UNCLASSIFIED SLEEP Hi 1 0 STATE- Whore 111M5- M I RELEASED IN- September LB 1980 I Dear Mr Xatabe -u - As we agreed in our meeting on July 30 I am _sending here f' with on an informal basis an outline of the ideas I am - exploring with a small number of governments and an additional informal discussion paper on the specific issue of approvals E i for reprocessing and use of plutonium - s you know I have been authorized to explore these ideas 1 on a personal non committal and- confidential basis It would b be my hOpe that ad referendum we could together define the ni - essential elements of our future nuclear cooperation on the 6f basis of which we could make realistic recommendations to our a respective governments - I would welcome your comments or questions on these ideas and on whether you believe this approach offers a prOmising basis for further in depth discussions Sincerely IIJ 1' a l Jr Gerard mioth a-u' Enclosures His EXCellency 'Atsuhiko Yatabe Director General for Scientific and Technological Affairs Ministrv of Foreign Affairs of Japan Tokgo Jlaan UNITED STATES ENT OF STATE REVIEW AUTHORITY GEHRON 06 DEC 2005 200502152- UNCLASSIFIED 95 2% mg ink- 903 UNCLASSIFIED CONFIDENTIAL We have common interests in both optimal use of nuclear power and minimization of proliferation risks We have made some progress but much work remains in harmonizing policies and removing sources of friction and strengthening the non-proliferation regime A post INFCE understanding could be founded on three basic elements respect for one another's views on the best use of nuclear power even though differing national circumstances may lead to differing views on for example the urgency of the breeder and other advanced reactor systems greater confidence and predictability of nuclear supply and retransfer authorizations a closer identity of views on how to improve the non- proliferation regime including approaches to be taken to acquisition use and export of weapons-usable materials and sensitive technologies The last two elements are linked Progress in one is likely to be influenced by progress in the other I believe that our ability to restore confidence in nuclear trade relationships will be directly influenced by the degree to which we can harmonize 'our overall nuclear policies This harmonization shOuld be achievable We appreciate that major trading partners of the U S need greater predictability confidence and timeliness in the process by which U S approvals are given for fuel supplies and approvals for retransfers We have mutual interest in improved front end UNCLASSIFIED CONFIDENTIAL - - - Jar 5 -- aha-I'5 I- UNCLASSIFIED CONFIDENTIAL - 2 assurances covering exports of low enriched uranium so that importers with good credentials can count on long-term supply I also see a need for greater predictability of conditions under which the would approve retransfers for reprocessing where the US has approval rights indigenous reprocessing where we have such rights and the storage fabrication and use and 'reuse of plutonium recovered from such reprocessing With greater harmonization of our policies and improvement of the non-proliferation regime the 0 5 might be able to move away from just granting case-by-case approvals for reprocessing and plutonium use under Specific implementing conditions - We might be treble to grant countries advance approvals to have spent fuel in France and the UK This advantage would be available to countries that have good non-proliferation credentials or where athe spent fuel is subject to pre-1977 contracts or there are no Spent fuel storage alternatives or where there are non-proliferation reasons We might be prepared also to agree in advance to reprocessing of materials over which the US has consent rights in mutually agreed facilities and use of the separated plutonium and subsequent generations iof such plutonium in agreed breeder and advanced reactor programs in advanceiNPT countries with good non-proliferation credentials advanced nuclear programs and large electric grids A discussion paper setting forth more detailed thoughts on this matter is appended UNCLASSIFIED - - I- fin- 1 _ su h countries - UNCLASSIFIED - CONFIDENTIAL 13 with regard to related elements oi the non proliferation consensus we see two sets of issues those generally relevant to strengthening the intennational non-proliferation regime and I a -o I these specifically related to the pha51ng and timing of and plutbnium use 'Ff' i improvements WOuld include among others -a reement to condition significant new nuclear supply commitments on the recipient country's commitment to facilities - 3f agreement to provide greater commitments of financial and resources as well as political support I an fidevelopment and implementation of improved IAEA safeguards and to ensure that plants are designed to facilitate 2 effective safeguards l1 5 f 3 agreement that any future enrichment plants should be designed and dedicated exclusively for low-enriched w uranium 5 4 liferation concern including effective restraints on exports of_sensitive technologies and materials to So that nations might'aVOid premature production and stock- piling of excess quantities of weapons-usable materials we should seek agreement on the following principles CONFIDENTIAL sci i- or Emportant elements of a new consensus-on general noneproliferation JVhave IAEA safeguards on all its future as well as existing 4 more effective cooperation in dealing with countries of pro- I CONFIDENTIAL -4- For the next 10 15 years reprocessing capacity and plutonium use should be limited to breeder and advanced reactor programs and commercialization of thermal recycle should be deferred We would hope for under- standings that cooperating countries do not contemplate further moves to commercial recycle although we recognize that some may want to preserve the option for exercise at a later date I New reprocessing capacity should be limited to that required for breeder and advanced reactors Separation of plutonium should be scheduled so as to avoid unnecessary stockpiling and pressure for thermal retycle Reprocessing for breeder programs should incorporate available proliferation resistance features _We should cooperate more closely in improving the utilization of fuel in light water reactors and in increasing spent fuel storage capacity I he should continue our efforts to work-tomards an effective IPS sYstem While a rigorous IFS-system might facilitate the application of national consent rights we do_not as a practical matter expect suppliers to relinquish such rights We propose that bilateral agreements on the exercise of such rights should underpin the IPS system CONFIDENTIAL UNCLASSIFIED i UNCLASSIFIED 4 CONFIDENTIAL INFORMAL DISCUSSION PAPER A POSSIBLEFAPPROACH FOR PROVIDING LONGER-RANGE U S APPROVALS - FOR RETRANSEERS END REPROCESSING ACTIVITIES GEARED TO DEFINED BREEDER AND ADVANCED REACTOR NEEDS 1 Nations engaged in breeder research and development or work -on advanced reactor fuel cycle systems wish to obtain greater and dare predictable assorances that the materials they require for - these programs will be available on a timely basis At the same Ftime nations should avoid the separation of plutonium earlier than d required for-specific national programs and installation of any new repiocessing capacity beyond established breeder and advanced reactor 3 heeds However since precise estimates of plutonium needs may be diificult to formulate well in advance of anticipated programs even 'With periodic review and update of-projections some stocks of h eXCess separated plutonium may be produced For this reason nations and the IAEA are giving serious attention to -f i e$tabli$hing aniinternational plutonium storage regime to control 'plutonium stockpiling Against this background the following are some preliminary observations as to how longer range approvals might be granted for the reprocessing and or retransfers which would be required to make available US-controlled plutonium for breeder and advanced reactor research and development A program and plan for granting such approvals oculd be developed by the U S and a cooperating nation or nations In connection with the appropriate Agreement for Cooperation a special minute or annex could reflect under- standings of the parties on various ke issues including how rights a CONFIDENTIAL - - UNCLASSIFIED CONFIDENTIAL of approval of reprocessing retransfers and plutonium storage '3 and use as set forth in'the Agreement would be exercised In contrast to the current case by-case mode of 0352 approvals the United States and the cooperating country could agree on specific 5 II programs and projects to be covered by longer-range programmatrc fappfovals and on conditions for granting such approvals The basic - rzco cept would be to review the using nation' anticipated'breeder advanced reactor needs over a stipulated period to endorse a 9 3 I in principle use of US-controlled plutonium and of'subsequent of that plutonium in speci fic'projects and to agree i r g Sac a Periodic review of needs to keep the original understanding 'iflftif and provide long range predictability as program needs is miggt change ouer time For illustrative purposes this approach-might operate along the following lines In the initial negotiations and if desired we would review with the other party a - reprojected needs for plutonium for breeder - i and advanced reactor programs under construction 'or in operation and for those planned for initia- tion in the following ten years as part of an_ official program approved by the government of the party concerned 0 the projected availability of separated plutonium to meet such scheduled needs identifying the primary sources of such plutOnium including any mmsamED a r' - -- 'Jn 1 - UNCLASSIFIED CONFIDENTIAL separated indigenously and any to be imported from other countries the facilities in which any such plutonium was proposed to be separated fabricated or stored including whether the best available safeguards measures and other appropriate proliferation resistance measures were in application at such facilities Use of new reprocessing capacity would also bear an appropriate relationship to the outcome of the review of needs and supply 0n the basis of such initial or subsequent review we would reach agreement on the reactors in which plutonium from USworigin or controlled fuel would be used and the schedule of such use taking into account the availability from other sources Once it was agreed that U S controlled plutonium was needed for a reactor project or activity the U S would expect-to approve on a timely basis any nebessary retransfers or reprocessing that were subject to U S consent rights With respect to reprocessing it is assumed that the parties would be satisfied that adequate safeguards were being applied to the activities involved and as noted one would expect reprocessing facilities to incorporate up to date advances in non proliferation technologies as feasible and appropriate Periodic reviews of the cooperating nation's needs would enable both parties to have a clear picture of the program and related plutonium needs for the following ten years This would permit the up-dating of ad ustments in schedules and LA L CONFIDENTIAL 9 - Hr l- wh Mo - 1' - _g tt'ru 4 - J 3 35dh n - - id - I I - UNCLASSIFIED CONFIDENTIAL -11 the specific reactOrs or programs covered Once a reactor or a pregram had been listed it would remain on the approved list unless it was not completed or was cancelled but delivery and related other schedules would be adjusted if required When applications for specific subseQuent arrangements of the type covered by Section 131 b of the Atomic Energy Act were made the applicant would certify that the end use was for a reactor specified in the agreed program that the shipment was consistent with the agreed schedule of needs and that no major changes had occurred either in that schedule or in the availability of plutonium from other sources On this basis the consent would be granted in accordance with our law In the event any excess plutonium were produced in the reprocessing facility involved it would be stored pending use in an agreed 1P3 or equally effective regime Pending agreement on a broadly based IPS the U S and the other affected states would establish specific release criteria and physical constraints that should govern returns of plutonium from excess stores to near term actual use The U S would look to the cooperating country to define its needs and requirements We would not have in-mind interposing our judgments as to-whether a breeder or research program was economically justified We recognize that uncertainties in some programs may oblige us in some cases to agree only on a provisional basis to use of plutonium over which the U S has consent rights with the understanding that precise requirements will become more apparent with the passage conr IDENTIAEU                    National Security Archive    Suite 701  Gelman Library  The George Washington University    2130 H Street  NW  Washington  D C  20037    Phone  202 994‐7000  Fax  202 994‐7005  nsarchiv@gwu edu