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Research Story of the WeekLittle-Known Commercial Enterprise Seeks to Take Over Russian Plutonium Disposition
By Dauren Aben
Securing funds for plutonium disposition was a challenge for Russia from the beginning. As early as September 2000, the Russian Ministry of Atomic Energy (Minatom) put forward the so-called "Western option," whereby foreign nuclear reactors would burn exported Russian MOX fuel, removing the need to modify domestic reactors. Alternatively, it proposed a combination of selling MOX fuel to Western European customers and a limited burning of the fuel in Russia's fast neutron reactors. Minatom argues that selling or "leasing" MOX fuel to foreign countries would significantly lower the costs of the program and speed up its implementation in the absence of full funding form the West. One of the most notable recent developments in this area was a private initiative presented by the little-known Nuclear Disarmament Forum AG (NDF). NDF was registered in Switzerland in 2000 and is managed by Andrey Bykov, who the Financial Times characterizes as a Russian media mogul.[4] Bykov calls himself President Putin's economic advisor.[5] He claims that NDF originated during the U.S.-Russia negotiations on plutonium disposition in the fall of 1999 and even played a crucial role in negotiating the U.S.-Russian Plutonium Disposition Agreement. Bykov also claims that Minatom "granted [NDF] a mandate to accompany the nuclear disarmament process in the next seven years."[6] However, these claims by Mr. Bykov have not been substantiated by Minatom or other official government statements or documents yet. The very existence of this organization became known to a wider public only in the fall of 2002. On October 12, 2002, NDF held a ceremony in Zug, Switzerland, to announce the nominees of the Demiurgus International Peace Award of $50,000 for "outstanding achievements in the field of strengthening peace among nations," established by NDF and the World Council of Former Foreign Ministers.[7] President Vladimir Putin, Archbishop Desmond Tutu, and CNN founder Ted Turner were among the nominees. Former Soviet President Mikhail Gorbachev chaired the ceremony. Almost 500 guests, including nuclear industry representatives from the United States, Europe, and Russia, attended the ceremony in the Zug casino theater and were entertained by the Russian National Orchestra flown over from Moscow.[8] NDF used the occasion to present a 1,500-page report titled "Russian Weapons Plutonium and the Western Option." This report contains NDF's plan for the disposition of Russian weapons-grade plutonium, which it claims is the most cost-efficient, effective, and time-saving alternative to previous proposals.[9] The NDF plan as a whole is very similar to Minatom's own approach to plutonium disposition. However, Minatom officials have not commented on the NDF report nor they confirmed that NDF was selected to be involved in the implementation of plutonium disposition or to prepare a plan for it. The absence of comments is surprising given the NDF claims about its mandate from Minatom and the fact that NDF and Minatom are not total strangers to each other. In September 2002, for example, NDF, Minatom, and Tekhsnabexport co-sponsored an international conference in Moscow on "Safe Management of Spent Nuclear Fuel 2002: New Initiatives for Russia."[10] Though the role NDF envisages for itself in the Russian plutonium disposition program is not clear, it boasts of active cooperation with two state-owned Russian corporations -- Tekhsnabexport and TVEL -- the primary suppliers of Russian nuclear fuel. Greenpeace reports that the Swedish nuclear company Vattenfall and the German companies RWE and GNS are among the Western European nuclear giants advising NDF on its proposal.[11] NDF also hints at support for its plan at the highest level of the Russian government by referring to the initiative put forward by President Putin at the September 2000 UN Millennium Summit in New York to use enriched uranium and plutonium for world energy production.[12] NDF names disarmament and nonproliferation as its main goals. It also firmly believes that its proposed plutonium disposition plan is a sound commercial project, which is quite possible given the "cost-free" plutonium from eliminated warheads it would use and likely availability of international funding for plutonium disposition in Russia. According to Bykov, NDF was deliberately founded as a commercial entity. He asserts that "so far, nothing but economic interest has allowed for practical results in the struggle for nuclear disarmament."[13] In addition to these goals, NDF seeks to "unite Christian organizations in both East and West in a struggle against the threat of nuclear terrorism." Speaking at the September 2002 conference devoted to the import of spent nuclear fuel to Russia, Bykov stated that his Forum works to "unify all the Christian Churches in their efforts to completely and utterly deny terrorists any access to radioactive materials of weapons quality."[14] NDF also announced plans to organize an international conference entitled "Christian World against the Threat of Nuclear Terrorism" in Bari, Italy in December 2003.[15] According to the NDF, its "Russian Weapons Plutonium and the Western Option" plan is a major contribution to enhanced world security. It is more specific and elaborate than Minatom's "Western option." NDF proposes constructing a plutonium conversion facility at PO Mayak in Ozersk, Chelyabinsk Oblast, and a MOX fuel-fabrication facility at the Zheleznogorsk Mining and Chemical Combine in Krasnoyarsk Kray. Russian-made MOX fuel would then be shipped from Murmansk on the Barents Sea, via the Norwegian Sea, to Western European nuclear power plants. Echoing Minatom, NDF claims that this alternative is financially more attractive than burning MOX fuel in Russian light-water reactors since it would eliminate the need for upgrading them and rely "on readily available experience" in dealing with MOX fuel in Western Europe.[16] It also proposes using revenues from MOX fuel sales to finance the operation of Russia's MOX fuel fabrication and plutonium conversion facilities built with Western money. Thus, the required funding for the Russian plutonium disposition program would be reduced by roughly one-half. NDF considers nuclear reactors in Belgium, Germany, Switzerland, and possibly Sweden, Spain, and France to be primary candidates for burning Russian MOX fuel.[17] As part of the deal, NDF also proposes the transportation of spent MOX fuel back to Russia where it would be stored awaiting either reprocessing or final disposition. The paid storage of Western European spent nuclear fuel (SNF) in Russia would bring in additional funding for the plutonium disposition effort. Current Russian environmental legislation does not allow the import of foreign SNF except for interim storage and reprocessing.[18] The NDF plan provides for the lease rather than sale of MOX fuel as a possible way to circumvent this prohibition.[19] If the "Western option" is implemented, with or without NDF's help, Minatom would achieve several goals. First, Russia at last would be able to secure enough Western funds to start the Russian MOX program. Second, the country would obtain at no or relatively low cost a modern industrial base for MOX fuel production -- the entire commercial plutonium conversion and MOX fabrication infrastructure would be paid for by the West. Third, by leasing rather than selling MOX fuel, Minatom would eliminate the need to obtain legislation allowing final nuclear waste storage in Russia. Furthermore, Minatom would generate revenue from leasing Western-financed MOX fuel to Western European countries, foreign SNF reprocessing, and nuclear waste disposal operations. Minatom might also create its own commercial venture to serve as a middleman leasing Russian MOX fuel to Western European utilities. Claims by NDF suggest that it considers itself a possible candidate for this role. Finally, and perhaps most importantly, Minatom would come closer to its dream of incorporating plutonium into the Russian closed nuclear fuel cycle. Minatom considers plutonium and SNF in general as a national treasure that should be used to generate energy rather than disposed of. In addition, the precedent created by the storage of spent MOX fuel might facilitate Russian plans to import 20,000 metric tons of SNF from all over the world for storage and potential reprocessing. Plans are easy to develop, but hard to implement. One of the crucial elements of the NDF plan -- the import of equipment from the Hanau MOX fuel-fabrication plant in Germany -- is no longer possible as the plant has been dismantled and its parts have been sold to Japan. At present the United States is pressing Minatom to replicate the design of the MOX fuel fabrication facility to be built in South Carolina. However, hurdles in the transfer of fuel fabrication technology and the MOX plant design to Russia, combined with a lack of funds, are yet to be overcome.[20] It is also not clear if Western Europeans will lease Russian-made MOX fuel. Germany and Sweden have decided to phase out nuclear energy production. Political opposition, especially from environmental movements, to trade in MOX fuel is an important barrier as well. Besides, Western MOX producers -- Cogema (France), Belgonucleaire (Belgium), and BNFL (UK) -- may fight against the Russian competition in their traditional markets. On the other hand, these companies might seek to expand their reach through cooperation with the Russian MOX program. Western European nuclear power plants, which to date have not shown a willingness to import Russian-made MOX fuel, might decide otherwise, if the price of the Russian-made fuel is sufficiently discounted. Return of the resulting SNF to Russia after the end of the "lease" may also attract some MOX fuel customers. The objective behind the MOX program involving the surplus military plutonium, as claimed by its proponents, is the reduction of proliferation risks associated with weapons-grade material. However, other nuclear nonproliferation experts believe that the MOX option represents a clear proliferation threat since it introduces weapons-grade plutonium into the civilian nuclear fuel cycle.[21] It creates an incentive to develop technologies to use plutonium and promote the creation of additional nuclear material. Moreover, the risk of theft or diversion would greatly increase once weapons-grade plutonium is in transit between storage sites and plutonium conversion and fuel fabrication facilities and during transport as fresh MOX fuel to nuclear reactors. Similar problems would arise when the spent MOX fuel is transported back to storage facilities. According to Russian nuclear safety and security officials, nuclear material is most vulnerable to theft during transportation.[22] In this respect, Minatom's plan to build plutonium conversion and MOX fuel-fabrication facilities at a shared location, PO Mayak, in contrast to the NDF plan, which proposes Zheleznogorsk as the location for a fabrication facility, is more reasonable both from the economic and nonproliferation points of view. In addition to addressing these nonproliferation concerns, plutonium
disposition should be implemented with sound management, physical
protection, control and accounting procedures to which the United States
and Russia agreed in September 2000. This does not preclude the
involvement of private business in the implementation of the agreement. In
fact, it is not unusual in the West to have private companies involved in
various government nuclear defense or disarmament contracts. However,
these contracts are given to companies that have long records in the
nuclear business and considerable expertise in the management of nuclear
materials. The NDF has yet to provide evidence of either.
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