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Argentina to Pay Fine to Iran for Canceling Nuclear Contract

Argentina will pay Iran a $5.5 million fine for the cancellation of a $48 million nuclear technology contract that featured the construction in Iran of a reactor with uranium-refining capabilities, official sources have said.

Argentina reportedly settled the case out of court after negotiations that were “hard and unfriendly,” sources said last week.

In early February 1992, the Argentine government stopped the shipment of the small nuclear reactor to Teheran under pressure from the United States and Israel.

The Argentine-built reactor was part of a bilateral contract, which included other provisions, such as lowering the levels of enriched-uranium at the core of the Teheran University research reactor.

These other tasks were carried out by Argentine technicians without American objections.

The contract for the provision of the reactor had been signed between Argentina’s INVAP, a state-owned atomic materials manufacturing company, and Iran’s Nuclear Energy Organization.

INVAP is now building a nuclear facility in Egypt and bidding for a contract in Thailand.

Earlier this year, Teheran told the Argentine government that it would seek $90 million in damages.

Also earlier, Reza Amrollah, head of the Iranian nuclear organization, said the reactor was needed “to train engineers and manufacture medical equipment, not to wage war.”

Argentina and Iran recalled their ambassadors after the Argentine government accused the Iranians of involvement in the July 18, 1994, bombing of the AMIA Jewish community center that left 86 dead and at least 300 wounded.

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