International Nuclear Fuel Bank in Kazakhstan: Risks vs. Dividends

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01.10.2012 09:10
Marzhan Merekenova, Political analyst, area studies specialist

During recent decades, more countries and regions place stake on nuclear programs to cover their energy demands and to provide sustained economic and social development.  Current trends are that for more countries the atomic energy is the only opportunity to ensure sustainability in their development.    

Traditional non-renewable energy resources (like oil, coal and gas) are extremely limited and their consumption and cause major environmental problems. Alternative energy resources (like wind energy and solar energy) are too expensive and are not able to cover mankind’s necessary demands in full measure. Atomic energy is based on highly efficient generation of the energy obtained from uranium fission. As for the volumes of the source fuel compared to thermal energy, they are apples and oranges. For instance, in terms of energetic efficiency, one 10 gram uranium fuel pellet is equal to 40 tons of coal. Herewith, atomic energy programs are more attractive in terms of environmental protection, they have exceptionally low level of wastes.          

So, today, in the period of so called “a nuclear renaissance” the world counts for 436 energy blocks and by 2030 their number is expected to increase up to 500. In this view, the issue of an uninterrupted guaranteed supply of atomic reactors with fuel becomes urgent. One of the options proposed by the concerned countries is to establish an International nuclear fuel bank (INFB) in Kazakhstan. The idea of the INFB is to store a marginal guaranteed stock of low-grade uranium to produce fuel assemblies for nuclear power plants. The INFB is expected to be established in 2013. It depends on how fast the country would be able to work out an agreement with IAEA, which determines the terms of the Bank location on the territory of the Ulbi Metallurgic Plant (Ust-Kamenogorsk).

From theory to practice
The history of the concept goes back to the 50s of the last century, when they thought about reduction of the technological expansion of the nuclear fuel manufacturing. In the course of time, due to certain historical reasons, this concept was worked on with varied success and gradually transformed. In the period from 1980 to 1987 some improvements and development were achieved after the establishment of the IAEA Committee on supplies security. However, this structure was closed soon, due to incapability to develop the document required.

It took more than 50 years to realize the necessity of modern problems solving, including guaranteed supplies of energy resources. So, the International Nuclear Fuel Bank was established only in 2006 under the IAEA control. In September 2007, Nuclear Threat Initiative Advisor Warren Buffett pledged 50 million USD as seed money for the Bank conditioned on other nations providing $100 million (or a corresponding volume of low-enriched uranium). An important condition was to establish the INFB within two years from the moment of this announcement. Later, President George Bush signed the Law on the establishment of the Bank fund.  

Current financial side of the Project is estimated at 150 million US dollars. Within 2008 and 2009 member-states contributed the following amounts: the European Union – 25 million Euros, the USA – 50 million USD, Kuwait and the United Arab Emirates – 10 million USD each, Norway – 5 million USD. In fact, the financial side of the Project is well provided.  

Global nuclear security summit was held in Washington in 2010. Kazakh President Nursultan Nazarbayev was among the first ones to take the floor, who made suggestion on a number of important measures on the nuclear threat reduction. He also confirmed Kazakhstan’s readiness to house the International Nuclear Fuel Bank and guarantee nuclear fuel storage.

Among the candidates for the position of the depositary were such serious competitors as Russia and Great Britain. The final decision was made in favor of Kazakhstan, which confirmed the IAEA member-states high trust and proved Kazakhstan is an undisputable leader in terms of nuclear weapon non-proliferation.

Technical part
Obviously, nuclear energy development programs have been reframed on a planetary scale after two accidents (Chernobyl and Fukusima-1) given 7 balls according to the International Nuclear Events Scale (INES). As a consequence, they created reasonable questions regarding the level of security, experience and technical preparedness of the domestic infrastructure to house the INFB.  
Having conducted a detailed study, the IAEA approved the Ulbi Metallurgic Plant (UMP), for it was handling the materials planned for depositing in the Bank for more than 50 years. 

During Soviet years, the Ulbi Plant manufactured up to 1,200 tons of fuel annually for all power stations of the Soviet Union and the Eastern Europe. It stored approximately thousand tons of low-enriched uranium in the form of uranium hexafluoride used for fuel processing. Since 1995, UMP operations relating to nuclear materials are under the IAEA inspectors monitoring. The whole plant infrastructure is in the line with the Organization standards and is capable to ensure safe materials storing and handling. 

Experts do not expect environmental overloads in the region. In fact, 60 tons of low-enriched uranium are planned to be stored, which compose 10 per cent of the current plant loading. The infrastructure is well-developed and includes existing fuel transportation routes and safe nuclear materials transportation system, experienced and high-qualified personnel. The only thing required at this stage for the INFB functioning is a minimal plant modernization.

Advantages versus Disadvantages
The decision in favor of Kazakhstan is supported by lots of factors, including technologies, geographical position and, as said above, loyalty of the global community. The INFB is a very serious international project, which automatically raises Kazakhstan to the world forefront in both policy and economy, as well as in the fields of education, science and technologies. 

It is also important for Kazakhstan to obtain a special status in the context of its own security. For example, attacking the sovereignty of the Republic will be treated as a violation of the Project participating countries. In the long term, we can also consider the likelihood of Kazakhstan’s special status in the UN, given the scale and historical significance of the Project. 

Authorities permanently stress that the Bank is not commercial, but political and certifies Kazakhstan’s position in relation to the nuclear weapon non-proliferation. Accordingly, the direct economic benefits are not expected, in fact the agreement signed is on the storage of the facility owned by the IAEA on the territory of the Plant. However, a multiplier effect of such decision should be taken into account and turned to own advantage. The following work shall be performed. 

Nuclear energy industry brings to the front in all fields, as new modern technologies are continuously developing. Furthermore, significant investments into information technologies will be anticipated. For example, it is entirely possible that the INFB will apply the programs that were prohibited for sale on the post Soviet territory.

Possession of such Bank and experience in its management will give Kazakhstan the opportunity to suggest establishment of other international energy centers, technological structures based on the Bank, to use it as a discussion area for various meetings, conferences, summits etc. This will follow by a significant increase in job places, closer attention to the environment protection, education, science, technologies and etc.

Besides supporters, the Project has the opponents speaking out against the Bank located in Kazakhstan. Their main complaints are about the absence of an open issue discussion with the community and their concern is about the acquisition of a nuclear wastes depository instead of the Bank. Regarding the latter, experts assure that there is nothing common between a Fuel Bank and storage of radioactive wastes. They are completely different process operations and have different purposes. The first complaint is harder to disagree with, especially considering the situation with Fukusima-1 that caused public vigilance. In this view the concept should have an adequate informational support. For example, to show all stages of a nuclear fuel cycle and the role of the INFB in Kazakhstan in this cycle. Or to analyze different situations taken place in the world, in particular, the incident with the Kursk submarine focusing on the reactor reliability.          

At the same time, a clear understanding is required of what informative work should be done in regard to raising purposes, and the final decisions shall be based on the advice of experts and a parallel dialogue between the authorities and society. Thus, revealing are the results of a social survey by the Institute of political decisions on construction of a nuclear power plant in Aktau, where ordinary citizens expressed a negative potential, but an expert audience was mostly positive about the initiative.

So, the International Nuclear Fuel Bank will be located in the country with the proved positive image, not possessing nuclear weapon, taking the first place in uranium manufacturing and the second in terms of the natural uranium deposits, as well as with the site available for the storage of a specific material. This will be an organization performing bank operations (accumulation, storage and issue) with a high historical importance. The idea of the project is to ensure access to nuclear fuel and to support development of the global atomic energy industry and strengthen the regime of nuclear weapon non-proliferation. 

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