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Nuclear Nonproliferation and Safety: Uncertainties About the Implementation of U.S.-Russian Plutonium Disposition Efforts (Letter Report, 01/14/98, GAO/RCED-98-46)


Pursuant to a congressional request, GAO provided information on: (1)
the goals of the Department of Energy's (DOE) plutonium disposition
program and the impediments facing its implementation; (2) U.S.
government officials' views on the importance of a U.S.-Russian
agreement on plutonium disposition and the status of efforts to
negotiate an agreement; (3) the costs to implement plutonium disposition
programs in the United States and Russia; and (4) experts' views about
the potential nonproliferation impacts of the U.S. plutonium disposition
program; and (5) surplus nuclear weapons that are among the sources of
plutonium for DOE's disposition plan.

GAO noted that: (1) DOE's plutonium disposition program seeks to
decrease the risk of nuclear proliferation by reducing U.S. plutonium
stockpiles by about half over the next 25 years and by influencing
Russia to take reciprocal actions, with the goal of reducing Russia's
stockpiles to U.S. levels; (2) achieving these mutual reductions is a
challenge because DOE's immobilization and mixed oxide fuel technologies
have not yet been demonstrated on an industrial scale in the United
States, and licensing, regulatory, and environmental issues will need to
be addressed for both options; (3) the Russian plutonium stockpile is
estimated to be about twice as large as the U.S. stockpile, and Russia
may not have the financial resources to implement its program in a time
frame comparable to that of the U.S.; (4) according to some U.S.
executive branch officials, the success of the U.S. plutonium
disposition program depends on Russia's implementing a similar program
because a U.S.-only program could be seen as putting the United States
at a strategic disadvantage and would not be supported by Congress or
the international community; (5) executive branch officials told GAO
that a plutonium disposition agreement between the United States and
Russia should be negotiated before large-scale expenditures are made for
U.S. plutonium disposition facilities; (6) no formal negotiations have
begun to implement such an agreement; (7) DOE's preliminary estimates
indicate that implementing the U.S. disposition program, which focuses
on two technologies to convert plutonium to safer, more
proliferant-resistant forms, could cost approximately $2.2 billion over
the next 25 years; (8) the cost for a similar program in Russia could
range between $1 billion and $2 billion, according to DOE's estimates;
(9) U.S. assistance to Russia's program is expected to total between $40
million and $80 million over the next 5 to 7 years and includes plans to
construct a pilot-scale plutonium conversion facility; (10) differing
views exist about the potential nuclear nonproliferation impacts of
DOE's plutonium disposition program and include: (a) a contention that
DOE's consideration of burning plutonium in commercial nuclear reactors
may pave the way for plutonium recycling and reverse a long-standing
policy; and (b) a concern that an industry for mixed oxide fuel would be
created in Russia that would increase opportunities for diversion and
theft of nuclear materials; and (11) Department of State officials state
that these and other issues will have to be addressed in a future
binding agreement with Russia.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  RCED-98-46
     TITLE:  Nuclear Nonproliferation and Safety: Uncertainties About 
             the Implementation of U.S.-Russian Plutonium
             Disposition Efforts
      DATE:  01/14/98
   SUBJECT:  International cooperation
             Nuclear waste management
             Atomic energy defense activities
             Nuclear facilities
             Nuclear weapons
             Nuclear waste disposal
             Radioactive wastes
             Nuclear proliferation
             Cost analysis
IDENTIFIER:  Russia
             DOE Yucca Mountain Project (NV)
             Russian VVER-1000 Nuclear Reactor
             Russian BN-600 Nuclear Reactor
             
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Cover
================================================================ COVER


Report to the Chairman, Committee on Foreign Relations, U.S.  Senate

January 1998

NUCLEAR NONPROLIFERATION AND
SAFETY - UNCERTAINTIES ABOUT THE
IMPLEMENTATION OF U.S.-RUSSIAN
PLUTONIUM DISPOSITION EFFORTS

GAO/RCED-98-46

Nuclear Nonproliferation and Safety

(141022)


Abbreviations
=============================================================== ABBREV

  ACDA - U.S.  Arms Control and Disarmament Agency
  CANDU - Canadian Deuterium Uranium Reactor
  DOE - Department of Energy
  GAO - General Accounting Office
  ICBM - Intercontinental Ballistic Missile
  INF - Intermediate-Range Nuclear Forces Treaty
  MINATOM - Russian Ministry of Atomic Energy
  MOX - mixed oxide fuel
  OSTP - White House Office of Science and Technology Policy
  START - Strategic Arms Reduction Treaty

Letter
=============================================================== LETTER


B-278690

January 14, 1998

The Honorable Jesse Helms
Chairman, Committee on Foreign
 Relations
United States Senate

Dear Mr.  Chairman: 

The United States and Russia have accumulated large stockpiles of
plutonium--a key ingredient in the production of nuclear weapons. 
Removing excess plutonium irreversibly from both countries'
stockpiles--thereby precluding its reuse in nuclear weapons--is a
major policy initiative of the Clinton Administration.  The United
States is implementing a long-term program to achieve the disposition
of about 50 metric tons of excess U.S.  plutonium by converting it
into forms that would eventually be suitable for permanent
disposal.\1 In July 1997, Russia's President established a working
group to develop a plan for Russia's plutonium disposition. 

As requested, we are providing you with information on (1) the goals
of the Department of Energy's (DOE) plutonium disposition program and
the impediments facing its implementation, (2) U.S.  government
officials' views on the importance of a U.S.-Russian agreement on
plutonium disposition and the status of efforts to negotiate an
agreement, (3) the costs to implement plutonium disposition programs
in the United States and Russia, and (4) experts' views about the
potential nonproliferation impacts of the U.S.  plutonium disposition
program.  In addition, this report provides information on the U.S. 
nuclear weapons that are among the sources of plutonium for DOE's
disposition plan.  (See app.  I.)


--------------------
\1 In accordance with the results of its environmental and
nonproliferation impact assessments, the Department of Energy is
focusing on two disposition technologies:  (1) immobilizing the
plutonium by mixing it with glass or ceramics and storing it in large
canisters that are filled with high-level radioactive waste and (2)
using the plutonium in mixed oxide fuel to be burned in commercial
nuclear power reactors which will also generate electricity. 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

DOE's plutonium disposition program seeks to decrease the risk of
nuclear proliferation by reducing U.S.  plutonium stockpiles by about
half to approximately 50 metric tons over the next 25 years and by
influencing Russia to take reciprocal actions.  Ultimately, U.S. 
executive branch officials advocate Russia's reducing its stockpiles
to levels that are equivalent to those in the United States.\2
Achieving these mutual reductions is a formidable challenge because
DOE's immobilization and mixed oxide fuel technologies have not yet
been demonstrated on an industrial scale in the United States
(although mixed oxide fuel is widely used in Europe), and licensing,
regulatory, and environmental issues will need to be addressed for
both disposition options.  Furthermore, the Russian plutonium
stockpile is estimated to be about twice as large as the U.S. 
stockpile, and Russia may not have the financial resources to
implement its program in a time frame that would be comparable to the
U.S.  disposition schedule.  According to some U.S.  executive branch
officials, the success of the U.S.  plutonium disposition program
depends on Russia's implementing a similar program because a
U.S.-only program could be seen as putting the United States at a
strategic disadvantage and would not be supported by the Congress or
the international community.  Other officials noted that there are
risks and costs if the United States does not pursue a plutonium
disposition program even if Russia does not implement a similar
program. 

Executive branch officials told us that a plutonium disposition
agreement between the United States and Russia should be negotiated
before large-scale expenditures are made for U.S.  plutonium
disposition facilities.  At the time of our review, no formal
negotiations had begun to implement such an agreement.  Executive
branch officials told us that several critical issues will have to be
addressed to achieve a binding bilateral agreement, including the
quantities of plutonium to be dispositioned, the time frames for
completing both countries' programs, the safeguarding of nuclear
material prior to disposition, and the funding arrangements. 

DOE's preliminary estimates indicate that implementing the U.S. 
disposition program, which focuses on two technologies to convert
plutonium to safer, more proliferant-resistant forms, could cost
approximately $2.2 billion over the next 25 years.  The cost for a
similar program in Russia could range between $1 billion and $2
billion, according to DOE's estimates.  U.S.  assistance to Russia's
program is expected to total between $40 million and $80 million over
the next 5 to 7 years and includes plans to construct a pilot-scale
plutonium conversion facility.  Russia will require significant
international assistance beyond what the United States expects to
contribute to implement a disposition program.  For both commercial
and security reasons, several western European countries may be
willing to contribute to this effort.  However, DOE officials told us
that due to funding uncertainties, the U.S.  cost to support Russia's
program could increase over time if assistance from other countries
is not forthcoming and the United States decides to absorb those
costs. 

Differing views exist among representatives of the U.S.  government,
private industry, and nongovernmental groups about the potential
nuclear nonproliferation impacts of DOE's plutonium disposition
program.  Some representatives contend that DOE's decision to
consider burning plutonium in the form of mixed oxide fuel in
commercial nuclear power reactors may pave the way for plutonium
recycling in the United States, which would reverse a long-standing
policy.  Furthermore, there is a concern that western assistance
would help create an industry for mixed oxide fuel in Russia that
does not now exist and would increase opportunities for the diversion
or theft of nuclear materials.  DOE officials and representatives
from the U.S.  nuclear industry told us that the disposition program
does not conflict with or reverse established U.S.  policy--as some
critics contend--because it does not include reprocessing and
recycling and is limited to plutonium from the weapons program. 
Executive branch officials have also stated that the mixed oxide fuel
fabrication facility that would be constructed in Russia should be
used only for the disposition of weapons plutonium until all declared
excess weapons plutonium is processed.  They also said that no mixed
oxide fuel should be reprocessed, at least until all stockpiles of
surplus weapons plutonium in Russia have been eliminated.  State
Department officials said these conditions will have to be addressed
in a future binding agreement with Russia. 

Because it is uncertain when such an agreement will be signed, the
Congress may wish to link DOE's future requests for program funding
to assurances that Russia will take binding reciprocal actions. 


--------------------
\2 These officials include representatives from the departments of
Energy and State, the White House Office of Science and Technology
Policy, and the U.S.  Arms Control and Disarmament Agency. 


   BACKGROUND
------------------------------------------------------------ Letter :2

From World War II to the end of the Cold War, the United States and
the former Soviet Union produced large quantities of plutonium to
build nuclear weapons.  With the lessening of tensions between the
United States and Russia, efforts began to reduce the inventory of
both countries' excess plutonium.  In early 1994, Presidents Clinton
and Yeltsin endorsed the goal of nuclear arms reduction and directed
experts to begin studying options for the long-term disposition of
plutonium and other nuclear materials. 

In 1995, the United States declared that 38.2 metric tons of
weapons-grade plutonium was no longer needed for national security
and was, therefore, excess.\3 DOE also designated 14.3 metric tons of
non-weapons-grade plutonium as excess.  Because a portion of the
plutonium declared excess is scrap or residue with low contents of
plutonium, it is unsuitable for fabrication into mixed oxide (MOX)
fuel and is better suited for immobilization instead.  According to
DOE, plutonium scheduled for disposition will come primarily from (1)
metal that may have been in a retired nuclear weapon,\4 (2) oxides,
(3) unirradiated fuel, and (4) irradiated fuel.  Securing plutonium
derived from these sources will require conversion into forms that
meet the "spent fuel standard." This standard, which was introduced
by the National Academy of Sciences and endorsed by DOE, requires
that plutonium be made roughly as unattractive and difficult to
retrieve and use in nuclear weapons as the plutonium that exists in
spent fuel from commercial nuclear power reactors.  DOE plans to
convert about 50 metric tons of excess plutonium into forms suitable
for eventual disposal.  Of the total, DOE plans to immobilize about
17 tons and could process the remainder as MOX fuel, although a final
decision on whether to burn or immobilize this plutonium has not been
made.\5

As figure 1 shows, it is estimated that Russia has about twice as
much weapons-usable plutonium (consisting of weapons-grade and other
grades) as the United States. 

   Figure 1:  Estimates of Total
   U.S.  and Russian Stockpiles of
   Weapons-Usable Plutonium

   (See figure in printed
   edition.)

Note 1:  This inventory does not include plutonium from commercial
nuclear power operations. 

Note 2:  According to the Stockholm International Peace Research
Institute, seven other countries may have possessed another 17 to 26
metric tons of plutonium, excluding plutonium from commercial nuclear
power operations. 

Sources:  Oak Ridge National Laboratory and GAO. 

At the April 1996 Summit on Nuclear Safety and Security held in
Moscow, the leaders of the G-7 countries plus Russia called for
further study of ways to manage excess nuclear materials, including
plutonium.\6 In October 1996, representatives from many countries,
including the United States and Russia--as well as representatives
from private industry--met in Paris and concluded that (1) the safe
and effective management of excess nuclear materials is technically
feasible; (2) no solution is rapid, simple, and inexpensive; and (3)
two existing technologies--burning the plutonium as a fuel in nuclear
reactors and immobilizing the plutonium in glass or ceramics--are
viable, complementary disposition options. 

An interagency group has been established in the United States under
the joint chairmanship of the White House Office of Science and
Technology Policy and the National Security Council to oversee
plutonium disposition.  DOE, as the agency with primary
responsibility for managing the disposition of plutonium, established
the Office of Fissile Materials Disposition, which is responsible for
implementing nuclear materials storage and disposition.  This office
has the technical lead for disposition-related technological
activities with Russia, which are coordinated by the Office of
Science and Technology Policy. 


--------------------
\3 Plutonium is primarily a man-made element, produced by irradiating
uranium in nuclear reactors.  Weapons-grade plutonium is the grade of
plutonium preferred by nuclear weapons designers. 

\4 Retirement refers to an administrative decision to remove the
warheads from the nuclear weapons stockpile and dismantle them. 

\5 For more information on U.S.  plutonium disposition issues, see
Department of Energy:  Plutonium Needs, Costs, and Management
Programs (GAO/RCED-97-98, Apr.  17, 1997). 

\6 The G-7 members are Canada, France, Germany, Italy, Japan, the
United Kingdom, and the United States.  The European Union
participates in G-7 discussions and working groups. 


   DOE SEEKS REDUCTIONS IN
   PLUTONIUM STOCKPILES, BUT
   DISPOSITION PROGRAM FACES
   UNCERTAINTIES
------------------------------------------------------------ Letter :3

U.S.  executive branch officials told us that the United States and
Russia should ultimately reduce their plutonium stockpiles to
equivalent levels.  However, achieving these reductions is a
formidable challenge because DOE's immobilization and MOX
technologies have not been demonstrated on an industrial scale in the
United States, and licensing, regulatory, environmental, economic,
and transparency (assurance that plutonium to be dispositioned comes
from weapons) issues need to be addressed for both disposition
options.  Furthermore, Russia may not have the financial resources to
implement its program in a time frame that would be comparable to the
U.S.  disposition schedule. 

In January 1997, DOE formally announced that it would pursue two
technologies to convert excess plutonium to safer, more
proliferant-resistant forms.  For planning and analysis purposes, DOE
anticipates converting about 50 metric tons of excess plutonium over
the next 25 years.  The total U.S.  plutonium inventory is
approximately 99.5 metric tons.  On the basis of preconceptual design
data and preliminary plans, DOE estimates that implementing its
plutonium disposition program--excluding long-term storage--will cost
approximately $2.2 billion.  This amount includes DOE's costs to
immobilize plutonium as well as to burn MOX fuel.  By using a
disposition strategy that uses both technologies, DOE hopes to
maximize the likelihood of the U.S.  program's being successfully
completed.  DOE also hopes that the U.S.  plan for MOX fuel will
provide additional encouragement for Russia to undertake a reciprocal
disposition program. 

According to U.S.  government officials, ultimately it is important
that both countries agree to reduce their remaining plutonium
stockpiles to equivalent levels.  The Deputy Minister of Russia's
Ministry of Atomic Energy (MINATOM) told us that Russia's only
acceptable disposition option for the bulk of its excess plutonium is
burning it in nuclear power reactors because Russia considers the
plutonium a valuable source of energy.  The Deputy Minister also
noted that Russia favors burning MOX fuel because this
process--unlike immobilization--changes the content of the plutonium,
thereby making it difficult to use in a nuclear weapon.\7 However,
according to State Department officials, MINATOM's Minister has also
stated that immobilization may be acceptable for scrap and low-grade
residues. 

According to DOE officials, the United States will not fully
implement its plutonium disposition program unless Russia implements
a comparable plutonium disposition program.  DOE's Acting Director of
the Office of Fissile Materials Disposition told us that it would be
unacceptable for DOE to request full funding to convert approximately
50 metric tons of U.S.  plutonium into more proliferant-resistant
forms without Russia taking corresponding actions.  DOE officials
told us that, in their opinion, a U.S.-only plutonium disposition
program would not be supported by the Congress because it could put
the United States at a strategic disadvantage.  Furthermore, by
acting unilaterally, the United States would lose leverage in future
negotiations with Russia on plutonium disposition.  A Department of
State official told us that other nations would be concerned that a
program involving only the United States would have a marginal impact
on reducing the worldwide risks of nuclear proliferation.  Officials
from the U.S.  Arms Control and Disarmament Agency (ACDA) noted that
there are risks and costs if the United States does not pursue
plutonium disposition even if Russia does not implement a similar
program. 


--------------------
\7 Administration officials noted that while weapons-grade plutonium
is preferred for weapons, either the United States or Russia could
produce weapons from reactor-grade plutonium having reliable
explosive yields, weights, and other characteristics generally
comparable to those of weapons-grade plutonium. 


      DISPOSITION TECHNOLOGIES
      HAVE NOT BEEN DEMONSTRATED
      ON A LARGE SCALE IN THE
      UNITED STATES
---------------------------------------------------------- Letter :3.1

DOE's plutonium disposition program is expected to be completed in
about 25 years but faces technological uncertainties that could
increase program costs and time frames because neither disposition
technology has been demonstrated on an industrial scale in the United
States.  Although immobilization has been used for other purposes, it
has never been used on a large scale for plutonium disposition. 
Unresolved questions include how the plutonium will react in the
immobilization processing, how stable and durable the immobilized
material will be, and how difficult it will be to recover the
plutonium from the immobilized forms and use it in nuclear weapons. 

MOX fuel derived from reactor-grade plutonium has been used
extensively in nuclear power reactors throughout Europe, and the
technology is well established.  Although the technology is well
known, the United States has no nuclear power reactors licensed by
the Nuclear Regulatory Commission to burn MOX fuel.  Furthermore, MOX
fuel derived from weapons-grade plutonium has not been burned in
commercial nuclear power reactors except on a test basis in Russia. 
The United States has no facilities to make MOX fuel and DOE has not
determined the number or locations of the commercial nuclear power
reactors that will be needed to burn MOX fuel.\8

Resolving these issues will depend not only on the development of the
disposition technologies but also on contract negotiations with
nuclear reactor owners, licensing requirements, and environmental
reviews.  However, according to DOE, the overall technical risk of
either disposition option is relatively low. 

Uncertainties also exist with the underground repository where DOE
plans to permanently dispose of excess plutonium.  While DOE assumes
that a permanent repository at Yucca Mountain, Nevada, will be ready
to accept the plutonium in 2010 (12 years later than originally
planned), it can not be certain that the repository will open.  DOE
is currently assessing the Yucca Mountain site to determine its
viability.\9


--------------------
\8 DOE has initiated efforts for designing, constructing or
modifying, licensing, and operating a MOX fuel fabrication facility
in the United States.  A contractor is expected to be selected by
September 1998. 

\9 See Nuclear Waste:  Impediments to Completing the Yucca Mountain
Repository Project (GAO/RCED-97-30, Jan.  17, 1997). 


      UNCERTAINTIES FACING THE
      IMPLEMENTATION OF A
      PLUTONIUM DISPOSITION
      PROGRAM IN RUSSIA
---------------------------------------------------------- Letter :3.2

According to U.S.  executive branch officials, Russia's plutonium
disposition efforts are not as advanced as U.S.  activities and face
impediments, including Russia's ongoing production of weapons-grade
plutonium.  Russia produces about 1.5 metric tons of plutonium each
year at nuclear reactors at Tomsk and Krasnoyarsk.  The plutonium is
produced by Russian reactors that also provide heat and electricity
to nearby cities.  In 1994, Russia agreed to shut down those reactors
by 2000.  However, in 1997, the United States and Russia signed an
agreement to modify the reactors rather than permanently shut them
down, as a means of stopping the production of weapons-grade
plutonium.  The United States has been providing assistance to
complete the modifications, although progress in implementing the
agreement has been slow. 

U.S.  officials believe, however, that Russia is making some progress
toward establishing a framework for a plutonium disposition program. 
For example, in July 1997, Russia's President Yeltsin established a
committee under his Defense Council to oversee Russia's plutonium
disposition, including developing a plan.  Furthermore, in September
1997, President Yeltsin declared that Russia would remove up to 50
tons of plutonium from its stockpile over time--roughly the same
amount that the United States declared excess.  According to DOE, the
costs for the disposition of about 50 metric tons of plutonium in
Russia could range from $1 billion to $2 billion. 

In developing a plutonium disposition program, Russia faces the same
technological issues as the United States.  Furthermore, Russia's
ability to undertake a successful program depends upon international
financial assistance.  According to the Deputy Minister of MINATOM,
the pace of Russia's program will depend on the financial support it
receives from the international community, including the United
States.  France and Germany are considering financing--with some
Russian support--a pilot facility in Russia to convert plutonium into
MOX fuel.  French government officials told us, however, that
although the donor governments can be expected to provide some of the
financing, most of it will have to come from European investors. 
They noted that private investment is uncertain because potential
investors may not be willing to accept the financial risk without
some assurances that the MOX fuel fabrication enterprise in Russia
will be commercially viable. 

Officials from DOE, the State Department, and the White House Office
of Science and Technology Policy, as well as representatives from
some nations with a commercial and/or security interest in supporting
Russia's disposition efforts (e.g., France, Germany, Canada, and
Belgium), told us that insufficient funding is a major obstacle to
implementing a disposition program in Russia.  As is the case in the
United States, major capital expenditures are needed in Russia to
build a plutonium conversion plant, construct a MOX fuel fabrication
facility, and modify and license nuclear power reactors to burn the
MOX fuel. 

Russia's limited number of nuclear power reactors that are capable of
burning MOX fuel could affect its ability to disposition its excess
plutonium in a time frame comparable to that of the United States. 
Although Russia has seven operational VVER-1000 pressurized water
reactors,\10 which are capable of burning MOX fuel, DOE officials and
other experts said that it is possible that Russia could use up to
six of these reactors.  In addition, another type of reactor, a
BN-600 at Beloyarsk, could be used.\11 According to Canadian
officials, if Russia's four VVER-1000 reactors and the BN-600 reactor
were used to burn the MOX fuel, it would take at least 40 years to
burn about 50 metric tons of Russia's plutonium.  According to DOE,
if Russia also used the two other VVER-1000 reactors, the plutonium
could be burned in 28 years. 

A 1996 State Department analysis noted that if Russia's VVER-1000
reactors were used, their planned 30-year operating lives would have
to be extended.  This extended usage could have an impact on the
overall cost of the Russian program because modifications to the
reactors may be required.  Figure 2 shows the location of Russia's
VVER-1000 reactors, a BN-600 reactor, and the sites where
weapons-grade plutonium has been or continues to be produced. 

   Figure 2:  Location of Russia's
   VVER-1000 Nuclear Power
   Reactors, BN-600 Reactor, and
   Plutonium Production Sites

   (See figure in printed
   edition.)

Note :  The numbers within the symbols show the number of reactors at
each site. 

DOE officials said that 11 additional VVER-1000 reactors operating in
Ukraine could be used to burn plutonium, thereby accelerating the
rate of disposition.  According to DOE, an additional VVER-1000
reactor, if completed, could also be used.  Russia's Deputy Minister
for Atomic Energy told us that there have been some preliminary
discussions with Ukraine's government officials about using their
reactors to burn MOX fuel and that they did not have serious concerns
about using their reactors. 

Although concerns exist about the number of VVER-1000 reactors that
Russia may use to burn MOX fuel, experts believe these reactors can
burn the fuel derived from weapons-grade plutonium safely.  Officials
from DOE, Oak Ridge National Laboratory, and the International Atomic
Energy Agency, as well as representatives from France, Belgium, and
Germany, told us that it is technically feasible for MOX fuel derived
from weapons-grade plutonium to be used in these reactors.  While
some of these officials recognize that additional testing and
analysis is required, they told us that there are no major technical
impediments to burning MOX fuel safely. 

According to a September 1996 U.S.-Russian plutonium disposition
study,\12 preliminary analyses indicate that the VVER-1000s could
safely burn MOX fuel, though some modifications to the reactors might
be necessary.  The study (1) estimated that the cost to modify the
seven VVER-1000 reactors totaled $77 million and (2) noted that
Russia could complete construction of three partially built VVER-1000
reactors, which could help increase the consumption of MOX fuel.  The
cost to complete the reactors could range from $500 million to $750
million. 


--------------------
\10 The VVER-1000 reactors have more safety features than earlier
Soviet-designed nuclear power reactors.  For example, these reactors
have containment structures similar to those in Western nuclear power
reactors.  According to DOE, Western experts believe that, with some
modifications, these reactors could meet internationally acceptable
levels of safety. 

\11 A BN-600 is a type of reactor designed to use plutonium in MOX
fuel. 

\12 The study, which is formally known as the Joint United
States/Russian Plutonium Disposition Study, was developed by
government officials and scientists representing the United States
and Russia.  It was transmitted to Presidents Clinton and Yeltsin by
the Assistant to the President of the United States for Science and
Technology and the Russian Minister of Minatom. 


   U.S.  OFFICIALS RECOGNIZE A
   BILATERAL PLUTONIUM DISPOSITION
   AGREEMENT IS NEEDED
------------------------------------------------------------ Letter :4

According to officials from DOE, the Department of State, and the
White House Office of Science and Technology Policy, an agreement
between the United States and Russia on plutonium disposition should
be negotiated before large-scale expenditures are made for U.S. 
disposition facilities.  These officials said that a bilateral
agreement should address such major issues as the following: 

  -- the quantities of plutonium to be dispositioned by both
     countries and the amounts of plutonium that will remain in their
     respective military stockpiles;

  -- the dates when both sides plan to complete the dispositioning of
     their excess plutonium;

  -- the methods to ensure that plutonium and disposition facilities
     are properly safeguarded to reduce the risks of diversion and/or
     theft;

  -- the assurances that the plutonium to be dispositioned will be
     subject to verification and inspection measures;

  -- the assurances that the facilities to fabricate MOX fuel will
     only be used for plutonium disposition until all declared excess
     weapons plutonium is processed through them and that spent
     nuclear fuel will not be reprocessed and recycled for continued
     use in civilian nuclear power reactors as long as Russia has
     surplus stocks of weapons plutonium; and

  -- the funding arrangements. 

Obtaining agreement with Russia on the procedures to ensure U.S. 
access to nuclear materials from dismantled weapons may prove
difficult.  As we reported in September 1996, the United States and
Russia were unable to conclude an agreement specifying exactly how
prior Russian assurances of access would be implemented at an interim
storage facility at Mayak.\13 This facility, which is partially being
constructed with U.S.  funds, is expected to store 50,000 containers
of material from dismantled nuclear weapons in Russia.  The lack of
progress in agreeing on inspection rights at Mayak is due largely to
a U.S.-Russian impasse on completing a broader agreement on
reciprocal access measures. 

Currently, there are no formal negotiations between the United States
and Russia on implementing a plutonium disposition program.  U.S. 
government officials told us, however, that such an agreement should
be signed within the next 2 to 3 years or else the future of the U.S. 
disposition program could be jeopardized.  In their view, an
agreement should be in place--and Russia needs to begin a parallel
program--before the United States begins to spend significant funds
to construct U.S.  facilities, such as the immobilization facility
and associated processing facilities and the MOX fuel fabrication
plant.  DOE and MINATOM are negotiating a more narrowly focused
agreement to address the technical arrangements related to joint
testing of disposition technology and pilot-scale demonstrations. 
However, DOE officials said this agreement does not replace the need
for a broader bilateral agreement. 


--------------------
\13 Weapons of Mass Destruction:  Status of the Cooperative Threat
Reduction Program (GAO/NSIAD-96-222, Sept.  27, 1996). 


   PLUTONIUM DISPOSITION COSTS
------------------------------------------------------------ Letter :5

DOE has not yet made large capital expenditures for its plutonium
disposition program.  As figure 3 shows, DOE plans to spend about
$550 million during fiscal years 1998 through 2007 on design,
construction, and equipment projects for disposition-related
activities in the United States, including the construction of a
facility to fabricate MOX fuel. 

   Figure 3:  DOE'S Estimated
   Schedule and Costs to Implement
   the U.S.  Plutonium Disposition
   Program (Dollars in thousands)

   (See figure in printed
   edition.)

\a Includes the costs for research, development and demonstration,
conceptual design, licensing permits, some environmental data
collection, and facility start-up and training. 

\b Consists of potential cost recoveries from participating
utilities' reduction of purchases of conventional uranium fuel. 

Source:  DOE. 

DOE officials estimated that the United States will provide between
$40 million and $80 million over the next 5 to 7 years to assist
Russia's disposition program.  Most of this funding is designated to
construct a pilot-scale facility in Russia to convert the plutonium
metal removed from nuclear warheads into plutonium oxide, a fine
powdery substance of plutonium combined with oxygen.  Once in this
form, the plutonium would be subject to international inspection and
could either be immobilized in glass or ceramics or be used in MOX
fuel.  According to DOE officials, the pilot facility should begin
operations in 2005.  They also told us that due to funding
uncertainties, the U.S.  cost to support Russia's program could
increase over time if assistance from other countries is not
forthcoming and the United States decides to absorb those costs. 


      U.S.  COST FOR RUSSIA'S
      PROGRAM
---------------------------------------------------------- Letter :5.1

During fiscal years 1995 through 1997, DOE had budgeted $13.9 million
for Russian activities related to plutonium disposition.  Of that
total, $8.5 million was budgeted for six joint demonstration
technology projects, and $5.4 million was budgeted for studies,
travel, weapons dismantlement, and support provided by DOE's national
laboratories and the Amarillo National Resource Center for
Plutonium.\14 The demonstration projects include (1) burning a
modified type of MOX fuel in a Canadian reactor, (2) fabricating MOX
fuel pellets, (3) validating computer codes for analyzing VVER-1000
reactors, (4) studying the feasibility of converting a Russian
reactor so it can burn MOX fuel, (5) studying ways to change
plutonium from dismantled nuclear warheads into safer forms and store
them, and (6) developing immobilization technologies.  Appendix II
discusses the status of these demonstration projects.  Figure 4 shows
the distribution of the $8.5 million for these projects. 

   Figure 4:  Distribution of $8.5
   Million for U.S.-Russian
   Plutonium Disposition
   Demonstration Projects Through
   Fiscal Year 1997

   (See figure in printed
   edition.)

Note 1:  DOE reported that about $4 million had been spent on these
projects as of July 31, 1997. 

Note 2:  MOX fuel-related projects include verifying safety data,
fabricating MOX pellets, and fabricating VVER-1000 MOX fuel. 

Note 3:  Total costs does not equal $8.5 million due to rounding. 

Source:  DOE. 


--------------------
\14 In 1994, DOE entered into a 5-year $51.5 million cooperative
agreement with Texas to establish the Amarillo National Resource
Center for Plutonium.  Approximately $2 million of the Center's
budget has been used to fund Russian activities related to plutonium
disposition. 


   VIEWS ON IMPACT OF DOE'S
   PLUTONIUM DISPOSITION PROGRAM
   DIFFER
------------------------------------------------------------ Letter :6

Representatives of the U.S.  government, private industry, and
nongovernmental groups have differing views about the potential
effects of DOE's plutonium disposition program on nuclear
proliferation.  Some representatives contend that DOE's decision to
consider burning plutonium in the form of MOX fuel in commercial
nuclear power reactors may pave the way for the future use of
plutonium in the U.S.  nuclear industry through plutonium
reprocessing.  Furthermore, there is a concern that Western
assistance would help create a MOX fuel industry in Russia that does
not now exist and would increase the risk of the diversion or the
theft of nuclear material. 

DOE's decision to burn plutonium in the form of MOX fuel in
commercial nuclear reactors has focused attention on plutonium's
value as an energy source but also has raised concerns about nuclear
proliferation.  The United States does not encourage the civilian use
of plutonium and does not engage in plutonium reprocessing to
generate nuclear power.\15 However, many countries, including France,
Belgium, Germany, the United Kingdom, Russia, and Japan, believe that
plutonium is a valuable fuel and have programs to reprocess and
recycle it. 

DOE officials and representatives from the U.S.  nuclear industry
told us that the disposition program does not conflict with or
reverse established U.S.  policy--as some critics contend--because it
does not include reprocessing and recycling and is limited to
plutonium that has been separated from nuclear weapons.  They have
maintained that by burning MOX fuel without reprocessing, the United
States is focusing on ultimately eliminating plutonium, not creating
more.  According to DOE, controls will be placed on the program for
fabricating MOX fuel.  For example, the U.S.  government would own
and control the MOX fuel fabrication facility, which would be located
at a DOE site.  Furthermore, the facility would only be used for the
disposition program, and no spent fuel would be reprocessed or
recycled.  DOE and White House Office of Science and Technology
Policy officials stated that DOE's MOX fuel program will not provide
the United States any plutonium reprocessing capability that is not
now readily available on the commercial market. 

In contrast, other government officials, a member of Congress and
representatives from nongovernmental organizations, such as the
Institute for Energy and Environmental Research, have indicated that
DOE's decision to pursue the MOX fuel option may pave the way for the
future civilian use of plutonium in the United States.  For example,
they believe that the disposition program will provide experience in
making and using MOX fuel that the United States does not now have. 
Others maintain that burning MOX fuel will establish a precedent that
would serve to justify the future commercial use of plutonium.  They
also contend that the activities of the civilian nuclear industry
have been kept separate from military activities to reduce the risk
of nuclear proliferation and to encourage the rest of the world to
maintain a similar standard. 

A November 1996 memorandum from the Director of the U.S.  Arms
Control and Disarmament Agency (ACDA) highlighted many of these
proliferation concerns.  According to the Director, (1) using MOX
fuel would establish an infrastructure, at least in part, for the
domestic civil use of plutonium; (2) employing both disposition
technologies would undermine U.S.  efforts to discourage the
reprocessing of plutonium in other countries, such as South Korea and
Russia; and (3) placing the two options on equal footing would be
contrary to U.S.  nonproliferation policy. 

Subsequently, ACDA's Director acknowledged that reserving the right
to use both the MOX fuel and immobilization options was consistent
with U.S.  policy.  ACDA officials told us that their agency's
concerns had been significantly tempered because DOE's final
disposition plan, announced in January 1997, did not favor one
disposition strategy over another.  The officials noted, however,
that ACDA still favored immobilizing the plutonium rather than
burning MOX fuel for the United States because they believed it
appeared to be less costly, quicker to implement, and left the
plutonium as unlikely to be stolen or diverted as the MOX fuel
option. 


--------------------
\15 The President's 1993 nonproliferation and export control policy
states that "The United States does not encourage the civil use of
plutonium and, accordingly, does not itself engage in plutonium
reprocessing for either nuclear power or nuclear explosive purposes."


      U.S.  SEEKS TO LIMIT
      PROLIFERATION RISKS IN
      RUSSIA
---------------------------------------------------------- Letter :6.1

A 1996 analysis prepared by an official from State Department's
Office of Nuclear Energy Affairs concluded that the use of
weapons-grade plutonium in Russian nuclear reactors posed certain
proliferation risks.  The document noted that Western assistance
would help create a MOX fuel industry that does not now exist and
that Russia might otherwise be unable to build.  The use of MOX fuel
could provide Russia with the infrastructure to reprocess plutonium
for both civilian and military purposes and thereby encourage a
plutonium economy.  According to DOE officials, however, Russia
already has a significant reprocessing capability. 

The Administration's position has been that (1) a MOX fuel
fabrication facility constructed with international assistance in
Russia should be used only for the disposition of weapons plutonium
and (2) no spent MOX fuel should be reprocessed and recycled at least
until all excess weapons plutonium has been processed.  State
Department officials said they want to preclude Russia's increasing
its stockpiles of plutonium as a by-product of converting military
plutonium into more proliferation- resistant forms.  They also said
that Russia has not yet accepted the provision related to the future
use of the MOX fuel facility and the reprocessing of spent nuclear
fuel.  Representatives from France, Belgium, and Canada told us their
governments support the U.S.  position. 


   CONCLUSIONS
------------------------------------------------------------ Letter :7

DOE's plutonium disposition program faces uncertainties related to
costs, licensing, regulatory and environmental issues, and the
further development of disposition technologies.  Furthermore, the
U.S.  program depends heavily on Russia's adoption of a similar
program that also faces many impediments.  Given these uncertainties,
DOE is pursuing its own plutonium disposition program, on a modest
scale at this time, without Russia's commitment to implement a
similar program that proceeds along similar time frames.  While the
United States ultimately wants to reduce both countries' stockpiles
of plutonium to equivalent levels, it is unclear if the Russian
government endorses this objective.  Furthermore, it is uncertain if
Russia--and the international community, including the United
States--is willing to make the financial commitment to achieve these
reductions in Russia over time. 


   MATTERS FOR CONGRESSIONAL
   CONSIDERATION
------------------------------------------------------------ Letter :8

Because of the uncertainties about Russia's commitment to implement a
program similar to the U.S.  program, the Congress may wish to
consider linking DOE's future funding requests for large-scale
projects to design and construct plutonium disposition facilities in
the United States and Russia to the progress being made in
negotiating and signing a bilateral agreement.  Furthermore, the
Congress may wish to consider requesting that the Department of
State, and other appropriate agencies, report periodically on efforts
to conclude a plutonium disposition agreement between the United
States and Russia. 


   AGENCY COMMENTS
------------------------------------------------------------ Letter :9

We provided copies of a draft of this report to the White House
Office of Science and Technology Policy, the departments of Energy
and State, and ACDA for review and comment.  The Office of Science
and Technology Policy provided its own comments and also obtained and
consolidated comments from the other agencies.  On December 17, 1997,
we met with the office's Assistant Director for National Security and
DOE's Assistant to the Director for International Programs, Office of
Fissile Materials Disposition, to discuss their comments.  In
general, the agencies agreed with the facts and analysis presented
and noted that our report correctly observed that there are
uncertainties associated with both the U.S.  and Russian plutonium
disposition programs.  The agencies also noted that MOX fuel
technology is well established in Europe.  We have expanded our
discussion on MOX fuel technology to make it clear that while the
technology is widely used in Europe it still has not yet been
demonstrated on an industrial scale in the United States.  The
agencies reiterated that the U.S.  government will not begin to
commit large amounts of funds to either the U.S.  or Russian
plutonium disposition programs until Russia commits to a comparable
program.  Furthermore, they emphasized that both programs should be
implemented in roughly parallel time frames.  The agencies also
provided us with additional clarifying information that we
incorporated as appropriate. 


   SCOPE AND METHODOLOGY
----------------------------------------------------------- Letter :10

To address our objectives, we interviewed officials and obtained
documents from the departments of State and Energy (and several
national laboratories), ACDA, and the White House Office of Science
and Technology Policy.  We also obtained information from various
foreign governments, commercial institutions, and international
organizations, including the International Atomic Energy Agency and
Russia's Ministry of Atomic Energy.  Our scope and methodology are
discussed in detail in appendix III. 

We performed our review from February 1997 through December 1997 in
accordance with generally accepted government auditing standards. 


--------------------------------------------------------- Letter :10.1

Unless you publicly announce its content earlier, we plan no further
distribution of this report until 5 days from the date of this
letter.  At that time, we will send copies of this report to other
interested congressional committees, the Secretaries of State and
Energy, the Assistant to the President for Science and Technology
Policy (Office of Science and Technology Policy), the Director of
ACDA, the Director of the Office of Management and Budget, and other
interested parties.  We will also make copies available to others
upon request. 

Please contact me at (202)512-8021 if you have any questions.  Major
contributors to this report are listed in appendix IV. 

Sincerely yours,

Gary L.  Jones
Associate Director, Energy, Resources,
 and Science Issues


U.S.  NUCLEAR WEAPONS THAT ARE
SOURCES OF PLUTONIUM FOR DOE'S
DISPOSITION PLAN
=========================================================== Appendix I

DOE's programmatic environmental impact statement for plutonium
disposition analyzes the disposition of about 50 metric tons of
excess weapons-usable plutonium over the next 25 years.  Included in
that amount is 21.3 metric tons that can be traced to nuclear
warheads that have been retired.  Retirement refers to an
administrative decision to remove the warheads from the nuclear
weapons stockpile and to dismantle them.  DOE and the Department of
Defense conducted a joint review and determined that 21.3 metric tons
of plutonium, most of which came from classes of warheads fully
retired between 1970 and 1993, was excess to national needs.  The
other 28.7 metric tons in DOE's analysis came from such other
plutonium-bearing sources as components, metals, and oxides that were
by-products from the production of nuclear weapons. 

Retirements of warheads have occurred for several reasons including
treaties and weapons modernization efforts that supplant the need for
some older or less reliable warheads\1 .  For example, a 1991 report
of the Committee on Armed Services, U.S.  House of Representatives,
identified concerns about the W69, a warhead for air-launched
missiles on bomber aircraft.  The warhead did not have such modern
design features as fire-resistant plutonium.  The concern was that an
accident involving the warhead could scatter plutonium over a wide
area or, in the very worst and far less likely case, result in a
nuclear explosion. 

Table 1.1 lists the fully retired classes of warheads that are
sources of plutonium scheduled for disposition. 



                               Table 1.1
                
                    Fully Retired Classes of Nuclear
                    Warheads That Contain Plutonium
                       Scheduled for Disposition

                                                    Year
                                                    weapons   Year all
                                                    entered   weapons
                                                    stockpil  were
Warhead\a             Type of weapon                e         retired
--------------------  ----------------------------  --------  --------
B28                   Thermonuclear bomb carried    1959      1991
                      by strategic and short-
                      range aircraft\b

B43                   Bomb carried by strategic     1961      1991
                      and short-range aircraft

B54                   Special atomic demolition     1964      1989
                      munition capable of being
                      placed by a two-person team

B57                   Multipurpose nuclear depth    1967      1993
                      charge and nuclear bomb for
                      antisubmarine warfare and
                      land warfare

W44                   Warhead for an antisubmarine  1961      1989
                      rocket aboard surface ships

W45                   Warhead in missiles and       1962      1988
                      medium atomic demolition
                      munition placed by a team

W48                   Atomic projectile fired from  1964      1992
                      a howitzer

W50                   Warhead for the short-range   1963      1991
                      Pershing ballistic missile

W55                   Warhead in a rocket launched  1964      1990
                      from a submarine to destroy
                      an enemy's submerged
                      submarine

W56                   Thermonuclear warhead in the  1963      1993
                      Minuteman II
                      Intercontinental Ballistic
                      Missile (ICBM)

W59                   Minuteman ICBM warhead        1962      1970

W66                   Anti-ICBM warhead             1974      1986

W68                   Warhead on a Poseidon         1975      1993
                      submarine-launched ballistic
                      missile

W69                   Short range air-to-surface    1972      1993
                      missile warhead carried
                      aboard strategic bombers

W70                   Warhead in a mobile-guided    1974      1992
                      surface-to-surface short-
                      range ballistic missile

W71                   Thermonuclear warhead for an  1975      1993
                      anti-ICBM

W79                   Atomic projectile fired from  1986      1992
                      a howitzer
----------------------------------------------------------------------
\a These designations refer to specific types of nuclear warheads
that were mass-produced nuclear devices capable of being carried by
missiles, aircraft, or other means. 

\b A thermonuclear weapon, also referred to as a hydrogen weapon,
derives its energy largely from fusion.  Existing treaties refer to
intercontinental ballistic missiles (ICBM) and other weapons that
have a maximum range exceeding 5,500 kilometers as strategic. 
Intermediate weapons have ranges between 1,000 and 5,500 kilometers,
and short-range weapons have a range of less than 1,000 kilometers. 

Source:  Sandia National Laboratories is the source for the
approximate dates.  The type of weapon is based on U.S.  Nuclear
Weapons:  The Secret History by Chuck Hansen (1988, Orion Books) and
the Natural Resources Defense Council's U.S.  Nuclear Forces and
Capabilities by Thomas B.  Cochran, William M.  Arkin, and Milton M. 
Hoening (1984, Ballinger Publishing Company). 

In addition, a small portion of the 21.3 metric tons of excess
plutonium comes from individual retired warheads among the current
classes of warheads.  Current warhead classes are listed in table
1.2. 



                               Table 1.2
                
                  Current Warheads in the Active U.S.
                               Stockpile

                                                    Year entered
Warhead                         Type of weapon      stockpile
------------------------------  ------------------  ------------------
B61                             Multipurpose        1966
                                thermonuclear bomb

B83                             Strategic           1983
                                thermonuclear bomb

W62                             Warhead on          1970
                                Minuteman III ICBM

W76                             Warhead for the     1978
                                submarine-
                                launched Trident
                                ballistic missile

W78                             Warhead on          1976
                                Minuteman III ICBM

W80                             Warhead on cruise   1983
                                missile

W84                             Warhead for         1983
                                ground-launched
                                cruise missile

W87                             Warhead for the     1986
                                MX/Peacekeeper
                                ICBM

W88                             Warhead for         1990
                                submarine-
                                launched Trident
                                II ballistic
                                missile
----------------------------------------------------------------------
Sources:  Sandia National Laboratories is the source for the
approximate dates.  The type of weapon is based on U.S.  Nuclear
Weapons:  The Secret History by Chuck Hansen (1988, Orion Books) and
the Natural Resources Defense Council's U.S.  Nuclear Forces and
Capabilities by Thomas B.  Cochran, William M.  Arkin, and Milton M. 
Hoening (1984, Ballinger Publishing Company). 


--------------------
\1 The Intermediate-Range Nuclear Forces (INF) Treaty ratified by the
United States and the former Soviet Union on June 1, 1988, called for
the elimination of missiles with a range of 300 to 3,400 miles, such
as the U.S.  Pershing II missiles and Soviet SS-20 missiles.  The
Strategic Arms Reduction Treaty (START-I), signed July 31, 1991,
mandates substantial reductions over 7 years in the number of
strategic ballistic missiles and heavy bombers and their associated
nuclear warheads.  For example, each country must reduce its
stockpile of warheads on its missiles and bombers to 6,000.  No
existing arms control agreement requires that nuclear weapons be
dismantled or their plutonium be accounted for.  The United States
and Russia are unilaterally dismantling warheads. 


DEPARTMENT OF ENERGY-RUSSIAN
DEMONSTRATION PROJECTS FOR
PLUTONIUM DISPOSITION TECHNOLOGY
========================================================== Appendix II

This appendix discusses six U.S-Russian plutonium disposition
demonstration projects.  These projects include burning MOX fuel in a
Canadian reactor, fabricating MOX fuel pellets, validating computer
codes for analyzing VVER-1000 reactors, studying the feasibility of
converting a Russian reactor so that it can burn MOX fuel, studying
ways to change plutonium from dismantled nuclear warheads into safer
forms and to store it, and developing immobilization technologies. 


   U.S.-RUSSIAN-CANADIAN PROJECT
   TO BURN MOX FUEL IN A CANADIAN
   NUCLEAR REACTOR
-------------------------------------------------------- Appendix II:1

The purpose of this demonstration project is to examine the technical
feasibility of burning weapons-grade plutonium in existing Canadian
Deuterium Uranium (CANDU) reactors.  The United States and Russia are
studying the possibility of using these reactors for this purpose,
but a substantial amount of analysis is required.  These reactors,
which use uranium fuel, may provide a technically attractive option
because their design allows them to handle MOX fuel with fewer
changes than would be expected with light water reactors.  Studies
have indicated that CANDU reactors could burn MOX fuel at a greater
rate than U.S.  reactors.  Oak Ridge National Laboratory is
coordinating the effort to test MOX fuel from the United States and
Russia in a Canadian test reactor--the National Research Universal
Reactor. 

The scope of the project involves fabrication, irradiation, and
post-irradiation examination of a small number of MOX fuel rods over
18 months.  Fuel rods are hollow metal tubes that contain fuel
pellets.  Los Alamos National Laboratory has fabricated seven fuel
rods for use in the demonstration.  Russia's A.  A.  Bochvar
All-Russia Scientific Research Institute is expected to fabricate
another 8 to 10 fuel rods to combine with the U.S.  fuel rods.  As
originally conceived in 1995, a total of 92 fuel rods--46
manufactured in the United States by Los Alamos National Laboratory
and 46 fabricated in Russia--would be made for assembly in four fuel
bundles.  The test irradiations and post-irradiation examinations
will be conducted at the Chalk River Laboratory in Canada.\1 This
trilateral effort will permit evaluation of such technical issues as
possible differences between U.S.  and Russian MOX fuel performance. 

DOE had planned to facilitate the signing of a contract between
Atomic Energy of Canada Limited, the designer of the CANDU reactor,
and the Bochvar Institute in July 1996.  As part of that effort, DOE
would pay for manufacturing the Russian fuel, transporting it to a
Russian port, and for licensing oversight in Russia.  The contract,
however, was not signed then because of disagreements about the
amount of money that would be provided to the Bochvar Institute to
fabricate the MOX fuel, the intellectual ownership of the fabrication
rights, the legal implications of transporting plutonium outside of
Russia, and the possible imposition of Russian taxes on U.S.-funded
assistance. 

The U.S.  fuel has not been delivered to Canada because the United
States was awaiting resolution of the disagreements concerning the
Russian contract.  In July 1997, Bochvar Institute officials
indicated their agreement to the proposed contract.  The signing
occurred in September 1997, and the shipment is expected to be made
sometime in calendar year 1998.  DOE reported expenditures totaling
$402,000 for this project as of July 31, 1997, and has planned
$455,000 for continued work in fiscal year 1998. 


--------------------
\1 More than 350 MOX fuel elements, using reactor-grade plutonium,
have been irradiated at experimental reactors at this facility,
including a prototype CANDU reactor. 


   FABRICATION OF VVER-1000 MOX
   FUEL
-------------------------------------------------------- Appendix II:2

The purpose of this demonstration project is to assist and encourage
Russia to (1) develop a MOX fuel fabrication process that is
compatible with surplus weapons-grade plutonium, (2) test the
resulting fuel, and (3) qualify it for use in a VVER-1000 reactor. 
The data and information collected in this task will be provided to
Gosatomnadzor, Russia's nuclear regulatory authority, and
Rosenergoatom, the Russian utility that operates the nuclear power
reactors, to facilitate the eventual licensing of MOX fuel in Russia. 

Oak Ridge National Laboratory is responsible for performing the work
on behalf of DOE.  In January 1997, a contract was signed by the
University of Texas at Austin and the A.A.  Bochvar All-Russia
Research Institute,\2 which established the statement of work,
budget, schedule, and list of deliverables for the initial phase of
work.  Under the terms of this contract, the Bochvar Institute will
receive $210,000 for various technical reports and for manufacturing
a limited amount of test fuel related to the use of MOX fuel in
VVER-1000 reactors.  According to laboratory officials, the program
to develop and test MOX fuel will be continued under separate
contracts that will be signed with the appropriate Russian
organizations. 

According to the Oak Ridge project manager, the project has made
little progress because the Bochvar Institute has not prepared an
acceptable plan to test the MOX fuel, has not provided a MOX fuel
specification, and has limited ability to handle plutonium on site. 
The project manager said that the original Russian test plan did not
contain the level of detail required to plan and execute the MOX fuel
development program.  The test plan is critical to the project
because it outlines the goals, the time frames, and the estimated
costs for manufacturing and testing MOX fuel in Russia. 

Laboratory officials noted that a contract has been placed with
another Russian institute, the Research Institute of Atomic Reactors,
to complement the current work and to perform the follow-on work that
will require larger plutonium inventories.  According to DOE, this
institute should be capable of performing the required manufacturing
work with limited equipment modifications and upgrades.  Because the
Bochvar Institute has been designated as the lead technical institute
in Russia for all reactor fuel development, it will remain involved
with the development program.  The delay in the program and the
reasons for it have been raised to higher levels within MINATOM
without resolution.  According to DOE, $443,000 had been spent on
this project as of July 31, 1997, and DOE has planned $600,000 for
continued work in fiscal year 1998. 


--------------------
\2 The University of Texas at Austin signed contracts on behalf of
the Amarillo National Resource Center for Plutonium, a consortium of
the Texas A & M University System, Texas Tech University, and the
University of Texas System.  Through a cooperative agreement with
Texas, DOE provided about $2 million to the Center for
Russian-related plutonium disposition activities. 


   VALIDATING THE PERFORMANCE OF
   MOX-FUELED NUCLEAR REACTORS
-------------------------------------------------------- Appendix II:3

Having available verified and validated computer codes that have been
used to predict the behavior of MOX fuel derived from weapons-grade
plutonium is essential for nuclear regulatory organizations to
complete their evaluations.\3 This joint U.S.-Russian project is
designed to begin the process of verifying and updating these
computer codes that both U.S.  and Russian regulators will need to
license reactors to use MOX fuel.  The verification process uses
safety data that has been compiled by various international
organizations and commercial organizations.  Using the results of
these verifications in Russia must have the concurrence of the
original designer of the VVER-1000 reactor and the Russian institute
responsible for the initial calculations of the reactor core's
physics.  The United States will take similar verification actions
once the type of U.S.  reactor has been selected. 

In 1996, the University of Texas at Austin and the Russian Institute
of Physics and Power Engineering entered into a $205,000 contract for
which Russian authorities were required to provide various
deliverables, including verification and validation studies in a form
suitable for presentation to the Russian nuclear regulatory agency
for licensing approval.  Oak Ridge National Laboratory is responsible
for coordinating this Russian work on behalf of DOE. 

Oak Ridge is also working with Russia's Kurchatov Institute, Russia's
leading research and development institution in the field of nuclear
energy, and the Institute of Physics and Power Engineering.  This
work is designed to assess the ability of Russian and U.S.  computer
codes to produce calculations on reactor physics that are consistent
with experimental data and with the results produced by computer
codes that are available in the international nuclear community.  The
results of the U.S.  and Russian calculations will be evaluated with
respect to how well the experimental results were predicted and the
U.S.  and Russian results will be compared.  This process will
provide an independent and parallel validation of the Russian models
that may be acceptable to Russia's nuclear regulatory authority. 

The initial phase of the work has been completed, and Oak Ridge
officials indicated that they were pleased with the results. 
Follow-on work will be started in fiscal year 1998 and will be
expanded to validate codes for rapidly changing and accident
conditions.  DOE reported expenditures totaling $912,000 for this
project as of July 31, 1997, and has planned $700,000 for continued
work in fiscal year 1998. 


--------------------
\3 Regulatory authorities in the United States as well as in the
Russian Federation depend on analysis using computerized models of
power- reactor physics and thermal hydraulics to gain confidence that
the reactor can operate without endangering its operators and the
public.  Simulating reactor operations through computerized models is
much faster and far less expensive than conducting reactor
experiments for all possible operating and accident conditions. 
However, when a model is used, the user must have confidence that the
simulation is acceptably accurate.  To check the model's accuracy,
its results are compared to results that have already been obtained
experimentally from tests conducted in reactors. 


   CONVERTING A RUSSIAN BREEDER
   REACTOR TO A PLUTONIUM BURNER
-------------------------------------------------------- Appendix II:4

DOE has agreed to help Russia assess the feasibility of converting
Russia's BN-600 reactor, a fast-neutron reactor, into a reactor
suitable for burning weapons-grade plutonium.  The BN-600 is a
demonstration fast breeder reactor (one that produces more plutonium
than it consumes) but operates on a fuel cycle that consumes uranium. 
When converted, the reactor may be used as a net consumer of
weapons-grade plutonium.  Studies indicated that the reactor would be
capable, with modifications to the reactor core, of burning 100
percent MOX fuel.  The BN-600 currently uses uranium oxide fuel.  To
proceed with the conversion plan, significant safety analyses is
required. 

Oak Ridge National Laboratory is responsible for managing the project
for DOE and providing technical support.  Oak Ridge has enlisted the
support of the Argonne National Laboratory and the Hanford Site to
provide training and computer codes to selected Russian
organizations, including the Institute of Physics and Power
Engineering.  Under the terms of a $100,000 contract between the
University of Texas at Austin and the Institute, Russia is
responsible for providing several deliverables, including design
studies, safety analyses, and an economic analysis.  According to
DOE, $527,000 had been spent on the project as of July 31, 1997, and
DOE has planned $800,000 for this project in fiscal year 1998. 


   PLUTONIUM CONVERSION TECHNOLOGY
-------------------------------------------------------- Appendix II:5

One of the critical objectives of the DOE-funded test and
demonstration projects is selecting a technology to convert the
plutonium weapons components from dismantled nuclear warheads into an
oxide form that is suitable for temporary storage, international
inspection, and disposition.  Once this "front-end" process has been
completed, the material can be used in MOX fuel and burned in a
nuclear reactor to generate electricity.  DOE, working with Los
Alamos National Laboratory, is studying plutonium conversion
technology as part of its own disposition plan.  Los Alamos has also
been tasked by DOE to lead a concurrent effort with Russia on
plutonium conversion.  Neither the United States nor Russia has
selected the final conversion process. 

The goal of the project is to find areas where the United States and
Russia can cooperate.  In fiscal year 1997, Los Alamos received $2
million to begin a cooperative effort with Russia.  DOE is placing
significant resources in this program and plans to contribute $40
million to $80 million over the next 5 to 7 years for research and
development and for the design and the construction of a pilot-scale
plutonium conversion facility in Russia. 

According to DOE and Los Alamos officials, the project with Russia
has been delayed.  The Bochvar Institute, which will be leading and
coordinating research on the project, would not sign any contracts
for several months until an agreement between DOE and MINATOM was
signed.  One of the Los Alamos officials told us that the Institute
wanted to have the internal political protection of this agreement
before starting any work.  In July 1997, however, the Deputy Minister
of MINATOM instructed the Institute to proceed without the agreement
in place. 

According to the Los Alamos official, another difficulty has been
that the Bochvar Institute has requested extremely high labor rates,
which have been unacceptable to DOE and have also delayed progress. 
The official, who described these matters as "growing pains" that are
to be expected with such a program, believed that the pace of the
project was beginning to accelerate as all of the different Russian
organizations gained a better understanding of their roles and
responsibilities. 

As of late August 1997, Los Alamos National Laboratory had signed two
task orders with the Bochvar Institute totaling $200,000.  The first
task order, for $78,000, is to develop a master plan for the joint
plutonium conversion and disposition project.  The plan is expected
to outline the steps for determining the optimum conversion process
for plutonium metal into an oxide.  In July 1997, the Institute
submitted the draft plan for review and it is being revised; it is
expected to be finalized in March 1998.  As of August 1997, the first
deliverable of the task order has been completed and payments
totaling $23,200 had been made to the Institute. 

In late July 1997, the second task order, for $122,000, was signed to
initiate tests and analyses that will lead to the design and
development of a nondestructive system to disassemble Russia's
nuclear weapons.  Under this task, Russia is responsible for
preparing a design report and a technical demonstration report. 
According to a Los Alamos official, several additional task orders
are being negotiated with the Bochvar Institute to initiate research
on various conversion technologies.  In addition, a broad feasibility
study and design for the pilot demonstration conversion plant is also
being developed as a near-term effort. 

According to DOE, $874,000 had been spent on the project as of July
31, 1997.  DOE planned an additional $3,000,000 for this project in
fiscal year 1998. 


   DEVELOPING IMMOBILIZATION
   TECHNOLOGIES
-------------------------------------------------------- Appendix II:6

DOE, working primarily through Lawrence Livermore National
Laboratory--with support from the Savannah River Site and other
laboratories--is engaged in projects with Russia to explore various
immobilization technologies.  As part of its dual-track approach to
plutonium disposition, DOE is studying several options, including
immobilization in glass or ceramics.  DOE is funding small-scale
demonstration projects to encourage Russia to consider the technical
merits of immobilization as a disposition option and to gain insight
into Russia's immobilization technology.\4

The Lawrence Livermore project manager told us that Russian views
toward immobilization have generally not been very positive because
they view plutonium as a valuable energy source.  As a result, it has
been difficult to obtain concurrence on some project's goals and
requirements.  He noted, however, that attitudes appear to be
changing somewhat in the past several months as dialogues between
U.S.and Russian scientists have increased.  For example, the July
1997 meeting of the U.S.-Russian Steering Committee in Moscow
resulted in a protocol agreement to increase the dialogue by holding
a focused U.S.-Russian experts workshop on plutonium stabilization
and immobilization. 

The University of Texas at Austin is funding projects valued at
$360,000 with two Russian institutes to perform immobilization tasks
related to (1) establishing the migration of plutonium in hard rock
formations in order to prepare for eventual siting, designing, and
licensing of a geological repository and (2) providing tests and
demonstrations to incorporate plutonium in glass using Russian
technologies. 

One task, valued at $100,000, includes a technical exchange meeting
at Lawrence Livermore National Laboratory, the purchase of equipment
used to obtain samples of rock cores from a site in the Krasnoyarsk
region of Siberia, and elevated pressure and temperature tests with
plutonium in Russia. 

The second task, valued at $260,000, which began in January 1997, has
been delayed.  Under the terms of its contract, the United States is
obligated to provide sample glass-fused material to the Bochvar
Institute for testing.  However, the release of the material was
significantly delayed due to export control requirements.  In the
interim, U.S.  requirements for the information changed and the
information pertaining to unique Russian melter technology and for
the Russian data on U.S.  glass compositions will not be needed. 
Lawrence Livermore is currently working with the University of Texas
to modify the contract for no extra cost and to extend the time
frames.  The proposed modification would be for studying
Russian-selected glass compositions capable of containing high
concentrations of plutonium using Russian technology. 

According to DOE, $863,000 had been spent on this project as of July
31, 1997.  DOE has budgeted $1.1 million for continued work on this
project in fiscal year 1998. 


--------------------
\4 Immobilization in glass involves dissolving or mixing the
plutonium (plutonium dioxide) in glass and pouring the molten glass
compound into cans where it cools and hardens.  The cans are sealed
and mounted in a large canister that is filled with molten glass
containing highly radioactive waste.  Alternatively, the plutonium
may be mixed with a titanium based ceramic material and compressed
and processed into very dense pellets.  The pellets are put into
cans, which are then sealed and put into large canisters.  The
canisters are filled with molten glass that contains highly
radioactive waste. 


SCOPE AND METHODOLOGY
========================================================= Appendix III

To obtain information about plutonium disposition issues, we
interviewed and obtained pertinent documents from officials at the
Department of State, the U.S.  Arms Control and Disarmament Agency,
DOE, and the White House Office of Science and Technology Policy.  We
also met with the Deputy Minister of Russia's Ministry of Atomic
Energy (MINATOM), who is responsible for matters relating to
plutonium disposition.  In the course of our review, we also attended
several forums that focused on plutonium disposition issues.  We
attended the Fourth International Policy Forum on the Management and
Disposition of Nuclear Weapons Material (Lansdowne, Virginia) and two
sessions sponsored by the Nuclear Energy Institute and the Nuclear
Regulatory Commission on licensing issues related to the fabrication
of MOX fuel.  We also met with the chairman of the U.S.  delegation
to the U.S.-Russia Independent Scientific Commission on the
Disposition of Excess Weapons Plutonium. 

Cost information was obtained primarily from DOE's Office of Fissile
Materials Disposition.  We did not independently verify the accuracy
of the cost data they provided.  We obtained information on the
status of various joint demonstration projects from DOE, Lawrence
Livermore National Laboratory, Berkeley, California; Oak Ridge
National Laboratory, Oak Ridge, Tennessee; Los Alamos National
Laboratory, Los Alamos, New Mexico; and the Amarillo National
Resource Center for Plutonium.  We also met with representatives from
Sandia National Laboratories (Rosslyn, Virginia office). 

To obtain information about the nonproliferation implications of
DOE's plutonium disposition program, we obtained the views of
numerous governmental and nongovernmental organizations. 
Representatives from nongovernmental organizations included the
Nuclear Energy Institute, the Natural Resources Defense Council, the
Nuclear Control Institute, the Institute for Energy and Environmental
Research, the Union of Concerned Scientists, Greenpeace, and the
Nuclear Information Resource Service.  We also obtained information
from the International Atomic Energy Agency (Vienna, Austria), BNFL
Inc., and COGEMA, Inc. 

We obtained the views of foreign governments on matters pertaining to
plutonium disposition.  We met with officials from the government of
France, including the Ministry of Foreign Affairs and Atomic Energy
Commission.  We also obtained information from the governments of
Belgium, Canada, and Germany.  We attempted to obtain information
from the governments of the United Kingdom and Ukraine via inquiries
made through their embassies in Washington, D.C.  Neither the United
Kingdom nor Ukraine responded to our inquiries. 

To obtain information on U.S.  nuclear weapons that are sources of
plutonium for DOE's disposition plan, we interviewed DOE officials
who provided documents and discussed the types of plutonium for
disposition and the amounts that would come from retired nuclear
weapons.  We also obtained additional information about particular
types of weapons from two documents:  Nuclear Weapons Databook:  U.S. 
Nuclear Forces and Capabilities and U.S.  Nuclear Weapons:  The
Secret History.  These documents are considered to be authoritative,
publicly available sources on the topic. 

The National Security Council declined to meet with us and stated
that it did not possess any information that could not be obtained
from other U.S.  government agencies. 


MAJOR CONTRIBUTORS TO THIS REPORT
========================================================== Appendix IV

RESOURCES, COMMUNITY, AND ECONOMIC
DEVELOPMENT DIVISION WASHINGTON,
D.C. 

Victor S.  Rezendes, Director, Energy, Resources,
 and Science Issues
Gene Aloise, Assistant Director
Glen Levis, Evaluator-in-Charge
Duane G.  Fitzgerald, Ph.D., Nuclear Engineer
Daniel Semick, Senior Evaluator

OFFICE OF THE GENERAL COUNSEL

Jackie A.  Goff, Senior Attorney


*** End of document. ***