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Last Updated: Tuesday, 1 August 2006, 16:26 GMT 17:26 UK
Analysis: Iran's nuclear fuel debate
By Roxana Saberi
BBC News, Tehran

Energy Minister Parviz Fattah
Mr Fattah said Iran's oil could run out in 80 years

As the dispute over Iran's nuclear programme intensifies, so does the debate over whether or not Iran really needs its own nuclear fuel cycle.

Critics question why a country that ranks fifth in the world in proven crude oil reserves and second in natural gas reserves needs nuclear power.

But Iran says these resources are limited.

It says nuclear energy is an economical, alternative source of electricity for its growing population.

"It's true that Iran has oil and gas, but so do other countries that also want to acquire other kinds of energy," Iran's Energy Minister Parviz Fattah said in an interview.

"Each day that we use our oil and gas, we're taking one step toward their depletion."

Electricity shortages

Mr Fattah said at the rate Iran was extracting its fossil fuels, its oil would run out in 80 years, and its gas would finish in 200 years.

Every 1,000 megawatts of electricity made from nuclear energy saves us 10 million barrels of oil
Kamal Daneshyar,
Parliamentary energy commission

Iran has said it plans to generate enough nuclear power in the next two decades to supply 20% of its electricity needs.

Those needs will increase dramatically as the population grows, according to Kamal Daneshyar, who heads the energy commission in Iran's parliament.

Electricity shortages are already relatively common in Iran, where electricity is heavily subsidised.

"In 20 years, Iran's population will increase from around 70 million to around 90 to 100 million," he said.

"We want to produce 20,000 megawatts a year of electricity from nuclear energy by then."

"Every 1,000 megawatts of electricity made from nuclear energy saves us 10 million barrels of oil," he added. "This oil can be used for other purposes."

Economic sense?

Tehran-based energy expert Narsi Ghorban said that on the face of it, this argument made economic sense.

"In theory, if Iran uses nuclear power stations to generate part of its electricity, more gas would be made available for Iran's gas-based industries and for injection into oil fields to enhance recovery," said Mr Ghorban, the managing director of NarKangan Gas to Liquid International Company.

Isfahan nuclear power plant
The [nuclear] technology they're trying to master is very expensive and very difficult
Jon Wolfsthal,
Center for Strategic and International Studies

"You could also sell your petroleum products to the world market, instead of using them to create electricity.

"With the price of oil in Iran more than $60 (32) a barrel, the economic benefits of having a nuclear power station are in principle obvious."

Jon Wolfsthal, a former U.S. energy department official, agrees it is reasonable for Iran to build nuclear reactors to free up oil for export, but adds that Iran's insistence on making its own nuclear fuel to power the reactors is not.

"This makes absolutely no economic sense from Iran's point of view," said Mr Wolfsthal, a non-proliferation fellow at the Center for Strategic and International Studies in Washington D.C.

"It can obtain fresh fuel for the reactors very cheaply and very reliably on the open market."

"The [nuclear] technology they're trying to master is very expensive and very difficult so it doesn't make sense from an economic point of view."

Independence

Analyst Joseph Cirincione also said it would be less costly for Iran to import nuclear fuel than to make it.

"Forty countries have nuclear power reactors," said Mr Cirincione, the senior vice-president for national security and international policy at the Center for American Progress.

"Almost all import fuel from the five or six nations that make and sell it. It doesn't make sense to make your own fuel unless you have 20 or more reactors. Iran doesn't yet have one."

Iran's first nuclear reactor, which Russia is helping build in Bushehr, is expected to go on line next year.

Iranian petrochemical worker
If we preserve our oil and gas reserves, in 50 years other forms of energy might be developed
Narsi Ghorban,
NarKangan Gas to Liquid International Company

Iranian MP Kamal Daneshyar said Tehran did not want to depend on any other country for nuclear fuel to power its future reactors.

"Who would give us a guarantee that they will sell us nuclear fuel?" he asked. "Would the UN guarantee it?"

"We don't trust the U.S.," he added. "And because we believe that they and the Zionists [Israel] don't want us to progress, we must build reactors ourselves, make fuel ourselves, and be independent."

Many Western countries are worried Iran's nuclear activities are a front for a nuclear weapons' programme - a charge Tehran denies.

On Monday 31 July, the UN Security Council passed a resolution giving Iran a month to suspend uranium enrichment or face the threat of economic or diplomatic sanctions.

Mr Ghorban believes the economic benefits of nuclear power might not be worth risking Iran's chance to attract much needed capital and technology, and that Iran should hold off for now.

"At the moment we could develop Bushehr power station and stop expanding more nuclear reactors," he said.

"We could concentrate on our oil and gas and wait for better and safer technology to be developed.

"If we preserve our oil and gas reserves, in 50 years other forms of energy might be developed."




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