Posted tagged ‘Iran – Arak heavy water reactor’

Obama Admin Withholding Details of ‘Potentially Illegal’ Deal to Buy Iranian Nuke Materials

April 27, 2016

Obama Admin Withholding Details of ‘Potentially Illegal’ Deal to Buy Iranian Nuke Materials, Washington Free Beacon, April 27, 2016

Part of Arak heavy water nuclear facilities is seen, near the central city of Arak, 150 miles southwest of the capital Tehran / AP

Officials from both the Treasury and Energy departments told the Free Beacon that details about the payment are being withheld until the purchase is complete. Iran is expected to deliver the heavy water to the United States in the “coming weeks,” officials confirmed.


Obama administration officials are declining to provide specific details about an unprecedented upcoming purchase of Iranian nuclear materials, an $8.6 million exchange that is likely to be funded using American taxpayer dollars, according to conversations with multiple administration officials and sources in Congress.

The administration is preparing to purchase from Iran 32 tons of heavy water, a key nuclear material, in a bid to keep Iran in compliance with last summer’s comprehensive nuclear agreement.

But administration officials have declined to provide specific details to Congress and reporters about how exactly it will pay for the purchase, as well as other information, until the deal has been completed.

The effort to withhold key information about the purchase, which is likely to be paid in some form using U.S. taxpayer dollars, is causing frustration on Capitol Hill, according to multiple sources who disclosed to the Washington Free Beacon that the administration is rebuffing congressional attempts to discern further information about the deal.

Experts further disclosed to the Free Beacon that the exchange is likely to legitimize Iran’s research into plutonium, knowledge that would provide the Islamic Republic with a secondary pathway to a nuclear weapon capability.

Officials from both the Treasury and Energy departments told the Free Beacon that details about the payment are being withheld until the purchase is complete. Iran is expected to deliver the heavy water to the United States in the “coming weeks,” officials confirmed.

“We cannot discuss details of the payment until after the purchase is complete,” a Treasury Department official who was not authorized to speak on record told the Free Beacon. “The Department of Energy’s Isotope Program plans to pay Iran approximately $8.6 million dollars for 32 metric tons of heavy water.”

The administration will use an offshore third party to facilitate the transfer of cash to Iran, according to officials in both the Treasury and Energy departments.

“Regardless of whether or not this is in U.S. dollars, this licensed transaction is limited in scope. This routing through third-country financial institutions is similar to the mechanism that has been used for years to allow other authorized transactions—such as for exports of food and medicine—between the United States and Iran,” the treasury official said, referencing a loophole in U.S. sanctions that permits transactions of a humanitarian nature.

An Energy Department official confirmed that officials “cannot discuss details of the payment until after the purchase is complete.”

The exchange is being handled by the Energy Department’s Isotope Program, which routinely conducts transactions of this nature, according to the official.

“DOE’s Isotope Program produces and distributes a variety of isotopes that are in short supply for industrial and medical purposes,” an Energy Department official told the Free Beacon. “Transactions like this one are regular business for the program.”

Iran’s excess heavy water “will help to fulfill a substantial portion of U.S. domestic market demand this year,” according to the official, who said that “over the past few years, there have often been constrained supplies of heavy water.”

The administration further “expects to resell the purchased heavy water at commercially reasonable prices to domestic commercial and research buyers, including Oak Ridge National Laboratory’s Spallation Neutron Source, where it would be used to increase the efficiency of the facility,” the source said.

Congressional critics of the arrangement accuse the administration of using this sale as part of a larger plan to help Iran gain access to the American financial system and U.S. dollar.

“Subsidizing Iran’s production of heavy water is a dangerous move,” Sen. Tom Cotton (R., Ark.) told the Free Beacon. “It stimulates Iran’s nuclear industry, opens the door to the use of U.S. dollars to facilitate Iranian trade and illicit financing, and provides U.S. tax dollars to the world’s top state sponsor of terrorism.”

Energy Secretary Ernest Moniz “is aware of these dangers, which is why he stressed that this is a one-time purchase,” said Cotton, the author of a new amendment that would block the administration from engaging in similar purchases with Iran in the future. “I want to hold him and President Obama to that vow, particularly in light of the many promises broken and redlines erased by this administration in the course of negotiating the Iran deal.”

Rep. Mike Pompeo (R., Kan.), a member of the House intelligence committee, accused the administration of funding Iran’s nuclear pursuits in contradiction of last summer’s agreement aimed at winding down Tehran’s nuclear ambitions.

“The Obama administration’s deal with the Mullahs in Tehran to purchase heavy water demonstrates a disturbing, potentially illegal, willingness of the administration to subsidize Iran’s nuclear program,” Pompeo told the Free Beacon. “This purchase allows the Iranians to offload previously unsellable product and it destigmatizes the act of doing business in Iran.”

Pompeo said it is irresponsible to pursue this deal without first providing lawmakers detailed information about whether Iran will directly receive taxpayer dollars.

“This purchase is being made without explanation as to how Iran will receive these funds or what steps the administration is taking to prevent what will almost certainly be U.S. taxpayer dollars from possibly being used to support terrorist activities, Syrian dictator Bashar al-Assad, or Iran’s ballistic missile program,” Pompeo said. “Of course, the reality is that once that money is in the hands of the Ayatollah, there is no way to prevent the funds from being diverted toward any of those purposes—a fact that seems to concern no one at the White House.”

A larger debate has been taking place in Washington over Iranian and European demands that the United States grant Iran access to dollars, a move the administration has publicly opposed and promised Congress would not take place.

However, sources indicate that the heavy water exchange could be the first sign that the administration is caving on this promise.

 Mark Dubowitz, head of the Foundation for Defense of Democracy’s Center on Sanctions and Illicit Finance, told theFree Beacon that Iran is producing excess nuclear material in order to wring more cash from the nuclear deal.

“Iran has created a clever scheme—produce too much heavy water so as to break the nuclear agreement, then get the Obama administration and eventually U.S. companies to pay Tehran using the U.S. dollar to get rid of it,” Dubowitz explained. “These U.S. subsidies will help Tehran perfect its heavy water production skills so it will be fully prepared to develop its plutonium bomb-making capabilities when restrictions on the program sunset over the next 10-15 years.”

“This scheme also will open the door to further dollarized transactions as the administration green-lights the greenback for a regime with a decades-long rap sheet of financial crimes,” he added.

A senior congressional source familiar with the trade disclosed that administration officials are declining to disclose key details about the deal.

“The administration is being coy about how the financial mechanics of this deal will work,” the source told the Free Beacon. “But the bottom line is that U.S. taxpayer dollars will be used, and used for a purchase directly connected to Iran’s nuclear program. This is an attempt by the administration to slowly open a door that leads to the wide acceptance of Iran’s nuclear industry and to the use of U.S. dollars by Iran to conduct trade.”

“Many in Congress—on both the Republican and Democratic sides—won’t stand for that, and will move to shut that door tightly,” the source said.

OMRI CEREN: Analyze This,

April 22, 2016

OMRI CEREN: Analyze This, Power LineScott Johnson, April 22, 2016

Omri Ceren writes from The Israel Project with the latest development in our partnership with the Islamic Republic of Iran. Omri writes:

Heavy water is a relatively rare form of water that is used to produce weapons-grade plutonium. The nuclear deal forbids Iran
from stockpiling more than 130 tonnes of heavy water at any given time.

But the Iranians have been overproducing. In February they violated the nuclear deal by going over the 130 ton cap, and they had to ship out their excess material to get back into compliance [a][b]. Instead of halting heavy water production in the aftermath of the violation, they continued producing and now may be in danger of violating the deal again.

So – per the Wall Street Journal this morning – the Obama administration will buy the heavy water from Iran in order to “safeguard its landmark nuclear agreement.” The Iranians will be saved from their own overproduction causing them to violate the deal. Some things to look out for:

1) The purchase will almost certainly involve dollars, and therefore indirect access to the U.S. financial system. The administration is refusing to clarify that:

U.S. law still bans Iran from entering the American financial system or conducting business in dollars. The Obama administration is deliberating ways to help Iran conduct dollarized trade without allowing it to directly access the U.S. system, according to U.S. officials. U.S. officials wouldn’t specify how the Department of Energy would pay Iran for the heavy water.

2) The money will almost certainly be taxpayer money, and it may be going to fund terrorism. Congress is trying to get answers on those questions from the administration:

The chairman of the House Foreign Relations Committee, Rep. Ed Royce (R., Calif.), wrote Mr. Moniz on April 18 to seek clarity on the terms of the deal. He specifically asked how the U.S. would pay for the heavy water and what guarantees the administration had that the funds wouldn’t be used by Tehran to fund its military or terrorist groups.

3) The Obama administration will be keeping alive a part of Iran’s nuclear program that can be turned around and used for producing nuclear weapons:

Some nuclear experts said the U.S. move comes close to subsidizing Iran’s nuclear program in a bid to keep the agreement alive. They said Tehran’s production of heavy water will remain a concern, especially when the constraints on its nuclear program are lifted after 10 to 15 years as part of the agreement. “We shouldn’t be paying them for something they shouldn’t be producing in the first place,” said David Albright, head of the Institute for Science and International Security, a Washington think tank.

4) The administration’s broader goal for the sale is to mainstream Iran’s nuclear program and encourage other countries to begin relying on Iran for nuclear materials. That’s not extrapolation. It’s their actual spin, which is already appearing elsewhere this morning in sympathetic articles: that thanks to this purchase, Iran’s nuclear program will no longer be an international pariah and other countries will begin purchasing nuclear material from Iran [c]. Those countries will potentially be beyond future U.S. pressure, should a future administration want to limit Iran’s heavy water production:

The U.S. hopes its initial purchase will give other countries the confidence to purchase Iran’s heavy water in the coming years… U.S. Energy Secretary Ernest Moniz said… “That will be a statement to the world: ‘You want to buy heavy water from Iran, you can buy heavy water from Iran. It’s been done. Even the United States did it.’”


Progress of sanctions relief will quicken Iran’s power struggle, spur clash with Saudi Arabia

January 17, 2016

Progress of sanctions relief will quicken Iran’s power struggle, spur clash with Saudi Arabia, DEBKAfile, January 16, 2016

investment-in-Iran-by-Ghanoon-daily_16.1.16The nuclear accord implementation by Iran and the lifting of sanctions may not survive the radical opposition in Tehran – not least, because Iran exports will further depress oil prices.

The nuclear watchdog confirmed Saturday night, Jan. 16, that Iran had fulfilled its side of the nuclear deal with the six world powers and that sanctions could be lifted, after US Secretary of State John Kerry, EU’s Federica Mogherini and Iran’s Foreign Minister Mohammad Javad Zarif had been kept hanging about for the IAEA’s from early morning for a verdict worth some $100-150 billion to Tehran. The wording did not explicitly confirm that Iran had met all the terms of the nuclear deal or that it had mothballed most of its uranium-enrichment centrifuges.

From the start, the deal was viewed with deep suspicion by Israel, Saudi Arabia and US lawmakers. Even the White House spokesman Josh Earnest was moved to comment Friday that “the United States wants to make sure that Iran doesn’t cut any corners.”

DEBKAfile’s intelligence and Iranian sources account for the delay in publishing the nuclear watchdog’s report by the “corners” Iran was still trying to cut. According to our sources, Iran had managed to dodge compliance with key terms of the nuclear deal. Nine tons of enriched uranium were indeed shipped to Russia, but most expert watchers are dubious about three other commitments:

1. Washington and Tehran have claimed that the Iranians fulfilled their commitment to pour concrete into the core of the Arak reactor to disable its capacity for producing plutonium. Two days ago, on Thursday, Iranian officials denied this had been done: Only a token operation may have taken place, if any.

Officials associated with Iran’s radical Revolutionary Guards, which fought tooth and nail against the nuclear accord, commented that instead of pouring concrete into the Arak reactor, it should be poured into the hearts of President Hassan Rouhani and Foreign Minister Zarif, for negotiating the accord with the six powers.

Such comments rarely reach the Western media. They are important because they mirror the fierce power struggle ongoing in Tehran, which is heavily fueled by infighting over the nuclear deal and sanctions.

2.  That deal provided for the number of centrifuges enriching uranium at the Natanz center to be reduced from 19,500 to 5,050. Our sources report that 9,000 are still in operation.

3. There is no confirmation that the number of centrifuges operating at the underground facility of Fordo was cut down to one thousand, as agreed.

On top of these deviations, the Obama administration admitted last week that the dispute over Iran’s nuclear-capable ballistic missiles, which were tested last month, is still open, in defiance of UN Security Council resolutions. This makes Tehran liable to a fresh set of sanctions, as US officials too have indicated.

The capture of two US patrol boats by the Revolutionary Guards speedboats last Tuesday, with the 10 American sailors aboard forced to surrender before they were released, was clearly a last-ditch attempt by Iran’s radicals to derail the nuclear accord before the Saturday deadline was reached.

That will not be the last such episode: Iran’s radicals may embark on more such actions to counteract the nuclear deal by striking more American targets and looking for trouble with Saudi Arabi and its Gulf allies.

The fact is that the hard-line factions in Tehran don’t want the sanctions lifted, because they see them as net profit for President Rouhani and his moderate conservatives and his leading backer, former president Hashem Rafsanjani, head of the powerful Assembly of Experts.

Iran’s Finance Minister Ali Tayyebnia gave the radicals fodder when he said last week that even $100 billion in cancelled sanctions would not haul the Iranian economy our [sic]  of crisis or balance the state budget, because the country’s indebtedness is far in excess of that huge amount.

The Iranian-Saudi row is another factor that could upset the nuclear deal, although paradoxically, since oil prices sank below $30, the Guards and Riyadh have a common interest in its collapse.

Iran’s expected return to an already glutted market – through the removal of sanctions – will drive prices down further. This, neither the Revolutionary Guards Corps, which control Iran’s oil sector, nor the Saudis want to see.

The spiral of hostility launched with the Saudi execution of the prominent Shiite cleric Nimr al-Nimr, followed by the mob attack on the Saudi embassy in Tehran and consulate in Meshaad, and the multiple severance of diplomatic and commercial ties between the Gulf emirates and Tehran, may have the effect of reversing the downward trend of oil prices with a sudden spurt.
Therefore, the rosy prospect the Obama administration paints of a successful landmark deal for curbing Iran’s nuclear capabilities is a far cry from being realized.

Therefore, the rosy prospect the Obama administration paints of a successful landmark deal for curbing Iran’s nuclear capabilities is a far cry from being realized.

Iran official denies report of nuclear reactor being sealed

January 12, 2016

Iran official denies report of nuclear reactor being sealed, Al Arabiya News, January 12, 2016

FILE -- In this Saturday, Jan. 15, 2011 file photo, a part of Arak heavy water nuclear facilities is seen, near the central city of Arak, 150 miles (250 kilometers) southwest of the capital Tehran, Iran. Iranian state television reported on Saturday, April, 19, 2014 that Vice President Ali Akbar Salehi has said a dispute between world powers and the country over its heavy water reactor at Arak has been “virtually resolved.” Iran and world powers are negotiating the terms of a permanent deal over its contested nuclear program. (AP Photo/Fars News Agency, Mehdi Marizad, File)

FILE — In this Saturday, Jan. 15, 2011 file photo, a part of Arak heavy water nuclear facilities is seen, near the central city of Arak, 150 miles (250 kilometers) southwest of the capital Tehran, Iran.  (AP Photo/Fars News Agency, Mehdi Marizad, File)

Iran’s deputy nuclear chief on Tuesday denied a report that the core of the country’s nearly finished heavy water reactor has been dismantled and filled it with concrete as part of Tehran’s obligations under the nuclear deal with the West.

Ali Asghar Zarean, in remarks to state TV said that Iran will first sign an agreement with China to modify the Arak reactor, a deal that is expected next week.

“Definitely, we will not apply any physical change in this field until a final agreement is finalized,” Zarean added, without specifically mentioning the Fars news agency report.

On Monday, Fars said that technicians had dismantled the core of the Arak reactor and filled it with concrete. The agency, which is close to Iranian hard-liners, cited unnamed sources for the report.

Under the landmark nuclear deal that commits Tehran to significant limits on its nuclear activities for over a decade in exchange for relief from crippling economic sanctions, Iran must redesign the Arak reactor so it can’t produce plutonium for nuclear weapons – though it will still produce small amounts of plutonium and heavy water.

Iran has insisted it needs the heavy water reactor for production of medical isotopes.

Hard-liners in Iran, who oppose Iranian President Hassan Rouhani and the nuclear deal with world powers, argue that the so-called “disabling” of Arak is a slap in the face of Iran and allegedly evidence of Rouhani having given too many concessions to the West in return to little.

It’s not clear what the modification process at Arak will involve, but officials in the past have said that some parts of the reactor need to be filled with cements because of safety concerns.

Zarean also said that once modifications are done and Arak goes online, Iran hopes to export excess heavy water produced there to the U.S. through a third country, for uses in research. He added that Savannah River National Laboratory near Jackson, South Carolina, has recently certified high purity of heavy water produced by Iran.

Iran is still expected to produce some 20 metric tons (22 tons) of heavy water at Arak a year. It has said it would domestically consume about 6 tons for medical isotopes and is looking to export the rest.