EXTRANCHECK: PRE-LICENSE CHECK: ARGON LLC,

UNCLAS MOSCOW 000668

SIPDIS

SIPDIS

USDOC FOR 532/OEA/MHAMES/LRITTER
USDOC FOR 3150/USFCS/OIO/CEENIS/MCOSTA
USDOC FOR 532/OEE/MO'BRIEN

E.O. 12958: N/A
TAGS: BEXP ETRD ETTC RS
SUBJECT: EXTRANCHECK: PRE-LICENSE CHECK: ARGON LLC,
BALAKOVO, SARATOV REGION, RUSSIA, LICENSE NO. D368394

REFTEL: USDOC 06722


1. Unauthorized disclosure of the information provided
below is prohibited by Section 12C of the Export
Administration Act.


2. Reftel requested a Pre-license check to determine
the legitimacy and reliability of the end-user, Argon
LLC, Balakovo, Russia. The company is listed on BIS
license application D368394 as the ultimate consignee
of one model CTUF-6.5D60-FT-2800 graphite resistance-
heated tube furnace. These items are controlled for
nuclear non-proliferation and missile technology
reasons under ECCN 1B101. The licensee is Harper
International Corporation, West Drullard Avenue,
Lancaster, NY 14086.


3. On February 8, 2007, Export Control Attache Donald
Pearce and FSN Natalya Shipitsina conducted the
requested pre-license check at the offices of Argon
LLC, Saratovskot Shosse, 2, Saratov region, Balakovo,
Russia. The export control team met with Sergey
Motorin, General Director.


4. Argon, a part of the Balakovsky Plant of "thread
materials," is a manufacturer of carbon poly-acrylic
materials and fibers. The plant was founded 40 years
ago, and at one time employed over 22,000. Currently
the plant employs around 4000, and produces a variety
of viscose cable, consumer carbon fiber products such
as inspection mirrors and fishing poles, and small
parts for the aerospace industry. The company is also
exploring the possibility of producing such varied
products as brake pads, blades for windmills, and
cigarette filters, all using carbon fiber materials.
While Argon has the ability to produce space grade and
aviation grade carbon fiber, the company has no
military or government contracts. Mr. Motorin stated
that government and military projects are usually
handled by state owned or managed companies, and are
not usually very profitable for the contractor.


5. The furnaces in reftel will be used in the
production of carbon fiber cord. Currently, Argon is
using furnaces produced 20 to 30 years ago. While
they are still operational, the production line is
slow compared to lines utilizing more modern furnaces.
The furnaces will be mounted into the production lines
in a large factory facility on the grounds of the
Balakovsky plant. The plant is manned 24 hours a day,
as the production lines are run around the clock. A
contract guard force provides security, and a high
wall encloses the perimeter of the facility. Access to
the area is restricted to authorized personnel and
escorted guests.


6. Mr. Motorin stated that this may be the first of
several purchases from Harper International
Corporation (HIC),as the company is planning on
adding additional lines. Mr. Motorin is assisting the
HIC in opening a representative office in Moscow. In
the early days of the company, Mr. Motorin stated that
the goal was for the factory to survive. With this
purchase, he is now focusing on how to thrive.


7. Recommendations: Post recommends Argon LLC,
Balakovo, Russia, as reliable recipients of sensitive
U.S. origin commodities. It is requested that post be
notified of final disposition of the application, and
of any shipments for this organization in order to
conduct appropriate FCS follow-up and statistical
reporting.
(FCS MOSCOW/ SBOZEK/DPEARCE)
BURNS