TURKISH INTEREST IN NUCLEAR ENERGY

C O N F I D E N T I A L ANKARA 001581

SIPDIS

SIPDIS

E.O. 12958: DECL: 03/21/2016
TAGS: BEXP ECON ENRG IR KNNP PARM TRGY TU
SUBJECT: TURKISH INTEREST IN NUCLEAR ENERGY

REF: 05 ANKARA 7390

Classified By: DCM Nancy McEldowney for reasons 1.4 (b) and (d).


1. (SBU) Summary: Turkey's need for energy diversification
has become a more prominent issue after this winter's
problems with the supply of hydrocarbon products provided by
Iran and Russia. Nuclear power is being actively considered
and several countries have offered to assist in this
development. The GOT has no plans for enrichment. We
understand that Secretary Bodman noted the importance of
balanced diversification during Energy Minister's Guler's
recent visit to the US. US participation in the development
of the Turkish Peaceful Nuclear Energy program will be
limited without the ratification of the Cooperation of
Peaceful Uses of Nuclear Energy Agreement signed in July

2000. End Summary.

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TURKEY INTERESTED IN NUCLEAR POWER BUT NOT ENRICHMENT
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2. (U) Turkish Minister of Energy Hilmi Guler led a
delegation of Turkish officials to the US in early February
to discuss various energy issues. The Turkish delegation was
also given a tour of the North Anna Nuclear Power Station.
Energy Ministry officials tell us that this visit was very
beneficial in their development of a more diversified energy
policy. We understand that in response to Secretary Bodman's
observation that Turkey needed to diversify its energy
sources away from hydrocarbons and to other sources including
nuclear and wind, Guler explained that Turkey is
investigating other methods, including nuclear, but the lack
of US ratification of the Cooperation for the Peaceful Uses
of Nuclear Energy Agreement would limit the extent of US
involvement. Guler also pointed out that for lack of this
Agreement, the planned exchange of highly enriched uranium
fuel rods for low enriched fuel rods in 2005 was stopped.


3. (SBU) President of the Turkish Atomic Energy Authority
(TAEK),Okay Cakiroglu told us recently that he has now met
with a delegation from Russia in addition to other countries
(as reported reftel) to discuss Turkey's nuclear power
station needs. Cakiroglu continues to desire US technology
for the Turkish program, however he believes planning needs
to begin soon in order to have an operating power stations
with in the next 5-7 years. When asked about a story in the
Turkish press on March 8 that Iran would be willing to move
its enrichment activities to Turkey, Cakiroglu responded that
Turkey has no desire to conduct any uranium enrichment
activities. Cakiroglu added that while Turkey is serious
about including nuclear energy in its energy portfolio, it
has no desire to develop its own enrichment capability and
will instead purchase the fuel from a reliable source
following all established IAEA guidelines. The Turkish
press, in updating this story on March 16, stated that Iran
has withdrawn the offer to move its activities to Turkey.

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US FIRMS INTERESTED, BUT COMPETITION IS STIFF
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4. (SBU) Post understands that US firms General Electric,
Westinghouse/Toshiba/BNFL, and Stone, Shaw and Webster have
indicated interest in looking at Turkey's quest to acquire
nuclear power stations to diversify its energy mix and meet a
projected electricity shortfall. MFA officials have told us
that in addition to Russian companies, French and German
companies (including Siemens) have expressed their serious
interest in pursuing these commercial opportunities. Those
companies have also suggested that they would be able to
deliver attractive, govenment-supported financing. While the
GOT has been holding these general discussions with a variety
of international firms, they have not yet launched a formal
tender.

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PEACEFUL USES AGREEMENT REQUIRED FOR AMERICAN PARTICIPATION
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5. (C) Comment: It has been nearly a year since the GOT
formally requested (April 2005) a status of the US's
ratification of the Agreement for the Cooperation Concerning
the Peaceful Uses of Nuclear Energy. We still have not
provided the GOT with a response, although we have outlined
requirements that the GOT needed to complete prior to
considering the forwarding of the agreement (reftel). The
GOT has complied with all the additional requirements and now
awaits information concerning the status of the agreement.
Without this agreement, US companies will not be able to
participate in this program no matter how much the GOT would
like to utilize US technology.


6. (SBU) Comment (cont.): We also understand that DOE is
considering adding Turkey as a participant in the new Global
Nuclear Energy Partnership initiative. This initiative is
designed to increase the sharing of nuclear technology and
non-proliferation information. Lack of any progress on the
ratification of the Cooperation Concerning the Peaceful Uses
of Nuclear Energy Agreement could be -- or at least be
perceived to be from the GOT -- as an impediment to Turkey's
participation in this initiative. End Comment.

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WILSON