Statement of Robert W. Daniel, Jr. Director, Office of Intelligence Department of Energy FY 1992 Appropriations Hearings Mr. Chairman and members of the subcommittee, I am Robert W. Daniel, Jr., Director of the Office of Intelligence for the Department of Energy (DOE). It is my pleasure to provide this statement today regarding the Department's intelligence programs with particular focus on the FY 1992 budget request. The Department faces daily challenges of a global nature spanning the spectrum from national defense and energy security issues to issues involving nuclear reactor safety and nuclear waste disposal. To meet these challenges, the Department's intelligence element was reorganized in April of 1990 with an expanded mission to provide special support over a broader range of issues. The primary mission of the reorganized element is to ensure that the intelligence information requirements of the Secretary and senior DOE policymakers are met. In addition, the Office of Intelligence ensures that DOE's technical, analytical, and research expertise is made available to the Intelligence Community in accordance with Executive Order 12333, "United States Intelligence Activities." The Office of Intelligence also provides threat assessment and counterintelligence support to DOE Headquarters and field operations. While the Office of Intelligence is a separate and distinct program element, Deleted Delete a member organization of the Intelligence Community in accordance with guidance provided by the Director of Central Intelligence. The Department traces its presence in the Intelligence Community to July 1947 when the National Intelligence Authority recognized that the Atomic Energy Commission (AEC) had an appropriate foreign intelligence role and authorized AEC representation on the Intelligence Advisory Board. Following enactment of the National Security Act of 1947, the AEC's intelligence role was affirmed by National Security Council Intelligence Directive No. I of December 12, 1947. The Energy Reorganization Act of 1974 transferred the AEC's intelligence responsibilities to the Energy Research and Development Administration and the Department of Energy Organization Act of 1977 transferred them to DOE. The nature and scope of DOE intelligence activities are influenced by a variety of international events and trends, particularly in the areas of nuclear and nonnuclear energy policy and technology, strategic petroleum reserves, defense policy, and nuclear weapons technology envelopments. In addition, the nature and scope of the Department's intelligence activities continue to be influenced by intelligence requirements Deleted Deleted Deleted PROGRAM ORGANIZATION AND ACTIVITIES The Office of Intelligence reports directly to the Office of the Secretary and provides specially tailored support over a broad spectrum of issues and programmatic areas. In addition, the Office of Intelligence staff represent the Department through participation on various national-level groups, Deleted Deleted The Department's intelligence and intelligence-related activities are accomplished by three primary organizational elements--the Office of Foreign Intelligence, the Office of Threat Assessment, and the Office of Counterintelligence. FOREIGN INTELLIGENCE ACTIVITIES During a period of rapid change in National security perspectives, foreign intelligence has become more important in the Department's policy A.nd decision making. DOE is involved in many issues that have complex implications. Timely and accurate intelligence reporting is essential to clarifying these implications. Deleted Deleted Deleted Deleted In addition to the above activities, substantial efforts are carried out to provide the Secretary, senior DOE management and appropriate staff pertinent information on worldwide energy developments. These activities focus on integrated, all-source intelligence analysis of the international developments that could affect the overall U.S. energy posture and the Strategic Petroleum Reserve. Special analyses provide for DOE needs for information on the prospects for disruption of energy supplies due to worldwide political, economic, and social instabilities. The energy resources intelligence activities also include analysis of overall energy balances within the Soviet Union and other nations, focusing on total energy needs that might influence global supply and demand. Information on plans, capabilities, and deficiencies of advanced countries to limit economic damage from petroleum supply disruption is also provided to support the formulation of DOE policies and plans. THREAT ASSESSMENT ACTIVITIES The Office of Threat Assessment (OTA) Is responsible for providing the Secretary and senior DOE officials with timely analysis of potential and actual threats to DOE facilities and interests, analysis of international terrorist activities that could affect DOE interests, and information on terrorist and other subnational threats to international energy systems. OTA also has several other responsibilities. For domestic intelligence and law enforcement personnel, OTA conducts threat assessment training and awareness seminars regarding nuclear threats. In support of the law enforcement and intelligence communities, OTA assesses subnational nuclear threats and nuclear material black market transactions. Deleted Deleted The OTA personnel brief key senior DOE officials regularly on terrorist threat-related intelligence. OTA also directs the Special Technologies Program. Deleted Deleted COUNTERINTELLIGENCE ACTIVITIES The primary objectives of the DOE counterintelligence program are to identify, neutralize and prevent foreign intelligence service actions to illegally acquire classified or sensitive DOE information. The Office of Counterintelligence (OCI) program consists of three separate elements--policy and oversight, field operations support, and Headquarters operations. Deleted OCI is responsible for development of the Department's counterintelligence policy and ensuring its implementation in the field. Deleted Deleted Therefore, DOE maintains an active and aggressive program to protect classified departmental assets and information. SIGNIFICANT ACCOMPLISHMENTS During FY 1990 the Department contributed significantly to National intelligence activities over a broad range of areas and made significant strides in accomplishing the goals and objectives set for its Departmental intelligence activities. The Department provided support to the Nation's top intelligence priorities as identified by the President's Foreign Intelligence Priorities Committee. Deleted Specific accomplishments were achieved Deleted During FY 1990, at Admiral Watkins' initiative, a National Intelligence Estimate was prepared in collaboration with the Intelligence Community. The estimate, titled "The Global Energy Environment Into the Next Century." supported the international context of the President's National Energy Strategy. In addition to the above accomplishments, significant strides were made toward Departmental management goals and objectives. Through the reorganization of the intelligence component, more efficient use of intelligence resources in the conduct of daily current intelligence activities was realized. Emphasis was placed on strengthening the ties between the Headquarters and Field intelligence elements, thereby harnessing the full intelligence resources at the Department's disposal in support of Departmental and national initiatives. The Department continued the development of the Counterintelligence Program. Deleted Deleted Through its Office of Threat Assessment, the Department provided technical support to the FBI, Customs, and other government agencies on assessment of nuclear threats and black market activities involving special nuclear materials. Special assessments were undertaken of the potential threat to the Strategic Petroleum Reserve and the Trans-Alaska Pipeline. Deleted Deleted In FY 1991 the Department will continue to make significant contributions to the ongoing efforts outlined above. In addition to enhancing these activities, the Intelligence Office will participate, with other DOE elements, Deleted Deleted in the energy security arena to provide more focus on U.S. energy-related economic competitiveness in global markets. SUPPORT TO DESERT STORM In addition to ongoing activities, the Office of Intelligence is involved in providing support to Desert Storm. Special analysis and reporting of developments in the Persian Gulf crisis have supported the Department's efforts to deter the potential for panic in international energy and financial markets emanating from false reports of adverse hostile impacts on energy production, marketing and pricing. Deleted Deleted In addition, Office of Intelligence staff prepare daily briefings, assessments and situation reports for the Secretary and key policy makers. FY 1992 FUNDING REQUEST FY 1991/1992 Funding Profile (dollars in thousands) Activity FY 1991 FY 1992 Change Deleted Deleted Deleted Deleted The Energy Security program supports DOE's needs for information on the prospects of energy supply disruption due to worldwide political, economic, and social instabilities. Deleted Deleted THREAT ASSESSMENTS The increased funding request for FY 1992 provides $565,000 to cover inflation and conduct additional Threat Assessment activities. The request will provide for continued development of the Domestic Regional Threat Assessment Program. The program is currently limited in scope and does not offer comprehensive local/regional threat assessments for determining impacts on DOE facilities and activities. Deleted Deleted Deleted Deleted CONCLUSION The Department's FY 1992 budget request for intelligence and Intelligence- related activities is in direct support of high level Departmental interests and Intelligence Community requirements. Deleted Deleted With the resources contained in this request, I am confident that the Department can fulfill its intelligence responsibilities and satisfy the high priority requirements of the Intelligence Community. It has been my pleasure to provide to you this overview of the DOE intelligence programs and to outline our FY 1992 budget request. If I can be of further assistance in providing additional details on the DOE intelligence programs, I will be pleased to meet with you or your appropriate staff personnel at your convenience.