Daily Press Briefing for September 28, 2005 - IRAN - Transcript - Sean McCormack, Spokesman - Washington, DC

QUESTION: What's your reaction to the protests in Iran around the British Embassy? This is a reaction to the IAEA vote, I presume, were there to be a U.S. embassy, they would be protesting there.

MR. MCCORMACK: Right. Well, I'll leave it to those on the ground to describe the protests there and who might be organizing those protests. The position where Iran finds itself right now, I think, is one that is probably a surprise to them after the IAEA Board of Governors vote. And where they find themselves is more isolated from the international community than when they started. And I think you can really trace back the point at which they started to further isolate themselves in the most recent sense to the Iranian President's speech before the General Assembly and their failure to field any ground whatsoever in the run-up to the Board of Governors' vote. The EU-3 as well as other members of the Board of Governors urged the Iranians to return to the negotiating table, to cooperate with the IAEA, to answer those outstanding questions that the international community has regarding Iran's nuclear programs and what we say is their pursuit of nuclear weapons under the cover of a civilian nuclear program. So what we have now is a statement of finding of noncompliance of Iran with their international obligations. Iran now has an opportunity. They have an opportunity in the coming days, weeks and months to return to the negotiations with the EU-3, engage in those negotiations in a constructive manner and also to cooperate with the IAEA. There will be a report from the IAEA to the Security Council and what is in that report, describing Iran's actions and the state of the cooperation with the international community will be up to Iran. We'll see if they decide to cooperate. We'll see if they decide to return to negotiations. But what the Iranian Government heard was a very clear message from the international community and that message was that the international community does not want Iran to obtain nuclear weapons. That would be a destabilizing action and they also made it very clear they don't think that Iran should have -- because of its past behavior, access to sensitive nuclear fuel cycles. So we'll see. We'll see what the coming days and weeks brings, but it really is up to Iran in terms of their actions and what they do and what is contained in that report to the Security Council. Yes.

QUESTION: You are not afraid that Iran could radicalize its position and leave or stop cooperating with the IAEA altogether?

MR. MCCORMACK: Well, what we've seen is that the defiant Iranian attitudes towards the international community has gotten to the point where they find themselves now, and that is further isolated than when they began. They were in negotiations with the EU-3. The EU-3 was engaged in those negotiations in good faith, trying to resolve the issue. And that issue concerns Iran's pursuit of nuclear weapons, so we'll see what Iran -- what actions Iran does and what attitude that they have. But I think that what the international community has seen through this speech at the United Nations, as well as in its subsequent actions, is really the true face of this new government and so we'll see. We'll see what Iran does in the coming days and weeks. We urge them to return to the negotiating table and to negotiate with the IAEA and to cooperate with the IAEA.

QUESTION: The situation here is that being cornered may contribute to a situation where they strike out even more radically than they would have otherwise. For instance, they're threatening to proceed with enrichment of uranium. And yesterday a former top State Department official has said that there's some belief within the administration they've actually begun that, buying technology around the world. Aren't you concerned that if cornered, Iran might be even more dangerous? I don't want to draw parallels, you know, too soon, but you know, you've begun to speak soothingly to North Korea and stopped beating on their heads and -- I mean, the State Department -- and maybe it paid dividends, maybe it didn't. I think the suggestion or the question -- (inaudible) the same thought, is isn't there some concern here that Iran is being cornered and isolated? Doesn't that have a bad -- couldn't that have bad results?




Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran

(a) Recalling the resolutions adopted by the Board on 11 August 2005 (GOV/2005/64), 29 November 2004 (GOV/2004/90), 18 September 2004 (GOV/2004/79), 18 June 2004 (GOV/2004/49, 13 March 2004 (GOV/2004/21), 26 November 2003 (GOV/2003/81) and on 12 September 2003 (GOV/2003/69), the statement of the Board of 19 June 2003 (GOV/OR.1072) and the Chairman of the Board's conclusions of March 2005 (GOV/OR.1122) and of June 2005 (GOV/OR.1130),


(b) Recalling that Article IV of the Treaty on the Non Proliferation of Nuclear Weapons stipulates that nothing in the Treaty shall be interpreted as affecting the inalienable rights of all the Parties to the Treaty to develop research, production and use of nuclear energy for peaceful purposes without discrimination and in conformity with Articles I and II of the Treaty,


(c) Commending the Director General and the Secretariat for their professional and impartial efforts to implement the Safeguards Agreement in Iran, to resolve outstanding safeguards issues in Iran and to verify the implementation by Iran of the suspension,


(d) Recalling Iran's failures in a number of instances over an extended period of time to meet its obligations under its NPT Safeguards Agreement (INFCIRC 214) with respect to the reporting of nuclear material, its processing and its use, as well as the declaration of facilities where such material had been processed and stored, as reported by the Director General in his report GOV/2003/75 dated 10 November 2003 and confirmed in GOV/2005/67, dated 2 September 2005,


(e) Recalling also that, as deplored by the Board in its resolution GOV/2003/81, Iran's policy of concealment has resulted in many breaches of its obligation to comply with its Safeguards Agreement,


(f) Recalling that the Director General in his report to the Board on 2 September 2005 noted that good progress has been made in Iran's correction of the breaches and in the Agency's ability to confirm certain aspects of Iran's current declarations,


(g) Noting that, as reported by the Director General, the Agency is not yet in a position to clarify some important outstanding issues after two and a half years of intensive inspections and investigation and that Iran's full transparency is indispensable and overdue,


(h) Uncertain of Iran's motives in failing to make important declarations over an extended period of time and in pursuing a policy of concealment up to October 2003,


(i) Concerned by continuing gaps in the Agency's understanding of proliferation sensitive aspects of Iran's nuclear programme,


(j) Recalling the emphasis placed in past resolutions on the importance of confidence building measures and that past resolutions have reaffirmed that the full and sustained implementation of the suspension notified to the Director General on 14 November 2004, as a voluntary, non legally binding confidence building measure, to be verified by the Agency, is essential to addressing outstanding issues,


(k) Deploring the fact that Iran has to date failed to heed the call by the Board in its resolution of 11 August 2005 to re-establish full suspension of all enrichment related activities including the production of feed material, including through tests or production at the Uranium Conversion Facility,


(l) Also concerned that Iran has to date failed to heed repeated calls to ratify the Additional Protocol and to reconsider its decision to construct a research reactor moderated by heavy water, as these measures would have helped build confidence in the exclusively peaceful nature of Iran's nuclear programme,


(m) Noting that the Director General reported that the Agency continues to follow up on information pertaining to Iran's nuclear programme and activities that could be relevant to that programme and that “the Agency’s legal authority to pursue the verification of possible nuclear weapons related activity is limited (GOV/2005/67),


(n) Endorsing the Director General's description of this as a special verification case, and


(o) Noting that the Agency is still not in a position to conclude that there are no undeclared nuclear materials or activities in Iran,


1. Finds that Iran's many failures and breaches of its obligations to comply with its NPT Safeguards Agreement, as detailed in GOV/2003/75, constitute non compliance in the context of Article XII.C of the Agency's Statute;


2. Finds also that the history of concealment of Iran's nuclear activities referred to in the Director General’s report, the nature of these activities, issues brought to light in the course of the Agency's verification of declarations made by Iran since September 2002 and the resulting absence of confidence that Iran's nuclear programme is exclusively for peaceful purposes have given rise to questions that are within the competence of the Security Council, as the organ bearing the main responsibility for the maintenance of international peace and security;


3. Requests the Director General to continue his efforts to implement this and previous Resolutions and to report again, including any further developments on the issues raised in his report of 2 September 2005 (GOV/2005/67) to the Board. The Board will address the timing and content of the report required under Article XII.C and the notification required under Article III.B.4;


4. In order to help the Director General to resolve outstanding questions and provide the necessary assurances, urges Iran:


(i) To implement transparency measures, as requested by the Director General in his report, which extend beyond the formal requirements of the Safeguards Agreement and Additional Protocol, and include access to individuals, documentation relating to procurement, dual use equipment, certain military owned workshops and research and development locations;


(ii) To re-establish full and sustained suspension of all enrichment-related activity, as in GOV/2005/64, and reprocessing activity;


(iii) To reconsider the construction of a research reactor moderated by heavy water;


(iv) Promptly to ratify and implement in full the Additional Protocol;


(v) Pending completion of the ratification of the Additional Protocol to continue to act in accordance with the provisions of the Additional Protocol, which Iran signed on 18 December 2003;


5. Calls on Iran to observe fully its commitments and to return to the negotiating process that has made good progress in the last two years;


6. Requests the Director General to continue his efforts to implement the Agency's Safeguards Agreement with Iran, to implement provisionally the Additional Protocol to that Agreement, and to pursue additional transparency measures required for the Agency to be able to reconstruct the history and nature of all aspects of Iran's past nuclear activities, and to compensate for the confidence deficit created; and


7. Decides to remain seized of the matter.






September 24–25, 2005

Statement by the Hon. DAVOUD DANESH JA’FARI,
Governor of the Bank for the ISLAMIC REPUBLIC OF IRAN,
at the Joint Annual Discussion
[EXCERPT] Mr. Chairman, Distinguished Governors

Now let me bring to your kind attention the latest developments in my country. The Islamic Republic of Iran has pursued the economic and social and reform strategies within the framework of the country's Development Plans. In this regard a package of reform policies were implemented in the context of the third 5 year development plan during the period of 2000/04 and many considerable and significant results have been achieved.

The Islamic Republic of Iran has the second largest population in MENA region. Most of them are young with increasing expectations of a better life and future. There are also a large number of well – educated women seeking opportunities to partake in different areas of economic and social activities. Despite significant progress in the country’s activities for poverty reduction and human development, creating enough job opportunity to meet the new flows into labor market along with extensive reduction of unemployment is required. In order to overcome this problem, high and sustainable economic growth with enough employment opportunities should be ensured. We strongly believe that economic development can not be achieved unless, attractive investment climate and broader participation of private sector in the economy is provided and promoted. In the same line the strategic policies deduced from the article 44 of the constitution implying the boundaries and areas of performance of state-owned, cooperative and private entities were elaborated and specified by the government. In these new introduced policies, the ground is paved for more private sector involvement in different economic and financial activities, specially in those areas that previously was monopolized by the Government.
  • Article 44
    The economy of the Islamic Republic of Iran is to consist of three sectors: state, cooperative, and private, and is to be based on systematic and sound planning. The state sector is to include all large-scale and mother industries, foreign trade, major minerals, banking, insurance, power generation, dams and large-scale irrigation networks, radio and television, post, telegraph and telephone services, aviation, shipping, roads, railroads and the like; all these will be publicly owned and administered by the State. The cooperative sector is to include cooperative companies and enterprises concerned with production and distribution, in urban and rural areas, in accordance with Islamic criteria. The private sector consists of those activities concerned with agriculture, animal husbandry, industry, trade, and services that supplement the economic activities of the state and cooperative sectors. Ownership in each of these three sectors is protected by the laws of the Islamic Republic, in so far as this ownership is in conformity with the other articles of this chapter, does not go beyond the bounds of Islamic law, contributes to the economic growth and progress of the country, and does not harm society. The [precise] scope of each of these sectors, as well as the regulations and conditions governing their operation, will be specified by law.

Therefore the legislative framework for contribution of the private sector in different areas of activity such as heavy industry, banking, insurance, power supply, communications and transportation sector is provided.

Greater transparency in the macroeconomic regime, budget reforms, tax reforms, unification of foreign exchange rate, downsizing the government's role in economic activities through privatization of SOEs, dismantling of monopolies and promoting competitive market, reducing the non-tariff trade barriers, adopting smart and targeted subsides, attracting foreign investments and protecting private sector investment, establishing private commercial banks to pave the ground for privatization of state-owned banks and developing an effective social security system are the evidence to the Government of Iran's commitment to implement structural reforms within the framework of the third five year Development Plan. These employed reforms and programs together with strong macroeconomic performance, have caused an average t growth rate of around 5.5 percent during the period of the third development plan, which is the one the highest in the region. In addition the unemployment rate is dropping continuously reaching 10.3 percent last year.

By reaching the end of the third development plan in 2004, the fourth five year development plan was ratified six months ago. In fact this Plan in compliance with the objectives set by Twenty Year Economic Vision Document of the country, draw the guidelines and specifies the framework for the new government policies and approaches. Achieving the continuous increasing and sustainable economic growth, providing the ground for the competitiveness of goods and services in local and foreign market, promoting non-oil exports, extending efforts for shifting the growth structure toward the knowledge economy are some of the major highlights of the economic approach of the fourth five year development plan.

I would like to emphasize that while the new government is very much committed, to the said 20 years Economic Vision Document and the Development Plan, one of the most important priority of the government is the issue of expansion of Equity in the society by economic and social means, by providing for example, equal job opportunities, education, health and social activities, in order to reduce the Gini Index . Furthermore, anticorruption campaign will also be implemented more forcefully.

Mr. Chairman, Dear Governors Ladies and Gentlemen
At the end I should express my appreciation to the World Bank management and staff for their extraordinary work and commitment. There is no doubt that in case of my country with a growing portfolio, the dedication and relentless efforts of the Bank's management and staff have played a crucial and significant role. In fact we consider the World Bank as an important center for synthesis of expertise, views and experiences in a global scale to illuminate the development gateway.

Thank you.




IAEA Board of Governors, 21 September 2005: EU Presidency Statement on Iran

Speaker: Peter Jenkins, UK Ambassador to the International Atomic Energy Agency (IAEA) and United Nations organisations in Vienna

IAEA Board of Governors, 21 September 2005: EU Presidency Statement on Iran

  1. I have the honour to speak on behalf of the European Union. The Acceding Countries Bulgaria and Romania, the Candidate Countries Croatia*, as well as the Countries of the Stabilisation and Association Process and potential candidates Albania, Bosnia and Herzegovina, the Former Yugoslav Republic of Macedonia, and Serbia and Montenegro and the Efta countries Iceland, and Norway, members of the European Economic Area, as well as Moldova, associate themselves with this statement.

  2. The EU has read with care and interest the Director General’s latest report on the implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran (GOV/2005/67) and has listened with equal care and interest to the Director General’s oral report on this subject at the start of this session. We are grateful to the Director General for yet another balanced and objective report. We commend the Director General and the Secretariat for the impartiality and professionalism with which they have pursued investigations into questions arising from Iran’s multiple failures, over an extended period of time, to declare nuclear materials and activities in accordance with its safeguards obligations.

  3. The EU notes that good progress has been made by Iran in correcting the many instances of non-compliance reported to the Board in November 2003. We note also good progress in the Agency’s ability to confirm Iran’s declarations, but that several important questions remain outstanding: in particular, the origin of some of the HEU and the LEU particle contamination found at various locations in Iran, the extent of Iran’s efforts to import, manufacture and use centrifuges of both the P1 and P2 designs, Iranian statements about plutonium research, Iranian activities at the Gchine uranium mine, and Iran’s activities involving polonium.

  4. The EU read with concern a number of passages in the Director General’s report:

    • The Agency still needs to understand what contacts took place between Iran and intermediaries in the late eighties and early nineties and why P-1 centrifuge design documents similar to those provided in 1987 were delivered again in 1994;

    • The Agency is still seeking sufficient assurance that no activities related to the P2 centrifuge design were carried out between 1995 and 2002;

    • The total number of unprocessed irradiated UO2 targets stored in containers turned out to be much higher than the number previously declared by Iran;

    • The Agency’s request to speak with the individual in charge of the Gchine project prior to 2002 has so far been refused and in documents relating to this project shown to the Agency the names of the persons who had designed, drawn, checked or approved the drawings, and the name of the company that had prepared the drawings, along with project numbers and dates, were blacked out;

    • The Agency is still trying to acquire a better understanding of why , apparently, no work was carried out at the Gchine site between 1993 and 2000;

    • The Agency is still awaiting additional information and clarifications from Iran regarding efforts by the Physics Research Centre to acquire dual use materials and equipment that could be used in uranium enrichment or conversion activities, including access to relevant individuals.

  5. The EU also read with concern that the Agency has made a number of other requests for information or access to individuals or locations which have still to be granted. We take a serious view of the Director General’s assessment that full transparency is not only indispensable but overdue, and that, given Iran’s past concealment efforts over many years, such transparency should extend beyond the formal requirements of the Safeguard 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. We note that the Agency is still not in a position to conclude that there are no undeclared nuclear materials or activities in Iran and that, in view of the past undeclared nature of significant aspects of Iran’s nuclear programme, and its past pattern of concealment, this conclusion can be expected to take longer to arrive at than in normal circumstances.

  6. Finally, Madame Chair, the EU notes that Iran has not heeded the call made by the Board on 11 August for the re-establishment of full suspension of all enrichment related activities; that Iran’s Additional Protocol is still unratified; and that Iran has ignored the Board’s request for reconsideration of its decision to construct a research reactor moderated by heavy water.

  7. These are among the many factors leading the EU to the view that this is an appropriate moment for the Board to take stock.

  8. In November 2003, the Board had before it a report from the Director General which made clear that "Iran had concealed many aspects of its nuclear activities, with resultant breaches of its obligation to comply with the provisions of its Safeguards Agreement". That report also noted that some of the breaches "dealt with the most sensitive aspects of the nuclear fuel cycle, including enrichment and reprocessing". The Board therefore took a number of important decisions. Inter alia, it:

    • Endorsed the view of the Director General that a policy of full transparency and openness on the part of Iran was indispensable;

    • Called on Iran to sustain full cooperation with the Agency in implementing Iran’s commitment to full disclosure and unrestricted access;

    • Underlined that it was essential that the declarations made by Iran in 2003 amounted to the correct, complete and final picture of Iran’s past and present nuclear programme;

    • Reemphasised the importance of Iran moving swiftly to ratification of the Additional Protocol;

    • Welcomed Iran’s decision voluntarily to suspend all enrichment-related and reprocessing activities and requested Iran to adhere to that decision in a complete and verifiable manner.

    The Board subsequently called on Iran to reconsider its decision to construct a research reactor moderated by heavy water.

  9. What is the situation confronting the Board today, almost two years later?

    • The Director General has reported that full transparency still has not been forthcoming: he describes it as overdue;

    • Iran's October 2003 declaration, said by Iran to provide a full picture of its nuclear activities, has turned out to be incomplete - for example, with respect to its P-2 centrifuge activities, with respect to the level of enrichment achieved by it laser enrichment work, and with respect to its plutonium research;

    • The contamination issue remains unresolved;

    • Iran’s Additional Protocol remains unratified;

    • All enrichment related activities in Iran have been suspended for only 8 of the 22 months that have passed since November 2003;

    • Construction of a research reactor moderated by heavy water has begun and continues.

  10. It is clear that Iran has failed to honour its commitments – commitments which made it possible for the Board to hold back from reporting to the Security Council and others, in November 2003, the non-compliance reported to it by the Secretariat. Iran has not engaged in full cooperation with the IAEA to address and resolve through full transparency all requirements and outstanding issues of the Agency. Having taken over a year to get round to suspending all enrichment-related and reprocessing activities, Iran has, in defiance of clear Board requests, abandoned that suspension well before the resolution by the Agency of all the issues arising from its non-compliance. In this regard may I recall that in the resolution it adopted in November 2004 the Board underlined that the full and sustained implementation of this suspension was essential to addressing outstanding issues.

  11. The EU has sought to create conditions in which the international community can leave it to the Agency to go about its job of providing the necessary assurances in the knowledge that, meanwhile; Iran would not be developing a capability to produce fissile material. The development by Iran of the mostsensitive parts of the fuel cycle has neither an economic nor a technical rationale. We therefore regret, and feel deeply concerned by the fact that Iran gives every sign of being intent on developing a fissile material production capability well before the international community obtains what it needs: confidence that Iran’s programme is exclusively peaceful in nature.

  12. It is that concern which leads us to assert that the Board cannot simply overlook Iran’s failure to fulfil its commitments and its defiance of Board resolutions. The Board must ask itself whether there is anything that can be done at this session to convince on Iran to implement the necessary confidence-building measures and to grant the Agency the full transparency which the Director General described on 19 September as a prerequisite for the Agency to be able to reconstruct the history and nature of all aspects of Iran’s past nuclear activities, and to compensate for the confidence deficit created.

  13. In the EU view there is something that the Board can and should do. The Board should draw the attention of the UN Security Council to the safeguards breaches and failures first reported to the Board in November 2003 and to the questions which have arisen in this connection that are within the competence of the Security Council. This will give the Security Council an opportunity to throw its weight and authority behind the Board’s resolutions. It will give the Security Council an opportunity to endorse the Board’s calls for confidence-building measures, especially full suspension, and for the full transparency which was first promised in October 2003 and which is indispensable to the resolution of outstanding issues and overdue.

  14. Involving the Security Council in this way is not intended to close off diplomacy. On the contrary: it is intended to facilitate it by reinforcing the signal that the international community expects Iran to deliver on its promises of full transparency and full suspension. EU Member States intend to work within the Security Council to ensure a sensible, measured and constructive multilateral approach to the issue. The IAEA will remain seized of the matter and the Secretariat’s responsibility for implementing Iran’s Safeguards Agreement will be unaltered.

  15. Let me close by stressing that the EU recognises the inalienable right of NPT parties to develop research, production and use of nuclear energy for peaceful purposes without discrimination and in conformity with Articles I and II of the NPT. But maintaining the balance between rights and obligations envisaged in the treaty is essential. We believe it is incumbent on a non-compliant state to return to full compliance and to build the necessary confidence in the exclusively peaceful nature of its nuclear activities. In the specific case of Iran the suspension of fissile material production and enrichment-related activities would do just that; it is therefore prudent for the Board and the international community to insist on it.

    * Croatia continues to be part of the Stabilisation and Association Pact




TEXT of U.S. Briefing on Iran Nuclear Program


SECTION 1: Iran’s Nuclear Fuel Cycle Facilities: A Pattern off Peaceful Intent?


Nuclear Energy or Nuclear Weapons?


1.       Confirmed record of hiding sensitive nuclear fuel cycle activities from the IAEA.

2.       Iran’s rationale for “peaceful” nuclear fuel cycle does not hold up under scrutiny.

3.       Given Iran’s insufficient uranium reserves, Iran cannot achieve its goal of nuclear energy independence.

4.       Moreover, indigenous fuel cycle costs are substantially greater than importing nuclear fuel at market prices…or taking full advantage of its current wasted hydrocarbon resources.

5.       But Iran’s uranium reserves could give Iran a significant number of nuclear weapons. In fact, Iran’s facilities are scaled exactly like another state’s facilities that were designed to produce fissile material for nuclear weapons.


Fuel Cycle Rationalization


1. “Iran cannot rely on energy from fossil fuels for the following reason: resources are limited…and the local use of these resources will drastically affect foreign exchange earnings.”

·         Iranian Vice-President and Atomic Energy Minister Aghazadeh, May 2003


2. “The best use that a country like mine can make out of its uranium ores is to replace oil as a primary source of energy…within two decades most of our oil production will be consumed internally, leaving nothing tangible for export.”

·         Iranian Representative to the IAEA, Ambassador Salehi, March 2003


Iran’s Nuclear Fuel Cycle Facilities: Concealment & Deception


A History of Concealment & Deception


1.       Long-standing IAEA safeguards violations show that Iran kept its nuclear activities hidden until they were first revealed by others.

2.       Iran’s provision of “changing or contradictory information,” as described by the Director General, leaves major issues remain unresolved:

·         Apart from “contamination,” the full extent of centrifuge research and development;

·         The full extent of plutonium experimentation;

·         Military involvement in any nuclear activity.


NUCLEAR FACILITY IMAGES: Sites Unknown before 2002


1.       Lashcar A’bad:        Uranium Enrichment Facility

2.       Tehran:                   Uranium Enrichment Facility

3.       Arak:                      Heavy Water Facility

4.       Arak:                      Research Reactor, Research Facility

5.       Natanz:                   Uranium Enrichment Facility

6.       Ardekan:                 Uranium Processing Facility

7.       Gachin:                   Uranium Processing Facility

8.       Gachin:                   Uranium Mines


Other Sites


1.       Tehran:                   Research Facility

2.       Isfahan:                   Research Facility

3.       Isfahan:                   Uranium Enrichment Facility

4.       Saghand:                Uranium Mines

5.       Bushehr:                 Light Water Reactor



Natanz Gas Centrifuge Uranium Enrichment Complex


1.       Covert facility in remote location, could enrich uranium for weapons

2.       Dummy structures to prevent detection and identification

3.       Concealed underground, hardened, well defended


Arak Heavy Water Reactor Complex: Reactor could produce ~1-3 Bombs worth off Pu/yrr


1.       June 2004-March 2005, significant progress on Heavy Water plant construction

·         Full production of primary line planned for 2005

2.       Despite IAEA Board request to forgo construction,

·         Reactor is well underway and progressing rapidly. Iran says reactor needed for medical and industrial isotopes… A capability already inherent in Iran’s 10 Megawatt Tehran Research Reactor.


Clandestine Uranium Mine & Mill Still Under IIAEA Investigation


1.       Iran omitted from national websites, pre-2004 declarations to IAEA, and OECD/IAEA “Red Book” reporting… any indication of Gachin, while regularly citing Saghand

2.       DDG’s June Oral Statement reiterated that the Agency seeks to “better understand the complex arrangements governing the current and past administration of the mine.” Possible Military Involvement?

3.       IAEA investigating “why the work on the very promising [Gachin] project was suspended by the AEOI from 1994 to 2000” while Iran focused on the “much less promising ore deposit at Saghand.”


Iranian Government Misrepresented Uranium Mine


Mine M_26_13 is located at the Gachin Uranium Mill but is listed only as the Sandrasang mine near the village of Gachin for “building stone.”


SECTION II:  Iran’s Nuclear Fuel Cycle Facilities: The Myths off Self Sufficiency and Maximizing Energy Resources


Why Iran’s Large Nuclear Fuel Cycle Investment Makes No Sense Economically


1.       Alternate investments in natural gas or oil refining would be more attractive.

2.       Iran lacks adequate deposits of natural uranium to be self sufficient for civil nuclear power.

3.       Iran’s supply of other energy resources far from depleted.


Estimated Fuel Cycle Costs


Capital costs of selected nuclear facilities (Arak, Esfahan, Saghand, Gchine, Natanz) approximately $600 million - $1 billion.  For seven planned reactors, Iran would need to invest at least another $6.0 billion.


1.       The role of economies of scale not clear in the Iranian nuclear program.

2.       Additional developmental hurdles unclear, such as with the fuel fabrication plant.


Attractive Alternatives to Investing in the Nuclear Fuel Cycle


1.       If Iran invested $2.5 – $3.2 billion to upgrade its natural gas infrastructure rather than to construct a nuclear fuel cycle infrastructure, Iran could save, at current market prices, $1.6 – $2.2 billion worth of natural gas annually.

2.       Were Iran to invest $5.5 billion in oil refinery projects to upgrade its gasoline refinery capacity, Iran could increase the annual net revenue for its petrochemical sector $982 million.


Benefit of Recovering Wasted Gas In 2002, Iran wasted 6.78% of natural gas gross production equal to 290 billion ft3.


1.       Assume Iran moved to world average (2.26%)

·         Approximate investment = $2.5 billion

·         Savings equivalent to:

1.       $1.6 billion (Market price 7.78$/MMBtu)3

2.       2.8 Bushehr Nuclear Power Plant equivalents4


2.       Assume Iran moved to N. American Average (0.53%)

·         Approximate investment = $3.2 billion

·         Savings equivalent to:

1.       $2.22 billion (Market price 7.78$/MMBtu)3

3.       3.9 Bushehr Nuclear Power Plant equivalents4


1, 2          – Data From U.S. EIA International Energy Annual 2002, Table 4.1

3              – Market Price U.S. EIA Natural Gas Weekly Update 7/13/05

4              – Replacement for CCTG Plants - 7200 BTU/kw-hr heat rate, 85% capacity factor, 1070BTU/ft3 natural gas


Benefits of Gasoline Production Upgrade


If Iran were to invest $5.6 billion in a high gasoline yield Western-type refinery, it could eliminate its dependence on imported gasoline and increase its annual net oil related revenue by approximately $982 million.


Comparative Nuclear Fuel Costs for 7000 Megawatts: Indigenous Vs. Market


Iran could save $59 - $161 million per year by purchasing fuel from abroad.


The Myth of Nuclear Fuel Self Sufficiency


Setting economics aside, even if speculative uranium deposits in Iran are assumed and included, Iran is not close to possessing sufficient uranium to fuel seven 1000 MWe for their lifetime. It is thus impossible for Iran to avoid dependence on a foreign supplier for its uranium fuel.


Limited Uranium Resources


            Iran does not have enough uranium to fuel its planned reactors


1.       Known uranium (1,427) + speculative (13,850) = 15,277 tons U

2.       Assume Bushehr burns 22 tons of LEU annually



Known Uranium


# Operational Reactors

Years of Operation

Years of Operation























Fuel Resource Constraints 2006-2026


1.       Known uranium will be exhausted by 2010 with only two operational reactors.

2.       Total uranium resources will be depleted by 2023 with all reactors far short of their 40 year design lifetime.


Which Resource [is] Truly Scarce?


1.       Oil

·         125.8 billion barrels proven reserves

·         Roughly 10% of world total

2.       Natural Gas

·         940 trillion cubic feet proven reserves

·         World’s 2nd largest supply, 15.5% world total


Iran’s Indigenous Energy Breakdown:                       

10^15 BTU



Natural Gas








Energy equivalence used = 1070 BTU/ft3 natural gas, 5.8e6 BTU/barrel oil, 11,000 BTU/lb. coal, 4.41e11 BTU/mton U-235. Source Nuclear Engineering: Theory and Technology of Commercial Nuclear Power – Knief. Energy data from March 2005 U.S. EIA Iran Country Analysis Brief.


SECTION III: Iran’s Nuclear Fuel Cycle Facilities: To What End?


Nuclear Energy or Nuclear Weapons?


Extensive Concealment and Deception Record


1.       Once revealed, Iran offered rationale for “peaceful” nuclear fuel cycle… However:

·         Nuclear energy independence not feasible given ore reserves

2.       Iran could maximize its earnings and energy by:

·         Importing nuclear fuel

·         Reducing waste of natural gas currently flared

·         Increasing gasoline production for domestic energy independence

3.       Iran’s uranium reserves cannot support planned nuclear power plants, but are well-scaled to give Iran a significant number of nuclear weapons.

4.       Iran’s nuclear program is very similar to another state’s nuclear weapons program.


Uranium Reserves: Only Enough for Weapons

As noted, Iran’s uranium resources cannot support the peaceful program Iran says it is pursuing.  However, Iran’s uranium resources are more than sufficient to support a nuclear weapons capability. The Gachin mine’s output (~21 tonnes/yr) alone could supply enough uranium, if enriched, to produce ~4 nuclear weapons/yr.


Comparing Nuclear Infrastructures


Iran’s program is strikingly similar to Another State’s Program in other ways:


1.       Uranium mining – Both States have limited known domestic reserves (Iran ~ 71 tons/year versus ~ 23 tons/year)

2.       UF6 Conversion – Both state’s seek a 200 ton/year production capacity


Comparing Delivery Capabilities


1.       Iran’s Shahab III and Another State’s Variant

2.       Intermediate-range ballistic missile (IRBM) derived from the DPRK’s No Dong




Iran’s past history of concealment and deception and nuclear fuel cycle infrastructure are most consistent with intent to acquire nuclear weapons.






  • Daily Press Briefing for September 28, 2005 - IRAN - Transcript - Sean McCormack, Spokesman - Washington, DC
  • Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran
  • IAEA Board of Governors, 21 September 2005: EU Presidency Statement on Iran
  • TEXT of U.S. Briefing on Iran Nuclear Program

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