May 19, 2006

EU aims to offer Iran atomic plants, fuel-diplomat

By Louis Charbonneau

BERLIN (Reuters) - Germany, Britain and France have
proposed offering Iran a number of incentives to abandon its
nuclear enrichment program, including nuclear power plants and
guarantees of atomic fuel, an EU diplomat said.

"We agreed to offer Iran a nuclear power plant and possibly
more along with support for an international (nuclear) fuel
consortium to guarantee fuel for civilian nuclear activity," a
diplomat from the European Union familiar with the draft
proposal agreed by the "EU3" told Reuters.

The EU and United States believe Iran is secretly
developing atomic weapons under cover of a civilian nuclear
energy program. Iran says its atomic program is solely aimed at
the peaceful generation of electricity.

Russia has proposed creating a fuel consortium to enable
Iran to enrich uranium in Russia to low-grade levels for use as
fuel for reactors and the EU draft appears to support this
idea. The consortium would be a joint venture based in Russia.

Iran has so far reacted negatively to the idea of the joint
venture with Russia but has not ruled it out.

The EU draft proposal will be discussed in London on
Wednesday by senior officials from the EU3, the United States,
Russia and China, the diplomat said on condition of anonymity.

The United States has not yet approved the proposal.

"We're still looking at it and we've not yet decided our
position," Undersecretary of State Nicholas Burns told Reuters,
adding he would deliver the U.S. response at the London

The draft also offers Iran a kind of security guarantee,
saying the EU would work toward "recognition of territorial
integrity" of Middle Eastern countries, the EU diplomat said.

In exchange, Iran would have to suspend all aspects of its
uranium enrichment program -- including research and
development work -- and cease construction of a heavy water
nuclear reactor at Arak to assure the world that it is not
trying to produce fuel for nuclear weapons.

The EU diplomat said that the proposal also included
warnings about possible sanctions if Iran continued enriching
uranium. The possible sanctions were virtually identical to a
paper given to the 25 EU members last month, he said.

That "Iran Options Paper" suggested a number of possible
sanctions, including visa bans for high-ranking Iranian
officials and their families, freezing assets of Iranian
individuals and companies and trade sanctions.

In Washington diplomats said the EU had asked the United
States to consider selling new aeroplanes to Iran as part of
the proposed package.

After news leaked that the EU would be willing to offer a
single nuclear reactor, Iran dismissed the idea as "candy for

EU and U.S. officials say they expect Iran to reject the
proposed incentives, but they say this will make it clear that
Iran is not interested in civilian nuclear energy, as Tehran
insists, but atomic bombs.

(Additional reporting by Carol Giacomo in Washington)