A Deeply Flawed Fuel Bank docx

103WINTER 2010 / 2011
ESSAY
PROVIDING NATIONS WITH ENRICHED
URANIUM WILL NOT PREVENT PROLIFERATION.
IT WILL PROMOTE IT.
AmitAi Etzioni
A Deeply Flawed
Fuel Bank
T
here’s a new and troubling
idea aoat in the world
of nuclear proliferation.
To ensure that nations will not
enrich uranium—a key element
in nuclear bomb production—they will
be provided with already-enriched ura-
nium. Nations that already have signi-
cant enrichment capabilities, including
France, Germany, the Netherlands, Rus-
sia, the United Kingdom and the United
© 2010 WORLD POLICY INSTITUTE
States, will provide the enriched
uranium. To ensure the recipient
nations are not dependent on the
good will of any one nation, coun-
tries will contribute to an inter-
national nuclear fuel bank, regulated by
the International Atomic Energy Agency
[] or some other, yet-to-be identied
international entity, from which recipi-
ent nations could obtain enriched ura-

nium. Call it a fallback bank.
104 WORLD POLICY JOURNAL
ESSAY
The uranium provided will be low-
enriched, or , usually dened as
enriched to 20 percent or less of the ssile
isotope uranium-235, which is used for
energy-related purposes, rather than highly
enriched uranium, , usually dened as
90 percent enriched or more of uranium-235,
which is used to make nuclear bombs. The
fuel bank idea attempts to prevent recipient
nations from further enriching the  to
make bombs, forcing them to give up their
enrichment capabilities and submit to
inspections, preventing them from turning
their  into . In short, nations will be
able to build nuclear reactors and use them
for peaceful purposes without enriching
uranium, and the world will rest assured
that no nuclear proliferation is in the ofng.
The plan sounds good, but as is often
the case, a great distance separates the lip
and the cup. Two signicant aws exist—
one in its design and another in its imple-
mentation. Both pitfalls make it likely that
outsourcing uranium enrichment will actu-
ally propel proliferation, rather than slow it.
CORRECTING A FLAW
Outsourcing enrichment corrects a gaping

hole in the Nuclear Non-Proliferation Trea-
ty []—a aw that is acknowledged by
long-time experts in nuclear security (my
rst books on the subject were published in
1962 and 1964). The treaty allows a nation
to build nuclear facilities, including those
needed to produce enriched uranium, as
long as these facilities are used for non-mil-
itary purposes. But the treaty also permits
a recipient nation to give three months’
notice to the other parties and the UN Se-
curity Council that it is opting out of the
treaty—allowing it to take advantage of its
fully developed nuclear facilities to manu-
facture bombs. This is exactly what North
Korea did in 2003.
Given that there are 189 parties in
the , including countries such as
Iran, Venezuela and Myanmar, reaching
consensus on modifying the treaty is about
as likely as getting all of the oil that has
spilled into the Gulf of Mexico to ow
back into Deepwater Horizon’s well.
When the signatories do meet—once every
ve years—they have difculty agreeing
on something as simple as the agenda.
Typically, their efforts produce very little.
Instead of vainly seeking to correct
this detrimental aw in the , nuclear
experts who lose sleep over these matters

came up with the idea that if nations
could be cajoled, enticed and pressured
not to build uranium enrichment facilities
themselves (and instead purchase enriched
uranium from other nations) the 
could work without correcting its core
loophole. In this way, if a nation genuinely
committed to not enriching uranium and
to use its reactors merely for non-military
purposes, it would have all the ready-made
fuel it needed. If it strayed, the supply
could be cut off. Moreover, if a nation quit
the , it would not have enrichment
facilities. So far, so good.
THE SUBSTITUTION EFFECT
The fuel bank idea, which for years was
the main subject of position papers and
theoretical discussions among experts,
was implemented in the United Arab
Emirates in 2009. It is now being of-
fered to other nations. In the process,
Amitai Etzioni is a Professor of International Relations at The George Washington
University and the author of Security First: For a Muscular, Moral Foreign
Policy (Yale 2007).
105WINTER 2010 / 2011
A FLAWED FUEL BANK
 
  
 
 

, ,
  
  
  
the fuel bank faces two major challenges
that are almost never mentioned. The
rst concerns the used rods leftover in
reactors after the uranium is consumed.
These rods can be reprocessed to make
plutonium-239, which can be used
to make bombs. Plutonium warheads
are smaller than those that use .
By some estimates, it takes 15 kilos of
uranium but only 4 kilos of plutonium,
or even less, to make a bomb. So the plu-
tonium that can be derived from used
rods in the nuclear reactors in Bushehr,
Iran—now fueled by Russia—could be
used to make 30 bombs a year, according
to Paul Leventhal, former
president of the Nuclear
Control Institute. This is
not just a theoretical no-
tion, but also an unlikely
development. Making plu-
tonium is difcult, turning
it into bombs is far from a
cakewalk, and miniaturizing
the bombs adds further chal-
lenges. But this is precisely

how North Korea developed
part of its stockpile of nuclear weapons.
It is dangerously smug to assume that
just because Iran has had difculties in
proceeding with its nuclear program that
it will be unable to proceed in a similar
fashion. The same holds for other nations
with a sizable industrial and technological
core. Selling such nations processed uranium
just makes their journey to proliferation easi-
er, if this is the nation’s desired route.
Fuel bank supporters are likely to
argue that the basic deal requires recipi-
ent nations to return spent fuel rods to
the suppliers. Many reports simply take
this for granted, as if picking up radio-
active rods is akin to picking up a pack-
age at the post ofce. Gerald Seib writes
in the Wall Street Journal, “By providing
the fuel, and taking away spent fuel, the
Russians have undercut Iran’s argument
that it has to do its own enrichment.”
Likewise, a State Department spokes-
man tried to reassure critics by saying
that Bushehr was “under  safeguards
and Russia is providing the needed fuel
and taking back the spent nuclear fuel,
which would be the principal source of
proliferation concerns.”
One can also imagine that the ura-

nium suppliers would cut off future
supplies of enriched uranium if the re-
cipient nation did not cough up the
used rods. However, such
a nation still could use
the rods to make a hefty
batch of plutonium-based
bombs before its ready-
made uranium supplies
run out. It is not known
how many years worth of
uranium Russia is provid-
ing for Iran’s reactors, but
a single rod, used for one
year in a fully loaded reac-
tor could make 30 bombs. True, such a
nation would need a reprocessing plant,
which would emit krypton-85, giving
away the plant’s location. However, the
international community can do little
to prevent Iran from making plutoni-
um. Furthermore, additional uranium
supplies may be purchased from some
other source (say, South Africa) during
the construction of the recipient nation’s
own enrichment facilities.
The second major catch arises in the
implementation methods for the fuel
bank. When enriched uranium is pro-
vided to nations that already have enrich-

ment facilities, but are in short supply of
uranium ore or have only limited facilities
106 WORLD POLICY JOURNAL
ESSAY
Brazil, when Colin Powell excused friction
between the Brazilian government and the
 by declaring that he was “sure” the
Brazilian government was not pursuing
nuclear weapons.
This approach has two defects. First,
governments change. One can readily
imagine that the authoritarian and op-
pressive Saudi regime will come to a sud-
den end. Moreover, the idea that there are
“good” governments that can be trusted
with nuclear weapons and “bad” govern-
ments that cannot is a dangerous concept.
Pakistan could fall to the Taliban before
you nish reading this text—and even
before that, Jordan, which has abundant
sources of uranium and is seeking nuclear
power plants, could fall to the Palestin-
ians. Even Brazil, which General Powell
considered a reliable partner, has taken a
rather sharp left turn in recent years.
Second, to some extent non-prolifera-
tion efforts are based on what Brown Uni-
versity professor Nina Tannenwald calls
the “nuclear taboo”—the notion that good
citizens of the international community

develop neither nuclear arms nor the facil-
ities that can be used to make them. Once
exceptions are allowed, it becomes more
difcult to encourage other nations not
to follow suit. And once one major power
holds that it can make exceptions for its
allies, other major powers can hardly be
expected to be far behind. Indeed, China
responded to America’s deal with India
with its own deal with Pakistan, a very
troubling development given the failing
state of this country.
VIETNAM
Another exception for a trusted ally is the
communist government of Vietnam, which
is also favored because it is considered a
counterweight to China. The United States
and skills, the bank’s uranium frees them
to use what they already have for military
purposes. This substitution effect, as I
will show shortly, is a realistic risk.
“TRUSTED” GOVERNMENTS
The United Arab Emirates signed a deal
with the United States in January 2009
based on the outsourcing fuel bank mod-
el. The pact, called a “123 Agreement,”
(named for the section of the Atomic En-
ergy Act that governs trade on sensitive
nuclear technologies) obligates the United
States to supply the UAE with uranium

for power plants, and the government of
the UAE agreed, in exchange, to forgo any
enrichment or reprocessing activities. This
agreement also freed the UAE to sign a $20
billion agreement with South Korea in De-
cember 2009 to build four nuclear reactors.
The rst will be operational by 2017.
Bahrain and Saudi Arabia are reported
to be next in line. Together with the UAE,
these three nations have no uranium enrich-
ment facilities of their own, so the substitu-
tion effect is of no concern. But, while the
UAE and Bahrain likely do not have the
wherewithal to make bombs out of the used
rods, the same cannot be said for Saudi Ara-
bia. Several observers expect Saudi Arabia
will seek to develop nuclear arms if any are
discovered in Iran. The United States and
its allies, though, consider the UAE, Bah-
rain and Saudi Arabia to be trustworthy
governments, and are not concerned that
they will abuse their enriched uranium sup-
plies. Gary Samore, special assistant to the
president and White House coordinator for
arms control, said recently that the “Gold
Standard” was applied to the agreement
made with the UAE, but from now on it
will be applied “selectively,” meaning that
other nations will be given more leeway.
This notion came up before, in reference to

107WINTER 2010 / 2011
A FLAWED FUEL BANK
tor in Bushehr, on Iran’s southern coast.
Russia says it will retrieve the used rods
from Iran, but it is unclear how this will
be enforced. Iran is short on yellowcake
and enrichment facilities, so providing it
with enriched uranium allows it to use the
supplies it already has for military pro-
grams. (Western powers offered Iran en-
riched uranium—but only if Iran agreed
to shut down its own facilities.)
Providing Iran with enriched
uranium is like pouring gasoline on a re.
After years of protracted negotiations,
the United Nations has concluded that
Iran is not living up to the international
obligations it assumed
by signing the .
Iran did not allow the
kind of inspections
needed to vet its claim
that it plans to use
the nuclear facilities
it is constructing
exclusively for peaceful
purposes. Indeed, the
, whose board
comprises 35 nations—
including non-western

nations such as
Russia, Malaysia, and
Cameroon—has implied
that Iran is seeking to
build nuclear arms.
Other observers hold that some of the
facilities, for instance the one at Qom
that Iran tried to conceal, are suited only
for making bombs. And after much give
and take, even Russia and China agreed
to impose some additional sanctions on
Iran, albeit not the crippling ones the
United States sought. In this context,
Russia’s move has strong consequences.
Iran has difculty enriching uranium
and was reported, in April 2010, to
is negotiating an agreement with Vietnam
to provide it with nuclear fuel and tech-
nology—without the usual constraints on
uranium enrichment. The deal has been
under discussion for several months follow-
ing Hanoi’s announcement that it plans to
build nuclear power stations over the next
20 years. Vietnam signed an initial memo-
randum of understanding on nuclear power
with the Bush administration in 2001 and
the Obama administration has accelerated
these talks. The United States and Vietnam
signed a new memorandum of understand-
ing in April 2010 over broad cooperation

on nuclear power, including access to “re-
liable sources of nuclear fuel,”
such as enriched uranium. In
addition, Hanoi signed nuclear
cooperation agreements with
several other countries—in-
cluding China, France and Rus-
sia—as sources for fuel.
Henry Sokolski, director
of the Nonproliferation Policy
Education Center in Wash-
ington, says that the United
States, by allowing Hanoi to
produce its own nuclear fuel,
undermines its deproliferation
efforts, along with the efforts
of those who seek to reverse
whatever proliferation has al-
ready taken place: “After the
U.S. set such a good example with the
UAE, the Vietnam deal not only sticks
out, it could drive a stake through the
heart of the general effort to rein in the
spread of nuclear fuel-making.” At least it
fully violates the basic fuel bank precept.
IRAN
On August 13, 2010, Russia announced it
would supply low-enriched uranium fuel
rods to the 1,000 megawatt nuclear reac-
 


 
 ,
  


 
  
  
  

108 WORLD POLICY JOURNAL
ESSAY
Ofce took the same position, saying that
the “announcement underlines the fact
that Iran does not need to pursue these oth-
er activities to enjoy the benets of nuclear
power.” However, one wonders if the world
needed such evidence, and whether it is
worthwhile to enable Iran to divert its lim-
ited uranium assets to a military program
to gain public relations points.
INDIA
India is one of two nations that, though
it admits to having nuclear bombs and fa-
cilities, has refused to join the . The
other is Pakistan. (Israel probably has
nuclear bombs, but has not ofcially ac-
knowledged it.) This reason alone should
be enough to pressure both India and Pak-

istan equally into giving up their nuclear
arms. Instead of pressuring India to dis-
arm, the Bush administration moved in
the opposite direction, providing Ameri-
can aid to India’s civilian nuclear energy
program and expanding U.S India coop-
eration in nuclear technology, as India ne-
gotiated its own 123 deal with the United
States for peaceful use of nuclear energy.
Ostensibly, this assistance was to be used
only for non-military purposes. But by al-
lowing the sale of uranium to India for its
civilian reactors, the United States enabled
India to move the limited supply of urani-
um it already had to military use. (Before
that, to make more nuclear bombs, Indian
power plants were operating at reduced
capacity.) The Bush administration ratio-
nalized these steps by claiming it would
improve relations with India, considered
the West’s best hope to “balance” China.
However, rather than creating a closer re-
lationship between India and the United
States, the deal remains controversial in
India. It took years of wrangling before it
was nally approved in August 2010.
be nearly out of yellowcake. Because
Russia is providing it with uranium for
some facilities, Iran can enrich whatever
remaining yellowcake it possesses or is

able to acquire for its weapons program.
Equally important is that the rods
Russia provides to Bushehr can be
processed to yield enough plutonium-239
to make about 30 nuclear weapons a year
(assuming the reactor is fully fuel-loaded).
Plutonium-239 can make much smaller
bombs than , so it is ideally suited for
Iran’s evolving offensive missile program.
Russia announced that the deal entails
Iran returning the used rods. However
there is no realistic way to enforce this
agreement. If Iran refuses to release these
rods, the most Russia can do is cut off
Iran’s future supply. This, of course, will
not prevent Iran from using what it has
to make bombs or from getting uranium
elsewhere, such as from Jordan.
On March 18, 2010, Secretary of State
Hillary Clinton stated, during a press
conference in Moscow following a meet-
ing with the Russian foreign minister,
that Russia’s deal with Iran was prema-
ture, given the suspect nature of Tehran’s
nuclear intentions. By August, though,
the Obama administration had given a
green light to Russia’s move in exchange
for Russia supporting additional sanc-
tions against Iran—although, again, they
were not as stringent as the Americans

had hoped. It was like allowing someone
to deliver an ocean liner full of heroin—
but only after paying customs.
White House spokesman Robert Gibbs,
trying to put a positive spin on the deal,
stated that the reactor “proves to the world
that if the Iranians are sincere about de-
veloping a peaceful program, their needs
can be met without undertaking its own
enrichment program.”The British Foreign
109WINTER 2010 / 2011
A FLAWED FUEL BANK
be excluded. Hence supplying uranium
to India and Pakistan not only adds to
the risks posed by these two nations (and
to the materials that terrorists may ob-
tain, one way or another), but also grave-
ly undermines the already-weakening
. Moreover, the basic conditions of
the fuel tanks are ignored—India is not
even required to turn over the used rods
nor to submit to inspection.
The next chapter of this outsourced
uranium saga will be set in Jordan. Unlike
India and Iran, which are short on urani-
um, Jordan recently discovered that it has
sizable deposits. It has sought to sign a 123
Agreement with the Unit-
ed States as a way to gain
nuclear reactors and know

how. But so far, Jordan has
refused to submit to the
same demands that the UAE
agreed to in its 123 Agree-
ment—no domestic enrich-
ment and no reprocessing
of the used rods. With its
newly-discovered uranium,
Jordan insists it has a right
under the  to enrich on
its own as much uranium as
it wants. Moreover, the King believes that
only pressure from Israel prevents Wash-
ington, so far, from acceding to its nuclear
ambitions. For Jordan to live by the pre-
cept of the fuel bank, it will have to ship
its own uranium to be processed by others,
which is not required by the  treaty.
THE DIVERSION RISK
Enriching uranium is a tricky business.
However, the rst stage—enriching up to
20 percent—is much more difcult than
the next stages, leading to 90 percent en-
richment. Hence providing a nation with
 (20 percent enriched), gives it a ma-
Far from winning the United States
some political support in India, Indian
opposition to the deal was loud, swift
and widespread. Opposition politicians
maintained that American assurances

of steady fuel supply were not legally
binding. Leftist members of Parliament
held that the accord violated Indian sov-
ereignty, and that the government was
hiding details of Indian obligations in
the agreement. Others claimed that the
deal surrendered Indian foreign policy
to an American veto. The Indian opposi-
tion grew as Indian politicians came to
believe they were misled by their govern-
ment about the details of
the accord—specically,
an added provision stat-
ing that the United States
would cut off the uranium
supply if India conducted a
nuclear test.
Most disconcerting, in
direct response to the Bush
administration’s deal with
India, Pakistan increased
its nuclear program on its
own by rapidly expanding
its plutonium production,
and China granted Pakistan two more re-
actors as part of an agreement parallel to
the U.S India one. The result is a case
study in how the expansion of nuclear fa-
cilities in one country leads to the expan-
sion of nuclear facilities in others.

The American agreement with India
and the tit-for-tat deal between China
and Pakistan are particularly troubling.
The Nuclear Suppliers Group [],
an informal cartel of enriched uranium
suppliers—the “shareholders” of the
fuel bank—will not serve nations that
are not signatories of the . So India,
Pakistan, North Korea and Israel were to
B  
  
  
 
, 
.. 
  
  
 
110 WORLD POLICY JOURNAL
ESSAY
after western intelligence sources discov-
ered the planned Qom nuclear facility
did Iran inform the  of its existence.
And though Iran is an  signatory, it has
not done all it can to ensure  access
even to its declared facilities. Iran signed
an “Additional Protocol” with the  in
2003, an agreement allowing more intru-
sive inspections with shorter notice time,
but withdrew its assent in 2005.

Providing nations with enriched ura-
nium works if the nation has neither en-
richment facilities of its own nor ore to
extract. This may be true in the UAE. But
even in this case, the question of control-
ling the spent fuel rods is a very serious
consideration. There is a considerable risk
that the recipient nation will reprocess
the spent fuel rods to produce plutonium
to make nuclear weapons, or that the re-
cipient country will divert uranium from
peaceful programs to military ones.
There might well be a germ of a good
idea in the fuel bank, but for now its major
aws must be addressed. To avoid prob-
lems with the used rods, nations should
be given only limited supplies of enriched
uranium—say, to last them six months—
and the material thrown off while these
rods are used should be collected every six
months and repatriated. In this way, we
can rest assured that the nation beneting
from the ready-made fuel will be unable to
draw on them to make plutonium bombs.
Finally, to avoid diversion, ready-made
fuel should not be given to nations that
are not members of the  and are not in
full compliance with its various protocols.
In this way, one might well be able to gain
reasonable assurance that no diversion of

fuel takes place and that the fuel is used
only for non-military purposes.
jor leg up. Iran had to start from scratch,
slowing its nuclear progression. More-
over, it has been subjected to a multi-fac-
eted and intensive dissuasion campaign,
extending as far as outright sabotage.
However, a nation receiving ready-made
 from the fuel bank without being
subjected to attacks, would have a much
easier journey if it chose to make bombs.
To make this central point with numbers:
it takes 24 cascades of 164 centrifuges to
enrich natural uranium to 3.5 percent;
eight cascades of 164 to bring it to 20
percent; but only four cascades of 114
centrifuges to bring it to 60 percent, and
a mere two more cascades of 64 centri-
fuges to bring it to weapons grade.
Supporters of the fuel bank argue that
those nations receiving  will have to
submit to inspection in order to ensure
that the fuel is not further enriched and
weaponized. We have already seen that
this requirement has been set aside. One
should also take into account that inspec-
tions have a sorry record. Iraq, Iran, Libya
and North Korea all managed to make
considerable progress toward clandestine
nuclear stockpile while being subject to

inspections. Benn Tannenbaum, program
director of the Center for Science, Tech-
nology and Security Policy at the Ameri-
can Association for the Advancement of
Science, put it well when he noted that
inspections only work “when you know
for what you’re looking, you know where
you’re looking and you’re allowed to do
the inspections you want to do when you
want to do them, where you want.” These
conditions, of course, almost never exist.
There’s an imbalance of information—
inspectors can only visit sites that host na-
tions choose to declare to the . Only
l