123 agreement and Russian nuclear industry

United States decided to punish Russia for its activities to protect peaceful population of South Ossetia. Refusal from the ratification of the "123" agreement can be among the retaliatory measures. This agreement establishes the frameworks of the bilateral cooperation in the sphere of the nuclear energy. How can it threaten our country?

Brief background of the problem

"123" bilateral agreements, that are signed between the USA and other countries, got their name from the number of the article 123 of the American law about the nuclear energy. It fixes the possibility of the cooperation with "the nations, groups of nations or regional defence organisations" only on terms of signing of the correspondent agreement, which is approved by the President and ratified by the US Parliament.

Main aim of the "123" agreement, as it is understood in Washington, is to define the criterions that will authorize the transfer of the nuclear technologies from the USA. Such agreements have been already signed with the large group of states of different scales - from Bangladesh and Thailand to Australia, Canada and Japan. EURATOM and IAEA are certain US partners.

It has been spoken for a long time about the reasonability of the elaboration and signing of "123" agreement between Russia and USA, but practical steps in this direction were made only after Sergey Kirienko and his teem came to Rosatom. In summer 2006 at G-8 summit in St.Petersburg a political decision of the two Presidents about the necessity of signing of this agreement was lobbied, after that a work on its elaboration and discussion has started.

In spite of the fact, that many experts were predicting the unclouded future for the Russian-American agreement, the process of its signing was stopped at the most unexpected moment - literally on the eve of its signing. Sergey Kirienko and his American colleague had to sign the elaborated agreement on the 1 of February 2008, but before the visit of the Rosatom chief to Washington, it became known, that text of the agreement was not given to George Bush for the prior approval.

Well-informed sources insist, that American site was dragging out the "123" signing process only on the political reasons - there existed no any principal technical or juridical contradictions between Moscow and Washington.

Though it was not proved officially, but by some indirect indicators it is possible to guess, that United States have put forward for Russia certain demands, that concern the position of our country on Iran, as a term for signing of the "123" agreement. To all appearance, American blackmailing was not successful and on the 6th of May, last day of the Vladimir Putin's presidency, long-suffering document was finally signed.

On the next stage the agreement faced the opposition of the US Parliament. Some deputies and Congress committees proposed to link its ratifying to the Russian-Iranian cooperation - it means to strive for the status, which the State Department could not establish.

It was even planned to get the Chamber of Accounts of the United States involved, which should have sorted out Russian participation in the Busher NPP constructing. But after the events in South Ossetia Iranian issue moved to the backburner, giving the way to the Georgian one, which turned into the everlasting trump card of the opponents of the cooperation with Russia.

As Joseph Biden (senator-democrat and the US vice presidential nominee) has noted, current staff of the Congress, most likely, won't ratify Russian-American "123" agreement. Biden also threatened, that this agreement will never come into effect if Russia won't "change its political course".

Consequences for Russia

Current US-Russian cooperation

In spite of the absence of "123" agreement, Russia and USA were always able to find the ways to cooperate in the nuclear area if it served the interested of the politicians. There is a number of treaties and initiatives between our countries, that have been carried out successfully in the past and will work well in the future - regardless of the way the US Congress thinks about "123" agreement.

Among such "local" deals the most popular is HEU-LEU agreement about the deliveries of low-enriched uranium to American NPPs, received after impoverishment of the surplus weapon-grade soviet uranium. It is impossible to overestimate the importance of HEU-LEU for the Americans - with its help Russians cover 46% of the demands of the dump enrichment in the United States.

There is no doubt that Washington will insist on carrying out the HEU-LEU treaty till the official date of its completion (year 2013) by any developments of the situation with the "123" agreement. Moreover, even the most furious opponents of the cooperation with Russia among the American politicians recognize the necessity of dump enrichment quotas for Russia.

Correspondent agreement or rather amendments to the Agreement on the Suspension of the Antidumping Investigations has already been signed between Kirienko and the US Minister of Trade. Possibility that it will be abolished because of the absence of "123" agreement or on the other reasons tends to zero.

One more non-proliferation bilateral initiative is developing slowly but surely. This initiative also doesn't need the support of "123" agreement - it is an agreement for the excessive weapon-grade plutonium utilization. Full set of all the necessary documentation is also ready here, and sites only have to start burning plutonium in the reactors. Momentary opinions of the politicians won't influence anyhow the partial progress of this agreement.

Next direction of the cooperation is from the sphere of MPC&A. This cooperation is unilateral - USA helps Russia to increase the nuclear security of its nuclear sites, but not vice versa. So, it seems to be impossible, that Americans will refuse from it on their own initiative, regardless of the "123" agreement status.

Finally Russia - USA cooperation within the frameworks of different international forums, such as IPRO, GNEP, G-4 and a lot of others is rather weak. International character of such cooperation doesn't demand, principally, the approval by the bilateral "123" agreement.

Potential cooperation between Russia and USA

In the series of articles by the American authors that appeared in the Russian press, some new directions of the collaboration are mentioned, that could be initiated if the "123" agreement will come into effect.

First of all, it is the creation of the fast neutron reactors. It is very important, that in this direction Russia can play the role of a donor, and America, correspondingly be a receiver of the technologies.

Development of fast neutron reactors in USA was stopped during more than 20 years, and a main part of groundwork of American specialists was either lost or went out of date. Theoretically Russia could export to the United States its own technologies on commercial prices, but American politicians should overcome their own pride for that and take a principal decision on the possibility of buying the advanced technologies from the recent most probable enemy.

Less ambitious and faster realizable project could become the use on the commercial terms of the Russian experimental base - first of all possibilities of NIIAR - for the American program on creating of the fast burn-out reactor. It is possible to suppose, that by the absence of the real alternative American national laboratories will be able to lobby the adoption of the necessary legislative base for the collaboration with the Russian experimenters without the "123" agreement.

Speaking again about the export of Russian fast technologies to the USA, it is to admit, that without "123" agreement it is impossible. But at first, such a task has never been included into the list of priorities of the Rosatom State Corporation.

Second, if the domestic State program will keep developing rapidly enough, gap in the fast neutron reactors direction between Russia and USA will be increasing. This way, refusal from the ratifying of the "123" agreement from the point of view of the fast reactors will bring harm, and first of all to the United States.

Speaking about the potential cooperation in the sphere of fast reactors, such potential threat for Russia as brain-draining can't be avoided. After the adoption of the "123" agreement, receiving access to the Russian institutes, research centres and designing bureaus, American site will surely try to attract as many experienced Russian specialists as it possible, using financial tools.

We should seriously take into consideration this threat. But one of the possible countermeasures can become providing of descent salaries for the Russian specialists in this sphere, that is potentially possible within the innovation State Program.

Next direction of the collaboration, that is put through by Americans is cooperation by creating of the reactors of the small and middle capacity, suitable for the export to the states that only start developing nuclear industry.

Russian prospective estimations in this sphere are different, from the facile optimistic (we are building KLT-40 and they don't have real projects) to the defeatists (their IRIS is ready to be licensed, and we don't have elaborated projects of the 4th generation). Anyway, it is not very obvious how USA plan to cooperate here with Russians.

Work on the certain projects doesn't seem to be possible, as the companies from the both countries will compete with each other in the future on the same markets. Theoretically, certain joint activities to create the list of demands and principals to such facilities can be realized, but it can be done within the frameworks of the international forums, but not the bilateral cooperation.

Two other topics for the cooperation between Russians and Americans are not mentioned very frequently in the public speeches - American nuclear spent fuel processing in Russia and building of the power generating units with AP-1000 reactors in Russia.

Nuclear spent fuel processing can become a profitable business for our country in the future. Presence of the "123" agreement is obligatory for its realization, as the main part of the world stores of the nuclear spent fuel are controlled by the United States in varying degrees.

But we don't have to speak about the bringing in of the nuclear spent fuel to Russia for processing, as Rosatom State Corporation still doesn't have a definite strategy of closing the nuclear fuel cycle and there is no any practical decision on the spent nuclear fuel of Russian NPPs. We only have to hope on the elimination of this white spot in the innovative State Program, but before this, bringing in of the spent fuel will be equivalent to the bringing in of radioactive wastes for the storage, that is opposed by the most of the Russian population.

Unwillingness of the Rosatom State Corporation to have business with the foreign spent fuel is obvious from the public speeches of administration of the State Corporation and from its relation to the so-called "second initiative of Putin". In spite of the obvious instruction of the President to create the global infrastructure of the nuclear energy, including the spent fuel processing, Rosatom State Corporation has brought this idea solely to the International Centre of Uranium Enrichment and to the Fuel Bank in Angarsk, and than fixed such a narrowing of the Putin's initiative in the official documents of IAEA.

Buying of AP-1000 reactors for Russia is also the matter of the far future, if ever happens. In spite of all the outward unpatriotic spirit of the idea of buying American reactors, it can be elaborated and all the potential advantages and disadvantages can be defined - especially speaking about the example of the Chinese deal with the gradual attainment of 100% localisation.

AP-1000 seems to be rather prospective device - at least on this stage. Its advantages were estimated by the Chinese, that are going to clone AR-1000 for the development of the large-scale energetic. It is not excluded, that building of AR-1000 units for the regions of Far East could be economically profitable - but there are neither direct, nor indirect proves, that such a deal could be realized during a pare of the next decades.

Conclusions

The "123" agreement between Russia and USA is a political issue. Refusal of the US Parliament to ratify it won't harm the current cooperation between the countries in the sphere of the nuclear energy.

Certainly, permanent attempts of different branches of American power to link the fact of the adoption of "123" to the issues that have no any direct relation to it - relations with Iran, situation in the Southern Ossetia and so on - look humiliating for Russia and can not but irritate.

In Washington they try to present a usual framework agreement as a certain encouragement for Moscow, in return for what Russia has to pay. It is easy to receive evidence that it is not so in reality. Absence of the active "123" agreement does not do any harm to Russia, but on the contrary, in some areas is unprofitable for the American site.

Russian diplomacy should be more active and stop playing the role of the outside observer, humbly waiting for the new demands or "punishments" from the USA. What, for example, prevented Russia from laying down its own set of demands for coming of the "123" agreement into effect, taking over this way the foreign policy initiative?

But there is no sense of going the other limit, it means minimising or cutting down of all the contacts with the American nuclear companies and organisations, justifying it by the absence of "123" agreement.

Somehow or rather, cooperation should be maintained, at least within the frameworks of international initiatives or bilateral working groups. Dissociating ourselves from this process we are having risk of facing new rules of the game on the world markets in some years that will be written and adjusted for the Americans.

SOURCE: Mikhail Storozhevoy, AtomInfo.Ru

DATE: September 09, 2008

Topics: Russia, USA


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