Cablegate: (Sbu) Argentina Sees Fuel Bank Proposal As Interesting But

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TAGS: ENRG KNNP TRGY PREL AORC IAEA AR
SUBJECT: (SBU) Argentina Sees Fuel Bank Proposal as Interesting but
Premature

REF: STATE 117710

1. (SBU) Argentine Foreign Ministry Director for International
Security, Nuclear and Space Affairs (DIGAN), Gustavo Ainchil, told
Political Officer November 20 in response to reftel points that
Argentina was not prepared to support the Angarsk Nuclear Fuel Bank
proposal at the IAEA. Ainchil said that while fuel banks might
well be a viable solution to future challenges in addressing secure
nuclear fuel supply, the proposal appeared premature to Argentina.
The GOA appreciated that Russia and the United States were working
together to support the proposal, he said, but it also did not see
a pressing need to move forward at present. "The market seems to
be working pretty well," he noted.

2. (SBU) Ainchil shared that Argentina's technical agencies, the
Nuclear Regulatory Commission (ARN) and the National Atomic Energy
Commission (CNEA), were critical of the proposal, principally
reflecting the fears of Argentina's nuclear industry. That sector,
which has emerged as a small but globally competitive provider of
technology, is concerned that establishment of the fuel bank could
have a significant effect on global nuclear energy and fuel
markets, possibly to its disadvantage. For Argentina to support
such a proposal, Ainchil said, much more detailed studies of how it
might impact the nuclear fuel market would be required.

3. (SBU) Ainchil also noted that through the end of the calendar
year Argentina's representative will be representing the G-77,
which as a group has significant concerns about moving forward on
the Angarsk proposal. "There is a great deal of suspicion" among
the G-77 at the IAEA right now, he added, and proposals such as
this required greater consensus-building and study.

4. (SBU) Comment: The GOA understands our case that the fuel bank
proposal does not entail or imply a diminution of its or other
countries' rights under the NPT, but it remains sensitive along
with the G-77 to any surrender of prerogatives. Probably the more
tangible concern, however, is uncertainty about how a fuel bank
could affect the global market. Any additional available
information addressing likely market impacts would be useful to us
in dialogue with the GOA.
MARTINEZ

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