MOSCOW, September 20 (Itar-Tass) — Russia’s Rostekhnologii state-run corporation and Iran’s authorities have agreed to jointly develop the world’s largest zink deposit in central Iran, the Russian business daily Kommersant reported on Tuesday.
Rostekhnologii and Bank Saderat Iran, the country’s largest private bank, will set up a joint venture to run the project estimated at 1-1.2 billion dollars.
“The sides agreed to develop cooperation on the construction of an ore mining and processing enterprise and on the development of the Mehdiabad zink deposit,” the daily said.
The document was signed by Russian Energy Minister Sergei Shmatko and Iranian Foreign Minister Ali Akbar Salehi.
According to an official close to the negotiations, shares in a joint venture has not been distributed yet. He did not rule out that a separate intergovernmental agreement that will incorporate the project’s details should be signed. Participants in the project hope to attract most of investments on Iran’s domestic market.
However, the project’s implementation can be impeded by certain political risks. In 2006 without waiting for the UN Security Council’s resolution to be adopted the United States unilaterally introduced sanctions against several Iranian financial institutions. Thus, the Iranian bank was put on the blacklist on suspicion of financing militant Islamic groups. In spring 2008 the UN Security Council adopted a resolution toughening sanctions against Iran that was supported by Russia.
However, the official noted that Rostekhnologii is interested in the project’s implementation and can find the way out of the situation, for instance it may decide to implement the project with mediation of Iran’s company against which no sanctions are effective.
The Mehdiabad zinc deposit’s reserves are estimated at 390 million tonnes of zinc-, lead- and silver-rich ore. Iran accounts for 3 percent of the world’s reserves of these metals. The country ranks the world’s fifteenth largest zinc producer.