Monday, October 31, 2005

ISN Security Watch - Venezuelan nuclear technology is a long shot

ISN Security Watch - Venezuelan nuclear technology is a long shot

President Hugo Chavez's intention to develop a peaceful nuclear program highlights the possibility of a nuclear weapons bluff and reveals potential threats to regional security.

By Sam Logan and Julio Cirino for ISN Security Watch (26/10/05)


When Argentina’s Foreign Minister Rafael Bielsa announced on 10 October that Venezuela was seeking to purchase a medium-sized nuclear reactor from his country, many asked why such an oil-rich nation as Venezuela would make public its aspirations to obtain nuclear power, raising suspicions about President Hugo Chavez’s real nuclear intentions.

This latest move in Venezuelan political maneuvering to further unite the region also has given Washington more cause for concern.

Regardless of the Chavez’s true intentions, the realities of this announcement reveal the tip of an iceberg that entails more than nuclear power and bilateral relations between Venezuela and neighboring Argentina and Brazil.

Regional nuclear initiatives
Argentina, Brazil, and Mexico are the only countries in Latin America capable of generating power through the use of nuclear technology. Argentina is the region’s nuclear technology pioneer, having begun construction on its first nuclear power reactor in 1964, five years before Mexico, and a full decade before Brazil.

Brazil began construction on its first nuclear plant, Angra I, in 1974. Today, the country operates that plant and a second, Angra II, which it built with the help of the German government. Angra III is still under construction. Many observers believe it will never reach completion, and will be due for decommissioning soon.

Mexico began construction on its only reactor, Laguna Verde, in 1969. To date, this reactor operates at loss and generates little power, accounting for only 3.2 per cent of the country’s electricity. It will likely be decommissioned in the coming years, spelling the end of Mexico’s ability to contribute significantly to regional nuclear science.

Argentina began operating Atucha I in 1974, a decade after construction on the power plant began. Atucha II is still under construction and will likely also find itself on the chopping block.

Through decades of nuclear technology research, development, and implementation, Brazil and Argentina have achieved two significant capabilities: uranium enrichment and a scientific brain trust.

Added value
Soon after the Brazilians began operating Angra II, they applied significant research and development resources to nuclear technology, focusing on uranium enrichment. This research and development, in part, led to the Brazilian claim that it was able to enrich uranium with a process that left the nuclear fuel up to 30 per cent more potent that other processes used around the world.

This process is one of the fundamental scientific technologies that any developing country must master before generating nuclear technology.

Brazil’s desire to guard this technology made for tense negotiations with the UN’s nuclear watchdog, the International Atomic Energy Agency (IAEA), when the agency expressed interest in inspecting Brazil’s newest nuclear fuel enrichment plant, which opened last year.

Brazil’s Resende plant, located some 100 kilometers from Rio de Janeiro, contains a fuel-fabrication facility, a uranium conversion plant under construction, and a uranium enrichment plant. Brazil barred the IAEA from inspecting this plant twice in 2004, citing the need to protect Brazilian technology.

It was a dubious argument at a time when the world was captivated by revelations that the father of Pakistan’s nuclear technology, Abdul Qadeer Khan, had sold nuclear technology to the highest bidders around the world, including North Korea and Iran.

Brazil eventually reached an agreement with the IAEA, but Brazilian scientists still know how to enrich uranium better than anyone in Latin America.

Argentina knows how to construct and sell nuclear reactors, having sold reactors to Peru, Australia, Algeria, and Egypt. The experience necessary to construct and sell a reactor is in place, as well as the scientific brain trust to transfer the technological know-how appropriate for the safe operation of such plants.

As Argentina has prepared four other countries for the safe use of nuclear reactors, there is no reason to believe it could not do so again. And with a price tag of some US$500 million, there is certainly an incentive to make a sale.

Both countries could give significant added value to Venezuela’s initiative for nuclear power. The question remains, however, how serious all three countries are about preserving South America as a “nuclear free” zone.

Central to this argument is the possible dual use of fuel, specifically uranium.

Simply put, enriched uranium used for peaceful nuclear reactions can just as well be used in a budding nuclear weapons program. With nuclear scientists and the capability to enrich nuclear fuel, it is possible for a country to either push for the development of nuclear weapons or to simply bluff in exchange for international attention and some control.

Argentina and Brazil have the capability and technology to deliver all of Chavez' requirements to effectively execute a nuclear energy program. And many observers do not discount the fact that Chavez has the money and the political connections to take such a program and bring it close enough to a nuclear weapons program to ensure a believable bluff.

Ground-level movement
Venezuela has been talking to Argentina about purchasing a mid-sized nuclear plant since May of this year, when an Argentine delegation that included at least one retired member of the military flew to Caracas to discuss nuclear technology cooperation with Chavez.

Initially, the discussions centered around training and technology transfer. Only recently have they begun to focus more on the purchase of a mid-sized reactor, according to an Argentine nuclear scientist close to the talks.

Argentina is interested in completing the sale, but is adamant about meeting international standards and expectations for transparency, which means it would register its intent with the IAEA. The IAEA, in turn, would monitor the process closely and is likely to request a complete review of the plant once the facility is installed and operational in Venezuela.

There is no guarantee, however, that Venezuela will yield to the will of an international agency, much less one that has been ignored and badgered by countries around the world since its inception.

There are questions in Argentina, however, as to whether the transfer of the technology required to operate a mid-sized nuclear reactor would constitute a “dual-use” situation. This is a touchy subject. It is difficult to see how Argentina would benefit from transferring technology necessary to operate a dual-use nuclear reactor. The international pressure would be fierce.

Venezuela claims that it is only interested in a nuclear reactor for peaceful purposes. Yet no one can ignore that fuel used for a peaceful nuclear reactor can also be used in a nuclear weapons program. And Brazil has been very careful to date about what it says publicly concerning any deal with Venezuela over nuclear fuel enrichment programs.

Brazil and Argentina are willing to negotiate with Chavez, but they want to be very careful as to what exactly they sell to Venezuela. It is likely that their involvement in this process will adhere to international standards and expectations for transparency.

Regional pressures
“Chavez has been very specific in keeping to plans that he has announced,” Julian Lumer, Latin American analyst for private intelligence firm Strategic Forecasting, told ISN Security Watch.

Lumer points out that Chavez said he would repatriate land and did. Chavez said he would raise taxes on foreign oil companies, and he did. He has been very public about joining Mercosur, and the country is now on track to becoming a full member.

It is clear that Chavez has the money and the political will to follow through on his announcement to obtain peaceful nuclear technology. But it will not be easy. Already rumors have begun to surface that Washington is working behind the scenes to prevent Argentina from selling a nuclear reactor to Venezuela.

Sources in the Pentagon say they expect Washington to pressure Argentina not to sell a reactor. Clearly, the last thing the Pentagon, or anyone else in Washington, wants to deal with is a southern neighbor threatening to acquire a nuclear weapons program.

Brazil’s capacity to enrich uranium is certainly attractive for Venezuela. But the Brazilian government is hesitant to bring more attention from the IAEA to this continent, which is exactly what would happen if the two countries announced a deal to share nuclear fuel enrichment facilities.

Regional alliances are stronger than the fear of upsetting an international regime perceived to be largely controlled by the US. But these alliances are trumped by sovereignty and national security considerations. Neither Brazil nor Argentina would benefit from a nuclear weapons program in Venezuela.

“There is nothing concrete,” insists Brazilian presidential foreign policy advisor Marco Aurelio Garcia. He argues that Brazil’s nuclear program is transparent and protected from any military use.

Aurelio Garcia goes further to speculate that in any initial phase of a nuclear program in Venezuela, Argentina would provide the reactor while Brazil would provide the enriched uranium. He believes that neither country would provide enough technology transfer to allow the Venezuelans to take complete control of the process.

The real cause for concern
What worries observers in Washington, however, is not Brazilian or Argentine intentions - which many consider to be carefully thought out and to have benign motivations - but rather Chavez’s constant communication with Iran and North Korea. Though this is not alarming at present, it is worth careful consideration.

If Brazil and Argentina are not willing to provide the technology transfer required for an independent Venezuelan nuclear program, it is possible that both Iran and North Korea will be more accomodating - especially North Korea, considering its need for fuel and Venezuela’s abundance of oil.

Both North Korea and Iran are relatively advanced in the field of nuclear technology, an area where Venezuela has literally no experience or technological know-how. Neither country would suffer adverse effects from a nuclear weapons program in Venezuela.

Considering their antagonistic stance vis-à-vis the US, it is more plausible that North Korea and Iran would support Venezuela’s intention to at least threaten to acquire a nuclear weapons program.

It is plausible that Chavez has already invited scientists from both countries to Venezuela. The confirmed installation of a North Korean embassy in Caracas reinforces the possibility of North Korean scientists in Venezuela.

Politics vs. reality
Yet sources within Venezuela are convinced that Chavez’s nuclear announcement is more political than actual.

“The nuclear plan is [hollow],” Venezuelan journalist and political observer, Manuel Malaver told ISN Security Watch.

Malaver argues that Chavez has embarked on a strategy similar to that of the North Koreans, threatening the use of nuclear technology and leveraging heightened international tensions to ensure access to resources and technology that he could not obtain otherwise.

“I don’t believe Chavez has an interest in developing nuclear [technology], which would take years, considering Venezuela does not have nuclear scientists,” Malaver said, adding, “for Chavez it’s more important to demonstrate that he has the support of the region in his desires for nuclear technology than to actually have the technology itself.”

Clearly, the wild cards here are Iran and North Korea, and it is difficult to predict what either country will do. Chavez has clearly engaged both countries, but it is unclear to what ends. Equally unclear is whether Chavez is serious about cloaking a nuclear weapons program with the peaceful use of nuclear technology, or if he is just trying to make international headlines again.

Smoke and mirrors
Chavez has a strong track record. He has engaged Argentina and Brazil for assistance in developing so-called peaceful nuclear technology. Argentina and Brazil have tacitly agreed, effectively giving him the regional support he covets.

The reality that Chavez does not have a group of Venezuelan nuclear scientists cannot be ignored. He needs to borrow the expertise from elsewhere. He does not know how to build a reactor, or operate one. And his neighbors in the region, while having demonstrated an ability to build and operate nuclear reactors, are still subject to international pressure in the form of the IAEA.

Additionally, the countries in the region that do have nuclear energy required no less than ten years to build a reactor. If Chavez is serious about bringing nuclear power to Venezuela, he would need at least ten years, if not closer to 20, to realize the first kilowatt of nuclear power output. There is currently little guarantee that he can stay in power that long.

Producing nuclear power would allow Venezuela to export more oil and generate additional revenues for the state treasury. If Chavez manages to stay in power long enough to take advantage of nuclear technology in Venezuela, he is likely to use the extra energy to alleviate domestic need for oil he would rather export. Herein lies the strongest chord of truth.

Venezuelan oil output is limited. Many suggest the country's oil output has declined and will continue to do so. Chavez’s intention to pull together the region with the carrot of generous oil export contracts and other financial incentives suggests that over time, he will need more money, more oil, and another reliable source of energy.

These two factors would allow him to benefit from a regional spending spree that will only grow each year if the region becomes more dependent upon Venezuela’s riches, rather than gamble with international markets. With a second, reliable source of energy from nuclear power, Chavez will have a secure path to continue his march toward his true goal of regional integration.

Any use of a peaceful nuclear program to conceal or hint at a nuclear weapons program would come as a fringe benefit, an ace up Chavez' sleeve, but nothing more than that. This prospect is something to watch out for, but will not be a threat to regional security for at least a decade, if at all.


Sam Logan is an investigative journalist who has covered security, energy, politics, economics, organized crime, terrorism, and black markets in South America since July 1999. He has reported from Santiago, Brasilia, Sao Paulo, and Rio de Janeiro. He currently lives in Buenos Aires. (www.samuellogan.com).
Julio Cirino is an Argentine historian and journalist specializing in international security affairs.

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