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Germany Permits SPG Steiner to Build Three Gas Plants in Iran

By Andreas Cremer and Nicholas Comfort

July 30 (Bloomberg) -- Germany, one of six nations leading efforts to press the Iranian government to stop uranium enrichment, gave the go ahead for engineering company SPG Steiner-Prematechnik-Gastec GmbH to build three liquefied natural gas plants in Iran.

The Federal Office of Economics and Export Control, a government agency based near Frankfurt that helps oversee company compliance with export regulations, has just finished a 12-month investigation into the project. It concluded that SPG's plans don't violate United Nations sanctions against Iran, spokesman Holger Beutel said.

``We have no reservations,'' Beutel said today by phone. ``We told the company that it's entitled to start working on these projects.'' A spokesman for SPG couldn't immediately be reached for comment.

Iran, home to the world's second-largest oil and natural- gas reserves, has balked at three UN resolutions demanding a halt to uranium enrichment and reprocessing. The European Union last month tightened its sanctions against Iran's nuclear ambitions, shutting down the EU offices of Bank Melli Iran and denying travel visas to more Iranian officials. Germany backs the sanctions.

The order for the three gas plants, which will each have a capacity of 10,000 barrels per day, is worth about 100 million euros ($155 million), the German newspaper Siegener Zeitung reported today, citing no one.

Siegen-based SPG, located about 100 kilometers (62 miles) northwest of Frankfurt, is part of the Steiner Group, which makes products for use in oil and gas treatment as well as coking plant technology, its Web site shows. Steiner Group employs 150 staff and has annual revenue of 25 million euros.

Total Gas Field

France-based Total SA, Europe's third-largest oil company, will help Iran develop an area of its South Pars gas field, Shana, the official news agency of the country's oil ministry, reported July 16, citing the managing director of National Iranian Oil Co.

EU foreign policy chief Javier Solana, U.S. Undersecretary of State William Burns and other diplomats met with Iranian officials in Geneva July 19, offering Iran economic and diplomatic incentives to halt its nuclear work. In the absence of any breakthrough, Solana gave Iran two weeks to respond.

Iran says it is trying to enrich uranium to produce fuel for power stations instead of building the weapons that the U.S. and some European countries allege it wants. The talks with Iran have been led by the EU, and involve all five permanent members of the UN Security Council -- the U.S., China, Russia, France and the U.K. -- plus Germany.

To contact the reporters on this story: Andreas Cremer in Berlin at acremer@bloomberg.net; Nicholas Comfort in Frankfurt at ncomfort1@bloomberg.net.

Last Updated: July 30, 2008 10:53 EDT

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