U.S.-Australia Civilian Nuclear Cooperation:
Issues for Congress
Mary Beth Nikitin
Analyst in Nonproliferation
Bruce Vaughn
Specialist in Asian Affairs
December 1, 2010
Congressional Research Service
7-5700
www.crs.gov
R41312
CRS Report for Congress
P
repared for Members and Committees of Congress
U.S.-Australia Civilian Nuclear Cooperation: Issues for Congress
Summary
Australia and the United States have cooperated in the peaceful use of nuclear energy since the
mid-1950s. The framework for this cooperation is a civilian nuclear cooperation agreement as
required by section 123 of the Atomic Energy Act. President Obama transmitted the proposed text
of the latest renewal agreement to Congress on May 5, 2010, along with the required Nuclear
Proliferation Assessment Statement (NPAS) and his determination that the agreement promotes
U.S. national security. Congress has 30 days of continuous session for consultations with the
Administration, followed by an additional 60 days of continuous session to review the agreement.
If not opposed by a joint resolution of disapproval or other legislation, then the agreement will be
considered approved at the end of this time period. Congress also has the option of adopting
either a joint resolution of approval with (or without) conditions or standalone legislation that
could approve or disapprove the agreement. On November 30, 2010, the House passed H.R. 6411
by voice vote. The bill would approve the agreement even if the required congressional review
period is not reached. The Senate has not yet acted on its version of the bill (S. 3844).
The United States and Australia first concluded a civilian nuclear cooperation agreement in 1957.
That agreement was updated in 1979. Australia sells around 36% of its $1 billion in uranium
exports to the United States. The United States is also a major processor of Australian uranium
sold to other countries. Australia does not currently possess any nuclear power plants, but it
operates one research reactor.
Congressional Research Service
U.S.-Australia Civilian Nuclear Cooperation: Issues for Congress
Contents
Summary of the Proposed Agreement.......................................................................................... 1
Issues for Congress ..................................................................................................................... 2
Context for Discussion................................................................................................................ 3
Australian Nonproliferation Policy.............................................................................................. 4
Australia and the Nuclear Balance............................................................................................... 5
Australia’s Nuclear Capacity ....................................................................................................... 6
R&D Activities ..................................................................................................................... 7
Research Reactors........................................................................................................... 7
Uranium Enrichment ....................................................................................................... 7
Uranium Mining and Milling ................................................................................................ 8
Uranium Sales to India .................................................................................................... 9
Nuclear Power Debate...........................................................................................................9
Contacts
Author Contact Information ...................................................................................................... 10
Congressional Research Service
U.S.-Australia Civilian Nuclear Cooperation: Issues for Congress
Summary of the Proposed Agreement
On May 5, 2010, President Obama transmitted the proposed text of a renewal of the U.S.-
Australian civilian nuclear cooperation agreement to Congress for approval, along with the
required Nuclear Proliferation Assessment (NPAS) and his determination that the agreement
would promote U.S. national security. The annexed classified NPAS was to be submitted
separately. The renewal agreement would replace the agreement in force from July 5, 1979, and
expiring on January 16, 2011. The new agreement has an initial term of 30 years from the date of
entry into force, and would continue in force for periods of five years each, unless terminated by
either party.
According to President Obama’s letter of transmittal, the agreement meets all the terms of the
Atomic Energy Act1 and therefore does not require any exemptions from the law’s requirements.
Therefore, the agreement will enter into effect after a 30-day consultation period and a review
period of 60 days of continuous session,2 unless Congress enacts a joint resolution of disapproval.
This period began on May 5, 2010. Congress also has the option of adopting either a joint
resolution of approval with (or without) conditions or standalone legislation that could approve or
disapprove the agreement.
Section 123 of the U.S. Atomic Energy Act (AEA) of 1954 (42 U.S.C. 2011 et seq.) governs
significant nuclear cooperation between the United States and other states.3 The United States has
agreements for civil nuclear cooperation in place with almost 50 countries. Such agreements,
known as “123 agreements,” provide the framework and authorization for cooperation, but do not
guarantee certain exports, technology, or material. Before significant nuclear exports4 can occur,
the State Department, with the advice of the Department of Energy, negotiates an agreement,
which must meet criteria listed in Section 123.a., (1) through (9), 42 U.S.C. 2151.5
The proposed agreement would permit the export, subject to licensing, of information, material,
equipment, and components for nuclear research and nuclear power production. The agreement
would not permit transfer of restricted data, sensitive nuclear facilities, or major critical
components of those facilities. Sensitive nuclear technology may be transferred only if the
agreement is amended. The proposed agreement does not allow for enrichment of uranium
transferred under the agreement to levels of 20% U-235 or greater unless mutually agreed. The
1 Under section 123.a., codified at 42 U.S.C. 2153(a)), Atomic Energy Act of 1946, ch. 724, 60 Stat. 755 (1946), as
amended. See also CRS Report RS22937, Nuclear Cooperation with Other Countries: A Primer, by Paul K. Kerr and
Mary Beth Nikitin.
2 Days on which either House is in a recess of more than three days (pursuant to a concurrent resolution authorizing the
recess) do not count toward the total. If Congress adjourns its session sine die, continuity is broken and the count starts
anew when it reconvenes.
3 Nuclear cooperation includes the distribution of special nuclear material, source material, and byproduct material, to
licensing for commercial, medical, and industrial purposes. These terms, “special nuclear material,” “source material,”
and “byproduct material,” as well as other terms used in the statute, are defined in 42 U.S.C. §2014. See also CRS
Report RS22937, Nuclear Cooperation with Other Countries: A Primer, by Paul K. Kerr and Mary Beth Nikitin.
4 Significant nuclear cooperation includes the physical transfer of reactors, reactor components, or special nuclear
material, source material, and byproduct material, under license for commercial, medical, and industrial purposes.
5 The Atomic Energy Act also sets out procedures for licensing exports to states with whom the United States has
nuclear cooperation agreements. (Sections 126, 127, and 128 codified as amended at 42 U.S.C. 2155, 2156, 2157.)
Even with a 123 agreement in place, each export of nuclear material, equipment, or technology requires a specific
export license or other authorization.
Congressional Research Service
1
U.S.-Australia Civilian Nuclear Cooperation: Issues for Congress
current agreement also does not allow for this. In accordance with the Nuclear Nonproliferation
Act (NNPA) of 1978, the United States must approve of enrichment of any nuclear material
exported from the United States to Australia. The proposed agreement modifies the 1979
agreement by expanding the scope of cooperation to cover nuclear forensics and allows the
transfer of nuclear material for radioisotope production. It also updates the physical security
requirements to reflect current international standards.
Issues for Congress
Uranium from Australia makes up 13% of U.S. uranium supplies. Renewal of the 123 agreement
with Australia is necessary for continuing this cooperation. Having an agreement in place also
facilitates Australia’s export of uranium to countries where it will be used in a reactor with U.S.
technology. Congress may consider Australia’s role in developing multilateral nuclear fuel cycle
services or assurances. Australia’s strong bilateral relationship with the United States, political
stability, and geographic location could be advantageous to the development of multilateral
nuclear fuel facilities.
Enrichment technology developed in Australia has been transferred to the United States and is
classified by both countries. In the event that Australia reverses current policy and decides to
build a uranium enrichment plant on its territory, it would face several obstacles, and the United
States would have to reconcile its policies. Uranium enrichment technology holders have
committed to a ban on the export of enrichment technology until the Nuclear Suppliers Group
decides on criteria for future transfers. It appears that Australia would qualify for transfer under
this criteria, but enrichment plants would be a black box or turnkey facility. This type of transfer
would be consistent with current U.S. policy. Australian officials have also noted additional
concerns, such as cost and finding a local government willing to host a commercial enrichment
plant.
As noted above, the Atomic Energy Act of 1954 provides for congressional review of proposed
civilian nuclear cooperation agreements. The review comprises two periods of continuous
session, one 30 days and one 60 days. The proposed agreement with Australia meets AEA
requirements; therefore, it will enter into force after the review period is complete, absent
congressional action. CRS estimates that the last day of the required congressional review period
would be December 3, 2010 (this date is unofficial, and the sole definitive counters of the review
periods are the House and Senate Parliamentarians). As the calendar stands as of mid-November,
Congress is expected to adjourn on December 3, thus the required review period would be
reached for this agreement and the agreement could enter into force without further action.
On June 15, 2010, House Foreign Affairs Committee Chairman Howard Berman and Ranking
Member Ileana Ros-Lehtinen introduced H.J.Res. 88, which provides for the approval of the
U.S.-Australia agreement. The House Foreign Affairs Committee held a hearing on September
24, 2010, about nuclear cooperation agreements, including the proposed renewal agreement with
Australia.6
6 House Foreign Affairs Committee Hearing, “Nuclear Cooperation After Iran and Khan: Are We Asking Enough of
Current and Future Agreements?” September 24, 2010.
Congressional Research Service
2
U.S.-Australia Civilian Nuclear Cooperation: Issues for Congress
Once the congressional calendar for the remainder of 2010 became clearer in mid-September,
some raised concerns that the 90-day period for congressional review of the U.S.-Australian
renewal agreement would not be met. In this case, four scenarios are possible for approval for the
agreement: (1) re-submittal of the agreement in the 112th Congress; (2) passage of a joint
resolution of approval that would include language that waived the required 90-day review
period; (3) separate legislation approving the proposed agreement with language to waive the 90-
day requirement; (4) changes to the congressional calendar so that the lame duck session would
contain enough days for the 90 day review period to lapse. Congress could also pass a joint
resolution of disapproval or include its disapproval in separate legislation.
Senator Richard Lugar introduced a bill, “To provide for the approval of the Agreement Between
the Government of the United States of America and the Government of Australia Concerning
Peaceful Uses of Nuclear Energy” (S. 3844), on September 27, 2010. Representative Ileana Ros-
Lehtinen introduced the companion bill, H.R. 6411, on November 16, 2010. The House passed
H.R. 6411 by voice vote on November 30, 2010.
It would approve the agreement notwithstanding the congressional review requirements of section
123 of the Atomic Energy Act. Other provisions of the AEA would apply. This bill would have
the proposed agreement come into force on or after October 8, 2010.
Notwithstanding the provisions for congressional consideration of a proposed agreement for
cooperation in subsection d. of section 123 of the Atomic Energy Act of 1954 (42 U.S.C.
2153), the Agreement Between the Government of the United States of America and the
Government of Australia Concerning Peaceful Uses of Nuclear Energy, done at New York
May 4, 2010, may become effective on or after October 8, 2010, as if all the requirements in
such section 123 for consideration of such agreement had been satisfied, subject to
subsection (b) of this section.
(b) Applicability of Atomic Energy Act of 1954 and Other Provisions of Law.—Upon
coming into effect, the agreement referred to in subsection (a) shall be subject to the
provisions of the Atomic Energy Act of 1954 (42 U.S.C. 2011 et seq.) and any other
applicable United States law as if such agreement had come into effect in accordance with
the requirements of section 123 of the Atomic Energy Act of 1954.
Context for Discussion
The context for discussion of U.S.-Australian civilian nuclear cooperation is one set inside a very
strong alliance relationship between the United States and Australia that stems from the two
nations’ shared democratic values, cultural and historic ties, and strategic outlook. According to
U.S. Ambassador to Australia Jeffrey Bleich, “the relationship between the United States and
Australia is one of our strongest and most productive international alliances. It is a bond solidified
during the Pacific battles of World War II and strengthened over the ensuing decades.”7 The
President’s National Security Strategy document describes Australia, along with our other allies
in Asia, as the “bedrock of security in Asia and a foundation of prosperity in the Asia-Pacific
region.”8
7 Jeffrey Bleich, “Statement Before the Senate Foreign Relations Committee,” Washington, DC, November 5, 2009.
8 “National Security Strategy, The White House, Washington, DC, May 2010.
Congressional Research Service
3
U.S.-Australia Civilian Nuclear Cooperation: Issues for Congress
The Australia New Zealand United States (ANZUS) treaty was signed in 1951 and entered into
force in 1952.9 A key aspect of the alliance with Australia today is the annual Australia-U.S.
Ministerial (AUSMIN) meetings. These consultations have been held since 1985 and are attended
by the Secretary of Defense and the Secretary of State from the United States, as well as the
Australian Defense Minister and Minister for Foreign Affairs. The United States and Australia
conduct joint combined military training exercises, have exchange officers in each others’ armed
forces, and work to standardize equipment and operational doctrine.10 In recent years, Australia
invoked the ANZUS Treaty after the attacks on the United States in 2001, and Australian troops
fought with U.S. troops in Iraq and Afghanistan.
Australia has the largest non-NATO military contingent in Afghanistan11 and fought alongside the
United States in Vietnam, Korea, World War II, and World War I, as well as in Iraq and
Afghanistan. Australia has also played a key role in promoting regional stability in places such as
Timor Leste, the Solomon Islands, and Bougainville. The United States and Australia have a very
close intelligence relationship. The United States and Australia also concluded a Free Trade
Agreement, which came into force in 2005. The two nations signed a Defense Trade Cooperation
Treaty in 2007 that would facilitate the trade of defense-related equipment and technology. The
U.S. Senate has not yet voted on ratification of this treaty. For all of the above reasons, and
others, the United States and Australia share a special relationship that includes a high degree of
trust.
Australian Nonproliferation Policy
Australia also is a strong partner to the United States in nonproliferation policy. Australia has
been a staunch supporter of the Non-Proliferation Treaty (NPT) since its adherence in 1973.
Australia has promoted strengthened International Atomic Energy Agency (IAEA) safeguards on
civilian nuclear activities and was the first to sign the Additional Protocol, which strengthened
IAEA monitoring. Australia is also a member of the Nuclear Suppliers Group (NSG), an export
control coordination body.12
Australia has developed stricter standards for nuclear trade than the export control regimes
currently call for; for example, requiring an Additional Protocol to be in force for any country
importing uranium from Australia. Over the past four decades, Australia has developed a bilateral
safeguards system for uranium exports. A bilateral safeguards agreement is required, and
countries may only retransfer Australian uranium to other countries that also have a bilateral
safeguards agreement with Australia. 13
9 For a text of the ANZUS Treaty, see http://avalon.law.yale.edu/20th_century/usmu002.asp.
10 “Background Note: Australia,” the Department of State, November 23, 2009.
11 Australian Government, Department of Defence Media Release, “Republic of Korea Joins ISAF as a Non NATO
Contributing Nation,” April 22, 2010.
12 See also CRS Report RL31559, Proliferation Control Regimes: Background and Status, coordinated by Mary Beth
Nikitin.
13 “Australia’s Network of Nuclear Safeguards Agreements,” Australian Department of Foreign Affairs and Trade,
http://www.dfat.gov.au/security/nuclear_safeguards.html.
Congressional Research Service
4
U.S.-Australia Civilian Nuclear Cooperation: Issues for Congress
In recent years, the international community has debated ways to foster the growth of nuclear
energy while minimizing proliferation risks of the spread of sensitive nuclear technologies.14
Australia has supported development of multilateral fuel assurance mechanisms while stating that
a well-functioning market provides the best assurance of supply. At the 2010 NPT Review
Conference, an Australian representative said that “Australia does not consider it necessary or
desirable for each state with a nuclear program to develop national enrichment or reprocessing
facilities … it would be a perverse outcome from the standpoint of international security to see a
proliferation of national fuel cycle facilities.”15 This is in line with current U.S. policy. The
Nuclear Suppliers Group is currently debating criteria for future transfers of enrichment or
reprocessing technologies.
Political division on nuclear power and to what extent Australia should pursue sensitive fuel cycle
technologies was evident in earlier periods. Former Liberal Prime Minister John Gorton sought to
keep Australia’s nuclear options open, though it did not eventuate. He reportedly signed a secret
deal with France to construct a uranium enrichment facility in Australia. A plan to develop a
nuclear reactor at Jervis Bay was also considered. These plans were reversed by the election of
Labor Party candidate Gough Whitlam, who was elected in 1972. Australia subsequently ratified
the NPT in 1973. The Labor perspective on nuclear weapons was further promoted by Australian
support for the South Pacific Nuclear Weapons Free Zone Treaty in 1985. Anti-nuclear sentiment
in Australia was also influenced to an extent by the anti-nuclear movement in New Zealand,
which led to New Zealand’s de facto ouster from the ANZUS alliance in the mid-1980s and by
the resumption of nuclear testing by France in French Polynesia in 1995.16 Today, Australia
remains a strong advocate of nuclear disarmament in international fora.
Australia and the Nuclear Balance
While Australia is today a strong proponent of nuclear disarmament, arms control, and non-
proliferation, this policy has evolved over time. As Rod Lyon has pointed out,17 Australia’s
posture on nuclear weapons has been to a large extent determined by Australia’s perceived “fit” in
the regional and global strategic context. As the strategic environment changed from World War II
to the era of the cold war to the present, Australia shifted from being a “possible nuclear
proliferator, to a supporter of extended nuclear deterrence (which it benefits from under the
ANZUS alliance) to an important advocate of global nuclear arms control.”18
During the post-World War II period through the 1950s, Australia worked closely with its
traditional security partner, the United Kingdom, including allowing Britain to conduct nuclear
14 CRS Report RL34234, Managing the Nuclear Fuel Cycle: Policy Implications of Expanding Global Access to
Nuclear Power, coordinated by Mary Beth Nikitin.
15 Statement by Mr. Jeremy Kruse to Main Committee III regarding the IAEA Peaceful Uses Initiative, as part of the
2010 Review Conference of the Parties to the Treaty on the Non-proliferation of Nuclear Weapons, as delivered on
May 10, 2010.
16 Jeffrey Lantis, “Elections and Enduring Realities: Australia’s Nuclear Debate,” Arms Control Today, April 2008.
17 Rod Lyon, “Australia: Back to the Future,” in Muthiah Alagappa ed. The Long Shadow: Nuclear Weapons and
Security in 21st Century Asia (Stanford: Stanford University Press, 2008).
18 Rod Lyon, “Australia: Back to the Future,” in Muthiah Alagappa ed. The Long Shadow
: Nuclear Weapons and Security in 21st Century Asia (Stanford: Stanford University Press, 2008).
Congressional Research Service
5
U.S.-Australia Civilian Nuclear Cooperation: Issues for Congress
tests at an island off its northwest coast and in the desert.19 Australian scientists worked in the
British nuclear atomic bomb research program, and former Prime Minister Menzies reportedly
saw such cooperation as an opportunity to gain knowledge of nuclear weapons development.20
Australia received a nuclear research reactor from Britain in 1958.21 It is apparently in the period
after World War II and prior to closer Anglo-U.S. nuclear cooperation that Australia, as part of
Britain’s attempt to resurrect its empire, worked most closely with the United Kingdom in
Britain’s efforts to acquire its own nuclear deterrent to the Soviet Union.22
Australia’s security environment became more precarious in the 1960s, which may have led it to
consider its strategic options. Key events influencing this included China conducting its first
nuclear test in 1964, the British announcement of its strategic departure from East of Suez in
1967, and the United States articulating the Guam Doctrine limiting U.S. ground troop support in
1969 while the war in Vietnam continued.
Australia’s involvement in joint intelligence, communications, and early warning facilities with
the United States made it a potential nuclear target of the Soviet Union during the cold war.23 The
Defense Support Program (DSP)24 facility at Nurrungar, South Australia, was part of a
constellation of geosynchronous satellites and ground tracking stations designed to detect the
launch of ballistic missiles. Early warning of missile attack strengthened America’s nuclear
missile second strike capability, thereby strengthening nuclear deterrence. DSP later played a role
in detecting Iraqi Scud missile launches during Operation Desert Storm. The Very Low Frequency
(VLF) station involved in communications with American submarine deployments in the region
at Northwest Cape, West Australia, and the signals intelligence collection facility at Pine Gap,
Northern Territory, also played a key role in helping to maintain the bi-polar strategic balance of
the cold war.
Australia’s Nuclear Capacity
Although Australia is a major uranium exporter, it does not have any uranium enrichment plants,
fuel fabrication facilities, or nuclear power plants. It currently operates a research reactor at Lucas
Heights, used primarily for medical isotope production. The Australian Atomic Energy
Commission (AAEC) was formed in 1952. The AAEC was replaced in 1987 by the Australian
Nuclear Science and Technology Organization (ANSTO).25 By statute, ANSTO cannot conduct
any research in the design or production of nuclear weapons. Its main research facility, the Lucas
Heights Research Establishment, opened in 1958. It was the site of Australia’s first nuclear
reactor, the High Flux Australian Reactor (HIFAR). Research and development work on uranium
enrichment technology was also carried out at Lucas Heights (see below).
19 Lorna Arnold, A Very Special Relationship: British Atomic Weapon Trials in Australia (London: Her Majesty’s
Stationery Office, 1987).
20 Jeffrey Lantis, “Elections and Enduring Realities: Australia’s Nuclear Debate,” Arms Control Today, April 2008.
21 Jeffrey Lantis, “Elections and Enduring Realities: Australia’s Nuclear Debate,” Arms Control Today, April 2008.
22 Wayne Reynolds, Australia’s Bid for the Atomic Bomb (Melbourne: Melbourne University Press, 2000).
23 Cameron Stewart et al., “US Aussie Spy Base Revelations,” The Australian, February 18, 1999.
24 Jeffrey Richelson, America’s Space Sentinels, University of Kansas Press ( 1999).
25 http://www.ansto.gov.au/discovering_ansto/history_of_ansto.
Congressional Research Service
6
U.S.-Australia Civilian Nuclear Cooperation: Issues for Congress
The nuclear fuel cycle begins with mining uranium ore and upgrading it to yellowcake. Because
naturally occurring uranium lacks sufficient fissile 235U to make fuel for commercial light-water
reactors, the concentration of 235U must be increased several times above its natural level of 0.7%
in a uranium enrichment plant. A nuclear power plant operator or utility typically purchases
yellowcake and contracts for its conversion to uranium hexafluoride, then enrichment, and finally
fabrication into fuel elements. Australia exports its uranium after the mining and milling stage.
Commercial enrichment services are available in the United States, Europe, Russia, and Japan.
Fuel fabrication services are even more widely available. As noted above, Australia requires a
bilateral safeguards agreement with uranium-importing countries to ensure its peaceful use.
R&D Activities
Research Reactors
Australia currently operates one research reactor. The Open Pool Australian Lightwater (OPAL)
reactor was commissioned in 2007. It is a low-enriched uranium (LEU)-fueled 20-megawatt
research reactor. It produces radioisotopes for medical purposes, among other research
functions.26 An older reactor, High Flux Australian Reactor (HIFAR), is in the process of being
decommissioned (by 2018). Another research reactor, Moata, was decommissioned in 1995.
Uranium Enrichment
The AAEC conducted research into enrichment technologies starting in the 1960s. Work was
done on both centrifuge and laser isotope separation enrichment. There had been discussions in
the 1970s about whether Australia should partner with Japan or others to build an enrichment
plant in Australia for the purpose of exporting enriched uranium hexafluoride, which would be
fabricated into fuel for power plants. These plans were highly controversial within Australia, were
objected to by the United States, and were never completed.27
The Hawke government terminated uranium enrichment R&D by the AAEC in 1986 and shut
down and dismantled Australia’s laboratory-scale centrifuge enrichment plant. Australia
continued to participate in the Hexapartite Safeguards Project, the purpose of which was to
improve the IAEA’s safeguards capability for enrichment plants. AAEC had also conducted
research on molecular laser isotope separation (MLIS) enrichment, but discontinued its research.
Beginning in 1990, Silex Systems, Ltd. (Silex Systems) began R&D work on laser enrichment
technology in a lab it leased at the Lucas Heights complex. The technology was proven on a
laboratory scale in 1994 (known as SILEX, or Separation of Isotopes by Laser Excitation).28 In
1996, the United States Enrichment Corporation (USEC, Inc.) signed an agreement for the
development and licensing of SILEX technology for uranium enrichment. In 1999, the United
26 http://www.ansto.gov.au/discovering_ansto/anstos_research_reactor.
27 Wayne Reynolds, “Australia’s quest to enrich uranium and the Whitlam Government’s loans affair,” The Australian
Journal of Politics and History, vol. 54, no. 4 (December 2008).
28 “Company History” page at http://www.silex.com.au/.
Congressional Research Service
7
U.S.-Australia Civilian Nuclear Cooperation: Issues for Congress
States and Australia signed an agreement that allowed for the transfer of SILEX technology to the
United States.29 The SILEX technology was classified by both governments in 2001.
The U.S.-Australian SILEX agreement allows for technology export to United States but limits
cooperation within the territory of Australia to research and development of SILEX technology.
The agreement prohibits the construction of an enrichment facility with this technology in
Australia unless the agreement is amended (Article 2.3). According to the Nuclear Proliferation
Assessment Statement attached to the proposed agreement, Silex Systems stopped lab work on
uranium enrichment in Australia but continues to support technology development in the United
States. In 2006, GE/Hitachi Nuclear Energy signed an agreement with Silex Systems to license
and commercialize laser separation technology for LEU production in the United States.
GE/Hitachi’s Global Laser Enrichment (GLE) subsidiary received a license from the Nuclear
Regulatory Commission (NRC) for the building of a test facility in 2008. The “Test Loop” facility
was built at GE’s fuel fabrication facility in Wilmington, NC. GLE has applied for a commercial
license from the NRC.30
Debate over whether Australia should have its own commercial uranium enrichment facility was
reignited after Prime Minister Howard expressed support for the idea in 2006.31 Howard argued
that since Australia possesses the largest uranium reserves in the world, it would make economic
sense to enrich uranium before exporting it, thereby adding to its value. John Carlson, director-
general of the Australian Safeguards and Non-Proliferation Office, responded to press speculation
at the time: “there are a number of uncertainties, including Australia’s lack of an established
enrichment technology and the license costs for imported technology, whether there would be
investors prepared to outlay the substantial capital costs involved, and whether a State
government would be willing to host an enrichment facility.”32 The present Australian
government under the Labor Party appears to oppose building a uranium enrichment facility in
Australia.
Uranium Mining and Milling
Australia has the world’s largest reserves of uranium, with an estimated 23% or more of total
reserves,33 and is the world’s third-largest exporter of uranium. The mining sector has become an
increasingly important aspect of Australia’s economy, accounting for 7% of GDP and 43% of
exports. Mining is also thought of by many in Australia as one of the key reasons why Australia
was able to avoid the recent global financial crisis.34 As such, the Australian electorate may be in
favor of exploring opportunities to expand mining exports, which could include the export of
uranium to India. Australia provides 13% of U.S. uranium imports. More than 85% of Australia’s
29 Agreement for Cooperation Between Australia and the United States of America Concerning Technology for the
Separation of Isotopes of Uranium by Laser Excitation.
30 The NRC’s estimated 30-month review period began in August 2009. Silex Annual Report 2009,
http://www.silex.com.au/SilexAR2009.pdf.
31 Raymond Bonner, “Call to Enrich Uranium in Australia Stirs Debate,” The New York Times, August 2, 2006;
“Uranium enrichment program revived after 20 years,” Australian Broadcasting Corporation, June 14, 2007.
32 “The Prospects for Uranium Enrichment in Australia—Correcting the Record,” Statement by Mr. John Carlson,
Director-General, Australian Safeguards and Non-proliferation Office, June 18, 2007, http://www.dfat.gov.au/media/
releases/department/d010_07.html.
33 “Australia’s Uranium,” January 2010, http://www.world-nuclear.org/info/inf48.html.
34 “Heroes in Hard Hats,” The Sydney Morning Herald, May 22, 2010.
Congressional Research Service
8
U.S.-Australia Civilian Nuclear Cooperation: Issues for Congress
uranium exports go to the United States, the European Union, and Japan.35 Australia reached an
agreement to sell uranium to China in 2006.36 The Australian government is concluding
arrangements for the export of uranium to Russia.
Uranium Sales to India
The Labor government of former Prime Minister Kevin Rudd opposed the export of uranium to
India because India has not signed the NPT. Rudd was replaced by an intra-party change of
leadership in June 2010 by Julia Gillard. She subsequently won a national election and remains
prime minister. Her position on the issue is not yet clear. The John Howard government, in power
until 2007, had supported uranium exports to India. The Nuclear Suppliers Group (NSG) decided
in September 2008 to allow civilian nuclear exports to India under certain conditions. Australia
did not actively block this consensus decision, but the Rudd government announced in September
2008 that Australia would not export uranium to India, despite the NSG rule change. Australian
Liberal Party opposition leader Tony Abbott has stated that he would reverse this policy and begin
exports of uranium to India as part of an effort to expand Australia’s ties to the region. Opinion
polls conducted in May 2010 had Rudd and Abbott either even or with Abbott slightly ahead of
Rudd.37 The next Australian federal election will elect members of Parliament of Australia and
must be held on or before April 2011. A Joint Feasibility Study recommended a bilateral free
trade agreement with India in May 2010. India is Australia’s fastest-growing export market.38
Expanding trade and other ties with India could help Australia diversify its export markets, which
have relied heavily on sales to China. Over the next 20 years, India will, according to some
estimates, rapidly expand its middle class and embark on major infrastructure projects, which
could fuel another resource boom in Australia.39
Nuclear Power Debate
The lead-up to the parliamentary elections of 2007 highlighted differences between the Kevin
Rudd-led Labor Party and the Liberal-National Coalition led by former Prime Minister John
Howard on nuclear energy policy. At the time, then Shadow Minister for Climate Change and the
Environment Peter Garrett, formerly of the rock band Midnight Oil, warned that nuclear power
was a bad idea for Australia, even given the demands of global warming, while Rudd declared
nuclear power “not an option.”40 Bob Brown, the leader of the Green Party in Australia, is against
nuclear power, as are many within the Labor Party.
Former Prime Minister John Howard stated in 2006 that he was of an “open mind” on nuclear
power for Australia and that he believed that the “nuclear energy scene will change significantly
in Australia.”41 The former Howard Liberal-National Coalition government selected Dr. Ziggy
35 Unclassified Nuclear Proliferation Assessment Statement Pursuant to Section 123 a. of the Atomic Energy Act of
1954, as Amended with Respect to the Proposed Agreement between the Government of the United States of American
and the Government of Australia Concerning Peaceful Uses of Nuclear Energy, May 4, 2010.
36 “Australia, China Sign uranium Deal,” CNN, April 3, 2006.
37 “Australia’s Abbott Wants Japan Trade Deal, India Uranium Sale,” Bloomsburg Business Week, May 26, 2010.
38 “Free Trade Pact with India More Likely,” Australian Associated Press, May 5, 2010.
39 Robin Bromby, “Massive Indian Expansion to Fuel Ongoing Resource Demand,” The Australian, May 17, 2010.
40 Jeffrey Lantis, “Elections and Enduring Realities: Australia’s Nuclear Debate,” Arms Control Today, April 2008.
41 Michael Perry, “Australia May Develop Nuclear Power—Howard,” Ezilon.com May 20, 2006.
Congressional Research Service
9
U.S.-Australia Civilian Nuclear Cooperation: Issues for Congress
Switkowski to chair a uranium mining, processing, and nuclear energy review in 2006. The
review’s report viewed nuclear power as “a practical option for part of Australia’s electricity
production.”42 The report also noted that Australian demand for electricity will double by 2050
and that over this period, two-thirds of Australian power generation will need to be upgraded or
replaced. While advocates of nuclear power remain within the Liberal-National Coalition, it
appears that there was less support for the nuclear option within the coalition after Howard’s
defeat in 2007 than there was while he was prime minister.43 The unpopularity of his position on
nuclear power in the lead-up to the 2007 elections apparently forced Howard to modify his
position.44
As Australia has become increasingly concerned about carbon emissions, a new consideration of
nuclear power has emerged from some advocates. The low cost of Australian coal, relative to the
cost of nuclear energy, appears to be a contributing factor as to why nuclear power has not been
pursued. Dr. Switkowski has argued that a cost of carbon of $15 to $40 per ton would make
nuclear power viable for Australia. Switkowski currently heads the Australian Nuclear Science
and Technology Organization.45 Australia has been considering a Carbon Pollution Reduction
Scheme (CPRS), which in April 2010 the Rudd government shelved until at least 2013.46 While
the emissions trading scheme has been set aside for the moment, Australia continues to seek to
reduce its carbon emissions.
Author Contact Information
Mary Beth Nikitin
Bruce Vaughn
Analyst in Nonproliferation
Specialist in Asian Affairs
mnikitin@crs.loc.gov, 7-7745
bvaughn@crs.loc.gov, 7-3144
42 Department of the Prime Minister and Cabinet, Uranium Mining, Processing and Nuclear Energ—Opportunities for
Australia? Report to the Prime Minister by the Uranium Mining, Processing and Nuclear Energy Review Task Force,
Commonwealth of Australia, 2006.
43 Steve Lewis, “MacFarlane Says Australia Must Adopt Nuclear Power,” Courier Mail, August 19, 2008.
44 Jewel Topsfield, ”Howard’s Nuclear Meltdown,” The Age, August 24, 2007.
45 Australian Government, Australian Nuclear Science and Technology Office, http://www.ansto.gov.au.
46 “Australia Cans its Carbon Emissions Trading Scheme for Now,” East Asia Forum, May 13, 2010.
Congressional Research Service
10