Glencore bartered with firm linked to Iranian N-program
Swiss company provided Iralco with thousands of tons of aluminium
UNITED NATIONS, March 1, (RTRS): Commodities giant Glencore supplied thousands of tons of alumina to an Iranian firm that has provided aluminum to Iran’s nuclear program, intelligence and diplomatic sources told Reuters.
The previously undisclosed barter arrangement between Glencore, the world’s biggest commodities trader, and the Iranian Aluminum Company (Iralco) illustrates how difficult it is for Western powers to curb Iran’s ability to trade with the rest of the world. Even as the West imposes stringent restrictions on banks that do business with Iran, United Nations diplomats say that Tehran keeps finding new ways to do business with willing partners.
Reuters first learned about Glencore’s barter deal with Iralco, and an aluminum supply contract that Iralco had with Iran Centrifuge Technology Co (TESA), from a Western diplomatic source in early November. That was about six weeks before the European Union’s December 2012 decision to levy sanctions on Iralco for supplying aluminum metal to TESA, which is a subsidiary of the Atomic Energy Organization of Iran (AEOI).
The source showed Reuters a Western intelligence report concerning Glencore’s arrangement with Iralco. It described how Baar, Switzerland-based Glencore provided Iralco with thousands of tons of alumina last year in exchange for a lesser amount of aluminum metal. The report’s authenticity was confirmed by UN diplomats.
Sanctions
It is not known whether any of the aluminum produced by Iralco from Glencore’s alumina raw material actually ended up with TESA. As part of AEOI, TESA has been subject to UN sanctions in place since 2006.
In a statement to Reuters, Glencore said it first learned about the TESAIralco relationship in December and immediately “ceased transactions” with Iralco. It said its last actual trade as part of the barter arrangement was in October 2012, two months before the EU move.
Glencore acknowledged that it did sign the barter deal with Iralco in August 2011, saying it was perfectly legal and denied any wrongdoing by the firm or attempts to help Iran bypass sanctions. It declined to provide details about the barter deal, the value of which is unclear.
Iralco did not respond to an emailed request for a comment. Iran’s UN mission said it was not in a position to comment.
Iran denies allegations by Western powers and their allies that it is seeking atomic weapons and has refused to stop enriching uranium. As a result, in addition to four rounds of UN sanctions, Iran has faced much tougher US and EU measures, specifically targeting its financial and energy sectors.
Aluminum can be used to make aluminum tubes for uranium enrichment gas centrifuges, though most newer gas centrifuges are made of a carbon composite material. Aluminum is also used in everything from cars to aircraft, buildings and cans.
Glencore had supplied Iralco with about five tons of alumina for every ton of aluminum that Glencore received in return, according to the intelligence report. Given that on average it takes only about two tons of alumina to produce one ton of aluminum, the barter deal may have left Iralco with more aluminum after processing the alumina than it supplied to Glencore.