POLAND SIGNS REACTOR FUEL RETURN CONTRACT

C O N F I D E N T I A L SECTION 01 OF 02 WARSAW 000223 SIPDIS SIPDIS DEPT FOR EUR/NCE, EUR/ERA/ EUR/PRA, ISN/NESS EUR/NCE FOR BPUTNEY AND TYEAGER ISN/NESS FOR DFENSTERMACHER DOE FOR DIANA CLARK, PARRISH STAPLES, IGOR BOLSHINSKY, MIKE TYACKE, AND BRIAN WAUD VIENNA FOR UNVIE LHILLIARD E.O. 12958: DECL: 02/18/2018 TAGS: KNNP KTIA PARM PL RS TRGY ENGR SUBJECT: POLAND SIGNS REACTOR FUEL RETURN CONTRACT REF: A. 08 WARSAW 150 ¶B. 07 WARSAW 2381 ¶C. 07 WARSAW 1870 ¶D. 07 STATE 70448 WARSAW 00000223 001.2 OF 002 Classified By: EconCouns R. Rorvig for reasons 1.4(b) and (d). ¶1. (C) Summary. Wlodzimierz Tomczak, chief of Poland's Radioactive Waste Management Plant (RWMP),signed a preliminary contract with Battelle Energy Alliance, a U.S. Department of Energy contractor, on February 8, putting into motion Poland's long-stalled participation in the Russian Reactor Radioactive Fuel Return program (RRRFR). The GOP estimates that fuel from the "Ewa" reactor could be shipped as early as September, 2009 but that fuel from the "Maria" reactor will take longer to prepare and will not be ready for transport until 2016. End summary. ¶2. (U) In May 2007, post presented the GOP with a diplomatic note proposing the terms of Poland's participation in the RRRFR (ref d). While representatives of the GOP repeatedly assured post that Poland was willing to participate, the GOP's formal agreement was not delivered until January 2008 (ref a). At that time, the GOP also informed post that the Ministry of Economy would act as its implementing authority, in place of the State Treasury. ¶3. (C) The contract signing on February 8 was attended by representatives of RWMP, the U.S. Department of Energy (DOE), and Econoff. The meeting was chaired by Jerzy Niewodniczanski, who heads the inter-ministerial working group that is coordinating RRRFR within the Polish government. Under the preliminary contract, the GOP and DOE can begin preparatory work toward shipping the fuel to secure storage at the Mayak facility in the Russian Federation. ¶4. (C) Niewodniczanski said it would take an additional two months to obtain approvals necessary to sign the implementing agreement. He said Poland would then start immediately to prepare fuel from the "Ewa" reactor, which would be sent to Russia in two shipments. The first shipment could take place as early as September 2009, and the second in December 2009. The rest of the fuel is from the "Maria" reactor and would take considerably longer to prepare. He estimated that the "Maria" reactor fuel could be shipped in 2016. ¶5. (C) Niewodniczanski said it would be Poland's responsibility to transport the fuel to Gdynia. At Gdynia, the fuel would be loaded onto a Russian ship, at which time ownership of the fuel will pass to Russia, and then be shipped to Murmansk. He added that the GOP had decided not to ship to St. Petersburg because of anti-nuclear sentiments in the city. Under the RRRFR agreement, Russia will store the fuel for twenty years at no cost to the GOP. Niewodniczanski acknowledged that the GOP has not decided whether to pay Russia for continued storage, or construct secure storage in Poland and have the fuel sent back after twenty years. ¶6. (U) Niewodniczanski stated that the GOP does not expect the U.S. to pay any VAT or customs fees in connection with the RRRFR. He added that the inter-ministerial group is still studying the matter, but said the GOP should cover such costs if necessary. He also said that the GOP has not discussed its participation in RRRFR with the European Union, but would do so sometime this spring. ¶7. (C) Comment: The GOP's signature of the preliminary contract for the RRRFR program is a long-delayed and important first step in Poland's participation in the fuel return program. While the previous GOP was reluctant to sign contracts or commit to the program, it did establish the Inter-Ministerial working group coordinating Poland's participation in its last days in office. Niewodniczanski, a well-respected figure in Poland's nuclear research community, convinced the new GOP to quickly sign the contracts. As Niewodniczanski is very supportive of the program we expect future cooperation on this important non-proliferation initiative to proceed more smoothly. End Comment. WARSAW 00000223 002.2 OF 002 CURTIN