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Hot Property, Cold Cash
The plan to turn Russia into the world's nuclear waste dump.

The world's nuclear plants are rapidly running out of places to store their nuclear waste. Public opposition so far has blocked plans to build centralized nuclear waste dumps in Sweden, Switzerland and Australia. The scheme to bury the spent fuel from U.S. nuclear plants deep inside Yucca Mountain in Nevada has run into one political and environmental pitfall after another. Security risks and liability concerns have made keeping the spent fuel on site an economic nightmare for utilities. But where there's danger, there's financial opportunity.

Economically starved Russia is hungry for the chance to cash in on the radioactive loot. In May, Yevgeny Adamov, the head of MinAtom, Russia's ministry of atomic energy, told the Moscow Times: "Russia must fight for its share of the nuclear waste market." Adamov wants the Russian Duma to overturn its ban on the import of commercial nuclear waste for storage and Russian plants to reprocess the waste and then export it as nuclear fuel or, perhaps, fissile material. The crafty Adamov estimates that the entire operation could produce $150 billion in revenue, making MinAtom the most powerful operation in Russia.

At this opportune time, along comes a proposal by the altruistic sounding Non-Proliferation Trust (NPT) that would supply Russia with exactly what Adamov and his cronies crave: tons of nuclear waste and billions of dollars. The NPT bills its plan as a way to help Russia secure "fissile" plutonium and uranium and to provide money for its comatose economy. The Washington-based NPT is an offshoot of the politically connected U.S. Fuels & Security (USF&S), a group which a few years ago promoted a scheme to dump radioactive waste on Wake Island, an atoll in the South Pacific.

Russia's desperate financial straits also have made the Russian government, never an environmental guardian, amenable to proposals that would have seemed outlandish only a few years ago. The NPT/MinAtom proposal is the latest example of how far Russia has fallen. This deal would set dangerous precedents by opening up an international market in radioactive waste and by placing nuclear bomb-making materials into the hands of private groups with little or no government oversight. Moreover, anti-nuclear groups charge, a deal to make Russia the dumping ground for the world's nuclear waste could end up saving the nuclear power industry, which is teetering because of financial and public relations burdens stemming from the accumulation of spent fuel that is stacking up at the rate of 500 pounds of plutonium per reactor each year.

In These Times has obtained a proposal drafted by the NPT that spells out an ambitious scenario for making Russia the dumping ground for the world's commercial nuclear waste, including shipments of high-grade plutonium that could be used to make atom bombs.

According to the documents, the NPT, which would be the managing partner in the scheme, would arrange for at least 10,000 metric tons of radioactive waste to be shipped to sites in Russia, most likely the Mayak facility in the southern Urals and Krasnoyarksk - 26 in Siberia. The spent nuclear fuel would come from commercial reactors in Switzerland, Taiwan, Japan and South Korea. Under the plan, the NPT, a private entity, would retain title to the nuclear waste.

The trust plans to charge nuclear utilities as much as $2,000 per kilogram to dispose of the waste in Russia. This would generate as much as $12 billion in revenue and $10 billion in profits for MinAtom and the contractors. How much NPT personnel would make is unclear. The documents suggest that the trust would retain at least 10 percent of the revenue for administrative overhead.

Under the plan, the waste would be shipped from Europe and Asia on large ships mounted with an arsenal of weapons designed to ward off nuclear pirates. A preview of these trans-oceanic nuclear armadas came in August when two merchant ships, armed with 30-millimeter cannons, carried enough weapons-grade plutonium to make 75 A-bombs across the Pacific from France to Japan, where it will be burned as mixed oxide (MOX) fuel in Japan's nuclear power plants.

The big question is what happens to the waste after it arrives in Russia. According to the NPT, the fuel would be either stored in casks or buried in deep geological formations in the Russian outback. Under either scenario, the NPT/MinAtom contract is for only 40 years, the equivalent of a nanosecond for waste that remains radioactive for nearly a million years. During that time, the trust claims that the fuel would not be reprocessed. But the Russian government has other ideas.

Officials with MinAtom, which has long been known as a lucrative feeding ground for corrupt officials and the resurgent Russian Mob, believe they can use the new stream of money to rebuild crumbling nuclear facilities and then reprocess the waste into weapons-grade uranium. Under terms of a 1993 agreement forged between Vice President Al Gore and former Russian Prime Minister Viktor Chernomyrdin, the Russians believe they could then turn around and sell the uranium to the United States. Or the hot materials could be sold on the nuclear market to willing buyers, such as Pakistan, India, Israel, Iran, China or North Korea.

Complicating matters further, one of the stranger aspects of the proposal would have the NPT taking control of 50 tons of fissile plutonium from the Russian government and storing it at Mayak. The trust argues that this would secure the weapons-grade material. But questions arise as to how a U.S.-based nonprofit would guard the plutonium at a site inside the heart of Russia: Will they have a security force? Will they be permitted to fire on Russian troops if they attempt to seize the materials? "What you have is a private nonprofit group taking title to bomb-making materials," says Michael Mariotte, director of the Washington-based Nuclear Information and Resource Service. "This sets a dangerous precedent and undermines years of non-proliferation agreements."

Ironically, the NPT proposal uses some of these very prospects as a pretext to advance its plan. "In Russia, economic conditions make it difficult for many to find a job with decent and reliable compensation," reads the proposal.

"Many nuclear defense workers in Russia are now suffering uncertainty and deprivation. To reduce the prospect that some of those workers may face opportunities internationally to market their skills that could be adverse to the security interests of Russia and the United States, programs are needed which enhance opportunities for them to continue to benefit their homeland."

The biggest initial hurdle for the NPT is Russian environmental statutes that currently outlaw the import of spent fuel for storage in Russia. MinAtom has been attempting to overturn these bothersome laws for the past few years. The NPT proposal will make MinAtom's lobbying job a lot easier. Recognizing the central fact that money is the real grease to the legislative gears of the Russian Parliament, the trust has pledged to spend at least $3.5 billion on the pet projects of key leaders of the Duma - including $1.8 billion for a spent-fuel geological repository, a scheme to bury the waste in deep underground caves. Critics note that this is barely a down payment on the price tag of such a facility. The trust also has promised to dole out nearly $2 billion to "safeguard" weapons-grade plutonium and hundreds of millions for charitable and environmental programs, the pensions and salaries owed to Russian nuclear and defense workers, and, most peculiarly, Russian orphans.

Russian environmentalists, though, say that any compacts with MinAtom are fraught with peril. "If this goes through, the deal will make MinAtom, an agency that is already barely answerable to the government, the most powerful entity in Russia," says Vladimir Slivyak, an organizer with the Social Ecological Union, the largest environmental group in Russia. "Certainly, MinAtom will be one of the few agencies with any money and they sure won't spend it on social programs."

On its face, the NPT proposal might sound far-fetched, but the organization is taken seriously in Washington. According to sources at the Department of Energy, over the past couple of years USF&S officials now associated with the trust have also talked about the possibility that nuclear waste from U.S. plants could end up being ferried to Russia on large ships, especially if the troubled plan to store U.S. nuclear waste at Yucca Mountain falls apart.

MinAtom actively courted this very scenario in a December 1998 letter, in which Adamov shrewdly reminds U.S. Energy Secretary Bill Richardson of the political, environmental and legal problems surrounding the Yucca Mountain site. He goes on to suggest: "It would be advisable to examine the question of possible transfer, on a commercial basis, of spent fuel from U.S. power plants to Russia for its long-term storage and subsequent reprocessing at [MinAtom]."

So far, the United States has rebuffed Adamov's offer. But a recent court victory by the nuclear power industry has complicated the situation enormously. A federal court ruled earlier this year that the U.S. government had made a contractual agreement with the nuclear utilities to assume all of the liabilities and most of the costs for the disposal of the nation's commercial nuclear waste. This decision may make the U.S. government much more anxious to dispose of the waste overseas.

Most senior officials in the Department of Energy oppose this scenario. The DOE has a huge financial stake in Yucca Mountain. Moreover, the agency is also pursuing the possibility of reprocessing spent fuel in a MOX fuel program to make weapons-grade plutonium. But sources at the DOE say that the State Department is fervently pushing the plan for a Russian dump. A key player here is Strobe Talbott, assistant secretary of state and roving Russian envoy, who reportedly has argued that the NPT proposal may be a way to buttress the ailing Russian economy and keep the defense and nuclear forces from disintegrating.

The fact that the NPT plan is supported by top officials in the Clinton administration is a sign of how tightly wired this group is to the Washington establishment. The trust is overseen by some of America's top nuclear warriors. Its board includes Adm. Daniel J. Murphy, Adm. Bruce DeMars, William Webster, and Dr. William Von Raab. Murphy, the founder of USF&S, is former commander of the Sixth Fleet, deputy director of the CIA, chief of staff for George Bush when he was vice president, and vice chairman of Hill and Knowlton, the global PR firm. DeMars is former director of the Navy's nuclear propulsion program, chief of its nuclear submarine fleet, head of its reactor program during the Clinton era and, after his retirement, a high-paid consultant to defense firms. Webster is former director of both the CIA and the FBI and now an adviser on nuclear issues to the Center for Strategic and International Studies, a D.C. think tank that is home to many former intelligence operatives. Von Raab served as U.S. Customs commissioner during the Reagan era (when tons of cocaine were being moved under the noses of customs agents by the contras) and as a top official of the old Federal Energy Administration. USF&S's corporate counsel is James Baker, former chief of staff and secretary of state under President Bush.

Over the past four years, the firm also has employed a retinue of lobbyists close to Congress and the White House. Most notable are Joseph R. Egan, who specializes in nuclear issues, William Oldaker, former general counsel to the Federal Election Commission, and Mark Grobmyer, one of Clinton's golfing buddies from Arkansas. In 1996, Grobmyer helped arrange a meeting between USF&S and Katie McGinty, then head of the President's Council on Environmental Policy, to discuss a hare-brained plan to move spent nuclear fuel from Russia to atolls in the South Pacific. Similar meetings took place at the National Security Council, CIA and DOE. One of the more bizarre figures involved in this outfit is Alex Copson, who variously has claimed to have been the drummer and the bassist for the dreadful heavy metal band Iron Butterfly. Copson has served as the frontman for USF&S, lining up venture capitalists as backers and promoting the firm's various schemes in the press. (A thorough account of Copson's earlier exploits can be found in Ken Silverstein's excellent book, Washington on $10 Million a Day.) For an impresario, Copson has a tendency to stick his foot in his mouth. When an early scheme to dump 200,000 tons of nuclear waste on the Marshall Islands collapsed due to fierce opposition from the islanders, Copson showed his true colors. "They're all scam artists, banging the tin cup in front of the white man," Copson told Outside magazine in 1995. "They've never lived so good since that bomb, the fat lazy fucks."

The NPT bills itself as a nonprofit enterprise, but the trust's partners and its principals could stand to make a killing in the international nuclear waste trade. The administrative take alone could top $1.2 billion. Plus, multimillion-dollar contracts would flow to allied firms such as Alaska Interstate Construction, which would design and build the storage facilities in Russia, and shipbuilder Halter Marine, a Gulfport, Miss., firm with close ties to Senate Majority Leader Trent Lott.

This is how the revolving door in Washington works these days. While they were government officials, the key players in the NPT ruthlessly pressed for ever-escalating expenditures for the nuclear arms and power industry. Now in the private sector, they are using their connections to cash in by inducing Russia to accept delivery of the world's most toxic materials.

The prospect of an international trade in nuclear waste troubles many environmentalists. "This plan represents the ultimate in 'not-in-my-backyard' thinking," says Mariotte of the Nuclear Information and Resource Service. "The only real beneficiaries are nuclear utilities and the NPT personnel."

The NPT anticipated opposition from environmentalists in Russia and the United States. To deflect such criticism, they recruited one of the world's most prominent green groups, the Natural Resources Defense Council, as an ally. Thomas Cochran, director of the NRDC's nuclear program, has portrayed his and the NRDC's roles as limited. "I only provide public policy advice to NPT," Cochran told the industry newsletter NuclearFuels.

But according to the documents obtained by In These Times, the NRDC stands to play a much bigger role. Cochran is listed as a trustee of the MinAtom Development Trust (MDT), an entity described as "holding, disbursing, and auditing funds provided by the NPT for the purpose of modernizing and improving the security of MinAtom nuclear facilities and assisting MinAtom in non-proliferation goals." The MDT is hardly a small-time operation. According to the proposal, more than $3 billion could flow through its accounts.

The NRDC may stand to reap substantial financial benefits from the project. According to the proposal, the NPT would set up a $200 million "Russian Environmental Reclamation Fund" to be used "for the cleanup of radiologically contaminated sites and other worthy environmental protection initiatives in Russia." The fund would be managed by the NRDC - whose cut could total about 10 percent of the entire fund, or $20 million. In 1998, the NRDC's annual income was only $27 million.

Cochran responds that the agreement is an innovative approach that would give the ailing Russian economy, including its budget-strapped environmental programs, an infusion of cash as well as keep weapons-grade plutonium off the nuclear black market.

However, these marginal potential gains are far outweighed by the environmental and security risks posed by creating an international market for materials that remain lethal for millennia and can be converted relatively easily into the ingredients that power bombs capable of destroying cities. The responsibility for the safe disposal of commercial nuclear waste should reside with the nuclear utilities and not economically desperate governments that are driven to take the spent fuel over the objections of their own people.

Perhaps this is why the NRDC's partnership with MinAtom, the NPT and the former CIA men has not served to muzzle criticism of the plan by environmentalists in Russia, where it is fiercely opposed by all the leading green groups. "The plan by the NPT and the NRDC has nothing to do with environmental principles," says Slivyak of the Social Ecological Union. "Instead, it unethically promotes the interests of the Western nuclear industry, whose main interest is to get rid of its own nuclear waste."

Jeffrey St. Clair is a contributing editor of In These Times.


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