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Nuclear News - 3/17/2006
RANSAC Nuclear News, March 17, 2006
Compiled By: Roman Sehling


A.  Global Nuclear Energy Partnership (GNEP)
    1. Terror risks of nuclear fuel, Mark Clayton , Christian Science Monitor (3/17/2006)
    2. U.S. Seeks Backing for Atomic Program, Yuriy Humber , Moscow Times (3/16/2006)
    3. France says US initiative on access to nuclear fuel interesting, Agence France-Presse (3/15/2006)
    4. REMARKS AND PRESS BRIEFING BY US ENERGY SECRETARY SAMUEL BODMAN, Official Kremlin International News Broadcast (3/15/2006)
B.  International Nuclear Fuel Centers
    1. China backs Russian proposal on nuclear fuel centers, RIA Novosti (3/17/2006)
    2. Russian President Says International Uranium Enrichment Network Viable, Interfax (3/16/2006)
    3. Japan Ready To Discuss Russia's Offer To Set Up Int'l Nuclear Centers, ITAR-TASS (3/15/2006)
C.  G8 Energy Security
    1. Putin Reassures G8 on Global Energy Security, Catherine Belton and Stephen Boykewich , Moscow Times (3/17/2006)
    2. Speech at Meeting with the G8 Energy Ministers, President Vladimir V. Putin, Kremlin Website (3/16/2006)
D.  Russia - Iran
    1. Iran Under Discussion in Moscow and New York. Consultations at UN Security Council Reveal Major Differences of Approach on Part of Participants, Arthur Blinov, Nezavisimoye Voyennoye Obozreniye (3/16/2006)
E.  Russia - India
    1. PM lauds Russia's decision to supply uranium to TAPS , The Hindu (3/17/2006)
    2. Russian Premier Confirms Supply of Nuclear Fuel to India's Power Plant , ITAR-TASS (3/16/2006)
    3. India Counters U.S. Objections to Russia's Decision To Supply Fuel, The Hindu (3/16/2006)
F.  Nuclear Forces
    1. Ukraine: Defense Minister Says No Plans To Restore Nuclear Missile Potential , Interfax (3/16/2006)
    2. Putin Names Navy's Modernization Among Russia's Priority Tasks , ITAR-TASS (3/15/2006)
    3. Missile for Monomakh. Creators of New Weapon Forced To Participate in Sergey Ivanov's PR Actions, Vladimir Mukhin and Viktor Myasnikov, Nezavisimaya Gazeta (3/15/2006)
    4. Vladimir Monomakh Will Be Supplied with Nuclear Bulava, Dmitry Litovkin, Izvestia (3/15/2006)
G.  Nuclear Security
    1. G8 must secure energy infrastructure - minister , RIA Novosti (3/16/2006)
    2. Ukraine, Russia, Bulgaria agree on nuclear fuel supplies bypassing Moldova, ITAR-TASS (3/16/2006)
H.  Nuclear Industry
    1. Kiriyenko Installs New Chief at Nuclear Power Consortium, Yuriy Humber , Moscow Times (3/17/2006)
    2. Russia's Rosatom Sets Out Priorities In Nuclear Energy Cooperation With France, ITAR-TASS (3/15/2006)
    3. Russian nuclear agency chief approves dismissal of facility director, Interfax (3/15/2006)
I.  Chemical Weapons Destruction
    1. Clean Kambarka. Russian Technologies for Destroying Chemical Weapons Prove Their Safety, Rossiyskaya Gazeta (3/16/2006)
    2. The Scourge with the Scent of Geraniums, Dmitry Litovkin, Izvestia (3/16/2006)



A.  Global Nuclear Energy Partnership (GNEP)

1.
Terror risks of nuclear fuel
Mark Clayton
Christian Science Monitor
3/17/2006
(for personal use only)


The Bush admininstration says new technology will reduce waste and proliferation, but scientists are quick to caution.

The Bush administration's plan to deploy a high-tech fuel to power a new generation of nuclear reactors worldwide has a potentially explosive problem:

It is too easy for terrorists to grab and turn it into a nuclear bomb.

That's the criticism expressed by nuclear scientists and in several little-known federal studies about the technology underlying the Global Nuclear Energy Partnership, unveiled last month. Administration officials tout GNEP for technological breakthroughs that dramatically reduce the nuclear waste from civilian reactors and, at the same time, greatly reduce the risk of nuclear proliferation.

Using GNEP's new fuel technology, called UREX-Plus, the United States could safely end its three-decade moratorium on reprocessing spent nuclear fuel intended to keep plutonium from spreading, officials say. "The goal of GNEP is recovery of the energy in a way that doesn't promote weapons," Energy Secretary Samuel Bodman told a US Senate committee last month.

Knowledgeable critics have said from the outset that the new reactor fuel envisioned in GNEP is not so very hard to turn into bombs. But what has not been widely known is that their views are echoed by the US Department of Energy's own studies. According to a 2004 study conducted for an Energy Department blue-ribbon commission, for instance, the UREX-plus technology was only slightly more "proliferation resistant" - difficult to turn into bombs - than the PUREX process used by other nations. The US has often criticized PUREX for its vulnerability.

"The bottom line is that UREX-plus is not much more proliferation resistant - by their own estimates," says Henry Sokolski, former deputy for nonproliferation policy at the Defense Department in the first Bush administration.

To be proliferation resistant, nuclear material should be so radioactive it would be deadly to handle, nearly impossible to divert without detection, and fiendishly difficult to refine into weapons fuel. UREX-plus falls well short by all three measures, according to federal reports.

For example: Any such reactor fuel should be so radioactive that it would be "self-protecting." The National Academy of Sciences calls for a "spent fuel standard" for plutonium. That means it should be so radioactive - emitting 1,000 rads per hour at arms-length - that anyone trying to steal it would receive a lethal dose of radiation within 30 minutes. It also means it should be as difficult to transport as a 12-foot-long assembly of nuclear fuel rods weighing half a ton or more.

But UREX-plus, as developed and as presented to Congress until recently, would emit less than 1 rad per hour, according to a November report from the Energy Department's Oak Ridge National Laboratory. Even using the lower standard for plutonium developed by the International Atomic Energy Agency, that's 1/100th of the necessary level for self-protection.

The UREX technologies "would still produce a material that is not radioactive enough to deter theft and could still be used to make nuclear weapons," says Edwin Lyman, a physicist with the Union of Concerned Scientists.

"UREX-plus is just PUREX with lipstick," adds physicist Frank von Hippel, former assistant director of national security in the White House Office of Science and Technology:

Supporters say critiques are outdated

Government scientists say UREX-plus is much better than critics say it is.

"There's only one step where this material has low self-protection, not up to the max, and then it's heavily guarded," says Phillip Finck, deputy associate laboratory director at Argonne National Laboratory in Argonne, Ill., and the administration's top scientific spokesman on UREX. "This process, UREX-plus, is much more proliferation resistant than things developed in the past."

And the Energy Department's 2004 study that rated UREX-plus only slightly above PUREX "should be performed again in view of the real technological changes since then," he adds.

Nevertheless, Dr. Finck in a presentation to congressional staff last Friday proposed a major change to UREX-plus that would add the radioactive element europium to the mix. That change is intended to boost the fuel's self-protection level, but it would also require additional refining capability at each "advanced fast-burner" reactor site, costing many billions more than the price tag US Energy Secretary Bodman offered in congressional hearings last month, several experts say.

So far, the government has proposed spending $250 million on GNEP planning and development. If GNEP gets the green light, it would cost another $3 billion to $6 billion over five years to get engineering scale demonstration facilities going and perhaps $20 billion to $40 billion overall, Bodman says.

But with the US needing dozens of reactors and reprocessing plants to meet demand, the cost could rise into hundreds of billions of dollars, according to early Energy Department estimates and the National Academy.

Radioactivity isn't the only defense against terrorists and rogue states. Another key is whether the plutonium-based fuel can be measured accurately. Plutonium is a sticky substance that gets caught in nooks, and crannies, like drains. The more accurately it can be tracked, the less likely an employee at a civilian reactor could divert small amounts without getting caught, a strong point for UREX-Plus, Finck says.

But the plutonium in UREX-plus would be in powder and liquid forms and mixed with other materials, known as minor actinides or MAs. And this mixture, which is intended to make it harder for terrorists to extract the plutonium, could make it very hard to measure, government scientists say.

"Even small concentrations of MAs in plutonium mixes could complicate the accuracy of the plutonium measurement if not properly taken into account: consequently, safeguards of plutonium could be affected," Los Alamos scientists wrote in a 1996 study.

A third test of a fuel's proliferation potential is whether it can be readily used as bomb fuel with little further refinement. With PUREX, the reprocessing technology now used by Britain, France, Russia, and Japan, it's clear that its plutonium oxide output could be swiftly and easily converted to metallic plutonium for a bomb, experts say.

By contrast, UREX-plus fuel "is not attractive or useable as weapons material," said Clay Sell, deputy secretary of Energy at a press conference unveiling the GNEP program last month.

But that's not what several energy Department scientists have concluded. They found that plutonium-based reactor fuels with various impurities can still be used in a crude or even an advanced nuclear weapon.

Fuel could become bomb, study says

A "subnational group using designs and technologies no more sophisticated than those used in first-generation nuclear weapons could build a nuclear weapon from reactor-grade plutonium," a 1997 DOE study found. The explosion would be on the scale of the bomb that was dropped on Nagasaki, Japan, in World War II. But even a "fizzled" explosion would mean a one-kiloton explosion, enough to devastate the core of a major US city.

True, that study did not evaluate the "minor actinides," elements included in UREX-plus, such as americium and neptunium. But more recent DOE analysis indicates such elements are not much, if any, real obstacle to the fuel's use in a weapon. Indeed, UREX-plus would contain americium and neptunium, nuclear elements with explosive properties any terrorist or a rogue state could well appreciate, government physicists say.

"As nuclear weapon design and engineering become more common in the world, it becomes possible to make nuclear weapons out of an increasing number of technically challenging explosive fissionable materials," including the likes of americium, wrote a DOE scientist in a 1999 report.

Such fears are largely unfounded, counters Finck at Argonne. "Theoretically, yes, you could use it [in a bomb.] But it would be an extremely difficult process. I can't comment further on that."

Common security measures, he adds, such as close-in surveillance cameras, real-time computer tracking of material, guards, guns, and fences at UREX-plus reprocessing plants, in tandem with technical challenges would make the fuel very difficult to steal.

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2.
U.S. Seeks Backing for Atomic Program
Yuriy Humber
Moscow Times
3/16/2006
(for personal use only)


U.S. Energy Secretary Samuel Bodman invited Russia on Wednesday to invest its technological know-how and financial resources in a U.S.-led initiative to boost nuclear power use while cutting down the risks of proliferation by developing nations.

Washington's Global Nuclear Energy Partnership, which aims to increase the number of nuclear processing facilities to meet the growing global demand for nuclear fuel, will be a "multibillion-dollar, multi-year, if not multi-decade, initiative," Bodman said at a news briefing.

Later in the day, Bodman met with the new head of Russia's Federal Atomic Energy Agency, Sergei Kiriyenko, and officially asked Russia to join the GNEP program.

"The hope is, by gathering the resources of our potential partners we can reduce the costs and time," Bodman said before the meeting with Kiriyenko, adding that Russia's global leadership in fast neutron reactor technology could play a major part in the program.

Although high-cost, the program could unlock a market worth tens of billions of dollars by providing fuel processing services to energy-hungry emerging economies.

The United States has already allocated $250 million of its 2007 budget to develop GNEP, as the country pushes to decrease its reliance on "foreign sources of fossil fuels" and meet rising energy needs, which are estimated to double in the next 20 years, Bodman said.

However, even as the U.S. energy strategy starts to embrace nuclear power as vital for domestic electricity needs and nuclear fuel processing as key to monitoring global atomic safety, it finds itself lagging behind other nuclear power-carrying nations in the sector, Rose Gottemoeller, director of the Carnegie Moscow Center, said in an interview Wednesday. "The United States has in the past several decades suffered from the so-called 'Three Mile Island effect.' The GNEP proposal is a way for the U.S. to take its nuclear industry forward," Gottemoeller said.

While the United States wound down its nuclear sector after the 1979 accident at its Three Mile Island reactor in Pennsylvania, in which a partial reactor meltdown led to a small radioactive leak, Russia has kept its nuclear plants in operation despite the much larger Chernobyl disaster.

This has placed Russia well ahead globally in certain fields of nuclear energy, such fast neutron reactors, which process relatively highly enriched uranium or plutonium, and seaborne nuclear energy stations.

Capitalizing on a domestic nuclear sector that has seen improved management efficiency in the last year under the guidance of Kiriyenko, Russia has stepped up efforts to reform its nuclear industry as a corporate entity with an eye on foreign energy markets.

In January, President Vladimir Putin called for full nuclear-fuel cycle facilities to be built in Russia. The move would calm U.S. concerns regarding emerging nations seeking to take care of their own processing and enrichment, which could enable them to develop nuclear weapons fuel.

At Tuesday's, briefing Bodman evaluated Russia's proposals as "consistent with our thinking," but declined to give outright backing because he had yet to see the details of Moscow's plan.

He did not say that the U.S.-led GNEP initiative ran counter to Russia's proposal to host a fuel-processing center, adding only that he hoped to bring Moscow on board as a partner in any schemes going forward.

Nuclear fuel-processing facilities could earn their host country large profits and significant political leverage worldwide, as potential clients include Iran, China and India, analysts say.

Russia already competes with France and the United States to build nuclear reactors in countries that do not have nuclear technology, and supplying those reactors with nuclear fuel would be a lucrative business.

Nuclear energy will top the agenda of Prime Minister Mikhail Fradkov during his visit to India on March 16 and 17, The Hindu daily reported Wednesday.

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3.
France says US initiative on access to nuclear fuel interesting
Agence France-Presse
3/15/2006
(for personal use only)


Excerpt from report by French news agency AFP

Moscow, 15 March: French Industry Minister Francois Loos has reacted cautiously to the US proposal for a global partnership to develop the civilian nuclear sector, describing the initiative as a "spectacular but not at all concrete" initiative to provide energy security.

"This proposal is part of the idea of the end of oil in the future. The idea is to hire out fuel and to process it subsequently. This spectacular initiative is interesting but not at all concrete," Mr Loos told AFP on Wednesday (15 March) on the sidelines of a G8 meeting in Moscow.

According to the French minister, nuclear energy is "one possible path for countries which have the ability to treat the waste, but the biggest problem for energy security remains the issues of supply and investment".

"For us, it is important to invest in refineries, to put Shtokman into operation," Francois Loos added in a reference to the huge gas field situated in the Barents Sea in northern Russia.

On Wednesday, US Secretary of Energy Samuel Bodman set out a programme which aims to enable developing countries to have safe access fuel under the auspices of the IAEA in exchange for a commitment of these states to renounce the development of enrichment and reprocessing technology.

France could be a "potential partner" of this programme, the minister said, citing the French Areva group, which has the ability to handle the entire fuel chain. "But we need to see the ideas behind this. We need to see whether this is a diplomatic initiative or a technical one," he stressed.

"Energy security poses a certain number of problems. But this initiative does not resolve any of these problems," Mr Loos said. (Passage omitted)

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4.
REMARKS AND PRESS BRIEFING BY US ENERGY SECRETARY SAMUEL BODMAN
Official Kremlin International News Broadcast
3/15/2006
(for personal use only)


Gottemoeller: Good morning. I am Rose Gottemoeller. I am the director of the Carnegie Moscow Center, and on behalf of the Carnegie Endowment for International Peace and its Carnegie Moscow Center I would like to offer you all a very, very warm welcome to this presentation by Secretary of Energy Samuel Bodman. There have been many exciting developments in US energy policy in recent months, among them in nuclear energy. And we have before us no greater authority on that than Secretary of Energy Bodman. In particular, President Bush has recently launched the Global Nuclear Energy Partnership and we will have an opportunity to hear about that this morning from Secretary Bodman.

Samuel W. Bodman was sworn in as the 11th Secretary of Energy on February 1, 2005. Secretary Bodman prior to that time served as the Deputy Secretary of the Treasury starting in February 2004. Previously, he served as Deputy Secretary of the Department of Commerce, from 2001. He is a financier and executive by trade and worked for three decades in the private sector.

But at the same time, he has a very, very impressive scientific- technical background. Bodman graduated in 1961 with a B.S. in chemical engineering from Cornell University. In 1965 he completed his Doctor of Science at the Massachusetts Institute of Technology. For the next six years he served as an associate professor of Chemical Engineering at MIT and began his work in the financial sector as Technical Director of the American Research and Development Corporation, which is a pioneer venture capital firm.

In 1983 he was named President and Chief Operating Officer of Fidelity Investments and in 1987 he joined Cabot Corporation, a Boston-based Fortune 300 Company with global business activities in specialty chemicals and materials, where he served as Chairman, CEO and a director. Secretary Bodman, in other words, represents an ideal combination of science, business and public service. And we are so pleased to welcome him here today. Please, join me in welcoming Secretary Bodman.

Bodman: Thank you, Rose. I appreciate your nice introduction.

Ladies and Gentlemen, I'm pleased and privileged to be here. I want to thank the Carnegie Endowment's Moscow Center for hosting this event. Here in Moscow - as in Washington and all around the world - the Carnegie Endowment has distinguished itself as a relevant player in nearly all policy debates related to international affairs going beyond the academic to offer concrete, practical policy guidance, educating the global public.

I would also stress the importance of the Endowment's significant presence here in Moscow. It is one thing to provide scholarly "advice" from across the ocean but it is quite another to do it in the midst of the country and her people. This Center not only encourages thoughtful analysis of the key challenges facing the United States, Russia and our friends around the world but it's also encouraging the type of international collaboration that is necessary to confront these very challenges.

And so, in my view, it's fitting to use our time today to discuss one of the greatest international challenges of our time: that is, increasing our energy security. I'm sure that many of you have heard these somewhat daunting statistics: our government estimates that the global demand for energy may increase by as much as 50 percent by the year 2025, twenty years from now, with the demand for electricity rising as much as 75 percent. It is projected that more than half of this growth will come from the world's emerging economies.

At the same time, we all seek to slow the growth of greenhouse gas emissions and other pollutants worldwide. But we also must enable the type of economic growth - the economic growth particularly in the developing world, which is so important. That economic growth will increase living standards and allow the nations of the world to succeed each in its own way. In short, we need to develop and deploy energy solutions that encourage global economic growth, and discourage global reliance on fossil fuels and polluting, out-dated technologies.

I'm very pleased to say that this is a key theme of this week's G8 Ministerial meeting, which is the reason for my trip here to Moscow. It will begin this evening and work on through tomorrow. I look forward to working with my G8 colleagues to find ways to build a global energy market that at once encourages investment and competition, that promotes conservation and the use of energy- efficient technologies, and ensures transparency, reliability and stability. This is a very tall order, but it's the type of conversation we must have at an international forum like the G8. Because the challenges that we face in this area are far too large, they are too complex and too deep-seated to be handled by any one nation alone.

Though the solution to our global energy challenges must be international in scope and multifaceted in execution, it will most certainly involve the expansion of nuclear power. And so, today, I'd like to focus on this topic: the immediate - and growing - global need to expand access to emissions-free, safe, nuclear power. And, as importantly, to do so in a way that responsibly manages nuclear waste and reduces the risk that nuclear technology and materials will fall into the wrong hands. It is a topic that relates well to this institution's core mission and ongoing work. I note, in particular, the Endowment's Nonproliferation Project and its report on nuclear security that was released just last year. President Bush considers the safe and secure expansion of nuclear power to be a very key policy goal for the United States. And, he has recently proposed a comprehensive strategy to push us forward in this area. That strategy is called the Global Nuclear Energy Partnership - or GNEP as we call it. I am sure people must be much more forward looking and don't have to have acronyms. We in Washington have acronyms and so GNEP is what we have termed this partnership. It's an initiative that seeks to demonstrate the notion that energy and security can go hand in hand.

We envision GNEP as an international collaboration that seeks to, first, increase the availability of clean, emissions-free power for the world; secondly, it reduces the threat of nuclear proliferation; and, thirdly, it decreases the volume and radiotoxicity of nuclear waste.

It is our hope and expectation that GNEP will expand the use of nuclear power in the United States and around the world by developing new proliferation-resistant technologies to recycle spent nuclear fuel. Let me say this: while GNEP will be an international initiative that will benefit many participating countries, this is not an entirely altruistic undertaking. The United States faces a major and pervasive set of challenges related to providing clean, safe energy to power our homes, our vehicles and our businesses. And if we are to succeed in significantly reducing our dependence on imported energy and further diversifying our energy portfolio, we simply must expand the use of nuclear power domestically, in the United States.

At present, nuclear power is the only mature technology of significant potential to supply large amounts of completely emissions-free base load power that will help us meet the ever- growing global demand for energy. Through GNEP, we will work with our international partners to develop and demonstrate the technological capability to repeatedly cycle spent fuel. This will one day allow us to recycle nuclear waste and dramatically increase the energy extracted from spent fuel. Simply put, the energy benefits of this approach could be enormous.

But that is not the only - or arguably even the most important - up-side of this effort. This process of repeatedly cycling spent fuel - which would consume, and not separate, plutonium - has the potential to help us reduce proliferation risks and reduce the amount of heat-load and radiotoxicity of the resulting nuclear waste.

To do this we will work with our international partners on both innovative technology development and new mechanisms for the distribution of fuel. On the technology side, we propose a demonstration of an advanced recycling technology - called "UREX Plus." This process does not separate plutonium as the current reprocessing technology that is utilized by countries around the world. Rather, it keeps the actinides together, including plutonium, so that they can be made into a fuel to be consumed in so-called "fast neutron" reactors that will also produce electricity. By not separating plutonium, and building in the most advanced safeguards technologies, recycling can be done in a way that greatly reduces proliferation concerns.

Through GNEP, the United States also plans to develop and demonstrate Advanced Burner Reactors. These "fast neutron" reactors would be designed to consume plutonium and other transuranic elements in used fuel, transforming the radiotoxicity of the waste in repeated cycles. The improvements, if we are successful, could be remarkable. They would include increased energy extraction; less nuclear waste; decreased heat-load of the remaining waste; and reductions in its radiotoxicity. In other words, GNEP could make permanent disposal of nuclear waste in a geological repository simpler, cheaper and safer.

And, in addition to generating less nuclear waste in the future, these technologies could enable us to start reusing the considerable amount of separated plutonium already being stored around the world. That would further reduce the risk that it will be used as a weapons material. Regardless of whether one believes that reprocessing has worked well in those nations where it is currently practiced, I think we all would agree that the stores of plutonium that have been built up as a consequence of conventional reprocessing technologies pose a growing proliferation risk that requires vigilant and constant attention. This situation simply must be dealt with - and we need to explore new technologies in order to get it done.

On the distribution side, we will work with our international partners to develop a fuel services program to supply developing nations with reliable access to nuclear fuel in exchange for a commitment on their part to forgo the development of enrichment and recycling technologies. This echoes an important point that the Carnegie Endowment has been advocating and that is that in order for this type of program to be successful, it must provide for guaranteed fuel services to states that do not enrich and do not reprocess.

This program would provide a type of "cradle-to-grave" fuel leasing approach. Fuel supplier nations would provide fresh fuel for conventional nuclear power plants located in user nations that agree to refrain from enrichment and reprocessing. Then, used fuel would be returned to the fuel supplier and recycled using a process that does not result in separated plutonium.

Now let me be clear that we do not propose to develop this recycling technology and then share it with countries that do not have existing reprocessing or enrichment capabilities. But we do envision an expansion of access to nuclear energy. And, in addition to reducing proliferation concerns, this arrangement carries the potential to bring significant economic and environmental benefits to developing countries at the same time. In a sense, such a program could allow poorer nations to "leapfrog" over some of the dirtiest (but most rudimentary and prevalent) fossil-fuel-based technologies.

This approach builds on - in fact, really goes beyond - current IAEA obligations. User nations would consent to refrain from enrichment and reprocessing for an agreed period, based on their own economic interests. Those states that choose to stay outside of the GNEP framework would develop their own fuel cycle facilities and would receive increased scrutiny. In addition, GNEP will necessarily include an international safeguard program, and we look forward to sharing our ideas for such a program with the IAEA as well as other potential participating nations.

Let me offer the bottom line here. The world needs more clean energy to sustain economic growth and raise living standards, particularly in developing nations; the world needs less plutonium; it needs less spent fuel; it needs lower levels of carbon emissions and new ways to reduce the frightening risks of nuclear proliferation. The program that I have described is one way to help us do this. This initiative is in its very early stages, and we look forward to working with the IAEA and the international community in order to make it a reality. Initial consultations have been held with our Russian, French, Chinese, British, and Japanese friends and so far have been quite encouraging.

For example, I was pleased to learn that the Russian government has been thinking about a global partnership along much the same lines that I have just described. As we meet here in Moscow, we cannot help but recognize the special responsibility that the United States and Russia have to be good stewards of the enormous nuclear legacy of the Cold War. The Cold War is now over, but the same plutonium-separations process that built strategic weapons has resulted in civil nuclear stocks which now rival weapons stocks. And, all the while, enrichment technology has spread around the world.

And that is why it is so important for the American and Russian governments to continue to work together on these issues - as we have been doing. We have been doing this, in my view, more closely than at any point in the past. Our joint work includes collaboration on securing nuclear facilities, training staff, improving emergency response mechanisms, and developing conversion programs - that is to say HEU to LEU - among other things. This work has been pushed along by the historic Bratislava accord negotiated by Presidents Putin and Bush. Their leadership is making the world more secure. They recognize this grave truth that having survived the Cold War, we must not lose the nuclear peace.

We can do more, and I believe that this G-8 summit provides a timely opportunity to expand on our on-going work and to explore new partnerships like GNEP. In our discussions this week and going forward, we should be honest with ourselves about the scope of just what we are proposing to take on: a program like GNEP will be a truly massive effort, and one that has not been proposed hastily by the United States government. It is the result of careful consideration of our nation's - and the world's - energy needs and responsibilities.

After all, it is quite clear that nuclear power will continue to expand around the world regardless of what the United States does. So, the way I see it, we have a choice. We can play a risky game of catch-up in the coming decades, or we can engage the world with a new, safer, and more secure approach to nuclear energy. The fact is, responsible nuclear powers are in a much stronger position to help our nuclear future if we are part of it.

I would just conclude, if I may, with a personal note. I consider this program to be a major challenge - it is a major challenge scientifically, diplomatically and financially. This initiative will be very expensive - President Bush has recently proposed spending $250 million on it next year alone - and it will be a very difficult undertaking. But, as all of you well know, the things that make our world a better, safer and more peaceful place are rarely easy. Nor are they cheap or quick. But they are often the things most worth trying.

I greatly appreciate the chance to come to talk to you about these matters today. I appreciate you all being here and the nice reception that I've had. And I thank you for your attention. Thank you. (Applause)

Gottemueller: Let me join Secretary Bodman in thanking you all very much for coming today. I have appreciated your presence here and I hope you found this speech as interesting and as forward looking as I do. I think we all have some exciting work ahead of us. Now, if you will give Secretary Bodman and his delegation a moment to clear the hall I would like to invite you all to a small luncheon buffet outside the door here. So, please stay and join us for that. And again, join me in thanking Secretary Bodman. ***

Bodman: ...Lastly, I'll be talking about the need for all of us to increase energy efficiency in our economies. As I often say at home, the greatest and the least expensive source of energy that we have is the energy that we waste. This was a major initiative at the Gleneagles G8 summit last year, and I am very hopeful that this year's energy summit will cause us to continue these efforts and perhaps add to them. With that I would be happy to take questions from you.

Q: CBS. Mr. Secretary, American oil firms are working here in Russia making multi-billion-dollar investments. I wonder if you think of that as something that really helps American oil security?

Bodman: Anything that can increase production of oil and of natural gas around the world will add to our security, not just US security, but the security of all nations that make use of oil. The fact that the Russians have chosen to use some US firms in that endeavor, that's really their decision decided on a competitive basis. But I think of course, you know, if we produce more, and we are fairly successful in producing oil and gas, then it would certainly add to energy security not just of the United States, but other countries around the world.

Q: Yevgeny Verlin, Profil magazine. Iran has said that it will start trading oil for euros. Is it dangerous?

Bodman: You know, that doesn't bother me. Our concerns with Iran really concern their apparent desire to build nuclear weapons. And that's really where the focus, you know, the focus of our policy attention is. And it's not on their desire or wish to use euros or other monetary units.

Q: Could you be more specific on the main avenue of cooperation between Russia and the United States on this Global Energy Partnership?

Bodman: It's very early, this is with respect to the nuclear power initiative, GNEP. We are very hopeful that the nations of the world, particularly those that have demonstrated expertise that is greater than we have in our country on, for example, fast nuclear reactors, will make that a real one and we'll work together with them in order to perfect first the separation of transuranic elements as a mixture or an alloy if you will. And that would be the first objective. The second objective would be to convert that material into a fuel-type product. And then thirdly, it would be to design a fast reactor that would burn that particular fuel. We have different types of fast reactors that have been developed and used around the world. This would have to be specifically tailored to that particular kind of fuel. And we think that it would take a lot of effort to do it, but we think that it's possible to do it and, as we say in our country, doable. And lastly, fourthly, it would be to develop a technology to continue to recycle that fuel until it was all burned or for the most part burned. And so, those would be the initiatives. We hope that the Chinese, the Japanese, the British, the French, others who have developed recycling and reprocessing technology, could bring that to bear and help us 1) to make use of facilities around the world for this, 2) that we could share the cost of this, it's a very costly undertaking. And so, we are hopeful that we will get a good response. But it's very early. It is something that the president just announced following the State of the Union Address he announced it very shortly, I think it was about a month ago and so we are still working on it. We had our preliminary consultations with a number of the nations of the world that I mentioned in my remarks upstairs, the nations I just mentioned. And preliminarily the response has been quite favorable. But as usual with something like this, the devil will be in the details and working it out, exactly who does what to whom and how much it's going to cost.

Q: Associated Press. Mr. Secretary, I was wondering if you could comment on the gas dispute with Ukraine, between Russia and Ukraine. Has it had an impact on US perception of Russia's secure supply of energy?

Bodman: I don't think it's necessarily had an impact on US perception. I think it's been a kind of wakeup call for European nations that have been dependent upon Russia for a number of years. And I think it also stimulated the thinking about the question of energy security and the impact that problems of any sort would have, whether it's a natural capacity of some kind that poses a problem in energy delivery, whether it's an act of terrorism. Any of these things can cause problems and so, therefore, diversifying the sources of energy is very important in managing the economy of a country of having strategic stockpiles of fuel. I think more people are starting to think more carefully about that as to having stockpiles of energy materials that can be used in the event of an emergency and that can be accessed in the event of an emergency. So, I think it caused those kinds of reactions.

Q: My first question concerns the issues of supply security and the Russian answer over the past few days about the need for security of American oil producers who have made dollar investments to produce the increased supply for the US. Minister Khristenko yesterday spoke about difficulties in licensing oil and gas projects in the United States. My question is what is the United States prepared to put on the table to encourage to increase transparency of demand and encourage producers. My second question is, could you please comment on the 60-dollar oil situation and how long do you expect it to persist.

Bodman: The issue of licensing LNG or liquefaction facilities in the United States. We have had a relatively stable situation. We had four, and now we have five terminals, the fifth one was just put on line within the last year. We haven't had an LNG terminal in the United States in, I think, at least two decades. And the president and Congress took action on this in the Energy Policy Act that was passed last August. It was passed last July and signed into law in our country in August. And that provides for a centralization of the ultimate decision-making process on LNG terminals to lie on the Federal Energy Regulatory Commission, or FERC as we call it. And that has helped dramatically. And so we now have, I think, eight additional terminals that have been approved by FERC. Three or four of those are already under construction and conversations are going about them. We have a very substantial increase in the capability of receiving LNG terminals.

The perspective and so on. I am relatively comfortable that as this process unfolds we will see more and more of that. There are a number of applications, I think 20 applications have been processed by FERC at the present time. So, we've seen a very substantial change in that picture.

With respect to how long we are going to have 60-dollar oil, I think that was the question you asked, what I learned a long time ago in my life in the private sector is not to forecast the prices of commodities. That is something I am bound to be wrong on, and my job, it seems to me, is to work with US companies, to work with US citizens and to work with foreign countries to provide adequate supplies. And we've been working hard at that. That's part of my job and that's what I do and so if we had adequate supplies, and if we had adequate diversity of availability of materials -- renewable energy for example, we are working hard on that, on solar energy and wind energy, those sorts of things so that we can start taking the pressure off of any one marketplace. That's really what is needed and we are working hard on that.

Q: You mentioned that two of your priorities would be mitigating the impact of hostile energy supply interruptions as well as encouraging diversification of energy transit routes. Given that, do you plan to encourage Russia to ratify the Energy Charter and/or the Transit Protocol that seems to be the key factor. And if not, have you plans for encouraging any other ways, opening up its supply pipelines, additional capacity to private companies?

Bodman: Well, the way Russia chooses to manage their affairs of their energy department, really that's an internal matter and that's something I am going to encourage them one way or another to do. I will encourage them. There are areas where, I believe, there is opportunity to expand the availability of materials and world markets. Russia has been considering for some time the so-called Shtockman initiative, the offshore gas fields that it has north of the Arctic Circle. And we will encourage that, I hope they will make a decision, we are going to encourage them to do that.

There have been issues with respect to the Caspian pipeline and getting that expanded because that transports Kazakhstani oil to world markets through Russian territory and there has been a challenging time getting the expansion of that approved by all the participants in the program. So, we will be encouraging things of that sort, but I would not want to encourage the Russian government or the Russian people to do things that they don't believe is in their interests...

Q: investments.

Bodman: Yes,

Q: You mentioned $250 million ...(inaudible)... the US for next year.

Bodman: Yes.

Q: Now ...(inaudible)... of expertise from countries like Russia. But what about money? Are you, is the US going to fund this alone?

Bodman: No, I think-- the details of that are really very -- are as yet undetermined. We just started. This has just been announced and I am here to talk about it because I am here for the G- 8 energy ministerial and we will discuss it, I will be discussing it with my colleagues there. We hope that we can make use of both the technical expertise, engineering expertise, as well as the financial strength of the various countries that are participating in this.

So, we would hope that we could share the cost of this. This is a multibillion dollars, multi-year, if not multi-decade undertaking. This is a long-term program that would be required to accomplish that. And the hope is that by gathering resources of the other nations of the world, the potential partners in this partnership we could reduce the overall cost of it and we could reduce the time that it will take to accomplish this.

Perhaps, we could get it done in one decade, and that would be a lot better than two decades. And so if one country does it alone, we have looked at what it would take to accomplish alone, just if we were to do this alone, and it's frightening -- how much money and how long it will take to accomplish this.

We have run tests in order to prove various aspects of this. We believe it can be done technically. But what the cost will be, how long it will take, these sorts of things, we really don't know. And so that's part of what we will be asking for, and we will -- what the organization might look like, what the cost might be and so forth.

Q: As far as I know, you have just visited Kazakhstan, where you discussed Kazakhstan's potential participation in the Baku- Ceyhan oil pipeline project in the near future. What are the results of the visit?

Bodman: This was, you know, a conversation with the people of Kazakhstan. I was there calling on my counterpart, the energy minister, other ministers, other members of the leadership in Kazakhstan, and we have encouraged them to complete their conversation -- they had been working on the negotiations for at least a year, and we would be pleased if they were able to complete the negotiations with the Azeris. It's really with Azerbaijan that the negotiation is going on, and we are hopeful that they will accomplish that and that they would make available Kazakh oil to the pipeline. Simply that.

More oil makes in the world markets -- using the BTC pipeline one can access world markets. That's the idea. And by accessing world markets, one produces greater flexibility. It's all the thing we just talked about. Greater security, if we have it in one part of the world, that we can produce it from another part of the world and access it. So, it's all consistent with the same theme, with what I have been saying.

Q: I just want to recall my previous question about security in demand and access to American markets. Can I deduce from your response that, about LNG terminals, that the United States is willing to get a portion, oil producers' access to construction of that type of facility as well as other projects that might bring them closer to US energy reserves. And my second question is more generic. Could you just tell us what ...(inaudible)... producers when they pose the question: Have you reconciled the US aspiration to control demand at the same time as it's asking Russia and other producers to increase supply?

Bodman: Well, first of all, the issue on the ownership of terminals. Russian companies are interested, Russian producers are interested in building a terminal. It is well known. And I would certainly encourage that, if that's what they want to do. I frankly have also encouraged Russian companies to work with American companies, who already have applied and have an experience in dealing with the regulatory environment in our country and in order to participate in such an undertaking. So, we would certainly encourage the Russian participation, Russian ownership in terminals, if that's what the Russian companies decide that they want to do.

On your second question --

Q: How would you, when Russians ask you how they should reconcile the US aspiration to control demand ... (inaudible)... supply?

Bodman: Well, we are looking out 20 years, and we are looking at a substantial growth in demand for imported oil in our country. And we simply, as anybody would, would like to identify ways of diversifying the sources of such materials, if we can do. And so we have been working on nuclear power. I mentioned that as a part of what I talked about upstairs. We talked about clean coal technology. There is an international effort that we have sponsored and we are involved with that. We have had particular focus in the budget the President has proposed for next year on developing cellulosic ethanol or ethanol manufacturing using cellulosic raw materials. Solar energy, wind energy -- all of these things are part of making available the widest portfolio of energy materials to our markets. That's what my job is.

And we then would let the free market make the determination of where, of the most attractive sources. So, this is strictly -- that's the goal. But there is no doubt that our country will be a very good market for some years to come for not only oil, but natural gas. And that's not a concern of mine. In my judgment, it should be a concern to the producers. Concern is what kind of technical work we can do to try to mitigate the amount of growth that we anticipate in our country.

Gottemoeller: So, we have time for one more question.

Q: El Pais, Spain. The Russians are going to propose the creation of an international center to treat the nuclear fuel of third countries. It seems that this proposal could fit into the American initiative.

Bodman: Yes.

Q: Will the United States back this project to create a nuclear fuel center in Russia for that purpose?

Bodman: I think it's consistent with it, and there would be a matter of what the details of the proposal are. I think it's fair to say we, as of now, don't have all the details of precisely what the Russians would propose. But as a general matter, I would agree with you. It is consistent with the sort of proposals that we have made, and I would be hopeful that over time, that we can work out an approach to this that is flexible and that allows us to take advantage of Russian interest in doing this and combining it with our interest in expanding nuclear power in the way that we have described.

Gottemoeller: Thank you, very much.

Bodman: Thank you all.


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B.  International Nuclear Fuel Centers

1.
China backs Russian proposal on nuclear fuel centers
RIA Novosti
3/17/2006
(for personal use only)


China supports a Russian proposal to set up international nuclear fuel centers under the control of the UN's nuclear watchdog, a senior official said Friday.

Sun Qin, chairman of the China Atomic Energy Authority (CAEA), speaking in Beijing at a meeting with the head of the Russian Federal Agency for Nuclear Power, Sergei Kiriyenko, said, "Every country has the right to develop nuclear energy."

President Vladimir Putin said in late January that Russia was ready to build an international center "to offer nuclear fuel cycle services, including [uranium] enrichment" under the control of the International Atomic Energy Agency.

Russia has offered to enrich Iranian uranium on its soil as a compromise solution to the current standoff over the Islamic Republic's controversial nuclear programs.

Putin said that enrichment centers could also be set up in other "nuclear club" countries, providing access on a non-discriminatory basis to nations seeking nuclear fuel.

"We consider the initiative to establish international centers to provide nuclear fuel cycle services to be very significant," Sun Qin said.

He also called Russia and China "countries with a major responsibility".

"Our countries complement each other in cooperation on the non-proliferation regime, and in the peaceful use of nuclear energy," he said.

Kiriyenko, who began his visit to Beijing Friday, said that Russia highly valued cooperation with China, including through the International Thermonuclear Experimental Reactor, and the International Project on Innovative Nuclear Reactors and Fuel Cycles.

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2.
Russian President Says International Uranium Enrichment Network Viable
Interfax
3/16/2006
(for personal use only)


Russian President Vladimir Putin expressed optimism on Thursday about a
Russian initiative to set up an international uranium enrichment network.

If put into practice, the initiative "would not only help make progress
toward solving the problem of energy poverty but would also strengthen the
nonproliferation regime for nuclear technology," Putin said at a meeting in
Moscow with the energy ministers of the industrialized countries of the Group
of Eight (G8).

"It would be no less important for us to formulate a regime for equal and
non-discriminatory access to nuclear technology," the Russian president said.
"The civilian nuclear energy alternative must be accessible to other
countries as well, including developing countries," he said.

Putin said Russia planned to initially increase the amount of electricity
generated at its nuclear plants to a minimum of 20% of its total electricity
output.

Putin also said the state "must react to emergencies on the energy market
and take an active part in developing technological foundations for the future
energy industry, for example for a thermonuclear energy industry."

But, "without proper regulation at the level of international organizations
and at the regional level, those problems cannot be solved effectively," he
said.

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3.
Japan Ready To Discuss Russia's Offer To Set Up Int'l Nuclear Centers
ITAR-TASS
3/15/2006
(for personal use only)


Japan is ready to discuss Russia's proposal to set up a network of
international centers offering nuclear services including uranium
enrichment, Kiyohiko Toyama, Parliamentary Secretary for Foreign Affairs,
told Tass in an interview Wednesday. He will represent Japan at a G-8
ministerial meeting on energy issues to be held in Moscow Thursday.

"We are going to consider this idea but first of all Russia in the framework
of its G-8 presidency should disclose the details of its initiative," Toyama
said.

He stressed Japan's resolute rejection of nuclear proliferation but said his
country has a clear understanding of "the importance of international
cooperation in the field of nuclear fuel reprocessing."

He made it clear that Japan's position on the issue will depend on
explanations of the initiative provided by the Russian side.

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C.  G8 Energy Security

1.
Putin Reassures G8 on Global Energy Security
Catherine Belton and Stephen Boykewich
Moscow Times
3/17/2006
(for personal use only)


President Vladimir Putin promised Russia would continue to boost global supplies of energy by bringing major new projects on line and called for nuclear energy to be more accessible as he hosted talks for Group of Eight energy ministers Thursday.

As he received ministers from the world's biggest economies in the Kremlin, Putin sought to cement Russia's credibility as the world's biggest energy exporter in times of tightening supply.

"Russian companies are already realizing projects that have strategic importance for a real strengthening of global energy security," Putin told the ministers in televised remarks at the end of a day of talks on shoring up energy markets. Russia has put energy security at the top of its agenda as G8 president this year as consumer nations feel the pinch of soaring oil prices amid growing fears of a supply crunch.

Putin highlighted projects such as the development of the vast Shtokman field, which contains more than 3 trillion cubic meters of gas, the construction of the North European gas pipeline under the Baltic Sea and an oil pipeline from eastern Siberia to the Pacific Rim as being just "the first in a series that world markets would benefit from soon."

He also sought to ease fears about the rules of the game changing by saying that the State Duma would soon pass laws, such as the subsoil law, that would clear up the role of foreign investors in future projects.

Russia has more than doubled exports of oil and oil products from just under 3 million barrels per day to 7 million bpd, becoming the world's biggest energy exporter, including of gas, as global demand soars. But amid growing bottlenecks in pipeline capacity, a growing state role in the energy sector and a slowdown in investment over the last year, fears have grown that Russia will not be able to keep pace with demand.

"No other country has added so much extra energy to the world in the last five years," said Chris Weafer, chief strategist at Alfa Bank and a former adviser to OPEC. He said that, so far, Russia had resisted calls to join OPEC as a way of controlling output. "If Russia had not delivered that extra 4 million barrels per day, the price of oil would have undoubtedly gone over $100 by now," Weafer said.

The oil price is currently floating at around $60 per barrel, prompting increasing criticism of producer nations by consumer nations such as Japan.

"Russia is president of the G8 today because it more than doubled oil exports under Putin," Weafer said. "Its credibility for staying in that elite company is the prospect it might be able to double exports again over the next 15 years.

"Other G8 ministers want assurances that is going to happen. The G8 is trying to make sure Russia lifts the obstacles to future investment."

Industry and Energy Minister Viktor Khristenko has cited International Energy Agency figures that put worldwide investment needed to ensure global supply at $17 trillion.

At the end of Thursday's talks, Russia issued a communique calling for major new investments in global energy. "We recognize that to attract to investment, it is essential for countries to have open and favorable investment regimes," it said.

Publicly, G8 ministers, including U.S. Energy Secretary Samuel Bodman, have called on Russia to liberalize its markets as a way of allowing more competition and ensuring energy security.

European ministers in particular have been spooked by the state's growing role in the Russian energy market.

After Gazprom cut off supplies to Ukraine in January, leading to shortfalls in Europe, the continent's political leaders called for ways to reduce dependency on Russia and pushed for Russia to ratify the Energy Charter. The charter requires member countries not to interrupt energy flows during disputes and would require Gazprom to negotiate in good faith on allowing other Energy Charter countries access to excess pipeline capacity.

Currently, the EU receives 25 percent of its gas supplies from Russia, most of which comes via Ukraine.

On Friday evening, European Commission President Jose Manuel Barroso is to present Putin with an EU plan for a new energy pact with Russia.

Russia's communique also called for "diversification of the energy portfolio in terms of energy sources, suppliers and consumers as well as delivery methods and routes." The communique said such an approach "will reduce energy security risks not only for individual countries, but for the entire international community."

But as Khristenko and a top Gazprom official publicly rebuffed calls to reduce the state's hold on transportation networks and allow greater access for third parties during conferences this week, it appears that G8 ministers are also privately resigned to the idea that the Russian state will not relax its grip and will insist on taking the lead role in major projects, Weafer said.

"The public agenda is for open access, but the pragmatic private approach is to push Russia to remove obstacles to investment and for foreigners to join at a minority level and provide technology," he said.

The communique was billed as a "chair's statement," suggesting it did not have the backing of all G8 countries. Khristenko, however, told a news conference after the talks that there had been no disagreements.

Khristenko conceded that Russia had yet to reach agreement with the EU on ratifying the Energy Charter, which Russia signed in 1994 but has yet to ratify. "Negotiations are going on, but they are very difficult," Khristenko told reporters, reiterating that Russia and the EU had to reach agreement on a transit protocol governing transit tariffs and several other issues.

The Energy Charter was not mentioned in the communique.

Bodman told the news conference that in his meetings Wednesday with Putin and Medvedev, he had restated the U.S. position "that free markets are a very important part of maintaining energy security through the world." He said he had not raised the question of third-party access to Gazprom's pipelines.

Khristenko reasserted Russia's intention to maintain a strong government hand in the sector. He said he supported diversification of energy sources, transit routes and markets, as "that kind of variety certainly reduces risks."

Major multinational energy projects such as the Northern European Gas Pipeline, in which Russia is partnering with Germany, and the Shtokman gas field, in which Gazprom will invite two or three foreign partners, required government participation, Khristenko said.

"The government should play a role in the realization of such enormous projects in order to reduce non-commercial risks," Khristenko said.

The communique, an 11-point statement, also said fossil fuels would remain the most important means of satisfying global energy demands at least for the first half of the 21st century, while also saying that nuclear power was a crucial "safe and secure" way of diversifying supply. Both assertions came in for harsh criticism from environmental groups late Wednesday.

"The nuclear industry is desperate to secure funding of billions from the taxpayers of the G8," Shaun Burnie of Greenpeace International said, Reuters reported. "If they succeed, we will fail in securing a sustainable energy future and will fail to prevent dangerous climate change."

The communique came in marked contrast to the one at last year's G8 summit in Gleneagles, Scotland, which called for ways to reduce emissions of greenhouse gases.

British energy minister Alan Johnson sharply denied that the concluding statement's acknowledgement that the world would rely chiefly on fossil fuels for the next half-century meant was a sign of resignation. "I refute entirely any suggestion that this statement implies more of the same," Johnson said.

Instead, the energy ministers have based their strategies on recognition of hard realities, including suspicions in developing nations that calls for reduced carbon emissions were attempts by rich nations to curb their growth, Johnson said.

"This is realpolitik. We're not trying to pretend that the world is anything other than it is," Johnson said.

Khristenko told reporters that steps toward greater use of nuclear energy were unavoidable. "We came to the conclusion that nuclear energy is an unavoidable prospect for a whole series of leading economies," he said.

Bodman and Putin echoed those remarks.

"Atomic energy alternatives must be accessible to other countries, including developing countries," Putin told a group of energy ministers that included G8 and other countries' representatives in the Kremlin, Interfax reported.

"We are hopeful for a very substantial worldwide rebirth of the nuclear power industry, which appears to be happening in much of the world," Bodman told the news conference. Bodman's comment came a day after he invited Russia to work with the United States in a multibillion-dollar nuclear energy partnership that would provide nuclear fuel for a revived U.S. nuclear industry, as well as for client nations.

It was unclear how the plan would coincide with Putin's recent call for Russia to build a nuclear fuel-processing center of its own to provide fuel to other countries.

The final decision about major nuclear projects "is the prerogative of our government leaders," Khristenko said.

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2.
Speech at Meeting with the G8 Energy Ministers
President Vladimir V. Putin
Kremlin Website
3/16/2006
(for personal use only)


PRESIDENT VLADIMIR PUTIN: Good afternoon, dear colleagues,

It gives me great pleasure to have this opportunity to meet with you. I hope that you have had substantial and professional discussions here in Moscow.

There is no doubt today that energy is a crucial resource for socio-economic development and progress and that it has a direct impact on the well being of everyone living on this planet. This is why it gives us such great pleasure to receive you here in Moscow, you, the people who are responsible for energy policy in the G8 countries. This is a key sector in the world economy.

But we also see that development in this sector is very uneven and is subject to serious risks – political, economic and environmental risks. The issue of global energy security proposed by Russia is clearly not a choice dictated simply by the situation of the moment. It is clear that the situation in the world energy sector is a real challenge for us all, a challenge that we must respond to. It is by combining our efforts that we can respond most effectively.

Our country, as you know, is the world’s biggest gas exporter and the second-biggest exporter of oil and oil products, and we make a considerable contribution to ensuring global and regional energy security. We value our deserved reputation as a serious and responsible partner on the energy resources markets.

Our production rate fell slightly last year but overall growth continues. In 2005, we produced 470,196 million tons of oil – a record since 1991. We also had a record gas production figure, exporting 152.4 billion cubic metres in 2005. This represented an 8-percent increase on 2004, and in oil production we had a 2.4-percent increase on 2004.

Russia is steadily increasing production of oil, gas, coal and electricity. Russian energy companies are planning active expansion of their activities in the fast-growing liquefied gas sector. Our plans include not only raising production and increasing Russia’s energy resource exports – our country is also ready to and wants to make its contribution to introducing new energy technology, new energy and resource conservation technology.

The State Duma is due in the coming months to examine and, I hope, pass important draft laws on natural resource extraction taxes and on new rules for mineral resource use, including the conditions for the participation of foreign capital. These draft laws aim at making doing business in the energy sector in Russia as comfortable, transparent and predictable as possible.

Russian companies are already carrying out projects of strategic importance for genuinely strengthening the global energy security system. We are looking at development of the major Shtokman gas field. Intensive work on the construction of the North European Gas Pipeline is now underway. We are working on the project to lay a pipeline from Eastern Siberia through to the Pacific coast, with a branch to the People’s Republic of China.

This is just the first stage of projects that, I am absolutely certain, will make their benefits felt on the world energy markets very soon.

As I have said, it is of vital importance that we develop a common vision of the global energy security challenges we face and use this as a basis for defining the most effective solutions to the existing problems. Russia supports the entire international community uniting efforts in order to work together to resolve the whole range of tasks that we have before us.

Above all, these tasks are to guarantee supplies of traditional energy sources for the world economy on conditions that are acceptable for both producer and consumer countries, and to combat energy poverty.

These tasks also include diversifying and ensuring the security of energy supplies, including by taking measures to prevent the threat of terrorist attack, and also developing nuclear energy, energy conservation, and searching for new breakthrough technology and promising, environmentally friendly energy resources.

We will propose concrete initiatives and proposals on all these issues at the G8 summit in St Petersburg. And we are ready to take full part in their practical implementation, including through our companies’ financial participation, through state participation of our companies and, if needed, through the participation of the state itself.

Gentlemen,

One of the keys to global energy security is a fair distribution of the risks among energy resource producers, transit service providers and consumers.

The energy market must be insured against unpredictability and its level of investment risk must be reduced. In other words, measures taken to ensure reliable supplies must be backed up by measures taken to ensure stable demand.

In our view this is the optimum way to harmonise the interests of all the players on the energy market.

To achieve this we must develop the corresponding instruments, in particular, long-term contracts between producers and consumers. First, this practice adequately takes into account the specific nature of investment in energy projects and the lengthy time frame before projects start to pay themselves off. Second, this practice puts in place the conditions for coordinating efforts to explore and develop new deposits, introduce new technology and means of delivering energy supplies to the consumers, and gives the consumers the confidence that they will receive the necessary quantity at the required time.

I think that mutually beneficial exchanges of assets between energy companies could play an important part in distributing the risks more evenly. This is one of the instruments that can help us ensure sustained optimisation of global energy supplies. We are already taking the first steps in this direction and are working in this area with our German partners. We are open to similar projects with energy companies from other countries.

It is important to achieve compatibility of the standards of work for foreign companies on the markets of countries linked by energy flows in order to improve the investment climate. We need to ensure equal access to information on consumers and energy consumption and on plans and forecasts in this area. Open and predictable supply of energy resources should be matched by open and predictable energy resource demand. This formula creates a responsible interdependence that is in everyone’s interests.

This position also fits with our basic argument that energy security is founded above all on effectively functioning global and regional energy markets. The market itself sets the balance between the different forms of contracts. The state can intervene only if the dominance of one form of contract is upsetting the market’s ability to function effectively.

Of course, the state’s role does not end here. The state is obliged to react to emergency circumstances on the energy market and, in our view, should also participate actively in creating the technological foundations for future energy sources, thermonuclear energy, for example. These tasks cannot be resolved effectively without the appropriate regulation at national level and in the international organisations.

In this context, I would like to say a few words separately about nuclear energy. The majority of the world’s leading countries have recently announced very ambitious plans in the nuclear energy sector, and our country is among them. We plan to raise the share of nuclear energy in our electricity production to at least 20 percent during the initial phase. I know that the nuclear energy sector accounts for more than 80 percent of electricity production in France – 85 percent, I think the figure is. Even in Germany, where our colleagues had announced that they were going to wind up the country’s nuclear energy programme, nuclear power plants currently produce around 28 percent of Germany’s electricity – not a bad figure at all. The nuclear energy alternative must be accessible to other countries too, and this includes, of course, the developing countries.

We believe that our initiative to create a network of international uranium enrichment centres has good prospects ahead. Realising this initiative would not only help us to make progress in addressing the problem of energy poverty, but would also strengthen the nuclear technology non-proliferation regime, which we see as being of immense importance for international security. But in this respect it is just as important to also establish a system that would provide equal and non-discriminatory access to nuclear technology.

The next issue is that specialists estimate that by 2030, up to 80 percent of global energy demand will nonetheless be met by hydrocarbon fuels. I draw your attention to this point and I know that you are just as aware of it as I am. The matter is not just to increase production and transport of these energy resources but also to develop environmentally friendly ways of producing this energy from non-traditional hydrocarbon sources. This requires us to make hydrocarbon energy effective, innovative and environmentally responsible. Increasing the share of refined hydrocarbon products in the international energy trade would also be a promising move and would bring added flexibility and thus greater stability to the global energy supply system.

We must also take steps to develop the production of energy using alternative and renewable resources, above all based on the use of new technology.

Our task is not just to ensure the necessary production volumes, however, but also to take needed measures to improve the demand structure. Making energy use more effective would reduce the risk of a gap between energy supply and demand.

The environment is an important aspect of energy security. As we know and have said on many occasions, the extensive and consumerist approach to nature is a dead-end road. Ensuring that developing countries have reliable and affordable access to energy services should be an important part of our work together. The G8 is constantly addressing the problems of the developing countries and in this respect we must also address development problems regarding energy security and energy policy. Of course, energy alone is not enough to solve the poverty problem, but at the same time, insufficient energy resources are a serious obstacle to economic growth and their non-rational use can lead to environmental disasters that go far beyond the local scale and have consequences for the entire world.

We are able to provide the developing countries with real assistance in introducing effective and affordable energy technology, including technology based on renewable energy sources.

In conclusion I would like to stress that we have today a unique opportunity to open a new chapter in global energy, a chapter that would see us move from one-off projects and bilateral dialogue to relations based on a global energy partnership. The G8 summit in St Petersburg will give us a good opportunity to begin this work and to define together a common approach to building an effective energy foundation for our civilisation in the long term.

Thank you for your attention.

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D.  Russia - Iran

1.
Iran Under Discussion in Moscow and New York. Consultations at UN Security Council Reveal Major Differences of Approach on Part of Participants
Arthur Blinov
Nezavisimoye Voyennoye Obozreniye
3/16/2006
(for personal use only)


The Iranian nuclear program is under discussion this week in two places and formats at once: In New York, where informal consultations have begun between UN Security Council members, and in Moscow, where there was a private meeting between representatives of the Russian and Iranian Security Councils.

During the latest round of Russian-Iranian consultations, which took place in Moscow on Tuesday, the Russian delegation was headed by Security Council Secretary Igor Ivanov and the Iranian by Seyyed Ali Hoseyni-Tash, deputy secretary of the Supreme National Security Council. The meeting took place in private and the only result that was announced was a phrase from the Russian delegation's press release to the effect that "dedication to a diplomatic solution of the problem by exploiting the IAEA's potential was confirmed during the discussion with the Russian side."

Supreme National Security Council spokesman Hoseyn Entezami made a statement in the same vein. According to him, "Iran believes that public negotiations based on international norms are the way to resolve the Iranian nuclear program situation. The Islamic Republic welcomes any constructive proposals on the issue."

Essentially, the unofficial consultations between UN Security Council members are private too. The first meeting took place on Tuesday at the French permanent representative's office. First to be invited were diplomats from the five permanent members of the Security Council (Britain, China, Russia, the United States, and France), and then there was a meeting involving all 15 Security Council members.

The theses of the document on Iran, which the Security Council was due to adopt, were presented at the meeting by French and British diplomats, who referred to endorsement by the Americans. In terms of their content, they are no different from the demands the IAEA had earlier put to Tehran.

The proposition is that the Iranians cease all operations, including research, on uranium enrichment and processing, revert to voluntary implementation of the Additional Protocol to the Nuclear Nonproliferation Treaty and, finally, ratify the actual protocol.

But the tactics of reiterating the IAEA stance did not help the theses' authors achieve an overall consensus. The chief objections, in particular from the Russia and Chinese envoys, was to the instruction, formulated by the British spokesman, to the IAEA director general to present in 14 days' time a report on Tehran's conduct. The British were not helped by the fact that, obviously expecting a debate on this mater, they had cleared a space in the text for the figure, which means it can be replaced by another.

Andrey Denisov, Russia's permanent representative at the United Nations, and Wang Guangya, his Chinese counterpart, were not distracted by the possibility of changing the figure. Both set out, in approximately the same terms, their fundamental objections to the ideas contained in the British proposal about the need for a new examination of the matter at the Security Council.

According to Wang Guangya, it should be a matter of bolstering the IAEA's powers to tackle the Iranian nuclear program issue and not of actions by the Security Council. Denisov spoke in roughly the same terms, stressing the importance of continued diplomatic efforts.

The statements by the Russian UN representative reflect approaches set out earlier this month by Russian Foreign Minister Sergey Lavrov at his White House meeting with US President George Bush. According to Lavrov, he explained to Bush that the international community has a perception of what to do about Iran within the IAEA framework, but has no strategy for action outside it. Therefore Lavrov opposed the West's tactics, which, according to him, amount to proposing "dumping the matter on the UN Security Council, adopting something there, and then see."

In response Bush advocated "displaying caution, so, before taking the first step, it is necessary to think through all the subsequent ones." "But that is Russian policy 100 percent!" the minister stressed. It appears that Lavrov tried to consolidate this judgment of Bush's when, at the meeting, he gave him a chess set -- the game is known for its emphasis on strategy.

Despite these statements by Bush, Western countries' representatives are displaying persistence in pushing their version of the document through the Security Council. According to John Bolton, US envoy at the United Nations, it has not yet been decided whether it will be presented as a statement by the Security Council chairman or take the form of a Security Council resolution.

Informal consultations will continue today between Security Council members and they will become officials on Friday. Western Countries initially intend to seek approval of a statement by the chairman on behalf of all Security Council members on the basis of consensus.

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E.  Russia - India

1.
PM lauds Russia's decision to supply uranium to TAPS
The Hindu
3/17/2006
(for personal use only)


Prime Minister Manmohan Singh today appreciated Russia's decision to supply uranium to Tarapur Atomic Power Plants and expressed confidence that both countries would utilise opportunities to expand partnership in civil nuclear energy field.

Addressing a joint press conference with visiting Russian Prime Minister, Mikhail Fradkov, after their two-hour long talks, he said "we envision a substantial increase in the share of nuclear energy in India's overall energy mix."

Observing that the Kudankulam nuclear power project was "flagship" of Indo-Russian cooperation in the area of nuclear energy, Singh said "I am confident that both countries will utilise opportunities to expand our partnership in civil nuclear energy coopertion."

About the proposed Iran-Pakistan-India gas pipeline, Singh said India was "desperately short of hydrocarbon resources" and so was interested in entering into a bilateral and trilateral arrangements to meet the requirement.

In that context, he said, Russia has great deal of experience in constructing pipelines and ways and means could be evolved to involve Moscow in this project.

Fradkov said cooperation between India and Russia in energy was "evolving" and if there was a suggestion for Moscow's involvement in the pipeline project and it would consider that.

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2.
India Counters U.S. Objections to Russia's Decision To Supply Fuel
The Hindu
3/16/2006
(for personal use only)


Dangling the carrot of "major" civilian nuclear imports before the United States in the event of a change in the laws there, India on Wednesday (15 Mar) countered Washington's objections to Russia's decision to supply light enriched uranium (LEU) for the Tarapur plant.

"The U.S. is aware of the urgent need for fuel for Tarapur," the Ministry of External Affairs (MEA) spokesperson said when asked for his response to Washington's reservations about the Russian decision. "There is no violation of the Nuclear Suppliers Group (NSG) guidelines and Russia has approached the group under the safety exception clause," he said. Senior officials told that the Russian offer "really has no connection to our nuclear deal with the United States."

In all interactions over the past year, Russia assured India that it would continue to provide LEU for Tarapur as and when required, an official said. This point was reiterated when Prime Minister Manmohan Singh went to Moscow last December and the final technical details of the transfer were sorted out in January. However, Russia waited till India and the U.S. reached agreement on March 2 before notifying the NSG of its decision.

First shipment has learnt that the first shipment of LEU from Russia is expected to arrive in India "by the end of the month."

U.S. State Department spokesman Adam Ereli on Tuesday (14 Mar) said the Russian fuel offer was premature, as India was yet to implement the civilian-military separation commitments made in the July 18, 2005 nuclear agreement with the U.S.

"(We) recognise that ... (ellipses as published) they have need for fuel," said Mr. Ereli, when asked about the India-Russia deal. "And we think that deals to supply that fuel should move forward on the basis of a joint initiative, on the basis of steps that India will take that it has not yet taken."

In response, the MEA made it clear that it was now for the U.S. to take the next step forward. "India had made a request to the U.S. to supply fuel for Tarapur but this was not possible under current U.S. laws," the spokesperson said.

"The July 18 joint statement has stated that the U.S. will seek to adjust its laws and seek a change in NSG guidelines to enable full civil nuclear cooperation with India, including fuel supplies for the safeguarded reactors at Tarapur."

Noting that the U.S. Congress "is currently debating a change in laws, which would enable full civilian nuclear energy cooperation with India", the spokesperson said that once the U.S. laws were amended "India looks forward to the U.S. emerging as a major and reliable partner to India not only in respect of assured fuel supplies but for other aspects of civilian nuclear energy cooperation."

The MEA's suggestion that the U.S. could emerge as a "major" partner in the nuclear field echoes a similar point made by U.S. Secretary of State Condoleezza Rice in a recent op-ed. "India plans to import eight nuclear reactors by 2012," she wrote in the on March 13, adding, "If U.S. companies win just two of those reactor contracts, it will mean thousands of new jobs".

The spokesperson reiterated the U.S. commitment in the July agreement "in the meantime, to encourage its partners to consider India's request for such fuel supplies expeditiously."

He said India had had to seek urgent and limited supplies of uranium to enable the Tarapur plant to continue its operations in safety.


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3.
Russian Premier Confirms Supply of Nuclear Fuel to India's Power Plant
ITAR-TASS
3/16/2006
(for personal use only)


Russian Prime Minister Mikhail Fradkov confirmed that Russia supplied nuclear
fuel to India's nuclear power plant in Tarapur.

In his meeting with Indian businessmen on Thursday, the Russian prime
minister said, "We cooperate with India and have tackled the issues within the
framework of international obligations."

Nuclear fuel exports to India meet the interests of the two countries and do
not violate international norms, Fradkov said.

"We've notified the group of nuclear fuel providers of Russia's fuel export
to Tarapur," he said.

In his view, nuclear fuel supplies to India meet the interests of both
countries and do not run counter international norms. "We informed a group of
nuclear suppliers about Russia's fuel supplies to Tarapur," the Russian prime
minister stressed.

Indian Foreign Ministry spokesman Navtej Sarna said Russian uranium supplies
to India's nuclear power plant in Tarapur "will not violate a directive adopted
by the Nuclear Suppliers Group."

Earlier, U.S. State Department Deputy Spokesman Adam Ereli expressed
objections on such Russian supplies. In his view, supplies may be started after
New Delhi fulfilled its obligations on the U.S.-Indian nuclear deal concluded
during U.S. President George W. Bush's recent visit to India.

According to Sarna, Washington knows well that India "needs fuel for the
nuclear power plant in Tarapur." To this end, India asked Russia to "supply the
restricted quantity of uranium" for the nuclear power plant in Tarapur.
He said India also requested the United States to supply certain part of
uranium, but American law bans such supplies.

Sarna recalled that in accordance with the Indian-U.S. agreements the
American Congress is now revising this law. India hopes that this problem will
be solved, the diplomat said. Then "the U.S. will become India's reliable
partner not only in fuel supplies but also in other fields of cooperation,
including in nuclear power engineering," Sarna emphasised.

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F.  Nuclear Forces

1.
Ukraine: Defense Minister Says No Plans To Restore Nuclear Missile Potential
Interfax
3/16/2006
(for personal use only)


Ukraine has no intention to restore its nuclear missile potential, Defense
Minister Anatoliy Gritsenko said.

Accusation suggesting that this is not true are "the conjecture of a twisted
mind. Ukrainian officials, including the president, the prime minister, the
defense minister and the chief of staff, have never spoken of restoring
Ukraine's nuclear missile potential.

The establishment of missile forces equipped with nuclear warheads, which
existed in the Soviet period, is out of the question," he said in an interview
published in the Thursday issue of the Vremya Novostei newspaper.

Ukraine has missile units in the Army and the Navy, he said. "These units
are armed with short and longer-range missiles made in the former Soviet Union.
The missiles are obsolete and need to be replaced. The Ukrainian National
Security and Defense Council has decided to draft a program on the production
of short and longer-range missiles. Our defense industry is capable of
manufacturing missiles with a range of up to 300 kilometers," he said.

"Ukraine will strictly abide by international agreements concerning control
and non-proliferation of missiles and missile technologies," he said.

The ministry also denied media claims alleging the possible leasing of the
Sevastopol and Mukachevo missile attack warning stations by the United States.
Currently, the stations are leased by for Russia.


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2.
Missile for Monomakh. Creators of New Weapon Forced To Participate in Sergey Ivanov's PR Actions
Vladimir Mukhin and Viktor Myasnikov
Nezavisimaya Gazeta
3/15/2006
(for personal use only)


Yesterday, 14 March, a vice premier, visited Moscow Thermotechnical Institute, the Russian Federation's main defense establishment, which implements programs for creating new strategic missile systems. Ivanov's visit had been kept secret until the last moment. The Russian Federation Defense Ministry Press Service declined to provide any information about this. Moscow Thermotechnical Institute reported that the minister's meeting with was held behind closed doors, without journalists or television cameras.

Meanwhile, Hero of Russia told that the vice premier's visit to the institute was most likely connected with the preparations to start building the new missile-carrying submarine Vladimir Monomakh, on which it is planned to accommodate Bulava solid-fuel ballistic missiles. Sergey Ivanov reported this to the Russian Federation president 13 March. The Vladimir Monomakh will be the third submarine to join the Russian Fleet in the future. The start of its construction is to coincide with the celebration of the submarine fleet's centenary.

But Adm Baltin does not rule out the possibility that there are problems here. It is planned to launch the Yuriy Dolgorukiy, a 955-project strategic missile submarine cruiser (code Borey), this year. Its construction began back in 1996 and it has been 10 years in the building. But a full-value missile has not been created for it during this time. According to the defense minister, the fourth-generation Bulava missile system will be adopted by the Russian Federation Navy only toward the end of 2007.

Moscow Thermotechnical Institute reported that the minister listened to a report from Yuriy Solomonov, the institute's director and general designer. What he spoke about is being kept secret. Although it is not hard to surmise what the Moscow Thermotechnical Institute general director said to Ivanov. Solomonov has repeatedly criticized the government, which, in his opinion, is holding back the development of missile building in the country. Thus, he declared at a joint news conference with Colonel General Nikolay Solovtsov, commander of the Strategic Missile Troops, held at the end of last year, that "the funds being received within the framework of the defense order are insufficient for Russian producers of strategic weapons to work normally."

It is easy to imagine the scale of expenditure on designing ballistic missiles for submarines by looking at a US example: The program for the in-depth modernization of 108 Trident-2 missiles during 2005-2011 will cost $11.22 billion. Of this sum, only $4 billion will go directly on missiles, and the rest on design work, testing, and so forth. In Russia this will cost almost as much.

In Adm Baltin's opinion, today the submarine fleet is being funded according to the residue principle. "They have launched a Bulava two times and are already trumpeting that it is time to adopt it. Previously, in the time of the USSR, even after adoption we carried out 30 test launches of ICBM's. In Soviet times test launches were carried out under different conditions, from different depths, and even from different seas with different salinity of the water. The Bulava missile must not be adopted if submarines with missile systems are not ready for it. References to computer tests and studies cannot serve as grounds for canceling flight tests of new products," Baltin believes.

"If we want to remain a sea power and a missile power, we must increase military expenditure," the admiral believes. "I do not envy Solomonov. Under conditions of a financial deficit he is trying to create new strategic missiles. The country's defense capability depends on what they will be like. Missiles must be reliable, otherwise the tragedy that we had with the Kursk (submarine) cannot be avoided," Baltin believes.

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3.
Putin Names Navy's Modernization Among Russia's Priority Tasks
ITAR-TASS
3/15/2006
(for personal use only)


The modernisation of the Navy and reinforcement of the submarine
fleet's personnel rank among Russia's priority objectives to rule out the
possibility of any political pressure on the country, President Vladimir Putin said.

"The qualitative technologic modernisation of the submarine fleet is now
regarded as a priority task of the state," Putin said on Wednesday, addressing
a solemn meeting, held on the occasion of the Russian submarine fleet's
centenary.

Putin stressed, "Today the Navy is one of the important tools of Russia's
defence policy. Concentrated there are state-of-the-art shipbuilding technology
and arms systems that excel foreign counterparts in many ways."

"These factors are very important for ensuring the security of Russia and
global stability and play a key role in strategic deterrence on the regional
and global scale," he said.

The president noted that the Russian Navy would soon get a fourth-generation
submarine armed with a new missile system, Bulava. "It will serve as the basis
for creating a group of modern submarines," he added.

"The state will go on doing everything necessary to reinforce the personnel
of the submarine forces," he promised.

"Our basic task is to build up a navy, adequate to the contemporary menaces
and capable of repulsing any military-political pressure on our country, a navy
which will guarantee our nation's naval might and security," Putin said.
Over years of services, submarines have proved their effectiveness in
defending Russia's maritime borders and engaging in naval warfare.

At present submarines make up the core of the Russian strategic nuclear
naval forces and guarantee the country's defence capability. Compared to Soviet
times, the number of submarines hase been reduced substantially. Still
remaining in service to this day are submarines of the third post-war
generation. The Russian Navy is being replenished with up-to-date
nuclear-propelled and diesel-powered submarines with qualitatively new
characteristics.

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4.
Vladimir Monomakh Will Be Supplied with Nuclear Bulava
Dmitry Litovkin
Izvestia
3/15/2006
(for personal use only)


Yesterday Vice Premier and Defense Minister Sergey Ivanov visited the Moscow Thermotechnical Institute, the firm where the Topol-M intercontinental strategic system was designed and the latest sea-launched Bulava ballistic system is being developed.

Next year the missile is to be commissioned along with the lead new-generation Project 955 Borey-class nuclear submarine, which is under construction at the Severodvinsk machine building enterprise. Seamen are associating a radical change in the development of the Russian nuclear deterrence forces' naval component with this event.

Russian submariners will be marking the Russian submarine fleet's 100th anniversary 19 March. That day in Severodvinsk Navy Commander in Chief Vladimir Masorin will lay the keel of the third Project 955 nuclear submarine, which has been named Vladimir Monomakh in honor of the prince who gathered together Russian territory. In accordance with the plans for the development of Russia's strategic nuclear forces there are to be four to six of these boats in total. Along with Project 971 Akula-class multirole attack submarines the Borey submarines will form the Russian Navy's main strike force. However, specialists point out that it will only be possible to say this once the boats have gotten their main weapons -- the Bulava intercontinental ballistic missile.

The development of the Bulava at the Moscow Thermotechnical Institute has taken half the time it usually takes (up to 15 years). The new missile weighs less than 50 tonnes, which is even less than the Topol-M, and can carry several MIRVed warheads. It is said that there will be no less than 10 of them, which will make it possible to employ the bunch of grapes principle on the Bulava -- the missile will be able individually to "deliver" warheads to several targets at once.

Like the Topol-M the Bulava will be produced at the Votkinsk machine building plant in Udmurtia. Sergey Ivanov paid a special visit to this enterprise last year to see to what extent series production of the new missiles is possible,

The Defense Ministry is saying that hopes not only of modernizing the nuclear component of the Navy are being pinned on the Bulava. Strategic Missile Troop commander Nikolay Solovtsov has repeatedly hinted that the new missile system may also be used on land -- as a silo-launched version.

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G.  Nuclear Security

1.
G8 must secure energy infrastructure - minister
RIA Novosti
3/16/2006
(for personal use only)


Ensuring security at key energy facilities must be a priority for the G8, Russia's energy minister said Thursday.

"Considering the risk of terrorist acts at key energy facilities, including nuclear power plants, pipelines, ports, etc., their vulnerability to disasters, and the practice of unauthorized tapping of energy resources, international cooperation becomes extremely important to ensure the physical security of these facilities," Industry and Energy Minister Viktor Khristenko said in his opening speech to a meeting of G8 energy ministers.

Energy ministers from the Group of Eight leading industrialized nations are attending a two-day series of meetings in Moscow starting Thursday. The talks are expected to focus on a range of issues, including diversification of energy supplies in the face of increasing demand, as well as development and implementation of "clean" technologies. Russia has declared energy security the No. 1 issue for its G8 presidency this year.

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2.
Ukraine, Russia, Bulgaria agree on nuclear fuel supplies bypassing Moldova
ITAR-TASS
3/16/2006
(for personal use only)


Bulgaria, Russia and Ukraine have completed drawing up a new agreement on transit of nuclear fuel for Bulgaria's Kozloduy nuclear power plant through Ukraine.

The head of Ukraine's State Committee for Nuclear Regulation, Olena Mykolaychuk, said the document legally defines the route for transporting fuel rods bypassing Moldova.

Under the previous 10-year agreement on cooperation in transporting nuclear substances, Russia and Ukraine (as received), fresh nuclear fuel was delivered from Russia to Kozloduy through Ukraine and Moldova, Mykolaychuk said. The same route was used to transport spent nuclear fuel to Russia for reprocessing. However, it had to be changed in 2001 due to increasing tension in (Moldova's breakaway) Dniester region. However, the route was not defined in legal terms until now. The new accord is also valid for 10 years.

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H.  Nuclear Industry

1.
Kiriyenko Installs New Chief at Nuclear Power Consortium
Yuriy Humber
Moscow Times
3/17/2006
(for personal use only)


The country's nuclear sector chief, Sergei Kiriyenko, has asked the head of Rosenergoatom, Stanislav Antipov, to step down, as the consortium begins planned restructuring, a spokesman for Kiriyenko's agency said Thursday.

The top job at Rosenergoatom, which runs Russia's 10 nuclear power stations, will go to Sergei Obozov, currently the company's deputy director and head of the pioneering division that develops seaborne nuclear reactors.

Antipov, who had held his post for a year, will assume an advisory role to Kiriyenko at the Federal Atomic Energy Agency, according to agency spokesman Sergei Novikov. Under the changes, Alexander Lokshin, previously head of the Smolensky nuclear power station, becomes Obozov's first deputy, Novikov said.

"As Rosenergoatom gears up to be incorporated, a lot of complex legal and restructuring issues will come up," Novikov said by telephone, adding that Obozov would act as a "good crisis manager" during restructuring.

Industry insiders, however, said the changes were part of Kiriyenko's strategy to bring in known allies with a proven business-minded approach.

Formerly a federal official in Nizhny Novgorod, where Kiriyenko made his business and political career, Obozon later went on to be presidential envoy to the Volga Federal District. He arrived at Rosenergoatom last December.


"The sector is about to undergo major changes, and Kiriyenko's team wants its own men around, the can-do people who bring things to completion and have business acumen," said Gennady Pshakin, a nuclear industry expert at the Obninsk Institute of Physics and Power Engineering.

Obozon will act as "a trusted man" at a time when large investments will be pumped into the sector, said Vladimir Orlov, director of Moscow-based PIR Center, which monitors nuclear policy

Russia is currently working on increasing the proportion of its electricity generated by nuclear power.

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2.
Russia's Rosatom Sets Out Priorities In Nuclear Energy Cooperation With France
ITAR-TASS
3/15/2006
(for personal use only)


Fast-neutron reactors and the closed nuclear cycle will be the priorities in
Russia's cooperation with France in nuclear energy, Itar-Tass learned on
Wednesday from the Federal Agency for Atomic Energy (Rosatom)
following the meeting between Rosatom chief Sergei Kiriyenko and French
Minister for Industry Francois Loos.

The parties noted at the meeting "nuclear energy can play the leading part
in supplying the world's growing needs in energy."

It was stressed that cooperation between the two countries in the nuclear
area rests on similar strategies and common approaches to the development of
nuclear energy. The Rosatom press service also reported that during the meeting
the parties came out for enhancing the spirit of cooperation in international
relations in working out approaches to non-spread of nuclear materials."

The negotiations were held in the framework of the Moscow meeting of energy
ministers of the eight major nations.

Rosatom announced Kiriyenko will have a meeting with US Energy Secretary
Samuel Bodman on the same day. Kiriyenko's press secretary said the Rosatom
chief will take part in the meeting of the energy ministers of the Group of
Eight on March 16.


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3.
Russian nuclear agency chief approves dismissal of facility director
Interfax
3/15/2006
(for personal use only)


Excerpt from report by Russian news agency Interfax

Yekaterinburg, 15 March: On 13 March Russian Federal Agency for Atomic Energy head Sergey Kiriyenko signed a directive on removing the director of the Mayak nuclear reprocessing plant in the Urals, Vitaliy Sadovnikov, from office. The directive was signed on the basis of procedural decisions by the Prosecutor General's Office and the court.

"The relevant document was received yesterday (14 March) by the Prosecutor-General's Office department in the Urals Federal District and has been attached to the criminal case materials," the press service of the deputy prosecutor-general for the Urals Federal District said on 15 March. (Passage omitted; earlier reported facts)

On 13 March the Leninskiy district court in Yekaterinburg received Sadovnikov's appeal against the decision to remove him from office. The date of hearings has not been fixed yet.

In pursuance of the court decision on his removal from office Sadovnikov appointed his first deputy Aleksandr Suslov acting general director of Mayak. (Passage omitted to end: earlier reported charges faced by Sadovnikov)

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I.  Chemical Weapons Destruction

1.
Clean Kambarka. Russian Technologies for Destroying Chemical Weapons Prove Their Safety
Rossiyskaya Gazeta
3/16/2006
(for personal use only)


Safety measures are very strict during CW destruction

Moscow in Russian -- the Government daily newspaper -- Moscow edition for 15 March 2006 devotes its page eighteen to a feature headlined "Clean Kambarka. Russian Technologies for Destroying Chemical Weapons Prove Their Safety," following up the 1 March launch of a new CW destruction facility at Kambarka in Udmurtia, part-funded by foreign contributions. It comprises a 500-word Sergey Ptichkin report on the project together with a series of comments by officials and politicians.

Ptichkin's 500-word report, titled "Arsenal Smelling of Geraniums," describes Kambarka's history as a lewisite-yperite production facility during and after World War II and the eventual focus of plans under the Russian Federation federal program to destroy its 6,340 tonnes of chemical weapons in a process "fully in accordance with 21st century technological requirements."

In a 500-word comment, Udmurt Republic President Aleksandr Volkov welcomes the impact of the new facility on Kambarka itself in not only "removing a potential danger to the population" but also providing employment and upgraded social provision in the town, which he describes as "an example of what implementing the priority national projects will bring in the spheres of education, health, and housing construction."

Federal Industry Agency deputy chief Viktor Kholstov contributes a 700-word article linking the Kambarka launch to the operation of an earlier facility at Gornyy, in Saratov Oblast, which completed the destruction of a 1,143-tonne lewisite-yperite stockpile in December 2005.

Kholstov writes that the Gornyy facility's hitch-free, leak-proof performance showed Russia's ability "to ensure full technological and ecological safety in the process of destroying any type of chemical weapon" --- experience "taken into account" in designing Kambarka's "new and highly promising solutions."

He pays tribute to the roles played here by "the Federal Agency for Special Construction, headed by General of the Army Nikolay Abroskin, and the Federal Administration for the Safe Storage and Destruction of Chemical Weapons, headed by Lieutenant General Valeriy Kapashin," and to "the simply invaluable financial and technical support given to us by Germany, Switzerland, Sweden, the Netherlands, Finland, and the EEC (as published)."

Kholstov concludes by noting the "close public attention, including foreign attention" to the process and the attendance of a "representative" foreign delegation and many journalists at the Kambarka launch, which he sees as showing how "we are learning to be open" about the CW destruction process.

The feature concludes with comments from some of those foreign observers:

German Foreign Ministry department head Friedrich Groening sees Kambarka as "a symbol of the close ties between Germany and Russia" in efforts to "rid mankind of the threat of the use of WMD" and says "on behalf of the FRG government" that "Germany will continue to support Russia in its aspitation to liquidate CW completely";

German Ambassador to Russia Walter Jurgen Schmid calls Kambarka "a wonderful example of fruitful international partnership";

Bundestag (Green Party) Deputy Winfried Nachtwei sees the Kambarka facility as "a lighthouse, showing us the way to ensure security together";

Finally, Swiss Foreign Ministry disarmament department chief Andreas Friedrich dubs Switzerland's "modest contribution" to building the Kambarka infrastructure "a wonderful example of bilateral cooperation between Russia and Switzerland in the cause of disarmament and reduction of the threat of WMD dissemination."

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2.
The Scourge with the Scent of Geraniums
Dmitry Litovkin
Izvestia
3/16/2006
(for personal use only)


People say that lewisite smells like geraniums. As a rule, of course, anyone capable of confirming this is no longer alive. For this reason, as you cross the threshold of one of the five sheds on the plant grounds, you feel tense and your hand instinctively reaches for the gas mask in the pouch you were issued....

"There is no reason to worry. Everything is fine," Colonel Igor Makarevich, the chief of the Federal Administration for the Safe Storage and Destruction of Chemical Weapons, assured the journalists. "Everything here is new. The installation work was just completed."

Four years ago, Moscow admitted it could not complete the recycling of its stockpiled chemical agents by the deadline in 2007. It lacked the resources to do this. Russia had been promised $20 billion in the next 10 years at the G8 summit in Kananaskis, Canada, in 2002. It never received the full amount, however, mainly through the fault of the chief "sponsor," Washington, which had demanded extra privileges from the Kremlin: access to Russian chemical enterprises not covered by the convention for American inspectors, tours of nuclear munitions depots, and so forth.

Germany was the only country agreeing to work with Moscow unconditionally. When FRG Ambassador Walter Schmidt attended the ceremony marking the opening of the plant, he called this relationship a "marriage of convenience." The Germans had already helped to build the plant in the settlement of Gornyy in Saratov Oblast, and Kambarka was the second cooperative project.

The designers did not want to disturb the "old" tanks holding the poison and erected a new "roof" right over the old one. Makarevich said the plans were updated to add more support beams in the interest of safety. This is more than enough to exclude the possibility of collapse. The new "sarcophagus" will also secure the proper temperature and humidity levels -- just as in the case of particularly valuable exhibits in a museum.

Participants in the process have no regrets giving up this scourge. The recycling technology is one of the latest examples of Russian know-how. The lewisite is mixed with an alkaline solution in a specially designed jet reactor and yields acetylene as it breaks down. The acetylene is incinerated in a thermal detoxifier, and the liquid reaction mass is processed in a granulating dryer. This produces granulated dry salts containing a raw material used in the electronics industry -- sodium arsenite. A similar facility is to be opened in Kirov Oblast this year.

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DISCLAIMER: Nuclear News is presented for informational purposes only. Views presented in any given article are those of the individual author or source and not of RANSAC. RANSAC takes no responsibility for the technical accuracy of information contained in any article presented in Nuclear News.

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