ERBIL, Kurdistan Region of Iraq - Iran and Russia signed a $25 billion agreement on Friday to construct nuclear power plants in southeastern Iran. The deal comes as Tehran faces the looming threat of the revival of sanctions on its nuclear program.

“An executive agreement for the construction of four advanced third-generation nuclear power plant units worth $25 billion in Sirik, Hormozgan, was signed between Iran Hormoz Company and the Rosatom Project Company,” Iran's state-owned IRNA news agency reported.

Rosatom Project Company, a subsidiary of Russia’s state nuclear agency Rosatom, is responsible for the design, construction, and management of nuclear power plants globally.

The project plans for a total capacity of 5,200 MW from the new power plant units in the Sirik region, with each unit contributing 1,255 MW. The agreement was signed “with the development of joint cooperation in the field of peaceful use of nuclear energy,” IRNA added.

The move follows an operational step taken by Iran and Russia to implement a nuclear cooperation memorandum signed previously in Moscow by Iranian atomic chief Mohammad Eslami and Rosatom CEO Alexei Likhachev.

While nuclear power plants are primarily used to generate electricity, the underlying technology, including fuel enrichment, reactor operation, and spent-fuel handling, has dual-use potential and can, under certain circumstances, be diverted for military applications.

The deal comes as Iran, which has struggled with severe electricity shortages in recent months, is also issuing warnings to Western powers. Tehran has said it would suspend cooperation with the UN nuclear watchdog if the Security Council votes to activate the "snapback" mechanism by September 28, a move it argues would exempt the country from its None Proliferation Treaty (NPT) obligations.

Earlier in September, Iran and Russia agreed to maximize "economic and defense cooperation" as both nations contend with severe Western sanctions.

Tehran is on the verge of facing the “snapback” mechanism from European countries, a move that would reinstate international sanctions due to an alleged lack of cooperation regarding the Islamic Republic’s nuclear program.

Iran has announced, based on talks held with European officials earlier this week in New York, that Western powers will most likely trigger the snapback mechanism.

Under the 2015 nuclear accord with world powers, officially called the Joint Comprehensive Plan of Action (JCPOA), from which the US unilaterally withdrew in 2018, the snapback mechanism permits the reactivation of UN sanctions if Iran is deemed in violation of its nuclear obligations.