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I salute the Arms Control Association … for its keen vision of the goals ahead and for its many efforts to identify and to promote practical measures that are so vitally needed to achieve them. -

– Amb. Nobuyasu Abe
Former UN Undersecretary General for Disarmament Affairs
January 28, 2004
Kelsey Davenport

Renewing Waivers for Nuclear Projects with Iran Serves U.S. Interests

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Volume 11, Issue 7, April 29, 2019

A critical decision in the long-running effort to block Iran’s potential path to nuclear weapons is just days away. The Trump administration must decide by May 2 to renew sanctions waivers allowing required nuclear cooperation projects with Iran detailed in the 2015 multilateral nuclear deal to continue or let the waivers lapse. Failure to grant the waivers would jeopardize U.S. nonproliferation priorities and increase the risk that the nuclear deal, known as the Joint Comprehensive Plan of Action (JCPOA), will collapse. Tehran is already threatening to withdraw from the JCPOA and, more seriously, the 1968 nuclear Nonproliferation Treaty (NPT) after the United States announced April 22 that it would no longer grant waivers to states seeking to purchase Iranian oil.

When the Trump administration first issued the 180-day nuclear cooperation waivers Nov. 5, it stated that allowing these projects to go forward would “impede Iran’s ability to reconstitute its weapons program and lock in the nuclear status quo until we can secure a stronger deal”—a clear acknowledgement that the U.S. benefits from these crucial nonproliferation projects.

The waivers were necessary after U.S. President Donald Trump violated the JCPOA by reimposing sanctions on Iran–despite Tehran’s clear record of compliance—and withdrew from the accord in May 2018. Had the Trump administration not issued the waivers, the United States could have penalized foreign entities involved in the nuclear projects for conducting legitimate work required by the JCPOA and endorsed by the UN Security Council in Resolution 2231.

Despite the fact that these nuclear cooperation projects help to reduce Iran’s nuclear weapons potential, the White House may allow the waivers to expire in order to try to ratchet up the pressure on Iran even further. Six Republican Senators wrote to U.S. Secretary of State Mike Pompeo April 9 encouraging the Trump administration to allow the waivers to lapse in order to put additional pressure on Tehran. These members of Congress and some officials within the Trump administration appear to believe that the United States can coerce Iran’s leaders into a new set of negotiations designed to produce a “stronger deal” that addresses Iranian regional activities that Washington views as destabilizing and requires Tehran to capitulate to all U.S. demands on the country’s nuclear program. So far, this strategy has only isolated the United States and damaged Washington’s credibility.

In an April 11 Senate Foreign Relations Committee Hearing, Pompeo said the decision regarding the nuclear cooperation projects is “complicated,” but did not indicate if the waivers would be renewed. Reportedly, Pompeo favors granting the waivers, but Iran hardliners in the National Security Council are opposed to renewal.

Failure to renew the waivers for JCPOA-related nuclear cooperation projects will not advance the Trump administration’s plan to maximize pressure on Iran in pursuit of a mythical “better deal,” which appears to be a thinly disguised call for regime change. Rather, it would be an own goal that sets back U.S. nonproliferation priorities and compounds Trump’s irresponsible decision to jeopardize the JCPOA by reimposing sanctions. It also risks putting the remaining P4+1 parties to the JCPOA (China, France, Russia, Germany, the United Kingdom, and the EU) in violation of the deal by preventing them from meeting obligations under the agreement to assist Iran with certain nuclear projects, thus giving Iran a further justification to abandon the agreement.

Jeopardizing Critical Nonproliferation Projects

If the Trump administration does not issue the waivers, it will put at risk critical projects that serve U.S. and international nonproliferation and security interests, particularly the conversion efforts at the Arak reactor and the Fordow facility, a former uranium enrichment site.

Arak: Prior to the negotiation of the JCPOA, the unfinished heavy-water reactor at Arak posed a proliferation risk that the United States and its negotiating partners sought to mitigate with the nuclear deal. If Iran had completed the reactor as originally designed, it would have produced enough plutonium for an estimated two nuclear weapons per year.

As a result of the JCPOA, Iran removed the calandria, or core, from the Arak reactor, filled it with concrete, and committed not to undertake any additional work at the site based on the original design. The IAEA verified the removal of the calandria and continues to monitor the reactor site. In addition, Iran committed to modify the reactor so that, when operational, it would produce a fraction of the necessary plutonium for a nuclear weapon on an annual basis.

Iran also agreed to ship out the spent fuel from the reactor for 15 years, preventing Tehran from accumulating several years’ worth of plutonium and then reprocessing it into a form suitable for nuclear weapons. The JCPOA established a working group “to support and facilitate the redesign and rebuilding” of the Arak reactor. (See JCPOA, Annex III, Section B, Paragraph 5.1.) China agreed to lead the work with the United States providing critical support verifying the design. When the Trump administration withdrew from the deal, the UK took over the U.S. role.

If China is prevented from fulfilling its contract on the Arak work, Iran may decide at some point to restart construction on the reactor, perhaps based on the original design. If Tehran were to go down that path, it would pose a proliferation risk and provide Iran with a source of plutonium, which when separated, could be used for nuclear weapons.

However, once the reactor is converted, it would be more difficult and time consuming for Iran to use it for weapons purposes or to revert back to the original design. Given the nonproliferation benefits of modifying the Arak reactor and the risks of Iran returning to its original plan for the reactor, supporting and allowing conversion efforts to continue clearly serves U.S. interests.

Fordow: A similar argument can be made for the Fordow site. Prior to the negotiation of the JCPOA, Iran was enriching uranium to 20 percent uranium-235 at Fordow. While 20 percent uranium-235 is still far below the 90 percent considered weapons grade, it poses a greater proliferation risk as it is easier to increase enrichment from 20 percent to 90 percent than it is to move from 3.67 percent (reactor grade and Iran’s current limit under the JCPOA) to 20 percent.

As a result of the JCPOA, Iran is prohibited from enriching uranium and having any nuclear material at the Fordow facility for 15 years. Iran also had the reduce the number of centrifuges at Fordow from about 2,700 first generation IR-1 machines to 1,044. Of the 1,044 centrifuges, two cascades (348 centrifuges) will be used for stable isotope production.

The JCPOA stipulates that Iran will convert the facility into a “nuclear physics, and technology centre ” and encourage international collaboration in certain areas of research. (See JCPOA, Annex I, Section H, Paragraph 44.) The IAEA is also permitted daily access to the site under the JCPOA and the deal notes that Russia will assist with the conversion efforts.

Turning Fordow into a nuclear physics center, reducing the centrifuges at the site, and using a portion of them for stable isotope production serves U.S. and international nonproliferation interests. It significantly reduces the risk that Iran will reconstitute the facility for uranium enrichment and, by having a regular Russian and IAEA presence at the site, it provides greater assurance that if Iran were to begin to transition Fordow back to a uranium enrichment plant, the international community would quickly be alerted to that fact.

Additionally, the Fordow facility is located within a mountain that would render it nearly impossible to destroy using conventional military means. A military strike is not a viable option for addressing Iran’s nuclear program should Tehran exit the JCPOA and resume more troublesome nuclear activities, and it is more likely to incentivize the country to pursue nuclear weapons. But the invulnerability of Fordow to a strike underscores the importance of retaining the JCPOA and preventing the proliferation risk that would come if Iran were to reconstitute uranium enrichment at the Fordow site.

Other Projects: Additional JCPOA-supported projects that could be impacted if the United States does not grant waivers include the transfer of 20 percent enriched uranium fuel to Iran for the Tehran Research Reactor (TRR), which produces medical isotopes, and Russia’s assistance at the Bushehr nuclear power reactor.

Under the JCPOA, Iran is allowed to import limited quantities of fuel enriched to 20 percent uranium-235 under IAEA monitoring for the TRR. The P4+1 are required by the deal to assist Iran in obtaining the fuel. (See JCPOA, Annex I, Section J, Paragraph 60.) If Tehran is unable to purchase the 20 percent material, it could lead Iran to resume enrichment to that level, which poses a far greater proliferation risk than the 3.67-percent uranium-235 limit that Iran is required to abide by for 15 years under the JCPOA.

At Bushehr, Iran’s sole civil nuclear power reactor is fueled by the Russians. Russia also removes the spent fuel. Sanctioning Russian entities involved in the operation of the reactor and the spent fuel removal risks incentivizing Iran to increase its enrichment capacity to fuel that reactor, again posing a greater proliferation threat.

Additionally, these projects, particularly the conversion of Fordow to a stable isotope production and research center and the modifications of the Arak reactor, are tangible benefits for Iran that incentivize its continued compliance with the nuclear deal. Currently, as a result of Trump violating the JCPOA by reimposing sanctions, Iran’s economy has suffered, and foreign entities have withdrawn from the Iranian market. Nevertheless, research and development activities like the Fordow and Arak projects still provide Iran with benefits and incentives to remain in the agreement.

Putting U.S. Partners and Allies in Violation of the JCPOA

In addition to halting projects that benefit U.S. security and nonproliferation objectives, failure to grant the waivers allowing nuclear cooperation projects to continue risks putting the remaining P4+1 parties to the deal in violation of the agreement.

The impact of halting nuclear cooperation differs from the impact of foreign entities exiting the Iranian market in order to avoid being penalized under U.S. sanctions reimposed by Trump. Reimposing sanctions put the United States in violation of the JCPOA, but the deal does not guarantee Iran any particular level of economic benefit or require the P4+1 to guarantee that companies will do business with Iran. Therefore, the decision by companies to sever contracts with Iran did not abrogate P4+1 commitments under the deal.

However, unlike the economic sanctions, certain nuclear cooperation projects are required by the JCPOA and have been endorsed by the UN Security Council. If entities involved in these projects halt work out of fear of being sanctioned and the P4+1 are unable to meet their obligations to assist with these projects, it risks putting them in violation of the deal.

On Fordow, Annex III of the JCPOA states that “the transitioning to stable isotope production of two cascades will be conducted in a joint partnership between the Russian Federation and Iran, on the basis of arrangements to be mutually agreed upon.” (See JCPOA, Annex III, Section C, Paragraph 7.1.) Russia’s work at Bushehr would also be at risk if the Trump administration does not issue a waiver. In addition to providing fuel for the reactor and removing spent fuel, Rosatom, Russia’s state-run energy organization, is currently working on an additional two reactor units at the site.

If the United States does not grant a waiver allowing Russia’s state-run energy organization Rosatom to continue working at Bushehr and Fordow, it will put Moscow in the difficult decision of deciding between meeting its explicit commitments under the JCPOA and risking U.S. penalties or violating the nuclear deal.

Similarly, Annex III of the JCPOA states that the Arak working group “will provide assistance needed by Iran for redesigning and rebuilding the reactor” and agree upon steps to provide an “assured path forward to modernize the reactor.” (See JCPOA, Annex III, Section B, Paragraphs 5.1; 5.5.)

The China National Nuclear Corporation (CNNC) is the primary entity involved in the Arak reactor redesign project and the CNNC and Iran agreed upon a contract in 2017 for the initial phases of the work. However, despite receiving a wavier in November, Iran has raised concerns about the pace of work at Arak, as CNNC reportedly considers the guidance provided by the Trump administration on the waiver to be vague and insufficient. Given CNNC’s global reach and ambitions, the company is likely adverse to any risk of sanction by the United States and would be unwilling to continue the project without a waiver.

There are additional implications for revoking the waivers beyond the nuclear deal with Iran. Rosatom, for instance, is involved in a number of nuclear cooperation projects with U.S. entities. If Washington refuses to grant the waivers allowing legitimate work under the JCPOA to continue, Rosatom and others could choose to retaliate by terminating projects with U.S. based entities. That could inhibit competitiveness of the U.S. nuclear industry and adversely impact their operations.

The General Nonproliferation Value of Nuclear Cooperation

Beyond the nonproliferation and JCPOA-compliance benefits of issuing the waivers, there is value to encouraging and supporting additional nuclear cooperation projects suggested in Annex III of the agreement. Unlike the work at Arak, Fordow, the TRR, and Bushehr, these projects are optional, yet fulfilling them would have significant nuclear security and safety benefits. Additionally, it would continue to provide greater transparency into Iran’s civil nuclear activities.

Iran currently operates two reactors, the TRR and the Bushehr reactor, and has ambitious plans to expand its nuclear program for energy generation. Yet Iran lags behind international standards and best practices for nuclear safety and security. Iran is not a party to the Convention on the Physical Protection of Nuclear Material and its 2005 amendment, nor the Nuclear Safety Convention. Iran also does not publish its nuclear regulatory practices, so it is difficult to determine if Tehran is meeting international standards for governing its civil nuclear activities. Annex III of the JCPOA encourages cooperative work to address these critical gaps on nuclear security and safety, including measures such as strengthening emergency preparedness, training and workshops on nuclear safety and security, the establishment of a nuclear safety center, and assistance to strengthen physical protection at nuclear facilities.

Cooperative work on several of these areas is already underway. The EU-Iran high-level seminars on nuclear cooperation have begun the initial phases of constructing a Nuclear Safety Center and assisting Iran with updating its regulatory frameworks to reflect international best practices. This work is proceeding and does not appear, at this time, to be impacted by U.S. sanctions.

This type of assistance project benefits not only Iran, but the entire region. A nuclear incident, caused either by accident or an intentional act of sabotage, would have an impact beyond Iran’s borders. It is in the best interests of Middle Eastern countries, particularly those in the Persian Gulf, that Iran’s nuclear activities are safe and secure. Without the JCPOA, or if the United States aggressively targets entities involved in legitimate nuclear cooperation, it is unlikely that these projects will continue.

Conclusion

Trump’s decision to withdraw from the JCPOA and reimpose sanctions was irresponsible and unjustified. If the Trump administration refuses to renew the waivers allowing nuclear cooperation projects to continue it would compound his dangerous decision to abandon the agreement.

Supporting nuclear cooperation with Iran benefits U.S. nonproliferation priorities and national security. It also allows the remaining parties to the deal to meet JCPOA requirements. Additionally, these projects provide greater insight and transparency into Iran’s nuclear activities and can provide important safety and security benefits.—KELSEY DAVENPORT, director for nonproliferation policy

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Failure to grant the sanctions waivers detailed in the 2015 Iran nucelar deal would jeopardize U.S. nonproliferation priorities and increases the risk that the nuclear deal, known as the Joint Comprehensive Plan of Action (JCPOA), will collapse.

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An Uncertain Future for North Korean Talks


April 2019
By Kelsey Davenport

North Korean leader Kim Jong Un may be losing interest in diplomacy with the United States, according to officials in Pyongyang, creating uncertainty around the future of U.S.-North Korean negotiations. If the two sides do resume talks, diplomats will need to overcome persistent differences that contributed to the abrupt end of the second summit between Kim and U.S. President Donald Trump in Hanoi Feb. 28.

National Security Advisor John Bolton said the United States would take no step-by-step measures to achieve North Korea's denuclearization. (Photo: Mandel Ngab/AFP/Getty Images)Trump and Kim initially expressed interest in continuing diplomacy after the Hanoi meeting, but Choe Son Hei, North Korea’s vice minister for foreign affairs, said on March 15 that Pyongyang might halt negotiations because Kim may have “lost the will” to continue talks. She also raised the prospect of North Korea resuming intercontinental ballistic missile (ICBM) tests, which are prohibited by UN Security Council resolutions, if Washington does not reward the North’s current testing freeze with a reciprocal step that addresses North Korean concerns.

North Korea announced in April 2018 a voluntary moratorium on nuclear and long-range missile tests. Trump has highlighted the testing suspension as an indicator of successful talks and announced on Feb. 28 that Kim had agreed to continue abiding by the moratorium.

Choe’s remarks implied that North Korea would undo additional steps it took as part of the process, including the partial dismantlement of its satellite launch facility and nuclear test site, if the United States refuses to take any actions. Satellite imagery from early March reportedly appears to show that North Korea has already reconstructed elements of the Sohae Satellite Launch facility that were dismantled last year. Imagery also suggested that North Korea may be preparing for a launch at the site, but South Korean Defense Minister Jeong Kyeong-doo said on March 18 that the activity at the site “should not be judged as activity preparing for a missile launch.”

Despite North Korea casting doubt on the future of negotiations and raising the prospect of future ICBM tests, U.S. officials have said the Trump administration remains committed to diplomacy.

U.S. Secretary of State Mike Pompeo said on March 15 that he is “hopeful” that the United States and North Korea “can continue to have conversations, negotiations.”

The Hanoi summit exposed that the United States and North Korea still prefer different approaches to advancing the goals agreed by Trump and Kim at their first summit in Singapore in June 2018.

North Korea has consistently stated its preference for a step-by-step process in which the United States takes reciprocal actions for progress toward North Korea’s denuclearization. North Korean officials also have made clear that Pyongyang wants the initial U.S. steps to include sanctions relief. The proposal that North Korean Foreign Minister Ri Yong Ho discussed publicly after the Hanoi summit called for lifting the majority of sanctions imposed by the UN Security Council in 2016 and 2017 in return for North Korea dismantling its Yongbyon nuclear complex under U.S. inspections and solidifying its voluntary testing moratorium.

U.S. officials, including National Security Advisor John Bolton in a March 3 interview with CBS, rejected the step-by-step approach outright.

Additionally, although Trump and Kim agreed to the general goals of the negotiating process during their meeting in Singapore, the Trump administration appears to be seeking a more detailed understanding of the term “complete denuclearization of the Korean peninsula,” and the end-state of the negotiations before agreeing on steps to advance the process.

Pompeo made clear in July that the United States and North Korea did not share the same definition of denuclearization. Bolton’s comments March 3 clarified that U.S. officials define denuclearization as the verifiable dismantlement of North Korea’s nuclear weapons program and its means of production, plus an end to the North’s “ballistic missile program, and its chemical and biological weapons programs.”

Trump had made statements indicating the United States would pursue dismantling these programs as part of negotiating process, but it had been unclear if the United States was actually including chemical and biological weapons in its definition of “denuclearization of the Korean peninsula.” The expanded definition puts further distance between the U.S. and North Korean understandings of the term.

North Korea and the United States are also at odds over the sequencing of sanctions relief. Stephen Biegun, U.S. special representative for North Korea, stated in January that Washington is “prepared to discuss many actions that could help build trust between our two countries and advance further progress in parallel on the Singapore summit objectives.” U.S. officials have made clear that those actions do not include sanctions relief, which will not be offered until denuclearization is complete.

The Trump administration has not explicitly stated what steps Washington would be willing to take “in parallel” to North Korean actions to denuclearize, but they may include establishing better ties between the two countries with liaison offices and discussions to bring a formal end to the Korean War. Reportedly, both topics were on the agenda for the Hanoi summit.

In her March 15 remarks, Choe appeared to reject the Trump administration’s approach and said that North Korea has “no intention to yield to U.S. demands” and Pyongyang is not willing to “engage in negotiations of this kind.”

South Korean President Moon Jae-in has been working to bring the United States and North Korea back to negotiations and bridge the divide between their positions. Foreign Minister Kang Kyung-wha said on March 4 that South Korea is looking to “create a venue for the resumption of the North Korea-U.S. dialogue.”

 

North Korea Continues to Evade UN Sanctions

North Korea persistently and successfully defies a range of UN sanctions, according to a March report from a UN panel of experts. The seven-member panel was established by a 2009 Security Council resolution to report on violations of North Korea sanctions and make recommendations for improving implementation of UN measures. The Security Council began sanctioning North Korea for its nuclear weapons activities in 2006, shortly after the country conducted its first nuclear test.

“The nuclear and ballistic missile programs of [North Korea] remain intact and the country continues to defy Security Council resolutions,” the report says.

The panel provided details on certain North Korean efforts dating back to 2013 to procure materials for its nuclear program in violation of Security Council measures. The panel said it continues to investigate attempts by designated individuals to obtain prohibited materials such as pressure transducers and vacuum equipment that can be used for nuclear activities and requested information from Beijing on Chinese companies that did business with the designated individuals.

To better ensure that these technologies do not end up in North Korea, the panel is currently surveying manufacturers that produce similar items in order to share best practices for internal screening and end-use verification.

The report notes North Korean efforts in 2018 to continue dispersing its ballistic missile assembly and storage locations, likely to prevent a decapitation strike, according to information provided to the panel by a UN member state.

The panel is also investigating North Korean efforts to sell military equipment to a number of states and nonstate actors, including the sale of ballistic missiles to Houthi forces in Yemen through a Syrian company, and requested information from a Houthi general and a Syrian national alleged to be involved in the transfer.

North Korea is also continuing to cooperate with the Scientific Studies and Research Center and the Army Supply Bureau in Syria, according to information provided to the panel by a member state. The Scientific Studies and Research Center in Syria is generally thought to be responsible for research on the country’s chemical weapons program. The panel of experts requested a full list of activities involving North Korean individuals in Syria in December 2018. Syria responded to the request Jan. 11, saying that the information provided by the panel was not objective and that all relations between Syria and North Korea are “in harmony with international law.”

The report also covers the sectoral sanctions imposed on North Korea in 2016 and 2017 and notes the “massive increase in illegal ship-to-ship transfers” to evade caps on petroleum imports and the ban on North Korean coal exports. The panel noted that these transfers “involve increasingly advanced evasion techniques.”

The panel could not conclude definitively that North Korea exceeded its annual cap of 500,000 barrels of imported petroleum products, but it detailed sophisticated efforts to conceal oil purchases, including falsely flagging ships and transmitting false signals to obfuscate the location of a vessel. North Korea used similar methods of deception to continue selling coal, which it is banned from doing under a 2017 Security Council resolution.

The report raises concerns about the implementation of financial sanctions and said these “remain some of the most poorly implemented and actively evaded measures of the sanctions regime.”—KELSEY DAVENPORT

U.S. officials make tough demands, but insist diplomacy continues.

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