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"No one can solve this problem alone, but together we can change things for the better." 

– Setsuko Thurlow
Hiroshima Survivor
June 6, 2016
Liability Concerns Jeopardize Renewal of Nonproliferation Programs
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Christine Kucia

Two U.S.-Russian nuclear security programs administered by the Department of Energy (DOE) could be terminated because U.S. officials refuse to continue them under existing liability agreements that are deemed inadequate.

DOE officials insist that the liability language in the charter of the Plutonium Disposition Scientific and Technical Cooperation and the Nuclear Cities Initiative agreements—both set to be renewed this year—must “include liability provisions meeting U.S. standards,” according to a July 22 DOE press release. The same statement cited Secretary of Energy Spencer Abraham: “We hope that the Russian Federation will accept our broad proposal on liability in time to allow for the extension of the Nuclear Cities Initiative Agreement,” which is set to expire September 22. The plutonium cooperation agreement lapsed July 24.

Washington insists on negotiating comprehensive liability provisions for foreign projects carried out in Russia to prevent the U.S. government and its representatives from being sued for accidents or problems that arise during the facilities’ building or operation. DOE operates an extensive array of U.S.-Russian nonproliferation programs under a variety of liability agreements. The plutonium and Nuclear Cities agreements, originally inked in 1998, contain fewer liability protections than language offered in other programs.

Bryan Wilkes, spokesman for DOE’s National Nuclear Security Administration, said August 20, “We’re confident the dispute is going to be resolved because the programs are important to both countries. In the short term, this [dispute] will have no effect. But in the long term, if it goes unresolved, it will have a negative impact on the programs.” Wilkes added that, until the liability matter is settled, DOE will not start any new projects in either program.

The Nuclear Cities Initiative provides U.S. assistance to Russia to shut down former weapons production sites that comprised the core of Russia’s nuclear weapons infrastructure during the Cold War and to channel the talents of former nuclear weapons scientists and engineers into non-nuclear or civilian projects. The plutonium initiative enables U.S. and Russian scientific collaboration to help Russia dispose of excess plutonium, and the program is a key component of current efforts to establish mixed-oxide fuel facilities in both countries to begin disposing of 34 metric tons of plutonium under a September 2000 agreement. (See ACT, March 2002.)

Administration officials have sent mixed signals about each program’s future. According to the July 22 DOE statement, Abraham told Russian Atomic Energy Minister Alexander Rumyantsev that, despite the legal dispute, the United States intends to continue the Nuclear Cities Initiative under a provision that would allow the existing projects to continue.

Yet, State Department spokeswoman Tara Rigler told Global Security Newswire July 29 that projects under the now-expired plutonium agreement have been put on hold pending the negotiation of the liability agreement. Wilkes, however, noted August 20 that some plutonium disposition projects might continue under the auspices of the 2000 Plutonium Management and Disposition agreement. “Things are still moving forward,” Wilkes said.

In a July 22 letter to President George W. Bush, Representatives Chet Edwards (D-TX), Adam Schiff (D-CA), Brad Sherman (D-CA), Ike Skelton (D-MO), John Spratt Jr. (D-SC), and Ellen Tauscher (D-CA) called for extending the nuclear security programs while continuing negotiations on liability language. They said that allowing the agreements to lapse or expire would not only jeopardize nonproliferation work in Russia but related plutonium disposition efforts in the United States as well. “The current situation raises doubts about the administration’s commitment to rapidly and effectively addressing the well-known nuclear security and proliferation concerns with Russia,” the members added.

Meanwhile, even the 2000 Plutonium Management and Disposition agreement faces questions about liability protections. Russia and the United States initially deferred liability discussions related to construction work on a facility in Russia that will process excess plutonium into mixed-oxide fuel for use in nuclear power plants—helping Russia fulfill its commitment to dispose of excess weapons-grade plutonium. A government source familiar with the issue warned that the present struggle over adequate liability provisions is the precursor to liability negotiations for building these facilities. Talks will intensify this fall because construction must begin in 2004 in order to meet the agreement’s timeline of beginning plutonium disposition in 2007. According to the source, “Russia needs to take the political decision to run its own facilities without a loophole to sue the U.S. for building the facilities.”

Administration officials point to liability provisions contained in the 1992 Cooperative Threat Reduction (CTR) umbrella agreement with Russia as the appropriate template for all nuclear nonproliferation programs. The Russian Duma, however, has not agreed to the liability requirements outlined by the United States, which would govern a large portion of U.S. threat reduction activities in Russia, so the umbrella agreement is considered provisional by the governments. Other nonproliferation program agreements negotiated after the CTR umbrella agreement did not contain the same strong liability provisions outlined in the CTR program.

Despite the dispute, other U.S.-Russian threat reduction programs operated by the Energy Department are moving forward. The United States and Russia negotiated access arrangements for a U.S. project to help shut down the last three of Russia’s plutonium-producing reactors in the closed nuclear cities of Seversk and Zheleznogorsk, the Energy Department announced July 17. Under the program, fossil fuel facilities will be constructed to replace the reactors, which still provide electricity to Russian residents and businesses in the region. After the fossil fuel plants are brought online beginning in 2008, the two countries will shut down the plutonium reactors. (See ACT, April 2003.)