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Iran foreign minister in Japan for nuclear talks
(Reuters)
Updated: 2006-02-27 14:57

JAPAN'S DILEMMA

An original Russian proposal had been for Iran's uranium to be enriched in Russia to defuse suspicions that Iran might divert some nuclear fuel into a weapons program.

But Iran has insisted on its right to enrich uranium it mines in its central desert on its own soil, and it was unclear how the original Russian proposal could be altered to please Tehran.

At the March 6 meeting, the IAEA board will discuss the U.N. watchdog's latest report on Iran's nuclear program which may determine whether the United States and European powers push the Security Council to impose sanctions.

The stand-off has posed a dilemma for Japan, which wants to stay in diplomatic sync with the United States, its main security ally, while also pursuing the development of an Iranian oil field seen by Tokyo as vital to its energy strategy.

Flying in the face of U.S. objections, Tokyo went ahead two years ago with a deal on a billion-dollar project to develop the Azadegan oil field in southern Iran, estimated to hold the world's second-biggest single oil reserves.

The Japanese government has a 36 percent stake in Japan's biggest oil developer, INPEX Corp., which plans to develop the southern part of Azadegan, estimated to hold 26 billion barrels of oil.

The Azadegan development is one of the biggest foreign investments in Iran, and Japanese media have estimated that the project may cost up to $1.7 billion.


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