In the face of Iran's race to obtain nuclear power, Israel signed a contract with Germany last month to buy two Dolphin-class submarines that will, according to foreign reports, provide superior second-strike nuclear capabilities, The Jerusalem Post has learned. The submarines will be assembled in Germany and provided with a propulsion system allowing them to remain underwater for far longer than the submarines currently in the Israel Navy's fleet. According to sources close to the deal, the submarines will be operational in the near future. The Post has also learned that the navy is considering installing a Fixed Underwater Sonar System (FUSS) off the coast to detect foreign submarines. In 1993, Iran bought two Russian Kilo-class submarines and eight mini-submarines from North Korea, although officials said this was not the only reason the system was being considered. In 2005, Israel spotted a Western submarine snooping off its shore. The contract signing was said to have come after a long dispute over the price and financing of the submarines. According to the details obtained by the Post, Israel will purchase the two Dolphins, manufactured by Howaldtswerke-Deutsche Werft AG, for $1.27 billion, a third of which will be financed by the German government. The navy already has three Dolphin-class submarines. They are the most expensive weapon platforms in the IDF's arsenal. Germany donated the first two submarines after the first Gulf War and split the cost of the third with Israel. The three submarines currently in the navy's possession employ a diesel-electric propulsion system, which requires them to resurface frequently to recharge their batteries. The new submarines - called the U212 - will be fitted with a new German technology in which the propulsion system combines a conventional diesel lead-acid battery system and an air-independent propulsion system used for slow, silent cruising, with a fuel cell equipped with oxygen and hydrogen storage. The submarines will also incorporate specifications gleaned from Israeli experience. The Dolphins currently in the navy's fleet were tailor-made for Israel's needs and reportedly have considerable operational capability. They are designed for a crew of 35 and can support 10 passengers. They have a maximum speed of 20 knots, a range of 4,500 kilometers and, according to Jane's Defense Weekly, the capability to launch cruise missiles carrying nuclear warheads. "With the new German technology," an official close to the deal said, "the new submarines will be able to remain submerged for much, much longer than the older Dolphin models." News of the impending deal first emerged in November after Der Spiegel reported that chancellor Gerhard Schroeder's outgoing government had agreed to sell Israel two submarines at a heavily discounted price. Prior to then, the German government had repeatedly turned down the request, supposedly because of reports the navy had outfitted the older submarines with Israeli-made, sea-launched cruise missiles. Sensitive armament sales need approval from Berlin's Security Council. Several months ago, however, the German government, now headed by Chancellor Angela Merkel, approved the deal after, sources told the Post, no significant public opposition was voiced. Closure of the deal followed on the heels of a warming in German-Israel ties. In 2005, the countries agreed for the first time to hold joint ground maneuvers. In June, the INS Eilat missile ship participated for the first time in a NATO exercise in the Black Sea, together with German Navy.