Is a US 123 with Saudi Arabia Necessary?

Memo questioning the need for a US 123 nuclear cooperative agreement with Saudi Arabia.

Feb 08, 2018

Is a US 123 with Saudi Arabia Necessary?

The United States is legally obligated to have a formal US 123 nuclear cooperative agreement with Saudi Arabia in place if US nuclear components listed on the US nuclear regulatory commission (NRC) nuclear trigger list are going to be exported to Saudi Arabia. Items on this 110 NRC list are “especially significant from a nuclear weapons standpoint.” That said, it is unclear if it is necessary for any items on this list to be sent to Saudi Arabia to complete the construction of the reactor most likely to win the Saudi bid – the Korean KEPCO APR 1400 reactor.

It is true that the US has exported items from the 110 NRC list to complete the APR 1400 reactors that KEPCO is building in the United Arab Emirates. The most important of these items were nuclear coolant pumps worth roughly $30 million each. The Korean KEPCO APR 1400 reactor requires 4 pumps per reactor for a grand total of 8 pumps worth roughly $240 million. This is hardly a large enough contract to require the creation of many new jobs in the US.

More important, there are other possible foreign suppliers for these pumps. In fact, KEPCO has previously bought coolant pumps for its APR 1400 reactor from a German company, KSB, which is perhaps the world’s largest commercial nuclear coolant supplier (they have sold pumps for over 270 reactors world-wide and there are only roughly 440 reactors currently extant).

KEPCO could buy KSB pumps rather than US-made pumps. The remaining few US-origin items on the NRC 110 nuclear trigger list that might be needed to complete APR 1400 reactors in Saudi Arabia might also be bought from non-US nuclear suppliers. If so, there would be no need to conclude a US 123 agreement with Saudi Arabia.

As for the transfer of US intangible nuclear know-how, this can be accomplished by exercising DOE Part 810 authority. This can be done without a 123, as was the case when the US transferred intangible nuclear technology to Russia and Argentina before either of those countries had a 123 agreement with the US. Finally, other US dual-use nuclear-related items can be exported to support the ROK reactor for Saudi Arabia with no NRC license or a Saudi 123.

There is a clear advantage of letting KEPCO proceed with Riyadh without the United States striking a loose nuclear 123 agreement with Saudi Arabia. In this case, the United States would not have to undermine the nonproliferation Gold Standard – the enrichment and reprocessing prohibitions contained in the 2009 US-UAE nuclear cooperative agreement. This, in turn, would maintain America’s moral authority to demand much tighter controls than those contained in the current nuclear deal with Iran. In contrast, if the US should strike a loose deal with Riyadh (one without the Gold Standard), the US would be telegraphing to the world that Washington thinks it might be alright for Saudi Arabia to become another Iran, i.e., that it would be ok for Saudi Arabia to enrich or reprocess nuclear materials.

How this story would end — with nuclear options throughout the region, perhaps nuclear arming or even use — is anyone’s guess. What is clear, however, is that the case for striking such a permissive deal is weak. It certainly is more important that we maintain the Gold Standard and try to get others to live up to it than throwing this aside for the sake a handful of jobs for a foreign company (Westinghouse).

Ultimately, of course, the further spread of nuclear power plants in the Middle East is worrisome. There certainly are cheaper ways to produce electricity that are nowhere near as tempting to attack and would not afford nuclear weapons options.