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07PRETORIA3674 2007-10-18 13:24:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Pretoria
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1. (U) This is an action request for State and DOE. Please
see paragraphs 2 and 9.

2. (SBU) SUMMARY: The South African Department of Minerals
and Energy (DME) proposes a half-day meeting at the end of
November in South Africa to advance areas of cooperation in
nuclear technology. The objective would be to identify areas
of agreement and disagreement on the full range of fuel cycle
issues and to plan for the proposed February meeting in South
Africa of the Joint Standing Committee on Nuclear Cooperation
(JSCNC). Economic Counselor repeated Ref B and C messages
about USG interest in moving forward on signing the Agreement
on Cooperation in Nuclear R&D and initiating the return of
spent nuclear fuel program. End Summary.

Minerals and Energy (DME) Deputy Director General (DDG)
Nelisiwe Magubane and Chief Director: Nuclear Tseliso
Maqubela met with Economic Counselor and Minerals/Energy
Officer on October 17 to advance bilateral nuclear
cooperation initiatives stemming from Magubane's visit to the
U.S. last April. Embassy Officers reiterated U.S. interest
in signing the Agreement on Cooperation in R&D in Nuclear
Technology (Ref B). Magubane said DME strongly supported
signing the agreement and asked the Embassy to "push" the
Department of Foreign Affairs (DFA), which is shepherding
inter-agency approval. Economic Counselor will make an
inquiry with DFA Director: USA Fadl Nacerodien. Embassy
Officials repeated Ref C points that DOE was ready to move
forward on the return of spent nuclear fuel program. Embassy
subsequently facilitated organization of a conference call
with DOE and SAG officials for October 19 to move forward on
this initiative. Maqubela commented on two benefits for
South Africa implementing the program: reducing a liability
and gaining experience in handling and moving the spent fuel.
Maqubela also expressed support for USG efforts to
accomplish return of spent fuel in the DRC. "It would be a
plus to link the return of spent fuel from the DRC with the
return of spent fuel from South Africa", he said. Per Ref D
guidance, Embassy Officers said they could not provide a
response at this time.

4. (SBU) JSCNC AND GNEP: Magubane recalled the intention for
South Africa to host a JSCNC launch meeting in Cape Town in
February. Maqubela cautioned that in the run-up to the bid
for new nuclear build between Westinghouse and Areva, it
would be more difficult to start new bilateral initiatives.
However, he recognized that this proposal had been under
discussion for a long time, so there could be justification
in moving forward on it. Magubane suggested that there be an
earlier half-day meeting at the end of November in South
Africa to clarify areas of agreement and disagreement with
respect to the full range of the nuclear fuel cycle to lay
the groundwork for nuclear cooperation in the many areas
under discussion, including the Global Nuclear Energy
Partnership (GNEP) (Ref A). Maqubela said he would provide
SAG comments to the GNEP Principles to both DOE and the

5. (SBU) NUCLEAR FUEL CYCLE: Maqubela stressed the SAG
commitment to beneficiate uranium and consider enrichment of
uranium, including potentially serving as an "international
fuel center", as part of gaining security of supply and
economies of scale. He would like to know if the USG is
opposed to South Africa developing this capacity, noting that
GNEP seems to be premised on helping current nuclear powers
maintain their control of the lucrative nuclear fuel market.
Maqubela asserted that this impression would be removed if
South Africa were allowed to participate in this market.

Maqubela stated that approval for South Africa's accession to
the GIF had been secured in the National Assembly on
September 13. However, he was embarrassed that a procedural
snafu had delayed submission of accession approval in the
second house, the National Council of Provinces (NCOP).
Maqubela said that the accession approval would be submitted
in the NCOP on October 23. Changing the topic, Maqubela said
that the SAG was also interested in the U.S. Futuregen
project (a zero emmissions, coal-fired prototype) and noted
that state electricity company Eskom was engaged in related

7. (SBU) NEW NUCLEAR BUILD: Maquebela asked whether the U.S.
would provide a "comprehensive package" for the Westinghouse
bid for building Eskom's new nuclear plants, like the French
are expected to do. Economic Counselor said Westinghouse
could be expected to offer a comprehensive package, including
price, modular design, safety, localization and training.
The USG would advocate for Westinghouse, but its package
would not necessarily include a USG component. Maqubela
noted that when China awarded a major nuclear contract to
Westinghouse last year, the U.S. Secretary of Energy had been
present the week before the award. He said this demonstrated
"high-level" support for China's nuclear construction

8. (SBU) COMMENT: The SAG supports the beneficiation of all
South Africa's mineral production, including future uranium
production. Consequently, the SAG is not inclined to
participate in bilateral or multilateral initiatives which
require it to renounce building capacity to provision its own
nuclear power plants. This is because South Africa plans to
base 25 percent of its electric power production on nuclear
power plants by 2025. End Comment.

9. (SBU) ACTION REQUEST: Post requests that State and DOE
provide a response on interest and availability to the SAG
offer to host a meeting at the end of November to assess and
advance bilateral nuclear technology cooperation initiatives.
In addition, post requests that State and DOE provide
guidance on USG views on South Africa's intentions to
consider enrichment and potential supply of nuclear fuel.