TEHRAN (Reuters) – Iran is prepared to release on bail a U.S. woman, one of three Americans it has held for more than a year accused of espionage, Iran’s English language Press TV quoted a Tehran prosecutor as saying on Sunday.

“The American spy could be released on $500,000 bail. She is not barred from leaving Iran,” the prosecutor, Abbas Jafari Dolatabadi said. “The other two detained American hikers will remain in jail.”

Sarah Shourd was detained near Iran’s border with Iraq at the end of July 2009 along with two males, Shane Bauer and Josh Fattal. Their families say the three were on a mountain hike in northern Iraq at the time.

Dolatabadi did not say when Shourd would be freed.

Officials had said last week that one of the three might be freed on Saturday, but the release was postponed.

They have not been formally charged, but under Iran’s Islamic law, espionage can be punishable by execution. Washington rejects the spying allegations and has demanded their immediate release.

Their case has further complicated relations between Tehran and Washington already fraught over Iran’s nuclear activities.