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A German firm has closed a major deal with Iran to build three new liquid gas plants.

The deal, recently approved by the German government, reportedly is worth $156 million to the Siegen-based firm of SPG-Steiner-Prematecnic-Gastec. SPG-Steiner will apply its high-tech method of turning gas into a sulphur-free liquid fuel, enabling the production of 10,000 barrels per day at each of three plants in southern Iran. Germany’s Federal Agency for Economics and Export Control examined the deal for a year before giving its approval, based on its determination that none of the construction elements could be put to military use and that the contract would not violate United Nations or European Union sanctions.

State loan guarantees are banned for deals with Iran, so step-by-step financing reportedly is planned. Critics say the deal violates the spirit of the sanctions, if not the letter of the law. Johannes Gerster, the head of the German-Israeli friendship society and a former member of parliament, told The Jerusalem Post the deal should be rescinded as incompatible with German Chancellor Angela Merkel’s talk of tougher sanctions during her address to the Israeli Knesset in March. Germany has reduced trade with Iran over the past year as part of international pressure on the Islamic Republic to stop enriching uranium.

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