4. Future trends--the pending agreement with Egypt

Of particular interest to Congress are the pending agreements for cooperation with Egypt and Israel. The one for Egypt appears nearest to completion and information on its principal provisions has been issued

by the State Department. *

On November 5, 1975, Secretary of State Kissinger and Egyptian Deputy Prime Minister Fahmy agreed in principle to conduct a program of cooperation in peaceful uses of atomic energy. Their agreement was viewed as an important step toward completing negotiations which, it is now hoped, can produce an agreement for cooperation in the near future.

From information released by the State Department, it appears that the agreement will closely follow typical agreements for research and power, with a few notable differences.

The scope of the agreement includes design, construction and operation of research and power reactors but does not mention fuel reprocessing or enriching which presumably are excluded.

The proposed commitment not to use any of the assistance for military purposes also specifically excludes the manufacture of any nuclear explosive device.

The plutonium produced in the powerplants covered under the agreement or derived from U.S. fuel supplied for these facilities will be reprocessed, fabricated and stored outside Egypt.

* Department of State release no. 533, November 4, 1975.

Also, facilities utilizing relevant nuclear technology obtained from the United States will be under safeguards. There is, however, no commitment to place all nuclear materials and equipment in Egypt under international safeguards. The Egyptian Government also guarantees to apply "effective physical security measures" to the facilities and nuclear material covered by the agreement. How these measures might apply, if at all, to facilities and nuclear materials from other sources is not specified. Finally, the State Department release notes the intention of the United States that at such time as negotiations are completed, the same safeguards and special measures will be included in both the agreements for cooperation with Egypt and Israel respectively: "If certain provisions are modified or altered in one agreement, it is the intention of the United States Government to introduce such modifications or alterations in the other agreement."

5. Re-export control

While initial exports of nuclear materials and equipment are licensed by the Nuclear Regulatory Commission, the agreements for cooperation require approval of the Energy Research and Development Administration for re-export of such items by an agreement nation. This anomaly could lead to confusion or divergent actions and therefore merits congressional attention.

The organization and administration of agreements for cooperation and the licensing of nuclear exports present an anomaly concerning export and re-export of nuclear materials and equipment. If an item such as a quantity of enriched uranium, is to be exported directly from the U.S. nuclear industry to an agreement nation, a license must be obtained from the Nuclear Regulatory Commission. However, if the agreement nation later

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wishes to re-export that item to another nation, it must obtain the approval of the Energy Research and Development Administration, even though a similar direct export to the second nation would require an export license from the Commission. In situations where one nation can turn to another or to the United States for a desired nuclear item, there is the possibility of inconsistent or even contradictory decisions and actions by the Commission and the Administration. This anomaly merits congressional attention. Another facet of re-export is that of nuclear technology. U.S. agreements for cooperation provide for control over re-export of material things but not for re-export of nuclear technology supplied by the United States. 6. Safeguarding nuclear technology

The agreements for cooperation require international safeguards for nuclear materials produced from exported nuclear materials or equipment, but not for nuclear materials produced in facilities built only with the help of U. S. technology and "know how". This appears to be a loophole which other governments are beginning to close in their agreements for nuclear cooperation. The safeguarding of U. S. -furnished nuclear technology is a matter warranting congressional attention.

The agreements for cooperation provide for safeguards for U.S. -supplied nuclear materials and equipment, and for nuclear material produced from them. The agreements do not, however, commit the agreement nation to declare nuclear facilities made with U. S. information and technology or by persons trained in the United States and to apply safeguards to them. In recent innovative actions, the governments of France and West Germany have sought to close this loophole in agreements for nuclear cooperation with South Korea and Brazil, respectively.

The general adoption of this innovation would help to assure nations throughout the world that their neighbors are not using imported technology to build unsafeguarded nuclear facilities. Of course, the effectiveness of such a provision depends ultimately upon the motivations of the agreement state and the factors that sustain its compliance with the terms of an agreement. Assuming, however, that agreements will be honored, it seems likely that this innovation is desirable and that the United States should seek to add it to existing as well as to future agreements.

7. Reprocessing of spent fuels

The agreements for cooperation provide assurances that reprocessing of U.S. supplied nuclear materials will be done only in facilities acceptable to the United States. Since there is little reprocessing of commercial nuclear fuel, these commitments remain untried. The demand for fuel reprocessing is likely to increase, however, and with it the desire of agreement nations to reprocess, particularly if there are no regional reprocessing centers or access to reprocessing in the United States. What changes can be made in terms and administration of agreements for cooperation to minimize the metastasis of fuel reprocessing among individual nations is a likely matter for congressional interest.

The agreements for cooperation generally provide that all alteration and reprocessing of nuclear fuel from the United States shall be done in facilities acceptable to both parties upon a joint determination that safeguards may be efficiently applied. The power agreement with the United Kingdom is silent on this matter. The power agreement with India specifies that India may reprocess any special nuclear material used in the Tarapur Atomic Power Station upon a joint determination that safeguards may be effectively applied, or in such other facilities as may be mutually agreed. Of special interest in India is that its reprocessing facilities can reprocess

its own materials, which are not under the agreement. This can complicate the workings of materials accountability and safeguards systems. It is somewhat akin to the problem of a butcher shop in keeping higher and lower grades of meat separate in the meat grinder: it requires unusual measures and discipline.

In the early years of the agreements, the used fuels from research reactors were returned to the United States for reprocessing, which was feasible because these fuels were comparatively simple in chemical and metallurgical qualities. At present there is little commercial reprocessing of

nuclear power fuels. Used fuels are mostly stored until reprocessing becomes available, or a decision is made not to reprocess but to store used fuels indefinitely. So there is no commercial competition on the world market for fuel reprocessing and the attendant risks that some reprocessors might pay less attention to safeguards than others. However, several nations are trying to acquire their own fuel reprocessing capability, including Brazil, Iran and South Korea. A trend toward national fuel reprocessing would compete with and perhaps weaken the efforts to establish regional fuel reprocessing facilities under international safeguards.

In the administration of agreements for cooperation, the United States can expect future pressure from agreement nations concerning reprocessing. If the United States does not permit those nations to reprocess U.S. -supplied fuel in their own plants, it will have to offer alternatives. But these are few. At present no commercial fuel reprocessing plants are operating in the United States to perform this service. Reprocessing of nuclear power