ML19345C012
| ML19345C012 | |
| Person / Time | |
|---|---|
| Site: | 05000436 |
| Issue date: | 10/23/1980 |
| From: | Warner J SENATE |
| To: | Kammerer C NRC OFFICE OF CONGRESSIONAL AFFAIRS (OCA) |
| Shared Package | |
| ML19345C004 | List: |
| References | |
| NUDOCS 8012030719 | |
| Download: ML19345C012 (5) | |
Text
. _ _ __.
O v -
. JOHN W, WARNER VIRGINI A 3Cnifeb States Senale WASHINGTON O.C. 20310 ,
October 23, 1980 Mr. Carlton Kammerer Nuclear Regulatory Commission Commissioner' 1717 H Street, N.W.
Wa sh i ng to n , D.C. 20555
Dear Commissioner Kammerer:
I am writing to bring to your attention the enclosed comments f rom my constituent, Mr. H. L. Schmitz.
I shall appreciate your reviewing this correspondence and preparing a report on the stated problems. Please send your reply in duplicate to the following address:
Office of Senator John W. Warner 805 Federal Building Norfolk, Virginia 23501 My constituent and I appreciate your as'sistance in this -
matter. I am grateful for all you can do to solve this matter wi~ thin the existing laws, rules and regulations of the Nuclear Regulatory Commission.
Thank you for your time and courtesy.
With best wishes, Sincerely, P
(O. k John W. Warner JWW/slc Enclosure 8012030 7g7 l
. _ ......_..________.,______,..J
Comeustion Engin:erng.inc. HERBERT K. SCHMITZ 1101 Afteentn Street.WN. Vice Presicent Wasn'ngton, O C. 20005 Govemment Affairs Tel 202/2941235 G
f1I h" x g$r.M 30 Et 11: 31 s
May 27, 1980 g T@
The Honorable John W. Warner United States Senate 6239 DSOB Washington, DC 20510
Dear Senator Warner:
Over the past eighteen months, C-E has been intensely pursuing contracts for design and fabrication of major components for the Atucha II nuclear pcwer plant in Argentina. This effort represents the opportunity for USA employment for approximately 600 man years of skilled American crafts-men as well as the opportunity to utilize the vital and highly developed U.S. nuclear component design and fabrication industry which is currently threatened with extinction. Our efforts have included direct discussions with the Argentine Comision Nacional de Energia Atomica (CNEA) who will own Atucha II, as well as with the prime contractor, Kraftwerk Union AG of West Germany. Substantial progress has been made in all areas, with the exception of questions raised by the failure of the United States government, for reasons related to nuclear safeguards, to issue export licenses for the -
componentsr.
CNEA issued a lettar of intent on Atucha II to KWU early in the fall of last year. KWU has since used a portion of the funding associated with the letter of intent to procure long lead material items for the primary components and has been active in preliminary design efforts with European component suppliers.
The CNEA has indicated that they would prefer C-E components, but could not risk such a venture due to C-E's inability to obtain and possibly retain technology transfer and export licenses. The Atucha II plant is going to be built and operated regardless of where these components are fabricated. If components are not built in the United States, a business and technological penalty will be incurred without serving a useful purpose.
C-E applied to the Nuclear Regulatory Commission for the export licenses on November 7, 1979. The Executive Branch has not yet completed preparation of the judgment required by the Nuclear Non-Proliferation Act of 1978 ("NNPA"),
although C-E believes that sufficient information is available to render a favorable judgment. The NNPA provides that the Executive Branch judgment is to be forwarded to the NRC within 60 days of receipt of the export license application unless the Secretary of State expressly authorizes additional time because it is in the national interest to allow such time. About 200 days have passed since C-E's license applications were submitted, more than three times the period provided by the NNPA.
.. . . . - - . . . . - - .n .v . . , . n.,,, . .- . n .a
May 27, 1980 Page Two No Executive Branch judgment has been completed nor has C-E been informed whether the additional time has been authorized or whether the committees of the House and Senate, which are required to be notified of such author-ization, have been so notified. If it is in the national interest to take additional time to review the applications, rather than reject them, then it is even more in the national inturast to act with sufficient speed that
~
the opportunity to sell export products for Atucha II is not irretrievably 1 cst. I cannot emphasize too strongly that time is of the essence in this matter;-if we are stalled much longer, C-E will surely lose the opportunity to participate in this program.
C-E has been advised that the German and Argentine safeguard agreement made l in March 1980 is fm accordance with the guidelines of the London Nuclear )
Suppliers' Club and goes beyond the normal International Atomic Energy l Agency's safeguard requirements. However, we understand that it does not 'l contain an explicit commitment to " full-scope" safeguards. We also under- ;
-stand that Argentine officials have told representatives of both the Canadian i and German governments that the Argentine government intends that any future reactors in Argentina which are based on heavy sater technology received from either country will be subjected to IAEA safeguards. All current nuclear activities in Argentina are also said to be subject to safeguards. Thus, the end result is a safeguards program which meets the requirements of the NNPA and equivalent to one resulting from a single commitment to a full-scope safe-guard program. ;
- . i There is an existing Agreement for Cooperation between the government of the -l United States of America and the government of the Argentine Republic concern- l ing civil issues of atomic energy. Nothing in that agreement prohibits C-E .
from making the export or technology transfers contemplated. {
The U.S. government at very high levels must demonstrate to the Argentine government that we are seriously interested in the overall Argentine nuclear 2
program by issuing C-E.the necessary export licenses for the Atucha II nuclear 1 components and assuring Argentina that future withdrawal of the licenses will l
not occur.
)
C-E, therefore, urgently requests prompt support from the U.S. government in 1 granting approval for the export of components for Atucha II and convincing the !
, Argentine government that the United States is a reliable nuclear supplier.
We stand ready, willing, and able to lend any and all assistance necessary to lfsupportyourefforts. I will be in touch with your office this week to learn \
L
-_how you might be able to assist us.
)
Very truly yours,
/ j 1
H. K..Schmitz Vice President - Covernment Affairs
Enclosure:
Fact Sheet f
M M* wSD e esp' K h g 9 - ' * ' ' 2 y p f, *9 ,77_*""******;,"**"- *N-**- '*,. "M' MAY %N O ' - 8 8
. . . .~ .
' ~
COMBUSTION ENGINEERING, INC.
EFFORTS TO SELL NUCLEAR COMPONENTS
. FOR ARGENTINA NUCLEAR STEAM SUPPLY SYSTEM FACT SHEET AS OF MAY 15, 1980-OBJECTIVES AND PARTIES INVOLVED:
1 Siemens/Kraftwerk Union (KWU) of Erlangen,. West Germany, has received a letter of intent from Comision Nacional Energia Atomica (CNEA) to serve as the overall systems supplier for the Atucha II plant. Combustion.
Engineering, Inc. (C-E) desires to enter into a. contract to supply the
. Argentina CNEA in conjunction with an Argentine fabricator - IMPSA i (Industrias Metalurgicas Pescarmona S.A.), the major primary components 4
for the Atucha II 600 MWe, Pressurized Heavy Water Moderated, Nuclear Steam Supply System. IMPSA would, under-this arrangement, receive C-E's technology for design and fabrication of these components.
KWU, as the overall systems contractor, would normally procure these primary components directly and C-E.has offered to sell them to KWU.
However, KWU' intends to minimize the Argentine work content in order to place this work with their normal German / Austrian fabricators. Therefore, CNEA has contemplated procuring this equipment separately from a contract with KWU so as to maximize Argentine content and attain American Society of
- ~ ~ ~ ~
Mechanical Engineers (ASME) design and fabrication experience for their future' nuclear activities.
- The German / Austrian fabricators utilize the German DIN Code criteria for - -
l design and fabrication. .The ASME codes are applied to eighty percent (80%)
of the free world's nuclear power plants. CNEA stated that they would prefer to have C-E supply ASME components, since this is definitely more attractive from technical, schedules, Argentine localization, and economic
. viewpoints. However, CNEA has indicated that it simply cannot afford to rely upon the U. S._ Government to grant C-E approval to export the necessary-nuclear hardware. CNEA is also concerned 'about the potential for overseas technology' transfer restrictions. In addition, CNEA stated that even if such permission were granted that Argentina could not totally depend upon retention of_'such permission thoughout the life of the contract period -
(1980-1984). It is, therefore, their current opinion that they must accept the less desirable supplies of KWU in exchange for'long-range dependability 4
and reliability of nuclear component supply.
, - It appears that1the German-Argentine nuclear safeguards agreement, together with the reported application of IAEA safeguards to all other peaceful nuclear activities in Argentina at this time, .is sufficient to meet the export criteria of the Nuclear Non-Proliferation Act. The existing Agree-ment of Cooperation between Argentina and the United States would not prohibit the export of components by'C-E. . Consequently, the legal criteria for issuing an export license are met and there should be no reason for delay. Further delay heightens the doubts of other countries concerning the United States' ' role as a reliable nuclear supplier country.
9 f
' ~~ '
- L 2. L L . O * *- .s .i no-. <, r s. i ,. , , , - --n. - - - - - - -, , , - \-n
,, ,4l*
COMPONENTS:
Present Offering: Other Possibilities:
Reactor Vessel. Primary Piping Reactor Vessel Internals Primary Coolant Pumps Steam Generators (two each) Moderator Coolers Pressurizer Misc. Tankage and Heat Exchangers-Pressure Relief Tank CONTRACT
SUMMARY
Hardware Value: Over 60 million U. S. Dollars Personnel: 200 jobs for three years in Chattanooga Performance Period: 1980-1984 U.S. POLICY AND LEGAL CONSIDERATIONS:
.... U.S. Nuclear Non-Proliferation Act (NNPA)
. . .. IAEA Non-Proliferation Treaty (NPT)
.... German / Argentina /IAEA Agreements
.... United States / Argentina Agreement for Cooperation USA BENEFITS:
i
. . .. Balance of payments. _
.... Retain USA nuclear design and fabrication expertise.
.... Provide better insight by U.S. Government as to Argentina nuclear activities.
IMMEDIATE ACTION REQUIRED:
Although we have the superior component package, the Argentine CNEA in effect has informed C-E that it does not -desire to do business with C-E because of our inability to obtain hardware export licenses and technology transfer approvals. C-E has been explaining the USA export situation to the CNEA for six months; it is very late to revive this business.-
Immediate action is necessary if C-E is to obtain reversal of the CNEA decision to proceed with major components from the regular KWU German /
Austrian vendors. The U. S. Government needs to issue hardware export licenses for the C-E component parts and a high level government delegation should be sent to Argentina.
The delegation should seek to convince the CNEA that the U.S.A. and C-E are reliable / dependable suppliers for nuclear components. Such an effort requires strong commitments at high levels for success. C-E is prepared to furnish full support for such an effort.
4
-.5 w '. t , , ,