Middle East

U.S. firms push Washington to restart Riyadh nuke pact talks

Saudi Deputy Crown Prince Mohammed bin Salman attends a graduation ceremony and air show marking the 50th anniversary of the founding of King Faisal Air College in Riyadh, Saudi Arabia, January 25, 2017. REUTERS/Faisal Al Nasser

RIYADH/DUBAI: U.S. firms attracted by Saudi Arabia’s plans to build nuclear reactors are pushing Washington to restart talks with Riyadh on an agreement to help the kingdom develop atomic energy, three industry sources said. Saudi Arabia has welcomed the lobbying, they said, though it is likely to worry regional rival Iran at a time when tensions are already high in the Middle East.

One of the sources also said Riyadh had told Washington it does not want to forfeit the possibility of one day enriching uranium – a process that can have military uses – though this is a standard condition of U.S. civil nuclear cooperation pacts.

“They want to secure enrichment if down the line they want to do it,” the source, who is in contact with Saudi and U.S. officials, said before U.S. Energy Secretary Rick Perry holds talks in Riyadh early next week. Another of the industry sources said Saudi Arabia and the U.S. had already held initial talks about a nuclear cooperation pact.

U.S. officials and Saudi officials responsible for nuclear energy issues declined to comment for this article.

The sources did not identify the U.S. firms involved in the lobbying.

Under Article 123 of the U.S. Atomic Energy Act, a peaceful cooperation agreement is required for the transfer of nuclear materials, technology and equipment.

In previous talks, Saudi Arabia has refused to sign up to any agreement with the United States that would deprive the kingdom of the possibility of one day enriching uranium. Saudi Arabia, the world’s top oil producer, says it wants nuclear power solely for peaceful uses – to produce electricity at home so that it can export more crude. It has not yet acquired nuclear power or enrichment technology.

Riyadh sent a request for information to nuclear reactor suppliers in October in a first step toward opening a multibillion-dollar tender for two nuclear power reactors, and plans to award the first construction contract in 2018.

Reuters has reported that Westinghouse is in talks with other U.S.-based companies to form a consortium for the bid. A downturn in the U.S. nuclear industry makes business abroad increasingly valuable for American firms.

Reactors need uranium enriched to around 5 percent purity but the same technology in this process can also be used to enrich the heavy metal to a higher, weapons-grade level.

This has been at the heart of Western and regional concerns over the nuclear work of Iran, which enriches uranium domestically.

Riyadh’s main reason to leave the door open to enrichment in the future may be political – to ensure the Sunni Muslim kingdom has the same possibility of enriching uranium as Shiite Muslim Iran, industry sources and analysts say.

Saudi Arabia’s nuclear plans have gained momentum as part of a reform plan led by Crown Prince Mohammad bin Salman to reduce the economy’s dependence on oil.

Riyadh wants eventually to install up to 17.6 gigawatts of atomic capacity by 2032 – or up to 17 reactors. This is a promising prospect for the struggling global nuclear industry and the United States is expected to face competition from South Korea, Russia, France and China for the initial tender.

Hashim bin Abdullah Yamani, head of the Saudi government agency tasked with the nuclear plans, has said the kingdom wants to tap its own uranium resources for “self-sufficiency in producing nuclear fuel” and that this is economically viable.

As a nuclear conference in October, Saudi officials declined to comment when they were asked to expand on the topic.

In 2015, before the Iran deal was signed, Prince Turki al-Faisal, a senior Saudi royal and former intelligence chief, said Riyadh would want the option to enrich uranium if Tehran had it.

In October, Maher al-Odan, the chief atomic energy officer of KACARE, said Saudi Arabia had around 60,000 tons of uranium based on initial studies and that the kingdom wanted to start extracting it to boost the economy.

Asked what would happen to the uranium after that, he replied: “This is a government decision.”

 
A version of this article appeared in the print edition of The Daily Star on December 02, 2017, on page 8.

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