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^ S. Hrg. 104-481 U.S.-EURAT0M AGREEMENT FOR PEACEFUL NUCLEAR COOPERATION Y 4. G 74/9: S. HRG. 104-481 U.S.-Euraton Agreenent for Peaceful. HEARING BEFORE THE COMMITTEE ON GOVERNMENTAL AFFAIRS UNITED STATES SENATE ONE HUNDRED FOURTH CONGRESS SECOND SESSION FEBRUARY 28, 1996 Printed for the use of the Committee on Governmental Affairs S. Hrg. 104-471 U.S.-EURATOM AGREEMENT FOR PEACEFUL NUCLEAR COOPERATION HEARING BEFORE THE COMMITTEE ON GOVERNMENTAL AFFAIRS UNITED STATES SENATE ONE HUNDRED FOURTH CONGRESS SECOND SESSION FEBRUARY 28, 1996 Printed for the use of the Committee on Governmental Affairs U.S. GOVERNMENT PRINTING OFFICE 22^883cc WASHINGTON 1996 : ForsalebytheU.S.GovernmentPrintingOffice SuperintendentofDocuments,CongressionalSalesOffice,Washington,DC 20402 ISBN 0-16-052797-X COMMITTEE ON GOVERNMENTAL AFFAIRS TED STEVENS, Alaska, Chairman WILLIAM V. ROTH, Jr., Delaware JOHN GLENN, Ohio WILLIAM S. COHEN, Maine SAM NUNN, Georgia FRED THOMPSON, Tennessee CARL LEVIN, Michigan THAD COCHRAN, Mississippi DAVID PRYOR, Arkansas JOHN McCAIN, Arizona JOSEPH I. LIEBERMAN, Connecticut BOB SMITH, New Hampshire DANIEL K. AKAKA, Hawaii HANK BROWN, Colorado BYRON L. DORGAN, North Dakota Albert L. McDermott, StaffDirector John Roots, Legislative Counsel Greg Hetzler, Legislative Fellow Leonard Weiss, Minority StaffDirector Michal Sue Prosser, ChiefClerk (ID CONTENTS Opening statements: Page SenatorStevens 1 SenatorGlenn 2 SenatorLevin 30 SenatorBrown 40 WITNESSES Wednesday, February 28, 1996 Victor S. Rezendes, Director for Energy, Resources, and Science Issues, Re- sources, Community, and Economic Development Division, U.S. General Accounting Office, accompanied by Gene Aloise, Keith Rhodes, and Marty Fitzgerald 5 Fred McGoldrick, Principal Deputy Director, Office ofNuclear EnergyAffairs, Bureau ofPolitical/MilitaryAffairs, U.S. DepartmentofState 14 Terry R. Lash, Director of the Office of Nuclear Energy, U.S. Department ofEnergy, Science and Technology, accompanied by Ken Sanders 17 Norman A. Wulf, Deputy Assistant Director ofthe Bureau ofNonproliferation and Regional Arms Control, U.S. Arms Control and DisarmamentAgency ... 19 Hon. James Schlesinger, former Secretary ofEnergy 33 Marvin S. Fertel, Vice President, Nuclear Energy Institute 42 Paul Leventhal, President, Nuclear Control Institute 43 Alphabetical List of Witnesses Fertel, Marvin S.: Testimony 42 Prepared statement 278 Lash, Terry R.: Testimony 17 Prepared statement 190 Leventhal, Paul: Testimony 43 Prepared statementwith attachments 291 McGoldrick, Fred: Testimony 14 Prepared statement 178 Rezendes, VictorS.: Testimony 5 Prepared statement 51 Schlesinger, Hon. James: Testimony 33 Wulf, NormanA.: Testimony 19 Prepared statement 201 (III) IV Page APPENDIX Prepared statements ofwitnesses in orderofappearance 51 GAO Report dated December 1994 entitled "U.S. International Nuclear Materials TrackingCapabilitiesAre Limited" 70 GAO Report dated June 1995 entitled "Information on Nuclear Exports Controlled by U.S.-EURATOM Agreement" 95 GAO Report dated August 1995 entitled "Poor Management of Nuclear Materials Tracking System Makes Success Unlikely"— 140 "Negotiating a U.S.-EURATOM Successor Agreement Finding Common Ground in Nuclear Cooperation. A Consensus Report ofthe CSIS U.S.- EURATOM Senior Policy Panel," submitted by Hon. James Schles- inger 246 Letter from British Nuclear Fuels Limited 277 Letter to Congressional leaders from Mr. Leventhal 301 NCI Report from Mr. Greenberg 313 "EURATOM's Nuclear Proliferation Record" submitted by Mr. Leventhal 329 . William H. Timbers, Jr., President and Chief Executive Officer, U.S. Enrichment Corporation, prepared statement 354 Steven R. Specker, Vice President and General Manager, General Electric Nuclear Energy, prepared statement 362 Summary of NMMSS Operations as of March 1, 1996, submitted by Edward M. Davis, President and CEO, NAC International 367 Jack Edlow, President, Edlow International Company, prepared statement 377 Prepared statements submitted as letters from: Hon. J. Bennett Johnston, Senator from the State ofLouisiana, prepared statement 378 Hon. Frank H. Murkowski, Senator from the State ofAlaska, prepared statement 379 Andrew T. Hyman, Knoxville, Maryland, prepared statement 380 Responses to questions submitted by SenatorStevens for: Mr. Leventhal 336 Mr. Fertel 350 Responses to questions submitted by SenatorGlenn for: Mr. Goldrick 211 U.S. Arms Control and DisarmamentAgency 382 Mr. Lash 387 Mr. Fertel 401 Mr. Goldrick (additional questions) 404 U.S./EURATOM AGREEMENT FOR PEACEFUL NUCLEAR COOPERATION WEDNESDAY, FEBRUARY 28, 1996 U.S. Senate, Committee on Governmental Affairs, Washington, DC. The Committee met, pursuant to notice, at 9:33 a.m., in room SD-342, Dirksen Senate Office Building, Hon. Ted Stevens, Chair- man ofthe Committee, presiding. Present: Senators Stevens, Glenn, Levin, and Brown. OPENING STATEMENT OF CHAIRMAN STEVENS Chairman Stevens. The Governmental Affairs Committee today will hold this hearing on the U.S./EURATOM Agreement. The United States has exported nuclear materials, equipment, and technologies to the member states of the European Atomic Energy Community, known as EURATOM, for more than 35 years. This cooperative effort has been governed by an agreement for cooperation in the peaceful uses of nuclear energy, which was first concluded in 1958 and has been amended several times. U.S. and EURATOM negotiators have discussed the replacement of the existing agreement since the early 1980's. Formal negotiations began in 1992. An agreement was reached among the negotiators in July of 1995. The agreement was approved by the General Affairs Council of the European Union on August 4, 1995, and by President Clin- ton on November 1, 1995. The new agreement would replace existing agreements with EURATOM as well as bilateral agreements with Austria, Finland, Spain, and Sweden, which are now members ofthe enlarged European Union. We are going to have both those who support the agreement and those who oppose the agreement on panels this morning, as well as views of Federal agencies directly involved in the agreement negotiations. I want to place three letters in the record at this time,1 if there is no objection. One is from Senator Frank Murkowski, who expresses unconditional support for the agreement, along with Sen- ator Bennett Johnston, who similarly expresses support for the agreement. The third is from Andrew Hyman, an attorney who has written on the constitutional requirements of Congress relative to treaties, compacts, and agreements. 1Lettersreferredtoappearsonpage377. (1) We look forward to this testimony today. I would ask that the witnesses keep their comments short. We do have matters on the floor this morning and hope to get through this testimony before we are called to the floor. The entire text of the written testimony will be included in the record. If possible, we would like to keep the comments from the witnesses to not more than 5 min—utes. We will ask questions of not more than 5 minutes ourselves maybe longer. [Laughter.] It depends on my good friend from Ohio and former Chairman Senator Glenn. Senator GLENN. Thank you, Mr. Chairman, I think. [Laughter.] OPENING STATEMENT OF SENATOR GLENN Senator Glenn. We do have a lot of ground to cover and I will try and be reasonably brief here, but there are a couple of points I want to make. I want to thank our Chairman of the Committee, Senator Ste- vens, for recognizing the importance of today's hearing. I think it would be a disgrace, or worse, it would be a forfeiture of our constitutional responsibility ifwe let this particular agreement for nuclear cooperation, given its enormous stakes, slip by without even a single hearing. He is fulfilling that responsibility we have. The American people may be able to rightfully condemn the ris- ing partisanship in the 104th Congress, but the behavior of this Committee on nonproliferation issues has for many years been characterized by cooperation and moderation and bipartisanship and I am glad to see that tradition continuing today. I also want to extend a special welcome to today's witnesses, both because of their expertise on the various facets of this agreement but also for having agreed to participate on such short notice. I doubt there is a single person in this country who knows more about the U.S./EURATOM agreement than today's witness from the State Department, Fred McGoldrick. The Committee can bene- fit from such expertise as we examine the many dimensions ofthis extremely important agreement. What exactly are the key stakes involved and why should Con- gress and the American people really care about this? First, this agreement will set the terms for nu—clear cooperation between the United States a—nd some 15 nations someday maybe several more than 15 nations that belong to the European Atomic Energy Com- munity, or EURATOM. This agreement will be in effect over the next 15 Congresses. It is not a little short deal we are talking about here, the next 15 Congresses, a 30-year arrangement. It will span the terms ofseven Presidential administrations. We need, therefore, to evaluate this agreement very carefully to confirm that it satisfies all ofour statutory requirements and, more broadly, that it sets America on the right direction to advance our commercial interests in Europe without inviting new risks of nuclear terrorism and proliferation. We are here to deliberate the national interest, not the needs ofspecial interests. With painful memories of the World Trade Center and the Okla- homa City bombing still fresh in our minds, it is indeed worthwhile for us to consider very carefully how America controls the weapons- usable nuclear materials that we export to other countries or that such countries produce using U.S. goods. Memories of some earlier bombings, such as Hiroshima and Na- gasaki, should remind us of the dangers that society would face if a few pounds ofhighly enriched uranium or plutonium were to dis- appear into a global black market, a realm that knows no borders, no friends, or so-called rogue nations, no audits, no force oflaw but the law offorce. This agreement will govern how 15 European nations will use American plutonium, highly enriched uranium, and other dan- gerous radioactive materials. Under U.S. law, Congress must sat- isfy itself that the agreement meets several conditions relating to such issues as safeguards, peaceful use, storage, retransfers, U.S. rights of return, alterations of nuclear materials, and the uses of sensitive nuclear technology. We should focus our attention not on determining whether the U.S. approvals and consents in this agreement are an improvement over the previous agreement but whether these approvals and consents are consistent with existing law and in our long-term interests. We have to determine ifthe agreement will advance America's nonproliferation policy, and ultimately, we have to determine ifthe agreement will serve the broad, long-term national security interests ofthe United States. We want to examine certain particular aspects of the agreement quite closely. First, America must have the facts. If we have learned anything from the recent flurry of reports from Europe about terrorism and nuclear smuggling, all ofus on this Committee should agree that America must know the precise whereabouts and physical condition ofthe nuclear materials that we export. Under U.S. law, the International Atomic Energy Agency plays a vital role in safeguarding the peaceful uses of these materials. But we have our own accounts to keep and the value of record keeping, tracking, and auditing is something that Members of this Committee, ofall people, surely understand all too well. Almost 40 years ago, when Congress considered the first EURATOM agreement, the executive branch assured Congress that America would have the ability to conduct detailed audits of how U.S. materials are used in EURATOM. Today, as we face the twin specters of nuclear terrorism and proliferation, Congress has even more reason to favor such detailed record keeping. America may not be able to dictate the energy policies of other countries but there is a lot we can do to reduce substantially the risks of nuclear terrorism or proliferation involving U.S.-origin nuclear materials. The agreement today may help to solve this prob- lem or it may not. That is one of the reasons for today's hearings. Second, Congress must examine this agreement to confirm that it fully satisfies the conditions of Section 123 ofthe Atomic Energy Act and is also consistent with existing U.S. policies to eliminate the use of highly enriched uranium, to prohibit the accumulation of plutonium stockpiles and not to encourage commercial uses of plutonium. Third, members of the next 15 Congresses and the people that elect them will require access to information needed to oversee the implementation of this agreement. Congress must not be a passive onlooker but an active participant working closely with the executive branch and eventually with the European Parliament to en- sure that this agreement is implemented in accordance with the terms of our common democratic heritage. Though the agreement was negotiated in secret, it must not now be implemented in secret. Congress should examine closely several other features of this agreement, including the scale ofthe commercial interests that are involved, what size are they, how they compare with Japan, our other 30-year agreement. We have to look at the U.S. rights to sus- pend or terminate the agreement. We have to look at the effects ofthe agreement on our export controls, and we have to look at the extent to which the agreement will serve as a precedent to apply to other countries or blocks ofcountries. And another major one is the extent to which our country will have a say over the extension of U.S. consents and approvals to former Warsaw Pact countries that may someday join EURATOM. We do not have a say-so, as I understand it, over who joins EURATOM, and yet those countries coming in would be supposedly given the same rights under this agreement as those already in that were in on the original negotiation. So this is a 30-year agreement. I opposed the original 30-year agreement with Japan on the idea that that was too long a time, that no one could predict what was going to happen in our own country 30 years down the road, let alone some other nations around the world. So I have reservations here. I am not saying that I am going to be opposed to this, but I do have some serious questions about this that I hope we can get some answers to this morning or in follow-up questions that will be submitted if we do not have time to do them all this morning. Thank you, Mr. Chairman. Chairman Stevens. Thank you very much, Senator Glenn. I have just been conferring with John Roots, who is my assistant in this matter. He tells me this is day 77 on a 90-day period for Congress to have oversight on this agreement. The time will expire March 14. That is the reason that we held this hearing, so that if there is to be a question about the agreement, there will be time to consider it and try to get around the train wrecks that are tak- ing place on the floor. Our first witness will be Victor Rezendes, Director for Energy, Resources, and Science Issues at the U.S. General Accounting Of- fice, GAO. Thank you very much. Will you tell us for the record who is with you, Mr. Rezendes? Mr. Rezendes. I would be delighted, Mr. Chairman. On my right is Gene Aloise, our Assistant Director who is responsible for our nuclear nonproliferation work, and on my left is Keith Rhodes, who is a Technical Assistant Director and an information expert. Chairman Stevens. Good morning, gentlemen. Thank you very much. Your full statement will be placed in the record, Mr. Rezendes. I hope I am pronouncing that correctly. Mr. Rezendes. Yes, it is exactly correct. I know it is a difficult name. Chairman Stevens. We would appreciate your comments.