U.S. To Boost Saudi Nuclear Power Development

perry saudi

by Thomas W. Lippman 

Almost a decade has passed since President George W.  Bush promised that the United States would help Saudi Arabia develop commercial nuclear energy plants. When he visited Riyadh in May 2008, he pledged to sign a “memorandum of understanding,” or MOU, committing the United States to “assist the Kingdom of Saudi Arabia to develop civilian nuclear power for use in medicine, industry and power generation” and “establish a comprehensive framework for cooperation in the development of environmentally sustainable, safe, and secure nuclear energy.”

In return, Saudi Arabia, a signatory to the Nuclear Nonproliferation Treaty, would also join the worldwide Proliferation Security Initiative, a U.S.-sponsored program to confront the threat of nuclear proliferation.

The text of that MOU has never been made public, and nothing much happened as a result of it until last week. Then, Energy Secretary Rick Perry, after meeting senior officials in the kingdom, urged the Saudis to choose a U.S.-based vendor, Westinghouse Electric Co., to participate in the nuclear energy program to which the Saudis have long been committed.

The Energy Department’s official statement about Perry’s talks with Khalid Al-Falih, Saudi Minister of Energy, Industry, and Mineral Resources, did not use the word “nuclear,” but numerous reports from the region said the Saudis heard Perry’s arguments for Westinghouse and were receptive to them.

“We heard that message that … ‘we want the United States to be our partner in this’,” Perry told the Reuters news agency. Westinghouse spokeswoman Sarah Casella said in a statement to Bloomberg News that “Westinghouse is pleased that Saudi Arabia has decided to pursue nuclear energy. We are fully participating in their request for information and are pleased to provide the AP1000 plant, the industry’s most advanced technology.” The Energy Department did not respond to several requests to go beyond its original statement or to confirm Perry’s reported remarks, but neither has it denied them.

There was a time when the words “nuclear” and “Saudi Arabia” in the same sentence would set off alarms all over Washington, because any such development in Saudi Arabia is bound to raise fears that the Saudis would use their program to develop nuclear weapons to counter what they fear is happening in Iran. But the idea of nuclear power in Saudi Arabia has been on the table at least since 2006, when the kingdom and all the other monarchies in the six-nation Gulf Cooperation Council declared their intention to pursue that goal.  Bush’s commitment in 2008 stirred little controversy. The first of four planned reactors is under construction in Abu Dhabi, largest of the United Arab Emirates, and is expected to come on line by 2020.

The Arab Gulf states are seeking nuclear power, as well as other forms of renewable energy such as solar, because they are burning rapidly increasing amounts of their crude oil to meet the voracious demand for electricity. The need is especially acute in Saudi Arabia, which uses vast amounts of electricity in the desalination plants that provide nearly all water for human use. In peak air conditioning season, Saudi Arabia uses more than a quarter of its oil production domestically, limiting the amount available for export, and it lacks sufficient natural gas to fuel its petrochemical industries and new power plants at the same time.

The late King Abdullah created a new organization, the King Abdullah City for Atomic and Renewable Energy, to manage the country’s nuclear development. But progress was desultory, in part because of reported resistance by Ali al-Naimi, who was then Energy Minister but retired in 2016, after the current king, Salman, succeeded Abdullah. Now the pace is picking up.

In May, the International Atomic Energy Agency announced it had reached agreement with Saudi Arabia on a technical assistance program that would include nuclear waste management and safety and security regulations. Saudi Arabia has discussed nuclear development with China, Russia, and France, among other potential suppliers.

Under U.S. law, Westinghouse or any other U.S.-based vendor can sell material and technology to Saudi Arabia only after the two countries negotiate a nuclear cooperation agreement, known as a 123 Agreement for the section of the law setting the requirement. The U.S.-Abu Dhabi agreement is known in the industry as the “gold standard,” because the government of the United Arab Emirates agreed to forgo both ends of the nuclear fuel cycle–it will neither enrich its own uranium nor reprocess its spent fuel to extract the plutonium.

The Saudis have made clear that they do not want to accept the same restrictions because their country has extensive uranium resources, which they want to process domestically. In articles in the trade press in 2010, an executive of a Finnish firm that was consulting with the Saudis on their program said that it could eventually include enrichment of uranium.

That was a non-starter while Barack Obama was president, but reports of Perry’s commitment to expedite an agreement have ignited speculation that the United States is preparing to soften its terms to accommodate the Saudis on this point, especially because of the close ties that have developed between the Trump administration and Crown Prince Mohammed bin Salman, the kingdom’s de facto ruler.

One potential obstacle is a clause in the Abu Dhabi “gold standard” opening that agreement to renegotiation if any neighboring country receives a more flexible deal.

Daryl Kimball, executive director of the Arms Control Association, said in a statement that “The Trump administration’s willingness bend key rules and standards designed to restrict the spread of sensitive nuclear technologies that can be used to make nuclear weapons to in order to help U.S. companies profit from nuclear commerce with Saudi Arabia is  disturbing and counterproductive.” He said Congress, “which will have to review any such agreement, should insist on the highest possible nonproliferation standards for nuclear commerce, especially in a troubled and unstable region.”

Another potential issue for Saudi Arabia, regardless of which contractor it selects, is where to put any reactors it decides to build. A nuclear plant requires an abundant supply of cooling water, which Saudi Arabia does not have except on its coasts.

The country’s most prominent geophysicist, Dr. Abdullah al-Amri of King Saud University, argued in a 2011 interview that neither coast is suitable–the Red Sea coast because it is potentially volcanic, the Gulf coast because it is sedimentary and unstable. Al-Amri said there are geologically suitable sites in the vast interior, but cooling water would have to be piped to them. He said the government does not want to do that because a pipeline supplying cooling water to an active nuclear reactor in the sparsely-populated interior would be an easy target for terrorists.

Nevertheless, Saudi Arabia is committed–at least on paper–to constructing as many as 16 reactors by about 2040.

Photo: Energy Secretary Rick Perry during a December 2017 visit to Saudi Arabia (source: Twitter/@Khalid_AlFalih)

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Thomas Lippman

Thomas W. Lippman is a Washington-based author and journalist who has written about Middle Eastern affairs and American foreign policy for more than four decades, specializing in Saudi Arabian affairs, U.S.- Saudi relations, and relations between the West and Islam. He is a former Middle East bureau chief of the Washington Post, and also served as that newspaper's oil and energy reporter. Throughout the 1990s, he covered foreign policy and national security for the Post, traveling frequently to Saudi Arabia and other countries in the Middle East. In 2003 he was the principal writer on the war in Iraq for Washingtonpost.com. Prior to his work in the Middle East, he covered the Vietnam war as the Washington Post's bureau chief in Saigon. Lippman has authored seven books about the Middle East and U.S. foreign policy. He is also an adjunct scholar at the Middle East Institute in Washington, where he serves as the principal media contact on Saudi Arabia and U.S. – Saudi relations.

One Comment

  1. Just got to reading this, so comment is late. Thomas Lippman didn’t do his homework on this one regarding Westinghouse. Since 2006 it has been owned mostly by Toshiba of Japan and, while relying on old Westinghouse licenses, builds essentially Japanese technology. And in 2017 Toshiba declared Chapter 11 bankruptcy for Westinghouse, due to cost overruns at four nuclear reactors in Southeast U.S. I don’t know if Toshiba is ready to bid seriously, despite Sara Casella indicating so, or is going to get rid of Westinghouse. In any case, the international nuclear power competition is fierce, now primarily between Russian, Chinese, Korean and French suppliers. Being frank, ‘Westinghouse’ doesn’t stand a chance to win a contract in Saudi Arabia, unless MbS would give President Trump that present. But we’re talking big investments here, which even SA would have trouble financing. In contrast, the Russians offer government-supported long term financing and other goodies. Such things don’t work with U.S. market capitalism. It should also be mentioned that the four-unit nuclear plant in the UAE is being built by Korea, which gives them a big advantage if SA really goes ahead with nuclear (as it should).

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