Iran nuclear deal draft makes release of prisoners and funds a priority

First phase does not include waivers on oil sanctions, diplomats have reportedly said

Negotiators attend a meeting aimed at reviving the Iran nuclear deal in Vienna, Austria.

A draft of a US-Iranian deal has focused on the unfreezing of Iranian funds and the release of western prisoners but does not include waivers on oil sanctions, diplomats have reportedly said.

The draft to revive Iran's 2015 nuclear agreement with world powers lays out steps to bring both sides back into full compliance. Delegates say much of the text is settled but issues remain.

Envoys from Iran, Russia, China, Britain, France, Germany, the EU and the US are still negotiating details of the draft accord amid western warnings that time is running out before the original deal becomes obsolete.

The broad objective is to return to the original bargain of lifting sanctions against Iran, including those that have slashed its crucial oil sales, in exchange for restrictions on its nuclear activities that extend the time it would need to produce enough enriched uranium for an atom bomb, if it chose to.

Iran has breached many of those restrictions — pushing well beyond some — in response to the US withdrawal from the deal in 2018 and its reimposition of sanctions under the Trump administration.

While the 2015 deal capped uranium enrichment at 3.67 per cent fissile purity, Iran is now enriching to up to 60 per cent, close to weapons grade.

Iran insists its aims are wholly peaceful and that it wants to master nuclear technology for civil uses. However, western powers say no other state has enriched to such a high level without developing nuclear weapons and Iran's advances since the US walkout mean the 2015 deal will soon be totally hollowed out.

The draft text of the agreement, which is more than 20 pages long, stipulates a sequence of steps to be put in place once it has been approved by the remaining parties to the deal, starting with a phase in which Iran suspends enrichment above 5 per cent purity, three diplomats said.

The text also alludes to other measures that include unfreezing about $7 billion in Iranian funds stuck in South Korean banks under US sanctions, as well as the release of western prisoners held in Iran, which US lead negotiator Robert Malley has suggested is a requirement for a deal.

Is 'Re-Implementation Day' coming soon?

Only once that initial wave of measures has been taken and confirmed would the main phase of sanctions-lifting begin, culminating in what many diplomats call Re-Implementation Day — a nod to the original deal's Implementation Day, when the last nuclear and sanctions-related measures fell into place.

The duration of these phases has not yet been agreed, and the text includes an X for the number of days between the milestone days such as Re-Implementation Day, diplomats say. Various officials have estimated the time from an agreement until Re-Implementation Day at between one and three months.

Iran will return to core nuclear limits such as the 3.67 per cent cap on enrichment purity, diplomats said.

As in the original deal, officially called the Joint Comprehensive Plan of Action (JCPOA), the new agreement entails the US granting waivers to sanctions on Iran's lifeblood oil sector rather than lifting them outright. That requires renewing the waivers every few months.

“On oil exports, under the deal, [former US President Barack] Obama and Trump used to issue 90- to 120-day waivers and renewed them consistently until Trump stopped after exiting the pact. Those waivers have been agreed to be issued again,” a Middle Eastern diplomat briefed on the talks said.