WASHINGTON (AP) - Buying more than 100 metric tons of weapons-grade uranium from Russia helped U.S. national security but may be hurting domestic producers as the nation's nuclear power plants become dependent on Russian uranium, congressional auditors said Friday.
In 1993, the United States agreed to a 20-year program of buying highly enriched uranium from dismantled Russian nuclear weapons, imported in a form suitable to fuel commercial reactors.
The Energy Department created the U.S. Enrichment Corp. to handle the purchases, then let the corporation be privatized through a July 1998 public offering that brought the Treasury $1.9 billion.
The Russian government's counterpart is Technsnabexport, known as Tenex, which processes the uranium and takes the payments.
Congress' investigative arm, the General Accounting Office, found that a committee of officials from several federal agencies, formed to oversee the uranium purchases, "has not fulfilled all of its responsibilities."
The Enrichment Oversight Committee had no contingency plan for replacing USEC, as it was instructed to have, when the company considered severing its ties with the Russia deal in 1999. The committee likewise has yet to complete a study of how government purchases of Russian uranium is affecting the U.S. nuclear fuel industry.
The GAO said that study should be done and the United States "should be prepared to either replace (USEC) or to take on the responsibilities itself."
While the corporation has tried "to balance conflicting commercial and national security interests," the report said, its stated "priority as a private company is to remain a profitable commercial enterprise and maintain maximum value to its shareholders."
The 40-page report was requested by House Commerce Chairman Thomas Bliley, R-Va., who is leaving Congress in January.
Undersecretary of Energy Ernest Moniz told the GAO he agrees with some of the report's broad themes and noted the 1993 agreement has succeeded in removing the equivalent of 4,000 nuclear weapons from Russia since 1995.
"It is a unique agreement that breaks new ground in the relations among nuclear weapons states," Moniz said.
He said, however, the report "understates" some of the oversight committee's accomplishments, such as acting to "address domestic market and fuel cycle interests."
The number of Russian nuclear warheads is expected to drop to 1,000 or fewer within seven years due to treaties and obsolescence. The prospective START III arms-control treaty, which is still to be negotiated, is expected to establish ceilings of 2,000 to 2,500 warheads.
Nuclear power supplies about 20 percent of U.S. electricity needs. In 1999, about half the 47.9 million pounds of uranium bought by U.S. utilities for commercial reactors came from the United States and Canada. The other half came from overseas sources.
The "growing dependence on Russian-origin material for nuclear fuel" that emerged from the 1993 agreement has prompted worries among industry officials about the United States' continued ability to produce fuel sufficient for commercial nuclear power plants domestically, the report said.
An oversupply of uranium caused by Russian imports has led to price drops, lower domestic production and decreased employment in the U.S. industry.
From June 1995 through October 2000, USEC paid Russia $1.6 billion for slightly more than one-fifth of the 500 metric tons of uranium that the United States agreed to buy between 1993 and 2013.
The corporation now plans to close its Portsmouth, Ohio, uranium enrichment facility in June 2001, leaving just one plant, in Paducah, Ky. The GAO says that would increase USEC's production costs and cause reliance on an aging plant that lies in an earthquake zone.
The Energy Department is to spend $630 million over five years to keep the Ohio plant in "cold standby" status to be reopened quickly if needed. return to menu
2. Nuclear Nonproliferation: Implications of the U.S. Purchase of Russian Highly Enriched Uranium. GAO-01-148
1. U.S. Funding Allows Russia to Step up Nuclear Security
December 30, 2000
(for personal use only)
MOSCOW, Dec 30, 2000 -- (Agence France Presse) Funds allocated by the U.S. Congress under a joint U.S. -Russian project have enabled Moscow to step up security at its nuclear arms storage facilities, defense ministry officials said Friday.
Russia's defense ministry enforced perimeter security fences guarding 123 nuclear arms storages, and made sure the equipment necessary for handling nuclear weapons was safe and in good condition, the ITAR-TASS news agency reported.
These projects cost some 277 million dollars and were part of a U.S. -Russian program on joint reduction of weapons of mass destruction, officials said.
Russia and the United States joined efforts to reduce the stocks of mass destruction weapons in 1992. Since then, the U.S. Congress has paid Moscow some two billion dollars in related grants. return to menu
C. Department of Energy (DOE)
1. Abraham To Lead Dept. He Wanted Shut
The Associated Press
January 2, 2001
(for personal use only)
WASHINGTON (AP) -- For years, Sen. Spencer Abraham tried to abolish the Department of Energy. Tuesday, he accepted President-elect Bush's offer to lead it.
Abraham's nomination comes two months after an unsuccessful campaign to keep his Senate seat, from which he sponsored as recently as 1999 legislation to dismantle the agency. During his campaign environmentalists assailed him for his opposition to higher fuel efficiency standards and support of increased U.S. oil drilling, criticisms repeated after Bush introduced Abraham.
The outgoing Michigan senator took the moment to say the United States has "vast resources" that are "crucial to our country's security.
"We can make good use of them, while at the same time, I believe, meeting our responsibilities as good stewards for the land, the air and the water," he said.
However, Mark Helm, a spokesman for Friends of the Earth, called Abraham a "disaster," citing his support for oil drilling in the Arctic National Wildlife Refuge and other efforts on behalf of the oil industry.
"It's incredibly important that anybody who is energy secretary not be an enemy of the environment, and that's what this guy is," Helm said.
Abraham was part of a small group of Senate Republicans who in 1996 cosponsored legislation to close the departments of Energy, Commerce and Housing and Urban Development and privatize or assign to other departments the functions worth preserving.
"We're not saying all government is bad. We're not saying every government program is bad," Abraham said in a 1997 interview about the department eliminations. But "we were elected to make government smarter and more efficient."
He co-sponsored legislation to eliminate the Energy Department again in 1999, when it was mired in the controversy over security problems at its Los Alamos nuclear weapons laboratory. Both times, the legislation died in committee.
Bush transition spokeswoman Angela Flood said Abraham wanted to eliminate the Energy Department when the country's deficit was high but changed his position when energy problems became crucial in recent months. She said his move to abolish the department did not weigh on his nomination.
"I would say he still supports streamlining and making the department more efficient, but what's important is that he will support President-elect Bush's energy policy," she said.
A one-time political operative back home in Michigan, Abraham built a reputation in the Senate as a hard worker, never missing a roll call vote in six years and passing more bills than any other senator from his freshman class.
"He's a brilliant visionary and he knows how to manage people and that's exactly what you want in a Cabinet official," said Rusty Hills, chairman of the Michigan Republican Party.
But some observers felt he had a harder time connecting with the public than his more gregarious opponent in the election, Rep. Debbie Stabenow.
"I think a lot of people were surprised when he first ran for office because he was such a behind-the-scenes person," said Tom Shields, president of Lansing-based firm Marketing Resource Group, a firm that works on Republican campaigns.
Abraham came to the Senate in 1995 with 11 freshmen who gave Republicans control of Congress for the first time in decades. He usually voted with his party. His involvement in energy issues came through an overall opposition to industry regulation, and he led the fight against higher fuel-efficiency standards in the Senate.
Environmentalists say that's a sign of things to come if Abraham becomes energy secretary.
"President-elect Bush is choosing the senator who led the fight for more gas-guzzling SUVs to go find the oil to keep them running," said Dan Becker of the Sierra Club.
He also has a limited Senate background in nuclear weapons issues, which accounts for a good portion of the Energy Department's activities.
"The bottom line is he doesn't have much background in the field of energy. He's done very little in this area. It doesn't mean he can't learn," said David Nemtzow, executive director of the Alliance to Save Energy, a private advocacy group.
At the department, Abraham is likely to face some immediate concerns including high winter heating prices, the possibility of natural gas shortages, a likely resurgence of world oil prices and a critical decision on disposal of nuclear waste.
Environmentalists repeatedly attacked Abraham during his re-election campaign for his ties to the oil industry. As gas prices rose in Michigan and across the Midwest this summer, Abraham called for a suspension of federal gas taxes while taking donations from oil companies.
According to campaign finance watchdog FECInfo, Abraham took $221,848 in contributions from energy and natural resources companies, including $10,000 each from the El Paso Energy Corp. and the Ohio Valley Coal Co. and $9,000 each from Chevron, Coastal Corp. and Michigan Petroleum.
Abraham, 48, was born in East Lansing, Mich., the grandson of Lebanese immigrants. He went to Michigan State University in the 1970s, where he worked on Republican campaigns.
He graduated with honors in 1979 and returned to Michigan to work at a small firm and teach at Cooley Law School. He worked on Republican campaigns in the state and then took the job as the head of the state GOP.
He left the state party in November 1989 to become deputy chief of staff to Vice President Dan Quayle. In 1992, he became co-chairman of the National Republican Congressional Committee.
"You never outworked Spencer when you worked for him," Shields said. "He would call you from the movie theater because he came up with an idea during the show. He's probably one of the brightest people I have met." return to menu
D. Russian Nuclear Forces 1. Russia transfers nuclear arms to Baltics
The Washington Times
January 3, 2001
(for personal use only)
Russia is moving tactical nuclear weapons into a military base in Eastern Europe for the first time since the Cold War ended in an apparent effort to step up military pressure on the expanded NATO alliance, The Washington Times has learned.
The transfers of battlefield nuclear weapons to the Russian enclave of Kaliningrad followed threats several years ago to position such weapons outside of Russia's territory in response to expansion of the North Atlantic Treaty Organization (NATO).
Kaliningrad is a Baltic Sea port located between Poland and Lithuania, and a major military base for Russian ground and naval forces, including the headquarters of the Baltic Fleet.
The movement of the new battlefield nuclear arms was detected in June and is a sign Moscow is following through on threats to respond to NATO expansion with the forward deployment of nuclear weapons, according to U.S. intelligence officials familiar with reports of the activity.
The precise type of new tactical weapons could not be learned. Some defense officials said they are probably for use on a new short-range missile known as the Toka. A Toka was test-fired on April 18 in Kaliningrad. It has a range of about 44 miles.
Pentagon spokesman Kenneth Bacon declined to comment on intelligence reports of the movement of tactical nuclear weapons to Kaliningrad.
However, Mr. Bacon said in an interview: "If the Russians have placed tactical nuclear weapons in Kaliningrad, it would violate their pledge that they were removing nuclear weapons from the Baltics, and that the Baltics should be nuclear-free."
Russia and the United States announced in 1991 and 1992 a non-binding agreement to reduce arsenals of tactical nuclear weapons.
In 1991, President George Bush ordered the military to unilaterally cut U.S. arsenals of tactical nuclear arms. Weapons were removed from ships and from many overseas bases.
The Soviet and Russian governments announced in 1991 and 1992, respectively, that all tactical nuclear weapons were removed from Eastern Europe to more secure areas in Russia. It was not clear whether that included nuclear weapons based in Kaliningrad.
Some U.S. tactical nuclear arms remain in Europe and Moscow has continued to demand their withdrawal in arms talks with U.S. officials.
Moscow also has refused to discuss the status and deployment of its tactical nuclear weapons with the United States, despite the Clinton administration's provision of millions of dollars in U.S. aid to Russia to help eliminate its nuclear arms or protect them against theft, according to defense officials.
Clinton administration arms-control officials suggested the tactical nuclear arms in Kaliningrad may be part of an attempt by Moscow to test the incoming administration of President-elect George W. Bush.
Cuts in U.S. and Russian tactical nuclear arsenals are supposed to be discussed in new U.S.-Russian negotiations on a START III arms treaty.
The forward deployment of new tactical nuclear arms is viewed by many defense officials as a worrisome sign Moscow is beefing up defenses against NATO.
Poland, Hungary and the Czech Republic were admitted to NATO in 1999, angering Moscow, which fears encroachment by what it views as a Cold War alliance against the Soviet Union.
There also has been talk of some or all of the Baltic states - Lithuania, Latvia and Estonia - joining the alliance.
Defense Secretary William S. Cohen said during a visit to Lithuania in June that it is "possible" the Vilnius government could join the alliance in the future. "We have indicted that the door to NATO remains open," Mr. Cohen said at the time.
In June 1998, Russian military officials stated that if the Baltic States joined NATO Moscow would base tactical nuclear arms in Kaliningrad.
Russia already has deployed its most advanced air-defense missiles, the S-300, in Kaliningrad, a sign that it plans to protect the enclave from attack.
Defense officials said Russian military exercises in the summer and fall of 1999 called Zapad-99 or "West-99" simulated a NATO attack against Kaliningrad. During the maneuvers, Russia's forces resorted to use of nuclear strikes and carried out air-launched cruise missiles against targets in Europe and the United States.
One official said the intelligence information about the new tactical nuclear arms was discovered in June but withheld from most policy-makers until last month, when it was first reported in the Military Intelligence Daily, the Defense Intelligence Agency's main intelligence report.
An intelligence official, however, said Kaliningrad nuclear reporting was not suppressed.
The Kaliningrad nuclear arms are part of an estimated 4,000 to 15,000 low-yield nuclear weapons in Russia's stockpile. They include artillery shells, short-range missile warheads, nuclear air-defense and ballistic missile defense interceptors, nuclear torpedoes and sea-launched cruise missiles, and nuclear weapons for shorter-range aircraft.
Russian military officials in the past have denied any nuclear arms are stored at the military facilities in Kaliningrad, although U.S. intelligence agencies suspected some nuclear arms, particularly naval weapons, are still there.
The sharp decline in Russia's military forces since the collapse of the Soviet Union in 1991 has increased Moscow's reliance on tactical nuclear weapons.
Defense analysts said the Russian military views these tactical weapons as war-fighting arms, in contrast to its strategic nuclear weapons that serve primarily as deterrent forces.
Russia's government announced in 1999, following NATO air strikes in Yugoslavia, that nuclear forces would remain the key element of military power.
At the time, Vladimir Putin, who later became President Boris Yeltsin's successor, announced that Mr. Yeltsin had signed three decrees outlining the development of Russia's nuclear weapons complex, including a new concept for developing and using nonstrategic nuclear weapons. return to menu
2. U.S.: Russia Moving Weapons
The Associated Press
January 3, 2001
(for personal use only)
WASHINGTON (AP) -- Russia has moved short-range nuclear weapons onto one of its military bases in the Baltics, senior Clinton administration officials said Wednesday. Some in the administration believe the Russians may be seeking to step up pressure on NATO to withdraw similar weapons from Europe.
The movement of Russian nuclear weapons, first reported in Wednesday's Washington Times, also may reflect Moscow's response to NATO's eastern expansion in 1999 when Poland, Hungary and the Czech Republic joined the alliance. The Baltic states of Lithuania, Latvia and Estonia want to be the next new members.
Russia views NATO expansion as a potential military threat and has said it would undermine arms control.
Moscow has long argued for the removal of all tactical, or short-range, nuclear weapons from Europe. The United States withdrew many missiles and other nuclear weapons from Europe in the 1980s and 1990s but maintains some nuclear bombs for aircraft based there.
The Times reported that Russia moved nuclear weapons last summer to the base in Kaliningrad, a Baltic Sea port located between Poland and Lithuania on a sliver of Russian territory not connected to the main part of Russia. The port is the headquarters of the Russian Baltic Fleet.
The report was denied by the Baltic Fleet, according to Tass. The Russian news agency quoted Anatoly Lobsky, assistant to the fleet commander, as saying the fleet is unconditionally fulfilling its obligations to keep the Baltic a nuclear-free zone.
Two administration officials, speaking on condition of anonymity, told The Associated Press there have been indications for more than a year that Russia moved nuclear weapons into the Baltics. Both officials said it was not clear how long the weapons have been there, but some were moved in recent months.
The Times report said the weapons are believed to be for use on a new missile with a range of about 44 miles.
Asked about the Times report, Pentagon spokesman Kenneth Bacon said, "We don't comment on intelligence." The Times quoted Bacon as saying, "If the Russians have placed tactical nuclear weapons in Kaliningrad, it would violate their pledge that they were removing nuclear weapons from the Baltics, and that the Baltics should be nuclear-free."
Russia and the United States announced in 1991 and 1992 nonbinding agreements to reduce arsenals of tactical nuclear weapons. The Russians said that all tactical nuclear weapons were removed from Eastern Europe to more secure areas in Russia. It was not clear whether that included nuclear weapons based in Kaliningrad. return to menu
3. Russia Completes Tests on New Nuclear Submarine
January 1, 2001
(for personal use only)
MOSCOW, Dec 30, 2000 -- (Agence France Presse) Russia's newest nuclear-powered submarine has successfully completed all tests in the northern White Sea, the submarine's constructors said Friday.
During two weeks at sea, the Cheetah submarine tested its technical systems, making sure that its nuclear reactors, weapon systems, navigational and other equipment were functioning properly.
After the successful tests, the Akula-class submarine may join Russia's Northern Fleet as early as next year, said a spokesman for the Sevmashpredpriyatie factory where the submarine was built.
The 12.8-thousand-ton submarine, operated by a crew of 60, is equipped with 28 long-range missiles and can operate at 600 meters (333 fathoms) under water. return to menu
E. Russian-Iranian Relations
1. Links With Iran Part of Moscow's Diplomatic Plan
January 2, 2001
(for personal use only)
MOSCOW, Jan 2, 2001 -- (Reuters) Expanded military links with Iran, announced during a visit to Tehran by Russia's defense minister, fit nicely into Moscow's diplomatic offensive to pursue its own interests and reap tidy profits into the bargain.
President Vladimir Putin, a year in office, has stressed on his many trips abroad his rejection of a "monopolar" world dominated by the United States.
With early post-Communist thaws with the West now forgotten, that meant taking policy a stage further by restoring Soviet-era ties with states viewed suspiciously in Washington. In addition to the Iran initiative, it involved Putin traveling to Cuba and North Korea and offering new friendship with Iraq and Libya.
"I believe that despite problems, the past year was made noteworthy by the broadening of scope of Russia's friends and partners and the strengthening of its image in the world," Foreign Minister Igor Ivanov told Itar-Tass news agency in a recent interview. This was made possible, he said, by support from parliament, combative under Putin's predecessor Boris Yeltsin but now backing the Kremlin on virtually all issues.
Such a policy also meant currying ties with European partners -- like Britain and Germany -- and keeping the door open with Washington on divisive issues, like the U.S. national missile defense proposal, denounced by Moscow. Putin put the case himself in a Christmas Day interview, saying Russia wanted good relations with Washington, but would not bow to pressure on ties with either Iran or Iraq.
"There are specific things about this region, which prompt us to take into account international security concerns," he said. "Being a UN Security Council member and a G8 member, we should take into account these concerns. But I will repeat we should not forget about our national interests."
NEW PHASE IN RUSSIAN-IRANIAN COOPERATION
Russia informed the U.S. State Department in the closing stages of the U.S. presidential campaign that Moscow no longer felt bound by a 1995 deal to curtail weapons sales to Iran.
During a visit to Tehran last week by Russian Defense Minister Igor Sergeyev, both sides made plain it mattered little what Washington had to say on the matter. Sergeyev spoke of a "new phase of military and technical cooperation". His Iranian counterpart proclaimed the 1995 deal championed by U.S. Vice President Al Gore "buried by history".
An Iranian Foreign Ministry spokesman pressed the message, dismissing any notion of U.S. sanctions. Russia and Iran, he said, had much common ground on foreign policy -- a list including suspicion of NATO expansion and the threat both see from the Islamic Taleban militia in Afghanistan.
"It's clear such bilateral military cooperation will not prejudice any country but aims to bolster bilateral ties for the purpose of strengthening regional cooperation," the spokesman said on Monday in an obvious reference to the United States.
With the more hawkish George W. Bush newly confirmed as the U.S. presidential election winner, Washington's reaction to Sergeyev's visit was predictably wary. State Department spokesman Philip Reeker said Washington was "particularly disturbed" by suggestions of increased arms sales to Iran and pledged Washington would seek clarification.
Even under Putin's predecessor, Boris Yeltsin, Russia cautiously nurtured links with Iran, with Moscow dismissing U.S. appeals to stop helping Iran build a nuclear power station. Russian officials say sales will involve defensive arms, mostly spares for Soviet-era equipment, and rule out technology transfers. That is Washington's biggest fear, particularly with regard to Iran's Sahab-3 missile now under development.
In securing closer ties with Iran, Iraq and other countries, Russia hopes both to claw back Soviet-era debt and earn new cash. Iran says it has a $10 billion budget surplus resulting from high oil prices.
Russian officials last week announced a large deal allowing the production under license of Su-30MKL warplanes in India -- two months after Putin visited Delhi. Moscow has also pressed for an end to sanctions imposed on Iraq after its occupation of Kuwait in 1991. Contracts to develop Iraq's oil industry are a prime consideration. Analysts suggest Putin may have trouble combining pragmatism and assertiveness.
"In terms of assertiveness, we have seen a great number of initiatives, with Cuba and Iran prime examples," political scientist Lilia Shevtsova of the Carnegie Endowment think-tank said in a recent interview.
"Among pragmatic measures are attempts to improve relations with NATO. But he is constantly looking over his shoulder at lobby groups. He is trying to make peace with everyone." return to menu
2. Iran Defends New Military Ties With Russia over U.S. Objections
January 1, 2001
(for personal use only)
TEHRAN, Jan 1, 2001 -- (Agence France Presse) Iran on Monday defended its moves to expand military cooperation with Russia that have come under fire from the United States, which opposes arms sales to the Islamic republic.
Foreign ministry spokesman Hamid-Reza Asefi told a Tehran press conference that the growing cooperation, sealed with a visit last week by Russian Defense Minister Igor Sergeyev, was a "crowning success."
He said military ties with Moscow "conform to international norms and do not threaten any third country," adding that the relationship was aimed at "strengthening security and stability in the region."
Asefi also underlined that "economic and military relations between Iran and Russia are nothing new."
Sergeyev -- who concluded the first visit to Tehran in more than 20 years by a Russian defense chief on Thursday -- announced a "new chapter" in military relations between the two countries.
"We've just opened a new chapter in our relations, marked by the reopening of military cooperation between Moscow and Tehran," Sergeyev said at a joint press conference with his Iranian counterpart, Ali Shamkhani.
"The complete trust between the two countries has created the appropriate grounds for a deepening of bilateral relations," he said.
"This is a historic day," Shamkhani added.
The US State Department later said it was "particularly disturbed by Russian press accounts ... of defense minister Sergeyev's discussions with the Iranians."
The reports "suggest that Russia is ready to sell Iran missiles, submarines and other equipment which would clearly place the national security interests of the United States, its allies and friends in the region at risk," department spokesman Philip Reeker said.
The prospect of fresh arms sales to Iran has upset the United States, particularly after Moscow last month renounced a 1995 U.S.-brokered deal blocking conventional weapons sales to Iran.
Russia's Interfax news agency has reported that Iran is interested in buying S-300 anti-aircraft missiles, Mi-17 combat helicopters and Su-25 fighter planes.
The United States accuses Iran of backing international terrorism and developing nuclear weapons and has also expressed concern over Tehran's missile program. return to menu