A year has passed since the release of the 2007 National Intelligence Estimate (NEI) on Iran. In a stunning departure from all the previous estimates dating back to 1997 under Presidents Clinton and Bush, it declared: "We judge with high confidence that in fall 2003, Tehran halted its nuclear weapons program."

It also judged, with modest confidence, that Iran had not resumed its quest for nuclear weapons. If correct, this new assessment meant that previous ones, such as the 2004 NIE that also judged with "high confidence" that Iran was expanding its nuclear weapons capabilities under the cover of a civilian energy program, were based on flawed intelligence.

But was this astonishing reversal correct?

The 2007 intelligence estimate proceeded from both a reorganization of the so-called intelligence community and a re-evaluation of information the CIA had gotten on a clandestine nuclear weapon design program code-named by Iran "Project 1-11." Even though Project 1-11 had been in operation since 1997, the CIA did not get wind of it until 2004, when it obtained a stolen Iranian laptop that had been smuggled into Turkey. The computer's hard drive contained thousands of pages of documents describing efforts to design a warhead that would fit in the nose cone of the Iranian Shahab 3 missile and detonate at an altitude of 600 meters (which is too high for any explosion but a nuclear one to be effective).

From the warhead's specifications, which included the kind of high-tension electric bridge wire used in implosion-type nuclear weapons, the CIA deduced that the payload was a nuclear bomb similar to Pakistan's early bomb. Its conclusion that Iran was going nuclear was repeated in all the NIEs through 2006.

By 2007, however, the CIA and reorganized intelligence community re-examined the issue and doubts began to emerge. It turned out that shortly after the stolen laptop compromised Project 1-11, satellite photographs showed that buildings involved in it had been bulldozed, and conversations intercepted by the U.S. indicated that the project was being dismantled. Then a high-level defector from the Iranian Revolutionary Guard, General Ali-Reza Asgari, confirmed in his CIA debriefings that Project 1-11 had been terminated in 2003.

After a long review, and "scrubbing" the evidence for signs of deception, the CIA reached its new conclusion that Iran's 1-11 project really had ended by 2004. In the world of clandestine activities, it is hardly unexpected that a super-secret operation such as Project 1-11, once it was compromised, would be officially closed down, and the evidence seems convincing that it was shuttered.

The issue is why. One explanation is that Iran had abandoned its efforts to acquire nuclear weapons. Another is that Iran no longer needed Project 1-11 because Iran had solved the tricky problem of triggering a nuclear warhead through other means.

Three pieces of the puzzle uncovered by the UN's International Atomic Energy Agency (IAEA) cast a surprising light on how Iran has advanced its capabilities independently of Project 11-1.

• First, there is the digital blueprint circulated by the network of A.Q. Khan, the father of Pakistan's nuclear bomb. IAEA investigators decoding and analyzing the massive computer files of this network found that it had clandestinely provided clients with a detailed design of a nuclear warhead of the version used by first China then Pakistan.

  Since the IAEA knew that Iran had been dealing with the Khan network since at least 2003, and features of that digital blueprint matched those described in the Project 11-1 documents, it was suspected that Iran acquired the digital blueprint, along with other components, from the Khan network. If so, it shortened the task of Project 1-11.

• Then, in late 2007, IAEA investigators uncovered a detailed Iranian narrative, written in Farsi, that described how a Russian scientist helped the Iranians conduct experiments to help Iranian scientists solve a complex design problem: Configuring high-tension electric bridge wire to detonate at different points less than a fraction of a nanosecond apart. In an implosion-type bomb, this is crucial for properly compressing the nuclear core. As Olli Heinonen, the IAEA's chief inspector explained at a closed-door briefing in February 2008, these Russian-led experiments were "not consistent with any application other than the development of a nuclear weapon."

• Finally, there is the Polonium 210 experiments that Iran conducted prior to 2004. Since Polonium 210 is used to initiate the chain reaction in early-generation nuclear bombs (and used in the Pakistan design), IAEA inspectors attempted up until 2008 to get access to the facility, or "box," in which the Polonium 210 was extracted from radioactive Bismuth.

Iran insisted that the Polonium 210 was only to be used for a civilian purpose - powering batteries on an Iranian spacecraft - and turned down these requests.

Iran had no known space program, but even if the extraction process was for civilian purposes, Iran's success with it meant that it could also produce Polonium 210 to trigger a nuclear bomb of the design furnished by the Khan network. So, even without further work by Project 1-11, it may have acquired all essential design elements for a nuclear weapon.

Design of course is only part of the equation. The other crucial part is obtaining a fissile fuel for the nuclear explosion, such as highly-enriched uranium.

In 1974, Pakistan, with the assistance of A.Q. Khan, had pioneered the path to nuclear proliferation by using centrifuges to enrich gasified uranium into weapon-grade uranium. In this process, the uranium cascades from one rapidly-spinning centrifuge to the next, each gradually increasing the proportion of the fissile isotope Uranium 235, until it becomes first low-enriched uranium for power plants, then, if continued, high-enriched uranium, for weapons. Iran built a similar facility in the massive underground caves at Natanz, able to house up to 50,000 centrifuges, which became operational in 2002.

Iran claimed this facility was intended for the production of low-enriched uranium for the Russian-built nuclear reactor at Bushehr to generate electric power (a facility Russia had agreed to fully supply as long as it operated). But the plant also could be used to produce weapons-grade uranium.

According to the IAEA, which monitors Natanz, by 2008 Iran had 3,800 centrifuges in operation and is adding another 3,000. It has also upgraded many of the older centrifuges, giving it about quadruple the capacity it had in 2003. To date, it has produced and stockpiled 1,380 pounds of low-enriched uranium, which is enough, if further enriched to weapons grade, to build a nuclear bomb.

The 2007 NIE deftly ducked this escalation with a footnote stating it was excluding from its assessment "Iran's declared civil work related to uranium conversion and enrichment," which meant Natanz. However, in light of all the developments in the past year, America's new president will have to confront the reality that Iran now has the capability to change the balance of power in the Gulf, if it so elects to do so, by building a nuclear weapon.

Edward Jay Epstein is an investigative writer and the author of thirteen books, including "Deception: The Invisible War Between the KGB and CIA." He is currently writing a book on the 9/11 Commission.

This article appeared December 10, 2008 in the International Herald Tribune
http://www.iht.com/articles/2008/12/10/opinion/edepstein

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