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| French firm probed in move of pumps to Iran |
| 2003-09-05 |
| Hat tip to Drudge U.S. export-control officials are investigating a French company suspected of illegally supplying Iran with four specialty pumps made in the United States that can be used in both commercial and military equipment, The Washington Times has learned. Treasury and Commerce department officials fear the pumps, described as cryogenic fluid transfer pumps, are being used as part of the cooling system for Iran’s nuclear reactors, which can be used to produce weapons-grade material. "That’s the immediate concern," a Commerce Department official said. Export of the pumps is controlled because of their military capabilities. The Treasury and Commerce departments are probing whether the French firm Technip-Coflexip in January diverted the pumps it purchased for a project in Iran to Iran’s nuclear program. The electric pumps are submersible and used to transfer extremely cold fluids. The officials said another likely use for the pumps is for the commercial transfer of liquid natural gas to ship containers for transport. The officials said their departments also are investigating whether Technip violated licensing rules on sales of oil and gas equipment to Iran. Both areas of investigation could result in criminal penalties. Technip spokesman Chris Welton had no immediate comment. If the pumps were used by Iran’s nuclear program, it would violate export controls on equipment with the potential for use in nuclear weapons development. It also would violate the 1996 Iran Foreign Oil Sanctions Act, which bars U.S. companies from developing Iran’s petroleum resources. Under the 1996 law, any foreign company that invests more than $40 million annually in the Iranian and Libyan oil and gas industry can be sanctioned. Additionally, the transfer pumps would require an export license if they were sold to Iran, which is under a U.S. embargo because of Tehran’s support for international terrorism. Yesterday, a United Nations diplomat said concern about Iran’s nuclear facilities has prompted the Bush administration to pursue a U.N. resolution to ensure inspection of the facilities by the International Atomic Energy Agency. According to officials, Technip contacted at least two U.S. transfer pump manufacturers, including the U.S. subsidiary of the Japanese-owned company Ebara International Corp. for two ethylene and two ethane transfer pumps. The pumps were intended for the petrochemical complex being built by Technip called the 9th Olefins Complex at Assaluyeh, located on the northwestern coast of the Persian Gulf. The diversion effort was outlined in documents sent to the Treasury Department’s Office of Foreign Assets Control (OFAC) in March by an informant close to Ebara. The office is in charge of monitoring adherence to export controls on Iran. Copies of the documents were obtained by The Times. Ebara "has knowingly engineered, manufactured, tested and shipped the above-referenced pumps to Technip of France for delivery to Iran," the informant stated in a document sent to Treasury’s chief of enforcement, Hal Harmon. According to the informant, EIC’s corporate lawyer in 1998 warned Ebara "not to engage in the sale of goods or engineering services to countries that are on the restricted list per OFAC regulations." The informant also stated that an inspector working on behalf of Technip refused to authorize the shipment of the pumps because of concerns that the pumps would be sent to Iran. The pumps also were exported without nameplates, the informant stated. Richard Mitchell, the Ebara corporate counsel, said in an interview that the company has not sent any pumps to Technip in January. The company also scrupulously abides by laws and regulations related to sales to Iran, Mr. Mitchell said. "I have asked everyone in the organization in a position to know and they have manifestly and devoutly stated that nothing was done" in violation of export rules, Mr. Mitchell said. Ebara in January shipped several pumps to a Middle Eastern petrochemical complex but the sale did not involve Technip, Mr. Mitchell said. The company is currently engaged in a deal with Technip to sell transfer pumps to a facility in Nigeria, but the pumps have not yet been exported, Mr. Mitchell said. As for sending pumps without nameplates, Mr. Mitchell said: "It’s not uncommon to ship pumps without nameplates. We do not nameplate pumps for other manufacturers." Mr. Mitchell said he did not know where the information about the suspected diversion came from. But he said it may have been part of an effort at "dirty tricks" by a disgruntled former employee now working for a competitor. Technip concluded a deal two years ago with the National Petrochemical Co. of Iran to build the 9th Olefins Complex and last year agreed to build a second facility. The value of the construction of the petrochemical complexes at Assaluyeh is estimated to be worth about $1.2 billion. Technip-Coflexip announced in September 2002 that it is also building Iran’s 10th Olefins plant near the 9th Olefins at Assaluyeh that will produce 1.3 million tons of ethylene a year. The deal is worth $358 million. A company press release said Technip-Coflexip would provided "in-house ethylene technology and proprietary furnaces and will carry out engineering, supply of equipment and materials." The company also will supervise construction of what it calls the largest ethylene plant in the world. |
| Posted by:Frank G |
| #1 For once, I wouldn't leap to conclusions about this being a suspicious deal: the price of Natural gas is skyrocketing due to tight supplies. There's been talk of shipping liquified Natural Gas via tanker from Russia. Why shouldn't Iran jump into this new sweet market: There's so much of it in those fields, Saudi Arabia used to let the stuff burn at the wellhead! I can confidently say that there isn't a nuclear reactor in the world that uses "cryogenic" liquids for cooling: Liquid Sodium, yes. Good ole Water, yes. Helium gas, yes. (Don't laugh. That reactor design uses fuels and produces wastes that cannot be used in a nuclear device) But liquid Nitrogen? Too expensive. This is the treasury and Commerce departments: How much do they know about Nuclear equipment, other than being able to recognize the word on a page? If they have a memo from the Nuclear Regulatory Commission's engineering staff (I'm told they have a very good one), or can point to a nuclear plant using them, then I'll be convinced. To me, the licensing and paperwork issues are more important: If this got through, what else did? |
| Posted by: Ptah 2003-9-5 3:01:08 PM |