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Vedomosti: Sanctions bargaining may isolate Tehran; GZT.ru: Ukraine to export its high-enriched uranium to Russia and United States; Nezavisimaya Gazeta: Americans to fly to Afghanistan via North Pole and Kazakhstan; Gazeta.ru: China boosts stake in U.S. energy assets, eyes Russia.

Vedomosti: Sanctions bargaining may isolate Tehran

Iran which has shocked the world in recent years with the construction of new nuclear installations, ballistic missile launches and thundering threats against the United States and Israel, runs the risk of being left in isolation. For the first time, China is ready to join sanctions against Tehran after years of debate on the Iranian nuclear program.

New information on Mahmoud Ahmadinejad's "peaceful atom" may have affected the change in Beijing's positions, experts believe. China may have traded its position on sanctions for Washington's concessions in talks on the exchange rate of the yuan and increased Chinese exports to the U.S.

This kind of bargaining can only be welcomed if it leads to establishing new rules of the game on the market of nuclear materials. Many countries that have acquired materials posing such a threat are prepared to sell some of the world evil, for a good price, to the U.S., Russia or Europe.

Big money is not the key element of such agreements. In 2003-2004, Libya, led by a charismatic Muammar Gaddafi, made a trade with an additional payment: it signed the Nuclear Non-Proliferation Treaty and paid compensation to victims of terrorist attacks inspired by Tripoli's secret services in exchange for the lifting of UN sanctions and guarantees for its regime.

Since 2002, North Korea has been regularly trading in the operation of its reactors into food and fuel supplies for its undemanding residents. Such artless blackmail is a key component of the system which makes it possible for the current regime in North Korea to stay in power.

Reaching a bargain with Iran's aggressive spiritual leaders is something of a mystery. It is far more challenging to force or encourage Tehran to sell its inventories of the evil for a good price and a generous compensation package. Iran is far more self-sufficient than Libya or North Korea. A nuclear program is not a best-selling commodity for it, but a symbol of prestige confirming its claim to the role of a regional superpower and leader of the Islamic world. The Iranian "peaceful atom" is a means to consolidate the regime and the radicals outside the Islamic Republic. No one can mount a large-scale military operation against a country with 70 million people and a large army. A mechanism capable of making Tehran more agreeable must be one of detailed international sanctions that can hit military and research programs but offer no hardship for ordinary Iranians. It must not promote Iran's image as a fighter against infidels.

The role which Russia is now choosing for itself is not clear as yet. Cooperation with Iran and a knowledge of the sensitive spots of its economy could make Moscow a key player in devising sanctions and, in a broader context, in drawing up a global policy on Iran. Russia's current uncertain position and its desire to avoid sanctions by finding a political and diplomatic solution, as President Dmitry Medvedev said in his ABC interview, is paving the way for a nuclear Iran.

GZT.ru: Ukraine to export its high-enriched uranium to Russia and United States

Ukraine has agreed to export all of its high-enriched uranium to Russia and the United States. Russian analysts say Washington, which advocates a nuclear-free world, will finance the transportation and reprocessing of the fuel.

A source at the Ukrainian Ministry of Fuel and Energy said high-enriched uranium would be delivered to the United States and Russia for reprocessing by late 2010. It declined to specify how much Kiev was going to be paid for the fuel.

The Ministry of Fuel and Energy is to receive about $1 million from Russia and the United States, the Ukrainian media said.

Andrei Gagarinsky, advisor to the director of the Kurchatov Institute, believes that the United States, who advocated this political initiative, should pay Ukraine for uranium shipments and reprocessing.

"90 kg of uranium is a commercially insignificant amount.

Russia has also processed Bulgarian fuel under a similar program, financed by the United States," Gagarinsky said.

Mayak, Russia's largest spent nuclear fuel reprocessing plant in Ozyorsk, the Ural Federal District, is the only national enterprise that can handle Ukrainian fuel, Gagarinsky said.

Ukraine stores all high-enriched uranium at the Sevastopol National University of Nuclear Energy and Industry (SNUNEI) and the Kharkov Institute of Physics and Technology, and uses it only for experimental purposes and for the production of medical isotopes.

Under the December 5, 1994 Budapest Memorandum on Security Assurances, Ukraine renounced nuclear weapons and prioritized civilian nuclear projects.

White House Press Secretary Robert Gibbs said Washington and Kiev had also agreed that Ukraine would use uranium enriched to less than 5% in its research reactors.

This agreement may boost the development of Ukraine's nuclear industry, the Rosatom Nuclear Energy State Corporation said.

"Conventional thermal nuclear reactors enrich uranium to 4%-5%, while enrichment at research reactors can reach 20%.

This is considered high-enriched uranium," Rosatom officials said.

Although new generation research reactors can operate on 5% uranium, Ukrainian facilities still lack such equipment.

Viktor Mikhailov, director of the Institute of Strategic Stability, said the United States should appreciate Ukraine's commitment to dispose of its uranium. It should pay Kiev for this and help the country to convert its reactors to low-enriched uranium, the expert believes.

He said this project would cost several million dollars to implement.

Nezavisimaya Gazeta: Americans to fly to Afghanistan via North Pole and Kazakhstan

Kazakhstan has granted permission to the United States to fly through its airspace when delivering troops and equipment to Afghanistan via the Arctic. The agreement was reached during a recent meeting between President Barack Obama and President Nursultan Nazarbayev in Washington.

The two countries broached the issue when the Pentagon suspended deliveries via the Transit Center at Manas in Kyrgyzstan after last week's unrest in that Central Asian country.

Mike McFaul, an Obama security advisor, told journalists that the two presidents had discussed flights from the United States to Afghanistan via the North Pole and Kazakhstan, which is more expeditious than flying over Europe.

Several media, including Radio Liberty, have reported that the transit agreement was signed on Sunday.

The transit issue was discussed in the absence of Russian President Dmitry Medvedev, who arrived in Washington after the Obama-Nazarbayev meeting. The region is within Russia's special interest zone where a fierce geopolitical struggle is currently under way.

Leonid Ivashov, president of the Russian Academy of Geopolitical Sciences, who had been chief of the Russian Defense Ministry's main department of international cooperation for years, said that the U.S.-Kazakh transit agreements "threaten the interests of Russia and other countries, notably China and especially Iran against which the United States is preparing a military operation."

"Russia has no legal reason to prevent them from signing the agreements because it is a signatory of the ICAO convention and hence should allow planes from the signatory countries to fly over its territory," the general said.

Russia supports the U.S.-led NATO operation in Afghanistan and hence the U.S. presence in Kyrgyzstan, Kazakhstan and other Central Asian countries, he said. On the other hand, such a presence may have a negative geopolitical implication since the U.S. could theoretically use its military aircraft flights for reconnaissance purposes against China, in particular the nuclear weapons R&D center in western China.

Ivashov also said that America could deploy a military base in Kazakhstan similar in size to the Kyrgyz facility.

However, Gen. Pyotr Deinekin, who was commander-in-chief of Russia's Air Force in 1991-1998, thinks that the route via the North Pole and Kazakhstan is the best option, adding that the Untied States should pay for flying over Russia.

"Russia could sell not only oil but also its air space for a profit," the general said.

Gazeta.ru: China boosts stake in U.S. energy assets, eyes Russia

China's Sinopec has bought into ConocoPhillips oil sands project, Syncrude, in a deal aimed at providing the country with more energy resources. Conoco will use the money paid for the stake to repay its debts. Analysts believe the Chinese company is eyeing a stake in Russia's LUKoil.

U.S. ConocoPhillips agreed to sell its 9.03% stake in the SPV, Syncrude Canada Ltd, to Sinopec (China Petroleum & Chemical Corp.) for $4.65 billion, the largest investment by a Chinese state company in North American energy assets, The Wall Street Journal reported.

Conoco needs to sell $10 billion worth of assets to decrease debt leverage, analysts explain. The company's debt stood at $28.7 billion at the end of last year, three times Exxon Mobile's, whose earnings are twice as high, and twice Chevron's, which is U.S. second largest oil and gas producer.

Analysts believe Conoco got a good deal and sold its asset at a profit; the stake was estimated earlier at $3-$3.5 billion.

Syncrude, Canada's largest oil sands development project, is a joint venture between Canadian Oil Sands Trust, Imperial Oil Ltd., Suncor Energy Inc., ConocoPhillips, Nexen Inc., Murphy Oil Corp. and Mocal Energy (a division of Japan's Nippon Oil Corp.). ConocoPhillips owned 9.03%, the third largest stake in Syncrude. The project's productivity was 280,000 barrels per day in 2009; it accounted for 10% of Canadian oil production.

The efficiency of oil production from sands is highly dependent on the market situation: It can yield a profit only if crude price is at least $70. The current price is $85, and the very fact that the Chinese decided to buy into the project shows their confidence that the situation will hold, Alexander Razuvayev, chief analyst at the Galleon Capital investment company, said.

China also needs to diversify oil supplies and reduce dependence on its key supplier, Iran, which says it might cut exports in the event of political destabilization.

ConocoPhillips earlier said it considered selling the assets to repay its debts within the next two years. The bulk of the sales are slated for the second half of this year.

Analysts say the next asset to be sold is the 10% stake in Russia's largest private oil producer LUKoil (estimated at around $5 billion), also owned by Conoco. China may also be interested, Razuvayev said.

April 14, 2010 

RIA Novosti




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