ML25260A573

SECY-78-337: Proposed Exchange of Notes with Yugoslavia

ML25260A573
Person / Time
Issue date:	06/22/1978
From:	James Shea NRC/OIP
To:	Commissioners NRC/OCM
References
SECY-78-337
Download: ML25260A573 (1)

Text

.~June 22; 1978 SECY-78-337 For:

From:

Thru:

Purpose:

INFORMATI N REPORT The Commissioners James R. Shea, Director, Office of International Programs r Executive Director for Operations (.,.;,tl},..,S PROPOSED EXCHANGE OF NOTES WITH YUGOSLAVIA

. To inform the Commission of recent developments concerning the supply of nuclear fuel for the Krsko nuclear power plant.

Discussion:

The State Department has provided NRC with a copy of a proposed exchange of notes concerning US/Yugoslavian nuclear cooperation (Enclosure 1). Also attached (Enclosure 2) is a copy of a message reporting on the recent visit to Yugoslavia of a State Department negotiating team.

As noted in Enclosure l, several changes were agreed to on an ad referendum basis during the recent U.S. team visit there. State expects the Yugoslavs to indicate their approval by early next week, and wishes to be in a position to give early U.S. agreement.

In forwarding the proposed exchange of notes to the Commission, State is not seeking formal concurrence, but does wish to be advised of any problems the Commission sees with the proposed exchange.

Enclosures:

1.

Proposed Exchange of Notes

2.

Cable from Yugoslavia

/

I NATlONAL SECURITY St1bj ect to Ge!".::iral, e "-' ssi!'ic:at!on So~od*Jle INFORMATION

\\.Jn!'!y*h::,"~~,j ~isc!osure Subiect To erlmin<1I S~rn:tions.

Contact:

J. R. She a, I P ( 4 9 2-:- 7 88 6 )

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Secretariat

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DEPARTMENT OF STATE Wa~h in~ton, O.C.

?0520 June 19, 1978 MEMORANDUM TO:

FROM:

T/D -

Dr. Joseph Nye ~

S/AS - Mr. Robert Kelley EUR/EE -

Mr. Samuel Fromowitz L/N -

Mr. Robert Sloan ACDA -

Mr. Charles Van Doren DOE -

Mr. Harold Bengelsdorf DOE -

Mr. Peter Brush NSC -

Dr. Jessica Mathews PM/NPP -

Mr. Allen Locke OES/NET/NEP -

Michael A. Guhin )1

SUBJECT:

PROPOSED EXCHANGE OF NOTES WITH YUGOSLAVIA Attached is a proposed exchange of notes concerning US/

Yugoslav nuclear cooperation.

As no~ed in the cable reporting on the recent team visit, three key changes were accomplished during that visit along with some minor modifications.

First, the sentence extending the coverage of the Exim Bank Agreement has been moved up and "irrespective of the duration of that agreement" has bee,i-' added to avoid any possible ambiguity regarding the continued application of the commitments once the Exim Bank loan is paid.

Second,the paragraph following the three disposition options has bee~ deleted to make it unambiguously clear that disposi-tion other than storage in Yugoslavia must be under arrange-ments to which* the US subscribes.

Third, 11 if practicable" has been added to the option for storage in the US to indi-cate that this choice would depend on US approval.

You will also note that the reference to "difficulties and differences still appearing" has been deleted from the first paragraph of the previously suggested Yugoslav draft.

With the first two changes noted above, I believe criteria 2_~ur.. ar1q _.tt Vf:! __ or their eoui valen t would be met for anv oro-

~;c3ed fuel exports to KRSKO.

The proposed exchange was approved ad referendum during the recent team visit.

Yugoslavia expects to have final government approval by June 26.

I would appreciate your concurrence in the proposed exchange by noon Wednesday, June 21.

-GO;ilF I fl f!.N 'I' I~:&-

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Attachments:

Proposed US/Yugoslavia Exchange of Notes and Proposed Yugoslav Letter to IAEA cc:

NRC/IP -

Mr. James R. Shea'-

NRC/OPE -

Mr. James Devine NRC/OGC -

Mr. Carlton Stoiber

u YUGOSLAV PROPOSAL: LETTER OF THE FEDE.qp.L SECRETARY FOR FOREIG~-1 AFFAIRS OF THE SF'R OF YUGOSLAVIA TO MR C. VAi.~C E, SECRETARY OF STATE OF THE u. s.1\\.

I have the honour to refer to the matter of supply of the US nuclear fuel for the Kr~ko Nucle~r Power Plant which remained outstanding a.:ter we hc1d, on 12

May, 1977, solved the problem of supply of equip~er.t for our first nuclear power plant. The problems which arose at that

time, were due to the request of the United States Governrnen t construction request of safegua.:-ds.

to of the revise the t;S the existing agree~ents on the Kr§ko

~uclear Power Plant, i.e. the Government for acditional bilat:c::-al I would l i'.-<e to take this os,portuni ty to repeat that t~e Government of the Socialist federal ~epublic of Yugoslavia has in its policy always and consistently pledged itself for nuclear disarnament and has, consequently, attached exceptional irnFortance to the halting of the nuclear arr.is race and prohibition of production, stockpiling and

~se of nuclear weapons. By ratifying the Treaty on non-proliferation of nuclear weapons (NFT) and by accepting the Agc~cy~s multilateral safeguards system it has, for its part, undertaken not to produce nor procure nuclear weapons or nucelar explosives and also that it will not use for military purposes nuclear ~echnology and techniques which it receives. The Government of the SFR of Yugoslavia has most faithfully adhered to the mentioned

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commitments and this constitutes a

lasting component of its policy.

I would like to note that the Government of the SFR of Yugoslavia, being consistent to its policy of non-proliferation of nuclear

weapons, has in connection with the construction of the Krsko Nucear Power Plant under-taken as follows:

(a)

Under the agreement between the Government of the Soci~list Federal Republic of Yugoslavia and the In-ternational Atomic Energy

Agency, Yugoslivia has under-taken that the reactor for the Krsko nuclear Powe:?:" E'lan t and any nuclear material contained,

used, produced or processed in, or by the use of the reactor, shall not be used in such a way as to further any military purpose; (b)

The same agreement specifies that the safe-g~~rds' rights and responsibilities of the Agency provi-ded for in paragraph A of Article XII of its Statute are relevant to the Krsko Nuclear Power Plant, and that their impleIT.entation is satisfied by the application of safeguards 9rocedures pursua~t to the Ag=eement bet~ee~

the Socialist Federal Republic of Yugoslavia and the In-ternational Atomic Energy Agency for the P..pplication of Safeguards in connection with the Treaty on Non-Prolife-ration of Nuclear Weapons; (c)

The Government of the SFR of Yugoslavia will do everything within its competence towards the implementa-tion of the provisions of the Agreement concluded betMeen the Nuclear Power Plant Krsko Consortiun and the Fxport-Import Bank, of 25 July 1974, to the effect that no esuip-ment or materials

supplied, by the United States to the Krsko Power Plant will be exported to or used in any 6ther

country, leased, sold or otherwise disposed. It is understood that those undertakings shall apply to all nuclear fuel the Krsko Nuclear Power Plant may receive under this arrangement, irrespective of the duration of that Agreement.

.J 3 -

We are convinced that the com~itments cited above are fully consistent with the nuclear..,,eapons non-prolifera-tion objectives our.two countries support and are, there-

fore, entirely in keeping with prevention of possible mis-uses and comply with

~~~ United States requirements concern-i n g

• t he non - p r o I i f e r a t i c n o f n u c I e a r

\\*1 ea po n s.

A s yo u a I r e.: d y k n o..,, t h e G o v e r n r,, c n t o f t h ~ S F R. o f Yugoslavia

has, in October 1977, responded to the invita-tion of the United States Government to participate in the I ~IF CE related studies and contribute to the solution of proble~s to the use of nuclear energy.

Yugoslavia has, together with other participants at the aforementioned Conference, including the United States, supported the at-titude that nuclear energy for peaceful purposes should be made

..,;idely available

and expressed its "conviction that effective measures can and should be taken at cha na-tional level and throu,;h international agreements *,.:i ic !"'.

would contribute to minimize the danger of the pro! i rara-tlon of nuclear weapons without jeopardizing nuclear energy supply for peaceful purpos_es. 11

~e are convinced as wet I as other partic i pants of the Conference that v,hile the INFCE studies are being carr i ec out and new solutions, confirmed by the international co~-

munity are not

adopted, there must not be any changes,n the existing arrangements for nuclear fuel supply and transfer of nuclear technology.

The SFR of Yugoslavia has noted that the Govern-ment of the United States affirms i t s interest in the t i me I y i s s u an c e for the first of n e c es s a r y I ice n s es for export. of f u e i core and f i rst reload as we! I ~s subsequent

~~

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fuel for

.the Krsko Nuclear* Power Plant as may be requested, in accordance with the existing agreements including the Agreement for the Agreement Contract").

Furni§.h_ing Uranium Ehrichrnen t Services under for Cooperation of 14 August, 1974l~("The disposal of vernment of following:

Having L11 mi.rd that the United States cons ic.ers irradiated fuel a particular problem, the Go-the SFR of Yugoslavia would like to state the The SFR of Yugoslavia is ready to store the irradited us

fuel, in adequate storage facilities on the territory of the SFR of Yugoslavia for a period of...

... i:::e sufficient for its possible subsequent use in SU??Ort c,f the eco.no:nic development of the SFRY and in accordance *.., i. :::i non-proliferation objectives.

The SFR of Yugosl2sia furthermore e:<?resses its readiness to expar1d its ir:-adiated fuel temporary storage facilities and notes ~ith plea3~=a the intention of we United States Government to provide appropriate support~ these efforts.

With respect to disposition of the US fuel irradiated in the Krsko Nuclear Power Plant the SFR of Yugoslavia shall accomplish such disposition in accor-dance with the alternatives set forth below:

A.

Storage in the SFR of Yugoslavia; B.

Storage, processing or other disposition in accordance with internationally accepted arrangements to which both the Government of the SFR of Yugoslavia and the Government of the United States ~bscribe; C.

Storage in the United States for abfixed fee under related commercial arrangements, if practical~

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The Government of the SFR of Yugoslavia un-derstands that the undertakings cited above refer to the first core and first reload and any other subseq~ent reload that may be requested and transferred.

Tb.ese undertakings nay be termina tcd, it beir.g ~nders teed '::-.:;.::

such termination shall not affect the rights and oblig~tio~s of the Parties (including those set forth in this Le~te= l with respect to fuel transferred to the S?~ o: '..*ugcs:.:.*::..-.

prior to such termination. Nothing in these arra~gese:-'..~3 is meant to affect the terms or conc!i tior.s c: tr.<;,~*.gree:-:-'.~:-. ':

.ii~

for Furnishing Uranium Enrichme:1 t Services 1..::1cerv--,;gree::-c.9:--.. t for the A

Coope=ation of 14 August, 1974, a~i t ~- ~

• : =2e ~~': ~==

Supply of Uranium Enrichment Servi.:-*:-"

Power Facility in the SFR of Yugoslavia c~ :~

~~~~, 137~.

In conclusion, I v.ould like to note that s:-.oulc.

the SFR of Yugoslavia or the United States subscribe to any new inter,national agreement which would refer to issues regulated by this Agreement, the Government of the SFR of Yugoslavia expresses its readiness to enter promptly into negotiations on necessary modifications for the irnplimen-tation of those agreements, unless their immediate imple-mentation has been provided for therein.

YUGOSLAV PROPOSAL:

LCTTER OF rm c. V.\\:!CE, SECRET/\\.RY OF ST.I\\TEOF THE U.S.A. TO TP.S FEDEitAL 51:CR-SI'/\\.RY FOR FOREIGN AFFAIRS OF THE S:R OF YUGOSLAVIA o.J A~--+/--

r have the honoJr to refer to the a~rangc2~R:s among the and the United States of

• America, the SFR of ':"i:.-:-csL1vi2.

International Atomic Energy Agency June

1974, concerning the use of the United States fuel for the Krsko Nuclear Power Plant, including you:- cc~_-::ur.icatic:~

to the Director General of the IA.EA and your letter to rr.e of

---

, and state the folloNing:

The Governnent of ~~e United States a::ir~s ~ts interest in timely issuance of the necessary lice~ses ~c:-

export of fuel for the first core and first reload ~s well as for subsequent fuel as may be requested for the Nuclear Power Plant Krsko, in accordance with ~isting agreements, including the Agreement for Cooperation of l

August, 1974

("The Contract"). I note that uncertakings of the Krsko Power Plant Consortium according to the Agreer..ent with the Export Import Sank of 25 July 1974, shall ap?lY to all nuclear fuel the Krsko Nuclear Power Plant may receive under this arrangement, irrespective of the duration of that -agreement.

SFR of by the I also note with pleasure the readiness of the Yugoslavia to store the irradiated fuel supplied United States under this Agreement in adequate storage facilities on the territory of the SFR of Yugo-slavia for a

period of time sufficient for its possible subsequent use in support of the economic development of

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the SFR of Yugoslavia and in accordance with non-pro-liferantion objectives. Furthermore, I note the readiness of the SFR of Yugoslavia to expand its irradiated fuel temporary storage fac.t-lit-i~s and I can confirm, on be-half of my Government, that the United States intends to provide ap9ropriate surport.t{ these efforts.

I\\.

With rcsp:ct to disposition of the US fuel ir-radiated in the Krsko

~ruclear Power Plant, the United States understands that the SFR of Yugoslavia shall ac-complish such disposition in accordance with the alter-natives set forth below:

A.

Storage in the SFR of Yugoslavia; B.

Storage, processing and other dis~osition in accordance with internationally acce9ted agree~e~ts to which both t:le Gov*ernr:ten t of t!:e SF~ of Yugcs lait ia a:1d t::e Government of the United States J.ubscribe; C.

Storage in the United States for a fixed fee h "~.

under related comrner *

• 1 arrangements, if practica 1.

f.,,.._

The G:7verr:me.. '1t of the United States understands that the undertakings cited above refer to the first core and first reload and any other subsequent reload that may by requested and transferred. These undertakings may be terminated, it being understood that such termination shall not affect the rights and obligations of the Par-ties (including those set forth in this Letter) with res-pect to fuel transferred to the SFR of Yugoslavia prior to such termination.

Nothing in these arrangements is

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meant to affect the terms or conditions of the Agreer.ent for Furnishing Uranium Enrichment Services under~ree-

/\\

ment for Cooperation of 14 August, 1974, and the Agree-ment for the Supply- - *ot---,Uranium Enrichment Services for a Nuclear Power Facility in the SFR of Yugosla,,ia of 14 June 1974.

I would also like to note that should the Cni-ted States and the SFR of Yugoslavia subs~ribe to any new international agreement which would refer to issues regulated by this Agreement, the Governnent o: the unit-ed States expresses its readiness to enter promptly into negotiations on necessary modifications for the imple-mentation of these agreements unless their immediate irn-ple~enti~ion ~~s been provi~ed fer therein.

supplying of Yugoslavia with f ~el

or the Krsko :iuclear Power Plant the United States i~tends to rr:sure that l

. 9--

f

. 1 h

Yugos avia receives ~ treatment no _8ss avo* rao et.an the one the United States may generally accord to any party with which it cooperates.

u

,I YUGOSLAV PROPOSAL: LETTER OF THE FEDERAL SECRETARY FOR FOREIGN AFFAIRS TO THE DIRECTOR GENERAL OF IAEA

~~ r I have the honour to refer to theanger.e~t among the SFR of Yugoslavia, the United States of Anerica and the International Atomic Energy Agency /IAEA/ of 14 June*

clear know Power

1977, ply 1974 concerning the supply of the United States nu-fuel for the Nuclear Power Plant Krsko. As you the issue of supply of the US fuel for the Krsko Plant remained outstanding after we had on 12 May soived with the United States the problem of sup-of equipment for our first nuclear power plant /our Note No.

427338 of 18 May, 1977/. The

~~~~ ~ ~~s ~~ ~=~

arc~2 at that time were due to the request o~

t~e United States Government to revise t~e existing agreements on the construction of the Krsko Nuclear Power

Plant,

. i.e. *the request of the US Government for additional bi-lateral safeguards.

In this connection I would like to inform you that the SFR of Yugoslavia has noted that the Govern-ment of the United States affirmed its interest in time-ly issuance of the necessary licenses for export of fuel for the first core and first reload as well as for subsequent fuel as may be requested for the Krs}t:o :-ru-clear Power

Plant, in accordance with ~~sting aqree-ments including the Agreement for Furnishing Uranium Enrichment Services under the Aqreement for Cooperation of 14 August, 1974 ("The Contract':J. It is und_erstood that

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certain undertakings of the Kr§ko Power Plant Consortium according to the Agreement concluded with the Export-Import Bank of 25 July-**19--7-4, shall apply to all nuclear fuel the Kr§ko Uuclear Power Plant may receive under this arrangement, irrespective of the duration of that agree~ent.

Having in mind that the United States consi-ders disposal of irradiated fuel a particular proble~,

the Government of the SFR of Yugoslavia declares its readiness to store the irradiated fuel supplied under this Agreement in adequate storage facilities on the territory of the SFR of Yugoslavia for a period of tiIT.e suffici~rit for its possible subsequent use in support of the economic develooment of the SFR of Yuqoslavia and in accorcance with ~on-proliferation ~bjec~i-ves.

Furthermore, the SFR of Yugoslavia expresses its readiness to expand its irradiated fuel temporary sto-rage facilities and notes with pleasure the intention of the U:1d;ed States Government to provide appropriate support~ these efforts.

A..

With respect to disposition of the US fuel irradiated in the Kr§ko Nuclear Power Plant, the SFR of Yugoslavia and the United States have agreed to ac-complish such disposition in accordance with the alter-natives set forth below:

A.

Storage in the SFR of Yugoslaviaj B.

Storage, processing accordance with internationally to which both the Government or other disposition in accepted arrangements of the SFR of

• Yugosla-via and. the Government of the United States fl!'!ey 0 subscribe;

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C.

Storage in the --.._United States for a fixed/:'

fee under related corrunercial arrangements, if practical':'

The Governments of the SFR of Yugoslavia and the United Stites understand that the undertakinss cited above refer to the first core and first reload and any other subsequent reload that may be requested and trans-ferred. These undertakings may be terminated, it being understood that such termination shall not affect the rights and obligations of the Parties /including those set forth in this Letter/ with respect to fuel transfer-red to ihe SFR of Yugoslavia prior to such terQination.

Nothing in these arrangements is meant to affect the terms

• of conditions o: the Agree~ent for Furnishing Ura-nium Enrichment Services ~nder the Aqreement for Coope-ration of 14

August, 1974 and the Agreement for the Supply of Uranium Enrichment Services for a Nuclear Power Facility in the SFR of Yugoslavia of 14 June, 1974.

The Governments of the SFR of Yugoslavia and the United States have also agreed that should either of them subscribe to any new international agreement which would refer to issues regulated by this Agreement, they would promptly enter into negotiati~_ps on necessary

4 -

modificc1tions for the implementation of these agrec~ents unless their i mm e d i a t e i m*p 1 em en ta t i on ha s been p r o v i d c d for therein.

that the to the The Government ~f the SFR ~f Yugoslavia expects lr,tcrnatio:-:2I

.'\\to:.1ic Energy.L\\gcncy/\\bcing a P3rty Trilc1terill cJgrccr.c n t en the const{ucticn cf the I~ r s k o r l u c 1 e c1 r P o \\*1 c r r 1 a n t

"' i 1 1 a p p r o il c h t h e U n i t c d S t il t c s

~

Government requesting a*

prompt issuance of the export 1 i cence f a r t h e n u c 1 e u r f u e I f o r t h e K r s k o t l u c I e a r P o 1-, e r Plant..,,hich is the ::-bligatio:-: of the United States Govern-ment under provisions of the aforementioned Agreement.

• PAGE

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/106 W IS0-00 INR-10 SOE-0 2 550-00 I0-13 DODE-00 INRE-00 NSCE-00 ACDA-12 L-03 NS A[-00 EB-Oe

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DOE-15 SS-15 SP-Q2 CE0-01

---

098051 0

R 1612312 JUN 78 FM AMEMBASSY SELGRADE TO SECSTATE WASHDC IMMEDIATE 6951 I~FO AMEMBASSY VIENNA e,-+C, - t

SOFTENING OF LANGUAGE IN YUGOSLAV LETTER TO I~EA DIRGEN AND YUGOSL ~ V LETTER TO VANCE REFERRING TO PAST DIFFICULTIES WITH THE US OVER NEW US NONPROLIFERATION LAW ANO POLICY.

8)

ADDITION CF "IAR!::SPECTIVE CF THE DUR ". TION Ci"

".'H t,T A GREEMENT" AFTEP STJ\\TE~'ENT TH.t\\T CERTIN us AIGHTS ur,.OER THE E Y. P *'Sf, Nr, AGREEMENT ~PPLY TO ALL FUEL USED AT KRSKO SUPPLIED UNDER THIS f,RRANGE ~1Ef.J T.

Cl DELETION OF ENTIRE PARA FOLLOWING THE THREE OPTIONS.

CO~JCERNING NEGOTIATIONS ON FURTHER DISPOSITION OF FUEL USED A T KRS r O.

D>

ADDITION OF "IF PRACTICABLE "

FOLLOWING REFERENCE TO STORAGE IN US IN OPTION C.

El DELETION OF

.. ~1,\\Y"' IN OPTION 8 3.

WE WILL F:.ETURN TO WASHI*NGTON WITH COMPLETE AD REFERENDUM TEXT OF LETTERS.

4,

IN SUBSEOLIENT Hc:ETING WITH 6ERNARDIC.

HE EXPRESSED GAE t, T PLEASURE W!,H REA.CHING AGREf.~-'.ENT I\\T wc::;,<_ I~JG GROU-' LE V EL

,\\ r; o INTE'.. 'ION TO -1:,vE GOY 1-\\PPAO V *\\ L soo:-.i,

\\VE Ir.JD!C,\\TE:J OUR INT::::r-HION TO S!::Et<. USG

• , c.,PP.OV*\\L OF TE X T!:. -"RC H PTLY.

8ERN,\\RDI': t,LSO CLE -'- C.LY SIGNM. LED I ~, ~EREST :r-l F\\JPTHEA COOPERATION v, ITH US IN PL,\\ "l l'JED tJUCLF"-~ PO '-'- r.~

E XPM*iS!ON IN 'fUGOSLAV!,\\.

IN THIS *lc'";.\\ RD,

'.,E NOTED IHPQ;:;T-', NCE OF CO;.JTil'J U ir, G DISCUSSIONS.

P I\\ RTI C'-' L,, ~L Y Gi'J PROPOSED "::'*JQ)/ :: l'H ro US-!,'\\E,\\

,\\ GREEHEr-iT, TO ~RO \\' IDc 6,\\ SIS i"C~

FURT>-:R coo;:::;:R,\\ TION.

l' ~JUN NOTED YUGOSL4V PRC8LE~1 WITH

,'. 1,'.El'-J0!,1E~,T.

BERl'.ARDIC /, GREED TO U ~PORT1\\NCE OF CONTrr-:uir.JG DISCUSSIOl'JS IN ALL CONTE:.XTS IBILI\\TERAL,

INFCE, AM) OTHER MULTILATERAL FOAAl.

WORTZEL

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