Select Committee on Foreign Affairs Appendices to the Minutes of Evidence


APPENDIX 30

Memorandum submitted by British Nuclear Fuels PLC (BNFL)

SCOPE OF THE PROBLEM

  1.  The Cold War legacy of excess weapons-grade nuclear material represents a serious threat to world security. As control systems become eroded, particularly in Russia, there is a significant risk of nuclear proliferation and nuclear terrorism from the theft, illegal sale, reconstitution of these materials back into warheads, and the unauthorised transfer of nuclear technology.

  2.  In 1996 it was estimated that there were 1,750 tonnes of military high-enriched uranium (HEU) and 250 tonnes of military plutonium (Pu) in the world's nuclear arsenals. The current mechanism for disposition of excess weapons-grade nuclear material is the conversion by 2014 of 500 tonnes of Russian military HEU to low-enriched uranium (LEU), which may be subsequently used in the civilian nuclear fuel cycle at agreed stabilised price levels. This follows agreements between the Russian and US Governments, and contacts in 1999 between the US Department of Energy (DOE), the Russian Ministry of Atomic Energy (Minatom) and various Western companies. By the end of 1998 only 54 tonnes of HEU had been blended down, and the current annual blending-down rate is around 30 tonnes. It is likely that additional excess military HEU will be declared by the USA and Russia during the next 20 years.

  3.  In 1998 President Yeltsin and Clinton both declared 50 tonnes of excess weapons-grade Pu, for which disposition plans are now being negotiated. In 1998 the USA and Russia agreed that their strategic and tactical warheads would not exceed 2,000 for each nation by 2007. The Pentagon has recommended a lower figure for the USA, and the Minatom Minister Adamov has stated that Russia will be economically unable to maintain more than 1,000 warheads by 2008. On this basis the cumulative totals of excess weapons-grade material available for disposition between now and 2010-15 could be estimated at: Russia—1,000 tonnes HEU and 115 tonnes Pu: USA—700 tonnes HEU and 85 tonnes Pu. If all this material were converted into fuel for civil reactors then there would be sufficient in itself to supply the entire global nuclear power structure for five years. Of course in reality, the material would be consumed over a much longer period of time. The disposition of such totals represents daunting financial and security challenges.

THE THREATS

  4.  The Cold War legacy of hundreds of tonnes of excess weapons-grade nuclear material is sufficient to create tens of thousands of nuclear devices, which in the wrong hands would represent a grave threat to world security. During the Soviet era these materials were protected by a rigorous system of physical perimeter controls—"guards, gates and guns". However, recent economic, political and social developments in Russia have resulted in a serious erosion of these physical controls, particularly in the 10 Russian "secret" nuclear cities, where much of the material is stored. Under the Materials Protection Control and Accountancy Programme (MPC&A), the USA (DOE) and Western partners are helping Russia with funding and technological advice, reinforcing perimeter controls with systems of defence in depth.

  5.  The ten Russian "secret" nuclear cities formerly comprised the core of the Soviet nuclear weapons complex. Some 750,000 people live in these cities, with an estimated 130,000 working at nuclear facilities, half in military programmes. Recent political and economic changes have seriously reduced employment and salary payments for many skilled nuclear specialists. Minatom plans to re-deploy these into civilian and non-nuclear programmes are heavily constrained by economic realities. Under the auspices of the Russian-American Nuclear Security Advisory Council (RANSAC) the USA (DOE) and Russia are co-operating in the Nuclear Cities Initiative (NCI) to assist this re-deployment into the commercial sector. However, progress is limited by the magnitude of the tasks. Economic hardship clearly increases the risk of nuclear technology and material being smuggled to potential terrorist states and organisations.

WESTERN (US) FUNDING

  6.  In 1999 President Clinton's presented a budget which asked Congress for a $1.7 billion increase over five years, nearly doubling the amount available for activities relating to weapons of mass destruction proliferation in Russia. The US 1999 budget includes several tens of millions for the NCI with the European Nuclear Cities Initiative (ENCI) looking to find some parallel European funding. The previous year's budget included hundreds of millions for the MPC&A Russian programme. Current G7 work aimed at the disposition of weapons-grade materials has suggested that a figure in excess of $1 billion will be required to tackle the disposition of Pu.

  4.  Although these are large amounts, they cannot in themselves fund all the necessary work, given the current state of the Russian economy and the vast magnitude of the tasks. Therefore, commercial funding initiatives are needed to help the process.

BNFL'S INDUSTRIAL CONTRIBUTION

  8.  BNFL, through its current wide range of nuclear clean-up and related environmental and threat-reduction work in Russia, has built up close working and personal relationships at all levels with Minatom, the Defence Ministry, regional authorities and nuclear institutions, including the key "secret" nuclear city at Mayak.

  9.  BNFL's environmental contribution, particularly over North-West Russia, is detailed in the BNFL Written Memorandum to the Foreign Affairs Committee Report on Russia. BNFL's threat-reduction contribution includes:

    —  improving the control and storage of fissile materials, through involvement in MPC&A;

    —  technological and operational experience in handling fissile materials, and conversion into a form which can no longer be used for weapons;

    —  training in design, construction and operation of conversion plants;

    —  provision of civilian employment opportunities in "secret" cities, such as Mayak;

    —  R&D out-placement at nuclear institutes, obtaining high-quality good-value research, while providing much-needed local employment;

    —  management of the "downstream" legacy of weapons programmes, to achieve environmental solutions;

    —  development of commercial funding routes for fissile material conversion, through electricity exports to generate revenue; and

    —  "global citizenship" co-operation through training, safety standards, environmental standards, good management practices.

A BNFL COMMERCIAL FUNDING INITIATIVE

  10.  The conversion of excess weapons-grade nuclear materials to a safe spent fuel standard for use in the civilian fuel cycle is regarded as the best way of ensuring the security of these materials. While governments will have a role in dismantling the weapons and in the initial conversion of the materials, a commercial involvement is required to meet the costs of converting the materials to fuel, and burning them in reactors to generate revenue.

  11.  BNFL is able to play a comprehensive role in this area, and is developing proposals to provide a system capable of dealing with all declared surplus materials in a commercially sustainable way. If implemented, these proposals could not only supplement government funding, but also provide an economic incentive for materials to be brought out of the military cycle. If progress is to be made it will require the co-ordination of a very complex set of activities. However, it is only by addressing the whole system that progress can be made self-sustaining. With its experience in all parts of the fuel cycle, including conversion, transportation and storage, BNFL is well placed to integrate the activities required, and so to help to provide a complete solution.

  12.  BNFL has described these proposals to the US Government, since US agreement and co-operation is essential. BNFL has also opened discussions with the Russian Government at a senior level, and with potential Western industry partners and funding bodies. The UK Government has also been briefed.

ADMINISTRATIVE OBSTACLES

  13.  UK industrial involvement would be encouraged by:

    —  stream-lining of access procedures for Russian "secret" areas, while recognising Russia's legitimate security concerns in what remains a sensitive area;

    —  relaxation of Russian bureaucratic hindrances, such as liability, taxation and customs, in order to stimulate Western commercial investment;

    —  development of Russian commercial attitudes and entrepreneurial thinking; and

    —  lowering of regulatory barriers to the international consolidation of Western nuclear industry, whose technology is essential to tackle threat-reduction challenges.

HOW THE UK GOVERNMENT CAN HELP

    —  exercise of support and influence, particularly with the US and Russian Governments, for UK industrial initiatives in these fields;

    —  an active UK role in the relevant G7 and international negotiations;

    —  international moves to reduce administrative obstacles; and

    —  some modest bilateral funding of industrial threat-reduction initiatives—to complement multilateral funding. As with the example of HMG's £5 million for NW Russian nuclear environmental clean-up, this could have a significant "multiplier" impact.

CONCLUSIONS

    —  the accumulation of excess weapons-grade nuclear materials represents a serious threat to the security of the international community;

    —  inter-governmental co-operation is essential to tackle this threat;

    —  an industrial contribution is also essential, to provide technology and commercial funding; and

    —  there are practical ways in which the UK Government can support an industrial contribution.

BNFL

22 March 2000


 
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