Importing nuclear fuel more economical for Iran than domestic production

Baku, Azerbaijan, Jan. 6

By Umid Niayesh - Trend:

It is more economical for Iran to acquire nuclear fuel for its only nuclear power plant Bushehr through long-term delivery agreements from international markets than to produce it domestically, Olli Heinonen, the former Deputy Director-General for Safeguards at the International Atomic Energy Agency (IAEA) told Trend Jan. 6.

Iranian Foreign Minister Mohammad Javad Zarif during his speech in parliament defended preserving the national interests in nuclear negotiations with P5+1 on Jan.6.

Some Iranian members of parliament demanded Zarif explain the agreements between Iran and P5+1 after releasing information about the possibility of sending the country's enriched uranium stockpile to Russia.

Iran and P5+1 (the five permanent members of the UN Security Council comprising of China, France, Russia, Britain, the US Plus Germany) sealed an interim deal in Geneva on November 24, 2013 to pave the way for the full resolution of the West's decade-old dispute with Iran over the country's nuclear energy program.

The Geneva deal took effect on January 20 and expired on July 20.

However the two sides agreed to extend their talks for four months until November 24 to reach a permanent deal on Iran's disputed nuclear program.

At a meeting held on November 24, 2014, the sides agreed to extend the talks for a further seven months.

Among the hardliners' worries for example, last month for first time some Iranian political figures including former MP Ahmad Shirzad, Pr.Sadeq Zibakalam and Pr.Davood Hermidas Bavand were allowed to make speeches at Tehran University against continuance of the nuclear program and cited the heavy costs of this program and especially pointed out the benefits of importing nuclear fuel versus producing it inside the country.

Producing nuclear fuel in Iran

Heinonen who currently serves as a senior fellow at Harvard University's Belfer Center for Science and International Affairs says that "If Iran plans to produce nuclear fuel for Bushehr domestically in a safe manner, it needs the cooperation of the reactor designer in order to have access to all proprietary information".

He added, "However, even having this capability, Iran needs to import uranium (known reasonable price uranium resources cover, at best, the annual reload needs of Bushehr for 5 years only), likely to buy enriched uranium from the world market."

Iran possesses only one 1,000-MW nuclear power plant, which began to operate in 2011.

Under contract, Russia undertook to provide the plant with fuel for 10 years.

Russia delivered 112 metric tons of 3.5-percent enriched nuclear fuel to the Iranian side in two batches. This volume is enough for the plant's operation until 2021.

Iran has restricted uranium mines inside the country, including Saghand and Gachin, with production capacity of 50 metric tons and 21 metric tons of raw uranium per year.

Heinonen underlined that "currently, and in foreseeable future, there is overproduction of all these services in the markets, which means that it is more economical to acquire them through long-term delivery agreements. Bushehr reactor needs about 25 metric tons of fuel annually".

According to the World Nuclear Association, in 2013, global uranium production was approximately 59,500 metric tons.

Heinonen says, "today's fuel fabrication plants produce 400 hundred metric tons of such fuel each. In order to make fuel manufacturing economically viable, such a plant should serve a dozen power reactors." He cited Ukraine, which is constructing a joint venture with the Russians to meet the needs of their reactor fleet as a good example.

Bushehr NPP, which was inaugurated in September 2013, has the capacity of producing 1000 megawatts of electricity. The power plant is scheduled to produce up to 5 billion megawatt hours of electricity per year, which is about 2 percent of country's total electricity production.

While commenting about recent statements from some Iranian political figures who argued continuance of nuclear program and the heavy costs of the program, Heinonen said that there has been earlier to this end some limited debates in Iran.

"For Instance, in 2003, the parliament discussed the financing of Iran's nuclear program. In that connection concerns about the economic aspects and energy independence of the nuclear program were raised," he said.

"What appears still to be missing is, indeed, a thorough debate on the role of nuclear power and electricity in Iran's energy mix taking also into account the vast unexploited natural gas resources of Iran, Heinonen said. He added that there is likely a role for nuclear power, but due to the fact that Iran has modest domestic uranium resources, the true energy independence provide by nuclear power will be very limited.

Transparency of Iran's nuclear activities

While responding to a question about providing full guaranty for Iran's nuclear program to remain peaceful while the Islamic Republic denied the IAEA to inspect Parchin Military base or to question some nuclear scientists, as well as to provide information about its centrifuge manufacturing units, Heinonen emphasized that these questions need to be resolved in order for the IAEA to be able to conclude that all nuclear material in Iran is in peaceful use.

The latest reports published by the International Atomic Energy Agency indicate that Iran hasn't fulfilled all of its obligations, and this included the lack of Iran's cooperation in providing allowance to IAEA to inspect Parchin military base, where Iran is suspected of having conducted high-explosive tests related to the nuclear bomb.

"Verification of the correctness and completeness of declarations - that all nuclear material is in peaceful use - is the global IAEA verification standard, and Iran is not an exception to that end," Heinonen added.

Former deputy of IAEA director said, "Due to the history of Iran nuclear activities, the verification will take years; perhaps 3-5 years depending on the cooperation provided by Iran, and the findings by the IAEA. Therefore, at this stage, a realistic approach is to phase in these verification activities with clear milestones".

The talks between Iran and the P5+1 (the US, UK, France, Russia, China plus Germany) group has been extended until July 1, 2015 in order to reach a comprehensive nuclear agreement to put an end to the decade-old dispute over the Islamic Republic's nuclear program.

After the sides failed to meet the 24 Nov. 2014 deadline they also extended the Geneva nuclear deal, which was signed in November 2013, to provide Iran with some sanctions relief in exchange for Tehran agreeing to limit certain aspects of its nuclear activities.

Edited by CN

Umid Niayesh is Trend Agency's staff journalist, follow him on Twitter:@UmidNiayesh

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