah and his government, with the direct assistance and strong encouragement (many believe pressure) by the US. Not only did the US want the Shah to develop nuclear infrastructure and build nuclear reactors (hence inspiring him to start the work for building nuclear bombs), but also offered him uranium enrichment technology, the main point of contention between the US and its European allies, and Iran. That was, of course, because the Shah was the US' dictator, having put him in power after he had been run out of Iran in 1953. The present reactionary right wing in Tehran is home grown. That appears to be the main difference between the Shah and his regime and Tehran's present right wingers.

Nearly 27 years ago, when the author moved to the US for his graduate studies at the University of Minnesota in Minneapolis, the neocons and pundits such as Messrs Clawson and Eisenstadt were considered as belonging to fringe groups on the far right. Today, such groups are gradually becoming the "mainstream" of the American politics. With the neocons being in power for the next four years, we may have to develop new meanings for "fringe groups," "far right," etc. In that case, the author shudders at the thought of what the new "fringe groups" or the "far right" may constitute, if the lunatic neocons represent the "mainstream."

References:

[1] US Department of State, "Atoms for Peace Agreement with Iran," Department of State Bulletin 36 (April 15, 1957).

[2] G.A. Morgan, "The Current Internal Political Situation in Iran," in Digital National Security Archive, secret internal paper dated February 11, 1961. http://nsarchive.chadwyck.com

[3] Digital National Security Archive, January 29, 1980, "US Supplied Nuclear Material to Iran." http://nsarchive.chadwyck.com

[4] D. Albright, "An Iranian Bomb?," The Bulletin of Atomic Scientists, vol. 51, No. 1 (January 1995).

[5] "Nuclear Plant Study Started," Kayhan International (December 19, 1972).

[6] Tehran Magazine (March 18, 1974), page 2.

[7] A.A. Alam, "Alam's Diaries", Volume 4, edited by A. Alikhani (Maziar Press, Tehran, 2001), pp. 54-58. Mr. Alam had left a copy of the letter with his diaries, which is reprinted in the book. These documents may also be found in, "Issues and Talking Points: Intensified Bilateral Cooperation," Department of State Briefing in Digital National Security Archive; nsarchive.chadwyck.com

[8] A.A. Alam, "Alam's Diaries", Volume 4, edited by A. Alikhani (Maziar Press, Tehran, 2001), page 7.

[9] "More Fingers on Nuclear Trigger?" Christian Science Monitor (June 25, 1974).

[10] According to Ref. [9], Iran's embassy in France issued a statement, denying that the Shah made that statement.

[11] Der Spiegel, February 8, 1975.

[12] A. Etemad, "Iran," in, "European Non-Proliferation Policy," edited by H. Mueller (Oxford University Press, London, 1987), page 9.

[13] A.A. Alam, "Alam's Diaries", Volume 1, edited by A. Alikhani (Maziar Press, Tehran, 2001), page 107.

[14] See President Gerald R. Ford's Presidential Documents at http://www.fordlibrarymuseum.gov/library/document/nsdmnssm/nsdmnssm.htm

[15] See President Gerald R. Ford's Presidential Documents at http://www.fordlibrarymuseum.gov/library/document/nsdmnssm/nsdmnssm.htm

[16] Department of State Secret Report, "Current Foreign Relations: US-Iran Commission cements bilateral ties; Iran and Iraq agree to settle differences." See, http://nsarchive.chadwyck.com.

[17] See President Gerald R. Ford's Presidential Documents at http://www.fordlibrarymuseum.gov/library/document/nsdmnssm/nsdmnssm.htm

[18] L.S. Spector, "Going Nuclear: The Spread of Nuclear Weapons 1986-1987" (Ballinger Publishing, Cambridge, 1987), page 46.

[19] L.S. Spector and J.R. Smith, "Nuclear Ambitions: The Spread of Nuclear Weapons, 1989-1990" (Westview Press, Boulder, 1990), page 205.

[20] A. Etemad and N. Meshkati, "The US-Iran Nuclear Dispute: Dr Mohamed ElBaradei's Mission Possible to Iran," Iran News (July 13, 2003).

[21] Department of State Memorandum, "Iran: The US-Iran Nuclear Energy Agreement," October 20, 1978.

[22] This beautiful and insightful quote is not the author's. He read it in an article but, unfortunately, could not locate its original source. The author would be grateful to any reader who can provide him with the original source of the quote.

[23] "Checking Iran's Nuclear Ambitions," edited by H. Sokolski and P. Clawson (Carlisle, PA, U.S. Army War College, 2004). The document can be accessed on-line at: http://www.carlisle.army.mil/ssi/pdffiles/00359.pdf. Those readers who may feel depressed after reading Mr. Eisenstadt's chapter in this book, may consider reading the chapter by Mr. Rob Sobhani for some relief and entertainment. (That chapter is, however, the subject of a forthcoming article by the author.)

[24] The author is grateful to Professor Najm Meshkati for sharing with him the e-mail on December 6, 2004.

[25] The author is grateful to Dr. Guive Mirfendereski for granting him permission, on December 6, 2004, to quote him here.

[26] P. Clawson, "How to Rein in Iran Without Bombing It," the Los Angeles Times (Friday October 15, 2004).

[27] S. Efron, "U.S. Options Few in Feud With Iran," the Los Angeles Times (Monday December 13, 2004).

[28] The author is grateful to Professor Najm Meshkati for his invaluable help with transcribing what Mr. Clawson stated.

[29] The video was produced by Steve Jambeck and Karl Grossman, and is about 30 minutes long.

[30] H. Wasserman and N. Solomon (with R. Alvarez and E. Walters), "Killing Our Own, the Disaster of America's Experience with Atomic Radiation" (Dell Publishing Co., New York, 1982).

[31] T.R. Stauffer, "Unlike Dimona, Iran's Bushehr Reactor Not Useful for Weapons-Grade Plutonium," Washington Report on Middle East Affairs (September 2003), p. 28; see, http://www.washington-report.org/archives/sept03/0309028.html.

Original URL: http://www.payvand.com/news/04/dec/1186.html

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Part VI: The European Union's Proposal, Iran's Defiance, and the Emerging Crisis

Introduction

Since February 2003 Iran's program for constructing the complete cycle for producing enriched uranium - the fuel for nuclear reactors and nuclear power plants (NPPs) - has been the subject of intense international debates. Over this period, the experts and inspectors of the International Atomic Energy Agency (IAEA) have been visiting Iran on a regular basis to inspect its nuclear facilities. The information and data that have been collected by the IAEA have revealed sustained and determined efforts by Iran since 1985 for constructing the complete cycle for producing enriched uranium. The Bush administrtation has been arguing that the primary purpose of Iran's nuclear program is developing nuclear weapons. The European Union (EU), which has very extensive commercial relations with Iran; Russia, which is completing the construction of a NPP in Bushehr (on the shores of the Persian Gulf), and Japan, which has signed a lucrative oil agreement with Iran for developing Iran's giant Azaadegaan oil field, have all pressed Iran hard, demanding that it reveal all the details of its nuclear program.

In a series of articles that were posted on Payvand.com in October 2003, the author provided a brief history of Iran's nuclear program (Part I); described in broad terms the reasons that justify Iran's nuclear energy program as economically, politically, and environmentally viable (Part II), and explained the crisis that was emerging at that time (October 2003) in the relationship between Iran and the IAEA (Part III). In Part IV, posted on Payvand.com on December 7, 2004, the author presented a detailed economical, political, and environmental analysis of Iran's nuclear energy program, using the most reliable statistics on Iran's current energy consumption and resources. Part V, posted on December 22, 2004, described in detail the key role that the United States (US) played from the 1950s to the 1970s in starting Iran's nuclear program. We showed that not only did the US push the Shah to buy its NPPs, but also offered Iran the technology for uranium enrichment and reprocessing of spent nuclear reactor fuel if Iran agreed to buy eight US-manufactured NPPs, assertions that were repeated later on in an article published in the Washington Post [1]. We also compared the history of the US involvement with Iran's nuclear program with the current thinking of the neo-conservatives and their sympathizers on how to prevent the Bushehr reactor from operating, a reactor that, under no conceivable circumstances, can be used for making a nuclear bomb [2].

A major goal of the series has been to debunk the "argument" that the US neo-conservatives and their allies have been making, namely, that given Iran's vast oil and gas reserves, it does not need nuclear energy. The neo-conservatives and their allies, ranging from Israel to Iran's anti-democratic groups (from the terrorist cultist group to the monarchists) and quasi-democratic groups (those whose words wish seemingly nothing for Iran but a secular democratic republic, but whose deeds indicate otherwise [3]) are the only groups that are still hanging onto this absurd argument [4]. The analysis presented in Parts II and IV of this series (and their short versions published elsewhere [5,6]) have made their impact: Iran's nuclear energy program has been transformed from one perceived not to be needed by, or suitable for, Iran to one for which the EU is willing to GUARANTEE the supply of nuclear fuels and advanced nuclear technology (see below), provided that Iran gives up its right for having the complete cycle for producing enriched uranium.

Another goal of this series has been to inform the public, especially the Iranians who live outside Iran, about the benefits and perils of the nuclear energy program that the present Iranian government is pursuing. At the same time, giving wide public exposure to the neoconservatives' thinking about Iran is particularly important.

The Board of Governors (BOG) of the IAEA has had periodic special meetings to review the progress in assessing Iran's nuclear program. In its special meeting held on Monday November 29, 2004, the IAEA reported to the BOG its latest findings on Iran's program, and due to the Paris agreement that Iran had signed with the EU troika - Britain, France, and Germany - for suspending its uranium enrichment program, no further special meeting of the BOG of the IAEA was supposed to be scheduled; that is, Iran's case before the BOG was supposed to have gone back to being a normal, un-urgent case.

However, as usual, recent developments have taken unexpected turns, as a result of which Iran's case before the BOG of the IAEA has, once again, become special. The reason for the latest twist in this saga is that, in mid August, after Iran rejected the long-awaited proposal by the EU troika for curtailment of its uranium enrichment activity in return for economic and political concessions (see below), it restarted the Esfahan facility for converting uranium yellow cake to uranium tetra- and hexafluoride - gaseous compounds (at elevated temperatures) that are used to produce enriched uranium. However, Iran relaunched the process after informing the IAEA which is now monitoring the Esfahan facility. The relaunch of the Esfahan facility was against the Paris agreement according to which Iran was obligated not to start any part of the complete cycle for producing enriched uranium, so long as it was negotiating with the EU troika.

It must be emphasized that producing uranium tetra- and hexafluoride is NOT considered by the IAEA as part of the uranium enrichment process. But, in the highly politicized and polarized environment that exists between Iran, the EU troika, and the US (which has worsened since the election of Mr. Mahmoud Ahmadinejad as Iran's new President), even a process as harmless, by itself, as producing uranium compounds causes much tension. We must also realize that the production of tetra- and hexafluoride in Esfahan is apparently still beset by technical problems. Various reports indicate that the uranium compounds produced there are not suitable for enrichment (see below).

In response to Iran's action, the EU troika has angrily suspended its negotiations with Iran, taking the case back before the BOG of the IAEA, and threatening Iran with a referral to the United Nations Security Council. We must, however, realize that the only valid basis for referring Iran to the Security Council is its breach of the nuclear non-proliferation regime as described in the NPT. However, the IAEA has yet to find any evidence that Iran was or is engaged in a nuclear weapons program. In fact, the IAEA just announced that its tests vindicated Iran's claims that traces of highly enriched uranium found two years ago at Iran's nuclear facilities are from the equipment imported from Pakistani (see below).

The goal of the present part of the series is twofold:

(1) We describe the developments that have led to the present state of affairs between Iran and the EU troika. In the author's opinion, much has been made of the proposal that the EU troika has submitted to Iran, whereas a careful reading of the proposal reveals that while Iran is being asked to give up some of its fundamental rights under the NPT agreement, when it comes to the most important part of an overall agreement between the EU troika and Iran, namely, the security aspects, the EU proposal falls severely short; it does not offer Iran any concrete security guarantees. At the same time, there has been little discussion of what the author considers a reasonable proposal that Iran made last March to its EU counterparts regarding its nuclear fuel cycle, which was, however, ignored completely by the EU troika and the US.

(2) We then discuss whether it is in Iran's national interest to start its full nuclear fuel cycle without reaching a formal agreement with the EU troika and, through them, the US.

Fall 2003: Iran's Weak Position and the Sa'd Abaad Agreement

On October 21, 2003, Iran signed the Sa'd Abaad agreement with the European troika. According to this agreement,

"The Iranian authorities reaffirmed that nuclear weapons have no place in Iran's defence doctrine and that its nuclear programme and activities have been exclusively in the peaceful domain. They reiterated Iran's commitment to the nuclear non-proliferation regime and informed the ministers that:

a. The Iranian Government has decided to engage in full co-operation with the IAEA to address and resolve through full transparency all requirements and outstanding issues of the Agency and clarify and correct any possible failures and deficiencies within the IAEA.

b. To promote confidence with a view to removing existing barriers for co-operation in the nuclear field:

i. having received the necessary clarifications, the Iranian Government has decided to sign the IAEA Additional Protocol and commence ratification procedures. As a confirmation of its good intentions the Iranian Government will continue to co-operate with the Agency in accordance with the Protocol in advance of its ratification.

ii. while Iran has a right within the nuclear non-proliferation regime to develop nuclear energy for peaceful purposes it has decided voluntarily to suspend all uranium enrichment and reprocessing activities as defined by the IAEA..."

These were important PRACTICAL concessions made by Iran. What did Iran gain in return? According to the agreement,

"The Foreign Ministers of Britain, France and Germany welcomed the decisions of the Iranian Government and informed the Iranian authorities that:

Their governments recognise the right of Iran to enjoy peaceful use of nuclear energy in accordance with the nuclear Non-Proliferation Treaty.

a. In their view the Additional Protocol is in no way intended to undermine the sovereignty, national dignity or national security of its State Parties...."

which are nothing but stating the rights that Iran already enjoyed under the Nuclear Non-proliferation Treaty (NPT). Therefore, in essence, Iran gained nothing practical by signing the Sa'd Abaad Agreement, except postponing a serious confrontation with the West. The question then is, why was Iran willing to sign such an agreement which was clearly indicative of its weak position (at that time)? Several factors contributed to Iran's decision to sign the Sa'd Abaad Agreement, some of which are as follows.

(1) Iran had not told the world about its nuclear energy program for 18 years. Although in terms of Iran's legal obligations towards the NPT, hidding the nuclear facilities was NOT illegal [7], the fact is that the world was suspicious of Iran. At the same time, even if Iran was, or still is, trying to make a nuclear bomb (and this is still unclear), most experts agree that it is still years away from achieving this goal [8], simply because Iran does not appear to have solved all the technical problems regarding the enrichment process (see below). Therefore, temporary transparency and openness could help Iran learn more about the process.

(2) In October 2003 the US and Britain had appeared to be the absolute victors in Iraq. Saddam Hussein's regime had been overthrown swiftly, and there was not yet any strong indication that the Sunnies, together with foreign terrorists, would fight back and create the mess that Iraq is today. President Bush had already declared "the end of major combat operations," and had boasted about "mission accomplished." His approval rating was high, and there was still strong support by a majority of Americans for invasion of Iraq. In short, Mr. Bush's "faith-based propaganda" [9] was still working, and had not broken down yet.

(3) The claim that Iraq had a "robust nuclear program" [10] was still believable. The search for the program had only begun recently, and many believed that it would be discovered sooner or later. Therefore, why would the world not believe the same claim about Iran?

(4) The energy market, and in particular the oil market, was not nearly as hot as what it is today. The oil price was in the $30 range (compared with the $60 range today), and there was still considerable oil excess capacity, implying that if Iran's oil exports were eliminated, other oil exporters could increase their production and compensate for the loss, just as they had done for Iraq's production. Moreover, there was "serious" talk of increasing Iraq's oil production to 4 million barrel/day, which has, of course, never materialized.

(5) Internally, the Majles, Iran's parliament, was still controlled by vocal reformists some of whom did not want any nuclear energy program (for example, some members of the Islamic Revolution Mojahedin Organization, and the Islamic Iran Participation Front), while the rest, although supporting the program, were advocating complete transparency in dealing with the IAEA (with which the author agrees completely). Moreover, Mr. Mohammad Khatami was still Iran's President, a man who wanted to make detente with the West not confront it.

In summary, Iran was in an extremely weak situation, and HAD TO sign the Sa'd Abaad Agreement.

Summer 2005: Iran's Strong and Defiant Position

What has changed in little less two years that has made Iran confident (or, perhaps, overconfident) that it can confront the West and come out ahead? Consider the following:

(1) Unlike Fall 2003, the world now knows much about Iran's nuclear program. Yes, there are still serious issues to be resolved (see below), but the fact is that the IAEA has not been able to find any credible evidence - a smoking gun so to speak - that would indicate that Iran is trying to make a nuclear bomb.

(2) Unlike Fall 2003, the insurgency in Iraq is in full swing with no end in sight, which has resulted in high US casualties, as well as huge civilian casualties among the Iraqi population. Even the Taliban are making a come back in Afghanistan. President Bush's approval rating has tumbled to high thirties or low forties, some of the lowest by any president. Nearly two-third of Americans now believe that the invasion of Iraq was a mistake, and that it has made the US LESS secure.

(3) No nuclear weapon, or any "robust program" for making them, was ever discovered in Iraq. Given that right before the invasion the IAEA had declared that there was no such program in Iraq, and that it has also failed to find the same in Iran, it would be difficult to believe that Iran is making a nuclear bomb unless, of course, new dramatic evidence is uncovered.

(4) The oil market is in turmoil. The oil price is in the neighbourhood of $70/barrel, and there is almost no excess capacity in other oil exporting nations left to compensate for Iran's exports - currently about 2.7 million barrel/day - if they are lost due to a confrontation between Iran and the US. At the same time, Iran will make about $60-70 billion in exports, and its foreign debts and obligations are minimal, only about $10 billion. In short, Iran's vulnerability to a worldwide economic sanction (as unlikely as it is) could not be any less.

(5) Through relatively democratic elections, a Shiite-dominated government is now ruling Iraq, led by men who spent years in Iran in exile. When Iraq's Prime Minister, Dr. Ebrahim Al-Jafari, who speaks Persian fluently, visited Iran recently, he put a wreath on Ayatollah Khomeini's grave. He admitted Iraq's responsibility and fault for starting the Iran-Iraq war in 1980, and asked Iran to help it train its armed forces. When Mr. Kamal Kharrazi, Iran's (former) Foreign Minister, visited Iraq recently, he visited Ayatollah Ali Sistani, the most powerful man in Iraq, if not in the entire Shiite world. Ayatollah Sistani has never granted an audience to any Western official. At the same time, radical Iranian elements and factions can create immense problems in Iraq, way beyond what is currently happening there.

(6) China and India, the two most populous nations, have signed huge contracts with Iran, worth well over $100 billion, to import oil and gas from Iran, hence making them dependent on Iran. India is the largest democracy in the world, while China is the up-and-coming superpower. Hence, these countries provide Iran with political support. In particular, it is plausible (but not certain) that China may veto any resolution against Iran, if its nuclear energy program is referred to the UN Security Council. Russia might do the same, since it has great stake in its nuclear copperation with Iran. But, their veto is not by any means guaranteed.

(7) The emergence of the Shanghai Cooperation Organization (SCO), consisting of China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan. The SCO goes back to 1996 when China initiated the Shanghai Five, which included all the current SCO members except for Uzbekistan. The purpose of SCO is to form a network of cooperation among the member States, including military security, economic development, trade and cultural exchange. In its most recent meeting on July 5, 2005, the SCO invited Iran to participate as an observer, which Iran did. Iran is likely to join the SCO sometime in the near future, which will provide it with further political support. The SCO has started asserting itself and flexing its political muscles, with Uzbekistan recently asking the US to evacuate its military forces out of the country, which the US will do soon. Clearly, if the US troops leave Central Asia, it will be an important positive development for Iran.

(8) Iran has started receiving the proceeds from its oil exports in Euro rather than dollar. Over a period time, it will stop receiving dollar altogether, and will completely switch to Euro. This will not only provide more financial stability and security for Iran's foreign exchange reserves, but also will have a negative impact on the oil market in New York.

(9) Internally, the Majles, the presidency, the armed forces, and the judiciary are all controlled by Iran's right wing. Although Iran's right itself is factionalized, but history indicates that when it comes to a common enemy, it becomes completely united.

Thus, Iran is in a strong position which explains its belligerence and defiance. At the same time, unlike what is claimed in the Western Press, Iran's defiance is NOT due to the election of Mr. Ahmadinejad as its new president, rather, as the above discussion should make it clear, is due mostly to the international developments.

Iran's Proposal to the EU Troika

In addition to the above, what contributes to Iran's position strong is the following. For sometime Iran was focused on providing the EU troika with the "objective guarantees" of the peaceful nature of its nuclear program. In fact, on March 23, 2005, Iran submitted to the EU troika a plan of objetive guarantees with the following elements [11]:

(1) Spent reactor fuels will not be reprocessed by Iran, so that no plutonium can be extracted to be used for bomb making.

(2) Iran will forego plutonium production through a heavy water reactor.

(3) Only low-enriched uranium will be produced.

(4) A limit will be imposed on the enrichment level, to be used solely as fuel for reactors.

(5) A limit will be imposed on the amount of enrichment, restricting it to what is needed for Iran's reactors.

(6) All the low-enriched uranium will be converted immediately to fuel rods for use in reactors (fuel rods cannot be further enriched).

(7) The number of centrifuges in Natanz can be limited, at least at the beginning. The full operation of the fuel cycle will be incremental, beginning with the least sensitive part, such as uranium conversion.

(8) The IAEA will have permanent on-site presence at all the facilities for uranium conversion and enrichment.

Items (1)-(7) that Iran has offered to limit, or to give up altogether, are actually allowed by Article IV of the NPT. Therefore, any objective person who is even remotely familiar with producing fuels for nuclear reactors would agree that what Iran proposed in March 2005 was a substantial, if not complete, step towards providing the EU troika and the US with the "objective guarantees" that they are supposedly looking for. In fact, item (8) goes even beyond the provisions of the Additional Protocol on the NPT that Iran signed in December 2003, and has been implementing ever since. At the minimum, Iran's proposal could have been the basis for further negotiations. But, the EU negotiators never responded to Iran's offer; they simply ignored it, hence demonstrating their nations' utter arrogance [12].

The Proposal of the EU Troika to Iran

The long-awaited proposal by the EU troika, "The Framework for a Long-Term Agreement," was submitted to Iran in early August. In the author's opinion, the proposal does contain several important elements. For example,

(1) it tries to force Iran to commit to combating terrorism (article 9), hence stopping many adventuresome aspects of Iran's foreign policy over the past twenty five years, such as supporting radical groups in the Middle East, which have done nothing but grossly damaging Iran's national interests;

(2) it recognizes Iran's right to developing the infrastructure for peaceful use of nuclear energy and research (articles 14 and 15) (these rights have, however, been recognized by the NPT);

(3) it recognizes Iran's right to have access to "international nuclear technology market" (article 18);

(4) it offers to provide expert help for safety aspects of Iran's program (article 20b);

(5) it offers to facilitate Iran's access to the international market for nuclear reactors fuels (article 23);

(6) it offers to help Iran develop a "buffer store" of 5 years of fuel supplies for the reactors in case either the supplies dry up, or the suppliers refuse to provide Iran more fuels for the reactors (article 30), and

(7) it proposes a mechanism for addressing the situation that arises in (6) (articles 27-29), although the mechanism is tedious.

However, certain aspects of the EU proposal are either against the existing international agreements, or their language is vague and leaves a lot to be desired. For example, the proposal demands that Iran (emphasis with capital letters added)

"make a legally binding commitment not to withdraw from the NPT and to keep all Iranian nuclear facilities under IAEA safeguarded UNDER ALL CIRCUMSTANCES" (article 36a).

The commitment not to withdraw from the NPT is even against the NPT itself, which allows the member States to withdraw from the agreement, subject to giving a 90 days notice to the IAEA, if the States believe that abiding by the terms of the NPT threatens their national security, and withdrawing from the NPT is in their "Supreme Interest."

At the same time, why is Iran's case so different that requires new skewed interpretation of the NPT's provisions, or creating new obligations for Iran that do not even exist in the international agreements regarding nuclear weapons? If Iran has violated certain aspects of the Safeguards Agreement by not reporting to the IAEA what it has been doing (which is still a matter of debate), it has not been the LONE violator. Over the past year alone, the IAEA has reported that South Korea, Taiwan, and Egypt have, at various times, violated the provisions of the NPT by secretly engaging in experiments on uranium enrichment and even bomb making. Brazil, a country that provided nuclear assistance to Saddam Hussein's regime in the 1980, refused, for a long time, granting permission to the IAEA to visit and inspect its uranium enrichment facilities under construction. Where is the international outcry over these violations?

Therefore, if Iran is to make a commitment not to withdraw from the NPT, the logical first step is to revise the terms of the NPT agreement, so that the commitment would become binding for ALL the member States, not just Iran. In addition, the revisions must address the all important issue of what to do about nuclear powers that are NOT signatories to the NPT, namely, India, Israel, and Pakistan, all in Iran's vicinity, with the latter two posing great threats to Iran's national security.

In addition, the "Political and Security Co-Operation" section of the EU proposal leaves a lot to be desired. Let us review a portion of it (article 4):

"Within the context of an overall agreement and Iran's fulfilment of its obligations under the Treaty on the Non-Proliferation of Nuclear Weapons (NPT), the United Kingdom and France would be prepared to reaffirm to Iran the unilateral security assurances given on 6 April 1995, and referred to in United Nations Security-Council Resolution 984 (1995). Specifically:

the United Kingdom and the French Republic would reaffirm to Iran that they will not use nuclear weapons against non-nuclear weapon States Parties to the Treaty on the Non-Proliferation of Nuclear Weapons except in the case of an invasion or ANY attack on them, their dependent territories, their armed forces, or other troops, their allies or on a State towards which they have a security commitment, carried out or sustained by such a non-nuclear-weapon State in association or alliance with a nuclear-weapon State...."

Such guarantees actually leave open the possibility of a nuclear or even non-nuclear attack on Iran because, as is clear in the above paragraph, immediately after promising not to attack Iran, a long list of "exceptional" cases which can provoke an attack is mentioned. Moreover, Iraq was invaded and occupied not through a nuclear attack, but by conventional forces. So, the question is, where is the guarantee that Britain and France (and, for that matter, Germany) will not participate in a war similar to the invasion of Iraq using conventional forces?

Even if full guarantees, with no ifs, buts, and exceptions, are provided, where is the guarantee that the US will not attack Iran? Where is the guarantee that its proxies, such as Israel, will not attack Iran? The proposal is silent about these aspects, except where it states that (article 4b):

"the United Kingdom and the French Republic would recall and reaffirm, as Permanent Members of the Security Council, to seek immediate Security Council action to provide assistance, in accordance with the Charter [of the UN], to any non-nuclear State, party to Treaty on the Non-Proliferation of Nuclear Weapons, that is a victim of an act of aggression or an object of a threat of aggression in which nuclear weapons are used."

In other words, the proposal guarantees nothing when it comes to the use of conventional forces, and even in the case of an aggression in which nuclear weapons are used, all the EU troika will do will be seeking "immediate Security Council action," presumably after tens (if not hundreds) of thousands of innocent people have already perished during the aggression.

The New IAEA Report and its Absurd Demands

As mentioned above, two years ago the EU troika insisted through the Sa'd Abaad Agreement that Iran must "voluntarily" sign the Additional Protocol to the NPT, which Iran did and began implementing. But, in his September 3, 2005 report to the BOG of the IAEA [13] entitled, "Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran", Dr. Mohamed ElBaradei, chief of the IAEA, has reported on the following item:

(1) Iran has submitted to the IAEA comprehensive declarations with respect to its nuclear facilities, including design information (article 5).

(2) In view of Iran's steady cooperation and increasing transparency, resolving the outstanding concerns (see below), the IAEA believes that Iran's nuclear issue "would be followed up as matters of routine safeguards" (article 6).

(3) Other than some delays and slowness in providing information on the design aspects, "no additional failures have been identified" by the IAEA (article 8).

(4) Certain aspects of Iran's previous declarations, especially the "outstanding issue" of the sources of contamination of Iran's equipment with high-enriched uranium which has turned out to be Pakistan (as had been widely believed), have been verified (article 12).

(5) Several Iranian "transparency measures," well beyond the Additional Protocol, are reported, including allowing inspection access to Iran's military bases (article 37).

(6) The report cites "good progress" in Iran's "corrective measures" since October 2003 (article 43).

(7) The report declares that, "all the declared nuclear material in Iran has been accounted for, and therefore such material has not been diverted to prohibited activities" (article 51).

(8) The report confirms again again that Iran's uranium enrichment facilities at Natanz have remained suspended; that the converted uranium had been relocated to safe storages, and that the uranium hexafluoride "remained under agency seals" (article 59).

(9) It admits that, "the agency's legal authority to pursue the verification of possible nuclear weapons-related activity is limited" (article 49).

This is, of course, a basic problem of the non-proliferation regime which transcends Iran, but is being selectively applied to Iran. After admitting this general shortcoming, the report states that Iran's transparency (emphasis with capital letters added)

(10) "should extend beyond the formal requirements of the Safeguards Agreement and Additional Protocol and include ACCESS TO INDIVIDUALS, documentation related to procurement, dual-use equipment, certain MILITARY-OWNED WORKSHOPS and research and development locations" (article 50).

Such demands are clearly pure political pressure far beyond any requirements demanded by the NPT and its Additional Protocol. In fact, Iran is being asked to comply with demands that are reminiscent of what Iraq was being asked to do in the months leading to its illegal invasion by the US and Britain. In essence, what the report is demanding is that Iran should reveal its sensitive military information. If Iran were to go along, where would the demand list end?

In addition, it is not even clear why, with so many positive aspects of Iran's cooperation with the IAEA reported by the IAEA, Iran should accede to such additional demands. This is particularly baffling in view of the IAEA's own discovery about Iran's deals with Pakistan's Abdul Ghadeer Khan, indicating that Iran turned down his offers of nuclear-weapons designs in the 1980s, which should reinforce Iran's position that it is not interested in acquiring nuclear weapons. What happened to President Bush's declaration at the National Defense University on February 11, 2004 that, "I propose that by next year, only States that have signed the Additional Protocol be allowed to import equipment for their civil nuclear programs"?

Lack of Mutual Trust and the Emerging Crisis

Given the above, the question is: What is REALLY at issue in the confrontation between Iran, the EU troika, and the US? The issue, as Dillip Hiro [14] put it, is:

"Do Third World countries have the right to develop and use all nuclear technology, including enrichment, as authorized by the Nuclear Non-proliferation Treaty, or not?"

Iran believes that the answer is an unequivocal "Yes," and is not alone in its stance: The Non-Aligned Movement, which has a membership of 116 nations (and includes such important nations with nuclear technology as Brazil, India, and South Africa), agrees. So, whether intended or not, Iran has become the champion of the developing nations, willing to stand up to the Western world. Moreover, whether we like it or not, Iran's stance has won it quiet admiration by Non-Aligned nations, as they fear that the limitations that the EU and the US are trying to impose on Iran could be extended to them eventually.

The EU troika does not deny the right. But it (and the US) wants Iran to give up its rights under the NPT FOREVER (article 34 of the EU proposal) in return for the commitments described above.

Why do the EU and the US want Iran to give up its right for having the complete cycle for producing enriched uranium? Their main argument is that, since Iran hid its nuclear energy program for 18 years, it has, in essence, given up that right. In essence, it is, more than anything else, an issue of trust between two hostile sides. As President Bush stated in a news conference on April 28, 2005, at the White House,

"America recognises that we cannot trust the Iranians when it comes to enriching uranium . . . they should not be allowed to enrich uranium."

In the author's opinion, there is not much merit to the argument that, "we do not trust Iran because it hid its nuclear program." To see why consider the following:

(1) As explained in Part II of this series, beginning in 1982, Iran started pursuing Germany to complete the reactors in Bushehr. It tried any and all the reasonable (and some not so reasonable) approaches in order to get Germany live up to its obligations; it never succeeded. If anything, Iran's efforts were indicating clearly to the West that it WAS pursuing a nuclear program. At the same time, the (West) German intelligence agency was the first to declare in 1984 that, "Iran was only TWO YEARS away from a nuclear bomb" [15].

(2) As noted in Ref. [6], under the provisions of the Safeguard Agreement of IAEA, building the Natanz facility and not declaring it were NOT illegal (though they were clandestine), so long as 180 days before introducing any nuclear materials into the facility Iran notified the IAEA, which Iran did long before the 180 days period. As has been emphasized in this series of articles, the difference between being clandestine and illegal has not been understood in the Western press; constructing the Natanz facility is constantly referred to as Iran's "breach of its obligations."

(3) The truth is that the EU troika and the US do not wish Iran to have the uranium enrichment facilities, REGARDLESS of what Iran does or does not. To see this one only needs to consider Iran's proposal of March 2005. At the same time, does anyone really believe that if, in 1985, Iran had declared its intention for constructing its present enrichment facilities, the US and the EU troika would have rushed in to help it, or even allowed Iran to proceed? It is difficult, if not impossible, to imagine any scenario under which this would have happened. So, the issue is not one of hiding something, rather not wanting Iran to possess the enrichment facilities and technology under any circumstances.

However, Iran's reactionary right has done too many things to make the world suspicious or distrustful of Iran, some of which, in the author's opinion, are as follows.

(1) The hardliners have suppressed Iran's democratic movement and violated, on a steady and consistent basis, the personal, social, political, and economical rights of Iranians. In fact, in the author's opinion, lost in the international fury over Iran's nuclear energy program has been the fact that, respect for human rights and a democratic political system are the most effective deterrent against the threat that any aspiring nuclear power run by an undemocratic government may pose to the world. When the US strongly pushed the Shah to start Iran's nuclear energy program at a time that it had no economic justification (see Parts II and IV of this series), instead of pushing him to undertake meaningful political reforms, it helped creating the Frankstein now called Iran's nuclear program.

A democratic political system in Iran greatly reduces and even eliminates the threat that its nuclear program may pose to the world because, in the author's opinion, the danger per se is not that Iran may have nuclear weapons (which it does not), but that some of its most important power centers and decision-making process are shrouded with secrecy. A free press in Iran - a pillar of human rights - will reveal nuclear adventures that Iran's hidden power centers may pursue against Iran's national interests [16].

Since 1970s, when the Shah started Iran's nuclear program, India, South Africa, North Korea, Pakistan, and Israel have joined the nuclear club. In the 1980s South Africa's apartheid regime produced nuclear bombs, but the democratic government of Nelson Mandella dismantled them. India, has developed a nuclear arsenal, but not many perceive world's largest democracy as a threat to the world. The same is true about Israel.

But, North Korea's nuclear arsenal is a threat because its regime is highly secretive and its leader a recluse. Pakistan's nuclear arsenal is extremely dangerous (even if the US does not acknowledge it) because Pakistan is an essentially failed State. Its nuclear-armed military, populated by Islamic extremists, created the Taliban which supported Osama bin Laden. Pakistan has a sectarian war in which the majority Sunni population has been murdering the Shiite minority, and many of its schools teach Islamic radicalism. Could Abdul Ghadeer Khan, the founder and owner of Pakistan's nuclear supermarket, have operated freely for so long without the support of some elements of its military? Could he have operated in a democratic Pakistan with a free press to reveal the depth of his dangerous enterprise?

Aside from the nature of Iran's hardliners which cannot be conducive to building trust between Iran and the international community, several questions about Iran's nuclear energy program remain unresolved:

(2) When did Iran obtain the design for the advanced P-2 centrifuges? Why did it not pursue its construction? or, has it?

(3) Why did Iran experiment for sometime uranium enrichment using lasers? Surely, laser enrichment is not economical, and can be justified only in the framework of a military program for which there is no limit to the budget that can be spent.

(4) Why was the Bandar Abbas uranium mine not declared to the IAEA for quite some time? How much uranium deposits does Iran possess, any way [17]?

(5) At least three companies - Kaalaa-ye Electric, Pars Taraash, and Faraayand Technic - supposedly having nothing to do with Iran's nuclear program - have turned out to be providing support for it. Iran must be prepared to address the issue of such companies in a systematic way, because it is likely that the IAEA will press Iran on this issue in the future.

But, this is not the complete story, but only half of it. The lack of trust between Iran, the EU, and the US is also due to the other half of the story, which is about the "guarantees" given by France, Germany, and the US to Iran that later on turned out to be "non-binding." Consider the following (which represents just the tip of the iceberg) [18]:

(1) As described in Part I and mentioned above, Germany was supposed to build two nuclear reactors in Bushehr. The construction of the reactors was begun and made considerable progress. But Germany stopped the work after the Iranian Revolution. It neither paid Iran back what it owed, nor did it finish building the reactors, nor delivered the parts that had already been purchased and paid for.

(2) Iran paid in 1975 $1 billion to buy 10% of Eurodif, a French company that produces enriched uranium. In return Iran was supposed to receive enriched uranium for its reactors, but has never received any. France was also supposed to construct nuclear reactors in Khuzestan province, but it never did.

(3) The Shah spent billions of dollars in the 1970s to purchase US made weapons. The US was obligated to provide Iran with the spare parts for the weapons. But, when the Iran-Iraq war began, the US refused to supply Iran with the spare parts which had already been paid for. But the US did not stop there. Donald Rumsfeld travelled to Baghdad in December 1983, had a friendly meeting with Saddam Hussein, and informed him that the US, although officially neutral, was going to "tilt" towards Iraq. The US then started supplying Iraq with detailed information on troops movement in Iran, and other valuable information.

(4) Historical factors also play important roles in the distrust of the Europeans by Iran. The Golestan and Turkmenchaay Treaties, signed in 1811 and 1827 between Iran and Russia, forced Iran to give up, under force, a large portion of its historical territories. Later on in 1867, the British empire did the same to Iran when it used force to separate Afghanistan from Iran. The 1953 coup d'etat overthrew the government of Iran's national hero, Dr. Mohammad Mosaddegh. These historial events, with gigantic implications, have left deep scars on Iran's historial memory.

Therefore, the lack of trust between Iran, the EU, and the US is mutual. While the EU nations have many good reasons to distrust Iran, they also have a track record of promises that they had made to, and obligations that they had towards, Iran, which were broken and violated later on.

Iran's Technical Problems: A Reason for Caution

While the Western Press has been trying to create a menacing image of Iran's nuclear energy program, now that the Esfahan facility has started operating again, the reality, which should prevent the EU from panicking, is quite different. The fact is that Iran faces many difficulties in operating both the Esfahan and Natanz facilities [19,20], with the latter facility being currently sealed, anyway. Iran had major problems with the Esfahan facility in 2004 when it produced uranium hexafluoride, which was unsuitable for enrichment because it contained impurities that prevent its enrichment. Another problem is obtaining suitable materials for handling and storing uranium hexafluoride, which is in a solid state at room temperature, but makes a transition to the gaseous state at about 135 F. Whether Iran has overcome such difficulties is not known yet. A third problem Iran is facing is about its centrifuge facility at Natanz. Apparently, Iran has been unable to keep the centrifuges running for a sufficient length of time at the required speeds.

At the same time, most experts believe that the IAEA inspections and safeguards will prevent Iran from directly using facilities declared to the IAEA for its weapons program (if one exists), so long as Iran does not withdraw from the NPT. A November 2004 report by the CIA supported these assertions. However, if Iran's program is referred to the Security Council, and the Council imposes tough sanctions against Iran (the possibility of which AT PRESENT is remote), Iran may withdraw from the NPT and expel its inspectors. Then, what Iran's hardliners do next is anybody's guess. It is not in the interest of the world to arrive at such a frightening moment.

Summary: Is Defiance in Iran's National Interest?

In the author's opinion, although Iran's current position is very strong, it is not in its national interest to be referred to the UN Security Council. The reason is threefold:

(1) Although Russia and China are both opposed to referring Iran's nuclear program to the United Nations Security Council, their veto of a resolution against Iran is NOT guaranteed. An approved resolution, even if it is mild, will be used by the War Party in the US as an exuse for staging military attack against Iran.

(2) If the Security Council does pass some resolution against Iran, it will have the legitimacy of the UN and, therefore, Iran will be isolated. In short, Iran must realize that, (i) it cannot afford to lose in the court of public opinion, and (2) while it might win the current battles with the EU troika, it may lose the ultimate war at the Security Council.

(3) Although Iran is entitled to having the complete cycle for producing enriched uranium, it does not have any urgent need for it. The fuel for the Bushehr reactor has been guaranteed by Russia, and any new reactor to be constructed in Iran is years away. Thus, once again, there is no need to put Iran in a position where the War Party in the US may become tempted to attack it, which would inflict immeasurable damage on Iran's industrial and population centers. Protecting Iran against such attacks is far more important than having the cycle for enriching uranium: Without a prosperous and safe Iran it makes no sense to speak of uranium enrichment.

At the same time, the EU and the US must also realize the following:

(1) Referring Iran to the Security Council is not in the interest of the international community, because in that case Iran may carry out its threat of withdrawing from the NPT. That would destroy the already troubled non-proliferation regime and, instead of full transparency, the IAEA will find Iran back in the pre-2003 era.

(2) In addition to being economically viable and necessary, Iran's nuclear energy program also has to do with nationalism and pride. If the EU and the US ignore this aspect, it will cause lasting repercussions, setting back the relations between Iran, the US, and the EU for a long time.

(3) In the author's opinion, the way to address the problem of Iran's nuclear program is not by threatening it with military strikes, but by providing Iran with incentives to move towards a democratic and transparent political system which would make its nuclear program benign. The Achiles' heel of Iran's hardliners is not their possible violation of Iran's international nuclear obligations that may drag them before the Security Council to bring about their eventual fall, but their violation of human rights of Iranians, including suffocating Iran's independent press.

(4) It is no accident that Iran's nuclear program began accelerating in 1997 when Mohammad Khatami was elected president, and began implementing a program of reform and more transparency. Since then, instead of helping Iran's fledgling democratic movement, which would have inevitably led to transparency in its nuclear program, the US has been hurting it. Whereas Mr. Khatami proposed people-to-people dialogue between the US and Iran, the US has prevented Iranian scholars and authors from publishing their work in the US. Whereas Iran greatly helped the US in the war in Afghanistan, the US bestowed upon it the "honour" of being a member of "Axis of Evil!" In return for the overwhelming victory of Iran's democratic forces in the 2000 elections for the Majles, the US lifted sanctions against importing Iranian pistachios! The US repeats the claim that Iran does not need nuclear energy because it has plenty of oil and natural gas, yet it has blocked the US oil companies to invest in Iran's oil industry. It is because of such contradictions in the US policy towards Iran that it is difficult for ANY Iranian leader to trust the US.

The proposals by Iran and the EU both have many positive elements. The Natanz facility remains suspended and sealed, and Iran faces many technical difficulties to operate a complete uranium enrichment cycle. Hence, there is no reason for the EU to panic just because the conversion of the yellow cake to uranium tetra- and hexafluoride, which the IAEA does not even consider as part of an enrichment process, has started. Through patience, flexibility, and mutual understanding, the two proposals can be combined into one coherent proposal that satisfies Iran's aspirations and the EU's and the US' concerns.

References and notes

[1] See, Dafna Linzer, "Past Arguments Don't Square with Current Iran Policy," the Washington Post, March 27, 2005.

[2] See Parts IV and V of this series for detailed discussions of this point. See also, T.R. Stauffer, "Unlike Dimona, Iran's Bushehr Reactor Not Useful for Weapons-Grade Plutonium," Washington Report on Middle East Affairs (September 2003), p. 28, as well as, www.washington-report.org/archives/sept03/0309028.html

[3] A good example of such quasi-democratic groups is an Iranian political journalist based in Europe and his cohorts in Los Angeles. They repeat, VERBATIM, whatever non-sense the neo-conservatives claim about Iraq and Iran. The same people had a "joyous" (sickening to the author though) scream on an Iranian satellite TV channel on March 19, 2003 - the day the US and Britain began their illegal invasion of Iraq - stating their hope and dream that, "Iran will soon have such a day." What has been happening in Iraq since then has not, of course, made them reconsider their "wish," simply because they do not understand a simple fact: Without defending Iran's national interests, it is meaningless to speak of democracy and human rights.

[4] On July 5, 2005, at a joint news conference with France's Foreign Minister Philippe Douste-Blazy, Secretary of State Condoleezza Rice said, "the United States does not see the need for a civilian nuclear program in oil-rich Iran," despite the fact that in the same news conference she said that the US strongly supports the EU-Iran neogotiations, and that the EU has recognized Iran's right and need for NPPs. To read about the news conference see, www.state.gov/secretary/rm/2005/48932.htm

[5] M. Sahimi, P. Mojtahedzadeh, and K.L. Afrasiabi, "Iran Needs Nuclear Reactors," International Herald Tribune, October 14, 2003.

[6] M. Sahimi, "Forced to Fuel: Iran's Nuclear Energy Program," Harvard International Review, Volume XXVI (No. 4), Winter 2005, p. 42.

[7] According to the original IAEA Safeguard agreements, Iran was not obligated to declare the start of construction of the Natanz facility for uranium enrichment. These agreements stipulate that, only 180 days before introducing any nuclear material, must Iran declare the existence of the facility. Therefore, construction of the undeclared Natanz facility is NOT by itself a violation of the NPT. In addition, the NPT does allow Iran to legally build any nuclear facility, including one for uranium enrichment, so long as it is declared to, and safeguarded by, the IAEA, and is intended for peaceful purposes.

[8] The latest US National Intelligence Estimate on Iran's nuclear program states that Iran is about 10 years away from making a nuclear bomb. See, Dafna Linzer, "Iran Is Judged 10 Years From Nuclear Bomb," The Washington Post, August 1, 2005. To view the article, see, www.washingtonpost.com/wp-dyn/content/article/2005/08/01/AR2005080101453.html See also Refs. [19] and [20] below.

[9] This phrase was taken from F. Rich's column, "Falluja Floods the Superdome," The New York Times, September 4, 2005.

[10] This is the phrase that Vice President Dick Cheney used frequently prior to invasion of Iraq.

[11] Excellent discussions of Iran's proposal are given by G. Prather (a physicist who has worked in the Departments of Energy and Defence). See, for example, "What the Neo-Crazies Knew," August 13, 2005, in www.antiwar.com/prather/?article=6269 See also Prather's August 8, 2005 article, "EU vs. Iran: Who's Right?" at www.antiwar.com/prather/?article=6901

[12] See also, T. Parsi, "Europe's Mendacity Doomed Iran Talks to Failure," the Financial Times of London, August 30, 2005. To view the article, see news.ft.com/cms/s/0cfd2c90-1980-11da-804e-00000e2511c8.html

[13] For a thorough analysis of the IAEA report see, K.L. Afrasiabi, "ElBaradei's Report Deconstructed," September 7, 2005, at atimes.com/atimes/Middle_East/GI07Ak05.html

[14] Dillip Hiro, "Iran's Nuclear Ambitions," the Nation Magazine, September 12, 2005. To view the article see, www.thenation.com/doc/20050912/hiro

[15] D. Leglu, Liberation (Paris), April 29, 1984.

[16] See also, Shirin Ebadi and M. Sahimi, "In the Mullahs' Shadow," the Wall Street Journal, June 15, 2005.

[17] Estimates on Iran's natural uranium deposits vary widely. They range anywhere from enough deposits to produce fuel for only one 1000 MW reactor for 6-7 years, which is what the US claims (hence pointing out that such small deposits do not justify an enrichment program, unless it is for military purposes), to much larger amounts cited in Part II of this series. The true amount is likely to be something in between.

[18] See also, F. Mokhtari, "Coping with Iran's Nuclear Ambitions," the Los Angeles Times, August 22, 2005. To view the article see, www.latimes.com/opinion/printedition/california/la-oe-mokhtari22aug22,1, 1689359.story?coll=la-headlines-pe-california

[19] P. Kerr, "Back to Normal, Iran Nuclear Abilities Limited," Arms Control Association, September 6, 2005. To view the article see, www.armscontrol.org/act/2005_09/IranLimits.asp?print/act/2005_09/IranLimits.asp

[20] See also, A. Cowell, "Nuclear Weapon is Years off for Iran, Research Panel Says," the New York Times, Wednesday September 8, 2005, p. A11.

Original URL: http://www.payvand.com/news/05/sep/1070.html

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About the author: Muhammad Sahimi is Professor of Chemical Engineering and Materials Science, and NIOC Professor of Petroleum Engineering at the University of Southern California in Los Angeles. Since 1986 he has been a member of the Union of Concerned Scientists - an organization dedicated to preventing the spread of nuclear weapons - and a contributor to its Partners for Earth Program. He has also been a visiting professor in Australia, Europe, and the Middle East, and a consultant to many energy firms around the world. In addition to his scientific work, his political articles have appeared as book chapters, on various websites, and in such publications as the Los Angeles Times and the Wall Street Journal.