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Nuclear News - 12/06/99
RANSAC Nuclear News, 06 December 1999


A.  HEU

    1. Richardson Statement on USEC Decision, Department of Energy(12/01/99)
    2. USEC to Retain Role in Russian Uranium Deal, Martha M.Hamilton, Washington Post (12/02/99)
B.  CTR
    1. Defense: Cooperative Security With Russia Remains a Priority,Sen. Carl Levin, Roll Call Online (12/06/99)
C.  Nuclear Cities Initiative
    1. Editorial [NCI], Rose Gottemoeller, Washington Post(11/27/99)
D.  Nuclear Waste
    1. Nuclear Waste Site In Chechnya Under Federal Control,Agence France Presse (12/03/99)
E.  Y2K
    1. Richardson, Adamov Demonstrate Video Link To Exchange Y2KInformation Between U.S., Russian Agencies, Department of Energy(12/01/99)
F.  DOE
    1. Nuclear Lab Visits to Resume, Walter Pincus, WashingtonPost (12/04/99)
G.  START
    1. New Russian Duma to Ratify Start-2 Treaty-Lukin, ItarTass (12/03/99)

A. HEU

1.
Richardson Statement on USEC Decision
        U.S. Department of Energy
        December 1, 1999
        (for personal use only)

Secretary of Energy Bill Richardson today made the following statementon the decision by the Board of the United States Enrichment Corporation(USEC), not to resign as the U.S. government's executive agent for theU.S.-Russia HEU (highly enriched uranium) Agreement and to continue toperform this responsibility:

"I'm pleased that USEC is standing by their role as our executive agentfor the HEU Agreement. I look forward to continuing to work with them onthis important agreement that is so critical to our nonproliferation goals.In the end, I think they realized that it was not in their interest toabandon an exclusive long-term market position that is of considerablefinancial value.

"My immediate concern is about the related matter of the workers atour gaseous diffusion plants in Ohio and Kentucky. I expect USEC to meettheir obligations to continue operation of the plants through 2004. I'mcommitted to do what's right for the critically important HEU Agreementwith Russia for our national security, what is right for workers and citizensin communities around our gaseous diffusion plants who helped to win theCold War and what's fair and proper by way of USEC. In turn, we expectthat USEC fully perform on the HEU Agreement and on the privatization agreementthat builds in workforce safeguards."

Background

The 1993 U.S.-Russian HEU Purchase Agreement involves the purchase overtwenty years by the U.S. from Russia of the low enriched uranium derivedfrom 500 metric tons of highly enriched uranium from Russian nuclear weaponsfor use in commercial nuclear reactors. USEC is currently the U.S. executiveagent for the agreement. USEC became a private corporation in July 1998.If USEC gave notice on December 1, they would still have to perform theircontractual obligations under the HEU Agreement until December 31, 2000.After December 1, for various reasons, the period extends to December 31,2001. The US government can also introduce additional or alternative executiveagents on 30 days notice. Annual scheduled quantities from to be orderedfrom Russia from 2000 to 2013 are some 30 metric tons per year, or roughlyone-half of the U.S. market annually. USEC had recently sought additionalfunds from the U.S. government to compensate for what it characterizedas the increasing costs of the implementing the HEU Agreement, but thesefunds were not provided by the Administration or the Congress.

The Department of Energy owns and leases to USEC the gaseous diffusionplants at Portsmouth Ohio, and Paducah, Kentucky. USEC prior to privatizationin July 1998 signed an agreement with the Department of Treasury to keepboth plants open through 2004 unless USEC's economic performance met severalhardship tests, which USEC's September 10, 1999 10-K filing with the Securityand Exchange Commission suggests do not now apply. Legislation has alsobeen proposed that addresses future decontamination and decommission workat these locations, construction of DUF6 plants, and medical assistancefor workers exposed during enrichment operations at the plants during theColdWar.

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2.
USEC to Retain Role in Russian Uranium Deal
        Martha M. Hamilton
        Washington Post
        December 2, 1999
        (for personal use only)

Bowing to pressure from the Clinton administration and Congress, theuranium-processing firm USEC Inc. yesterday dropped its threat to resignas the federal government's executive agent in a nuclear nonproliferationdeal with Russia.

The Bethesda-based company, which was sold by the government to investorsin July 1998, had raised the possibility that it would resign as the agentin the Russian deal if it failed in its efforts to win as much as $200million in federal financial aid.

USEC had said that it needed the federal financial support because thedeal with the Russians--under which Russians convert highly enriched uraniumfrom dismantled nuclear warheads into low-enriched uranium used as fuelin power plants--was costing the company money. USEC buys the processingfrom the Russians at a price it says is higher than its own cost of processing.

But the administration countered by saying that it was negotiating withother companies to take over the executive agency, which could have createda competitor to USEC in the market to sell fuel-quality uranium to utilities.

Yesterday USEC's board blinked, voting to continue as executive agentuntil the deal with the Russians expires at the end of 2001. The companyestimated that doing so will result in approximately $10 million in lostearnings next year, but USEC President William H. Timbers Jr. said that"the company would incur greater economic costs in the long run from notbeing the manager of this program."

Investors sent the company's shares tumbling 7.6 percent, or 62 1/2cents, to close at a new low of $7.62 1/2.

The company also may have incurred costs in ill will created by itslobbying campaign. Members of Congress and the administration have saidthey were unconvinced that federal aid of the magnitude that USEC was seekingwas warranted, noting that the company is spending $100 million a yearin dividends to shareholders and another $100 million to buy back its stock.

Energy Secretary Bill Richardson said yesterday that he doesn't ruleout helping USEC. But he said that the amount the company had been seekingand its unwillingness to give assurances about employment and the continuedoperation of its uranium-processing plants in Paducah, Ky., and Portsmouth,Ohio, were "unacceptable."

"We will work with USEC. We will try to straighten out some of ourdifferences,"Richardson said, but he also said that he is keeping alive the idea ofintroducing additional agents into the Russian deal. "This is not a threat,"but a step to make sure national security considerations are protected,he said.

House Commerce Committee Chairman Rep. Thomas J. Bliley Jr. (R-Va.)said yesterday that "today's announcement does not mean this problem hasdisappeared." Bliley has been sharply critical of the administration forwhat he has said is a failure to provide adequate oversight for USEC afterit was privatized. "The Clinton administration dodged the bullet today,"he said.

In a written statement yesterday, USEC's Timbers said that to meet theneeds of shareholders "the relationship between our cost structure, includingthe purchase price of enriched uranium from Russia and the market priceof our products must come into better alignment." Rep. Ted Strickland (D-Ohio)said he was concerned that USEC's next step might be to lay off workers.

USEC pays Russia $88 per unit of processed uranium now and will pay$91 in 2001, which the company says is higher than its own cost of processingand above the market price, which is in the low $80s, according to companyspokesman Charles Yulish.

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B. CTR

1.
Defense: Cooperative Security With Russia Remains a Priority
        Sen. Carl Levin
        Roll Call Online
        December 6, 1999
        (for personal use only)

In the coming year, the United States will face no greater challengethan how we manage the future course of our security relationship withRussia.

Recently there has been a surge of sentiment here in the United Statesthat Russia is too hard to work with, or that it may not be worth the troubleto cooperate with the world's largest post-communist democracy, or thatRussia has been "lost." These are short-sighted and dangerous sentiments.

There are obvious limits on how much we can hope to influence certainaspects of Russian life, including crime, corruption and money laundering.However, there is one area where we have had, and must continue to have,a clear influence: our security relationship and strategic stability withRussia.

Since the collapse of the former Soviet Union and the end of the ColdWar, we have experienced a number of disagreements with Russia. For example,Russia opposed NATO enlargement and NATO's use of force in Kosovo. TheUnited States, while acknowledging Russia's right to protect its territorialintegrity and to fight terrorism, has criticized Russia's seeminglyindiscriminateuse of force in Chechnya.

On the other hand, we have made major strides in cooperative securitywith Russia, including in nuclear weapons reductions and nonproliferation.Here are a few examples:

In an extraordinary cooperative program, Russia has deactivated morethan 1,500 nuclear warheads that used to be on missiles and bombers thatcould reach our nation. Through our Cooperative Threat Reduction Program,we have helped Russia destroy more than 280 intercontinental nuclear missiles,along with 10 missile-carrying submarines, 30 nuclear bombers and 50 silosthat once housed these missiles. Those destroyed forces dwarf the arsenalsall other potential adversaries could muster against us, either now orin the foreseeable future.

Through the Defense and Energy departments, we have helped to secureand safeguard Russian nuclear weapons and materials so they are not subjectto accident, theft or diversion. This has helped reduce the "loose nukes"threat we feared when the Soviet Union dissolved. Although there is noreason for complacency, we are not aware of any confirmed cases of nuclearsmuggling, theft or diversion, and security has been dramatically improved.

The United States is helping design and build a fissile material storagefacility - a secure building to house the plutonium and uranium from morethan 6,000 Russian nuclear weapons that are being dismantled – in Mayak,Russia. This facility will help accelerate the Russian dismantlement ofnuclear warheads and assure that these deadly warhead components are safeand secure.

In an effort to stop the continued production of Russian plutonium fornuclear weapons, the United States is assisting with the conversion ofRussia's three remaining plutonium production reactors. This will eliminatethe world's largest source of new weapons-grade plutonium.

Despite substantial differences relative to Kosovo, United States andRussian soldiers are serving there side by side in peacekeeping operationsunder a unified command, as they have done for several years in Bosnia.

However, these and other gains in the U.S.-Russian relationship willbe at risk, and the previous failures will seem insignificant by comparison,if in the coming months the United States and Russia do not reach agreementon how to proceed cooperatively on the issues of missile defenses and nucleararms reductions.

If we act in a unilateral fashion on missile defense issues and abrogatethe Anti-Ballistic Missile Treaty, it will fundamentally end the cooperativebasis for the mutual security relationship. In that case we can expectthat the START nuclear arms reduction process would also end and Russiawould be free to keep all of its current nuclear weapons, and indeed whenRussia is economically stronger, which it surely will be some day, to increaseits nuclear weapons arsenal.

That, in turn, will create a proliferation threat because without theverified reductions and eliminations resulting from arms control agreements,there is a significantly greater likelihood of proliferation of Russiannuclear weapons and "loose nukes."

It is clearly not in our national interest to let that happen. It surelyis in our national interest to attempt to work through our differenceswith Russia to find common ground.

The United States and Russia have begun discussions on possible modificationsto the ABM Treaty to permit the possible deployment of a limited nationalmissile defense system (i.e., a system designed as a defense against afew possible rogue state ballistic missiles).

President Clinton is currently scheduled to make an initial deploymentdecision on such a limited system next summer, so there isn't much time.Although the system isn't designed or intended to defend against Russia'ssubstantial nuclear arsenal, we have to find ways to convince Russia thatthis system is not aimed there (i.e., does not threaten its capabilities)and is not the first step in the development of a larger system that couldundermine Russia's deterrent force.

I would hope that Russia, which is vulnerable to the same possible threatsfrom rogue states that we are, would accept the United States' offer tocooperate on limited defenses against ballistic missiles.

If Russia fails economically and politically, the Russians will be primarilyresponsible. But we and Russia bear joint responsibility for our mutualsecurity situation. If we fail to negotiate a path to nuclear arms reductionsin the post-Cold War era, we will not be able to duck the consequences.Russia's internal problems are ultimately in its own hands. But the futureof the U.S.-Russian security relationship is in both our hands.

A year ago I stood with former Sen. Sam Nunn (R-Ga.) and Sen.RichardLugar (R-Ind.) on the dock of the Sevmash shipyard in Severodvinsk, Russia,and saw firsthand where the Russians are dismantling their nuclear missilesubmarines with U.S. assistance. This sort of cooperation was simplyunimaginableduring the Cold War.

Our goal for the coming year must be to begin the new millennium bypreserving and increasing the enhancements to our national security fromnuclear arms reduction agreements and strategic stability with Russia.It will take intense negotiations with Russia and courageous bipartisanshipat home to achieve this important goal.

Sen. Carl Levin (D-Mich.) is the ranking member of the Armed ServicesCommittee.

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C. Nuclear Cities Initiative

1.
Editorial [NCI]
        Rose Gottemoeller
        Washington Post
        November 27, 1999
        (for personal use only)

Despite the congressional cuts imposed on our important Nuclear CitiesInitiative, we will do our best to maintain projects in three Russian nuclearcities, not just one described in The Post [news story, Nov. 12].

Our program is designed to keep the former nuclear weapons scientistsfrom selling their knowledge to unfriendly countries.

While we will place considerable emphasis on the nuclear city of Sarov,we also will continue to encourage the development of peaceful commercialjobs for former weapons scientists in Snezhinsk and Zheleznogorsk.

Although we have a limited budget, we will continue to work with theRussians to place resources, including Russian budget resources, in ourthree focus cities. We believe it is neither in the Russian nor the U.S.interest that nuclear scientists find their next jobs in North Korea or
Iraq.

ROSE GOTTEMOELLER
Assistant Secretary
Nonproliferation and National Security
U.S. Department of Energy
Washington

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D. Nuclear Waste

1.
Nuclear Waste Site In Chechnya Under Federal Control
        Agence France Presse
        December 3, 1999
        (for personal use only)

MOSCOW, Dec 3, 1999 -- (Agence France Presse) Moscow said Friday thata nuclear waste site near Gudermes, the Russian-controlled second cityin Chechnya, was under the control of federal troops.

"This nuclear waste storage facility is under the control of Russianforces and presents no danger," a foreign ministry statement said.

"Russia has informed the International Atomic Energy Agency (IAEA) ofthe situation at the site," the ministry added.

"It is the Chechen fighters, who have on several occasions threatenedRussia with nuclear terrorism, who represent the real danger," the statementcontinued.

Russian forces walked into Gudermes, in the east of the war-torn rebelprovince, unopposed on November 12 after an agreement with local leaders.

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E. Y2K

1.
Richardson, Adamov Demonstrate Video Link To Exchange Y2K InformationBetween U.S., Russian Agencies
        U.S. Department of Energy
        December 1, 1999
        (for personal use only)

Secretary of Energy Bill Richardson and Russia's Minister of AtomicEnergy Yevgeniy Adamov today demonstrated a live video conference capabilitybetween the two countries. The new interactive link between the U.S. Departmentof Energy (DOE) Emergency Operations Center (EOC) and the MinAtom Situationand Crisis Center (SCC) will be central to communications between the U.S.and Russia during the Year 2000 (Y2K) rollover. The Situation and CrisisCenter uses the Energy Department's unclassified Emergency CommunicationsNetwork System to allow immediate communication in times of emergency.The Energy Department is lending support to the Russian government as itworks to assure that its power grids and nuclear power plants are Y2K ready.

"On New Year's Eve, Russian experts will be in the Department of Energy'sEmergency Operations Center and U.S. experts will be in the MinAtom Centerto monitor and provide advice and counsel on any Y2K-related problems inRussia's electricity grid and nuclear power plants," said Secretary Richardson."It is in our national security interest to have a stable Russian energysupply at this critical time."

For the rollover, the Energy Department will maintain open lines ofcommunication with Russia between its Emergency Operations Center and theSCC -- allowing experts to share information and up-to-the-minute reportsin the event of a Y2K-related emergency. Americans will be stationed inthe SCC, and Russians in the EOC. American experts will also be stationedin Ukraine to monitor the situation there.

DOE has an ongoing nuclear power plant safety cooperation program aimedat helping the Russian government prevent another Chornobyl-like accidentat Soviet-designed nuclear power reactors. The program is improving thesafety of 65 operating Soviet-designed nuclear power reactors at 21 nuclearpower plants in 9 countries. DOE has been working with the InternationalAtomic Energy Agency to help resolve Y2K issues associated with these reactors.

The Department of Energy has observed two Russian nuclear power plantY2K exercises in November and they were reported to be ready. Another exerciseon December 8 at the Leningrad nuclear power plant also will be observed.The primary safety systems at these nuclear reactors are expected to functionnormally. These systems, which are designed to shut reactor plants downautomatically in an emergency, do not contain the type of digital computersystems that are susceptible to the "millennium bug."

Other systems such as computers that monitor plant conditions, however,could potentially fail, and lead to a reactor shutdown leaving local populationswithout electricity. DOE's Y2K assistance efforts have been aimed at helpingreactor operators correct deficiencies in these systems by providing Y2Kcompliant computers and software.

DOE began work on the video and telecommunications link in March 1999when Secretary Richardson and Minister Adamov signed the Report of theNuclear Committee Meeting of the U.S.-Russian Joint Commission on Economicand Technological Cooperation. They agreed to establish an emergency centerworking relationship, provide DOE assistance for technology and engineeringat the Situation Crisis Center and its planned future expansion withinRussia, and provide MinAtom with DOE emergency management training andexercise assistance. Secretary Richardson and Minister Adamov dedicatedMinAtom's SCC in Moscow on October 2.

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F. DOE

1.
Nuclear Lab Visits to Resume
        Walter Pincus
        Washington Post
        December 4, 1999
        (for personal use only)

WASHINGTON - Warning that ''congressional hysteria over security'' threatensthe quality of science at America's nuclear weapons laboratories, EnergySecretary Bill Richardson has announced he will begin issuing waivers forforeign scientists to visit the national labs again.

Mr. Richardson said the waivers were permitted under a new law thatimposed a moratorium on visits to the Los Alamos, Lawrence Livermore andSandia national laboratories by scientists from China, Israel, India, Pakistanand other countries deemed sensitive.

The freeze in scientific exchanges and other efforts to tighten security– such as severe restrictions on outgoing electronic mail - began lastspring and summer amid a political furor over allegations that China hadstolen U.S. nuclear secrets from the labs, which belong to the EnergyDepartment.

''As a result of congressional hysteria over security, we are in dangerof losing the science that we sought to protect,'' Mr. Richardson saidThursday in an interview. He added that he wanted to ''restore the properbalance between security and science.''

At the heart of Mr. Richardson's concerns are steps that he initiatedto tighten security and that Congress subsequently endorsed or took further.

His suggestion early this year that polygraph tests be given to employeeshandling top-secret information, for example, was later put into law byCongress. But it has engendered strong opposition from scientists worriedabout the incidence of false results in such ''lie detector'' exams, andMr. Richardson said the latest plan was to require testing of only ''severalhundred'' scientists at each lab, far less than the 5,000 to 10,000 subjectsoriginally envisioned.

Mr. Richardson's decision to scale back some new security programs wastriggered in part by a National Academy of Sciences study, released lastmonth, that emphasized that ''both secrecy and scientific openness contributeto our security.''

At present, the study concluded, ''far more attention is being directedtoward avoiding the risks of potential espionage than toward ensuring thatwe realize the benefits of a properly balanced policy.''

The directors of the national laboratories also have warned that therecent focus on security is having a ''chilling effect'' on efforts torecruit scientists to work at the laboratories, according to Mr. Richardson,who quoted President Harry Truman on the spy hunting of the 1950s: ''Wecannot drive scientists into our laboratories, but if we tolerate recklessor unfair attacks, we can certainly drive them out.''

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G. START

1.
New Russian Duma to Ratify Start-2 Treaty-Lukin
        Itar Tass
        December 3, 1999
        (for personal use only)

MOSCOW, December 3 (Itar-Tass) -- The next State Duma lower house ofRussian parliament will be more rational and ratify the START-2 strategicarms reduction treaty, Vladimir Lukin, chairman of the Duma committee forforeign affairs, said on Friday.

However the ratification can only take place if the 1972 Anti-BallisticMissile (ABM) Treaty is strictly observed, Lukin told Itar-Tass.

"If amendments are introduced to the ABM Treaty, we can think of ratificationof the START-3 treaty, which would include new provisions," he added.

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