The Islamic republic revealed Sunday the 1,000-megawatt plant would be operational in October 2006, a year behind schedule.

The new start date of the Bushehr reactor in southern Iran, which is being built with Russia's help, comes after Russian officials only recently announced the plant was expected to come on-stream in 2005, some two years from an earlier target of 2003.

Deputy head of Iran's Atomic Organization, Asadollah Sabouri, told reporters there were some complexities dogging the project, including a deal related to the return of spent fuel and its costs.

One subject which has not been concluded yet is the return of the spent fuel to Russia, which is very complex, he said, stressing that the state decision in Iran is to return the spent fuel to Russia.

Given that the transfer of the spent fuel from the power plant to Russia will be carried out eight or nine years later, it is hard to figure out the transfer costs now, Sabouri said, adding, however, that the contract had been finalized with some differences over the costs. The two countries have set the deadline for Russia's delivery of nuclear fuel as the end of 2005, according to the official.

The agreement is reportedly meant to ease fears that Iran could reprocess the spent fuel and turn it into bomb-grade material.

Observers say the delivery of the Russian fuel has been put back as Moscow bowed to pressures from Washington that, in turn, believes Tehran's nuclear program is a prelude to building an atomic bomb. Iran rejects U.S. accusations, arguing that, despite its large oil and gas reserves, it needs to generate 7,000 megawatts of nuclear-generated electricity by the year 2020 to meet not only the growing demand for power but to face the overstretching of its fossil fuel.

Sabouri said Iran, after having made important advances in the field, should be able to produce its own fuel for the envisaged second reactor at Bushehr -- the subject of a new contract whose technical and economic studies have been concluded with Russia.

Important advances have been made, he said. It will not be many years before we are in a position to produce our own fuel.

Iran's ability to master the uranium enrichment cycle has proven most controversial, causing concern within the international community. The U.N. watchdog, the International Atomic Energy Agency, has expressed reservations about whether the Islamic republic could use the technology to produce its own bomb.

Sabouri also welcomed European participation in the project, saying Iran had received initial expression of readiness of at least two European firms to take part. He declined to name the countries.

Asked if the Americans were also welcome, he replied, I have no clear answer in this regard since this subject goes beyond the technical and engineering scope.

Another factor holding up the project is protection and security requirements, Sabouri said.

One of the reasons that the project has faced delay is our precise attention to international standards on safety and the environment, he said.

So far, Iran has spent more than $1 billion on the project and it is projected that a further $3 billion to $4 billion has to be spent on bringing the power plant on-stream, according to Sabouri.

We will receive all the equipment by the end of this (Iranian) year (starting March 21, 2005), and the installation work will be carried out in the second half of this (Iranian) year and next year, he added.

Construction on the Bushehr power plant goes back to when the German firm, Siemens, and its subsidiary Kraftswerke Union, began work on the first reactor in 1974. However, they abandoned the project following an Islamic revolution in 1979 that ended in the establishment of a theocratic regime in Iran the same year.

At the time, the first reactor, called Unit One, was 90 percent complete, with 60 percent of the equipment installed, according to Iranian officials. The completion work on the second reactor, or Unit Two, was 50 percent.

Starting in mid-1980s, Iran approached several nuclear suppliers in a bid to reach an agreement for the completion of the project. A group of West German, Spanish and Argentinean companies was the first consortium that, in the late 1980s, showed willingness for the job, but the deal, Iranian officials say, was never realized owing to U.S. pressures.

In a similar deal, Iran signed a protocol in February 1990 with Spanish companies to complete the plant and supply the reactor's fuel, but they later left off, citing U.S. political pressures for their withdrawal, according to the same officials.

The Bushehr reactor, nevertheless, turned into a target for Iraqi warplanes during its eight-year war with Iran in 1980s, when no work on the abandoned plant was underway. At least, six air raids were reported during 1980-1988.

Also, fearing Iran's nuclear capabilities as a serious threat to its security, Israel has warned in recent years it will launch an attack against Iranian nuclear facilities, including the Bushehr power plant.

The dispute between the two countries escalated in recent weeks, leading to an unprecedented exchange of threats between the arch-foes.

In response to Israeli threats that it might strike Bushehr -- just the same way it bombed the Iraqi nuclear facility at Osirak in 1981 -- a commander of Iran's elite Revolutionary Guards, Gen. Mohammad-Baqer Zolqadr, warned the Jewish state last week it would have to permanently forget about (its) Dimona nuclear center, if Israel fires one missile at Bushehr atomic power plant.

Dimona, in the Negev desert, is allegedly where Israel produces weapons-grade plutonium for its estimated 200-400 nuclear warheads.

Israel, however, has never confirmed nor denied possessing a nuclear arsenal. It has, instead, warned that Iran may become a nuclear power within the next three or four years.

Commenting on a likely Israeli attack on the plant, Sabouri played down the threats, saying, The Israeli threats are intended for propaganda and will never become practical.

Zolqadr was also quoted as having reacted to the threat the same way, saying, Given the internal crises in the Zionist regime (Israel) and its military, security and geographical vulnerability, Israel is not capable of attacking Iran and its threats are only propaganda.

Touching on the security of the plant, Sabouri assured reporters at the news conference, Those responsible to guarantee the power plant's security have fulfilled their task, and officials in different rank and file have responded (to these threats).

Israel raised the ante recently with its launch, in July, of the Arrow missile-defense system that reportedly destroyed an incoming ballistic missile in a test off the California coast.

The launch was followed, earlier this month, by Iran's testing of an upgraded version of its conventional medium-range Shahab-3 missile, with the Revolutionary Guards chief, Yadollah Javani, warning that the entire territory of Israel, including its nuclear sites, were within range.

Analysts, however, say the delay to the Bushehr reactor will do little to allay international concerns about Iran's nuclear ambitions which focus more on its uranium enrichment efforts.

The IAEA governing body is scheduled to review the question of Iran's nuclear projects at meetings held in Vienna in mid-September. At its June meeting, the agency demanded the clerical regime provide conclusive proof that it was not secretly developing nuclear weapons.

Iran, however, says it has done its utmost to cooperate with the IAEA, such as suspending uranium enrichment, declaring nuclear activities, and allowing tougher inspections by U.N. experts.

Despite the U.S. campaign to refer Iran's dossier to the U.N. Security Council for possible sanctions, diplomats in Vienna were quoted last week as having said that the agency's 35-member board of directors would neither mention in its report whether Iran's nuclear activities are of a military nature nor recommend bringing the case before the Council.

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