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Cablegate: Gob Seeks Usg Guidance On Developing Nuclear Power

VZCZCXRO9922
PP RUEHDE RUEHDH RUEHDIR
DE RUEHMK #0647/01 3091339
ZNY CCCCC ZZH
P 051339Z NOV 09
FM AMEMBASSY MANAMA
TO RUEHC/SECSTATE WASHDC PRIORITY 9004
RHMFISS/DEPT OF ENERGY WASHINGTON DC PRIORITY
INFO RUEHZM/GULF COOPERATION COUNCIL COLLECTIVE PRIORITY
RHMFISS/HQ USCENTCOM MACDILL AFB FL PRIORITY
RHBVAKS/COMUSNAVCENT PRIORITY
RHEHAAA/WHITE HOUSE WASHDC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY

C O N F I D E N T I A L SECTION 01 OF 02 MANAMA 000647

SIPDIS

STATE FOR NEA/ARP, EEB, AND ISN

E.O. 12958: DECL: 11/05/2019
TAGS: ENRG PREL ETRD KNNP BA
SUBJECT: GOB SEEKS USG GUIDANCE ON DEVELOPING NUCLEAR POWER
PLANT

REF: A. MANAMA 642 B. 08 MANAMA 306 C. 08 MANAMA 237 D. 08 MANAMA 147 E. 07 MANAMA 982 Classified By: Ambassador Adam Ereli for reasons 1.4 (b) and (d).

1.(C) This is an action request, see paragraph

7.
2.(C) Summary: On November 4, Deputy Prime Minister Mohammed bin Mubarak Al Khalifa told Ambassador that the GOB would like USG guidance/assistance in developing a domestic nuclear energy program, and would prefer a U.S. company to build and operate any such plant. End Summary.

3.(C) Deputy Prime Minister Mohammed bin Mubarak Al Khalifa called Ambassador to his office on November 4 -- on the instructions of King Hamad, he said -- to seek USG guidance and participation in developing a nuclear power plant in Bahrain. Repeating what King Hamad told Ambassador on November 1, the DPM said the GOB has formed an inter-ministerial committee to study the use of nuclear energy for power generation(ref A). The DPM said the GOB recognizes that they do not have the resources to develop or operate a nuclear reactor on their own, but that they need the power and are interested in moving forward with the idea. He said that there were no shortage of commercial entities offering to build a plant, but pointed out that "this is serious business; we need to do it right and be transparent about it."

4.(C) For that reason, he said, the GOB seeks USG guidance on how to move forward. Specifically, they have asked if there is a government-to-government agreement that could serve as the basis for developing this sector and ensure that everything is done in accordance with all international agreements and best practices. He further stated that the GOB is interested in ensuring that it is a U.S. firm, or consortium of firms, that builds and operates any nuclear project in Bahrain. According to the GOB's vision, the plant owner and operator would sell the power it generates to Bahrain and the region on a commercial basis.

5.(C) Background: Bahrain has long signaled its interest in developing nuclear energy. In October 2006, GOB officials met with USDOE representatives to discuss DOE's Global Nuclear Energy Partnership (GNEP)(ref E), stating in March 2008 that they were "very interested" in joining (ref D). In September 2007, they joined the IAEA, and signed a civil nuclear cooperation MOU with the U.S. in March 2008. Prior to March 2008 however, GOB officials had not expressed a desire in hosting a reactor in Bahrain, instead focusing their attention on a GCC joint project (ref C). In March 2008, Bahrain Petroleum Company (BAPCO) Chairman (and PM son) Sheikh Salman bin Khalifa Al Khalifa said that Bahrain was indeed interested in developing a domestic nuclear reactor. In January 2009, the Parliament ratified the Nuclear Safeguards Agreement. MFA Legal Affairs Director Yusuf Abdulkarim told poloff at that time that he had been instructed to focus on the Additional Protocol once the Safeguards Agreement was deposited with the IAEA.

6.(C) Comment: The GOB has consistently stated that Bahrain is energy constrained and that natural gas supplies will not be sufficient to meet projected energy needs within 10 years. They have said that projected gas shortages necessitate the need to negotiate with all local gas producers including Iran (ref B). Development of a nuclear plant would not only meet the country's energy needs, but would also liberate domestic gas production (over 60% of which currently feeds domestic power generators) for further development of a petrochemical industry--a widely stated goal of the Bahrainis. It is not clear whether a private nuclear power plant is economically feasible, especially in light of the highly subsidized price of electricity in Bahrain. It is also unclear how Bahrain's GCC neighbors, particularly Saudi Arabia, might react to a unilateral pursuit of nuclear power outside a GCC framework. End Comment.

7.(C) Post requests the Department, in conjunction with the Department of Energy, develop a response to the GOB detailing USG assistance available in developing a nuclear program involving U.S. private sector companies. Post would MANAMA 00000647 002 OF 002 particularly welcome the visit of a USDOE delegation to discuss the subject in more detail with the GOB. ERELI

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