Identifier
Created
Classification
Origin
09ASTANA2007
2009-11-13 06:29:00
SECRET
Embassy Astana
Cable title:  

MINISTER OF ENERGY ON BN-350, SEMIPALATINSK AND ALATAU

Tags:  PGOV PREL PINR ECON EPET MARR KNNP IT TU KZ 
pdf how-to read a cable
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TO RUEHC/SECSTATE WASHDC IMMEDIATE 6820
INFO RUCNCIS/CIS COLLECTIVE 2152
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RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1522
RUEHKO/AMEMBASSY TOKYO 2223
RUEHUL/AMEMBASSY SEOUL 1157
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S E C R E T SECTION 01 OF 02 ASTANA 002007 

SIPDIS

STATE FOR SCA/CEN, EUR/RUS, S/EEE, S/CIEA, EEB
NSC FOR JOYCE CONNERY

E.O. 12958: 11/12/2029
TAGS: PGOV PREL PINR ECON EPET MARR KNNP IT TU KZ
SUBJECT: MINISTER OF ENERGY ON BN-350, SEMIPALATINSK AND ALATAU

Classified By: Ambassador Richard E. Hoagland, 1.4 (b),(d)

S E C R E T SECTION 01 OF 02 ASTANA 002007

SIPDIS

STATE FOR SCA/CEN, EUR/RUS, S/EEE, S/CIEA, EEB
NSC FOR JOYCE CONNERY

E.O. 12958: 11/12/2029
TAGS: PGOV PREL PINR ECON EPET MARR KNNP IT TU KZ
SUBJECT: MINISTER OF ENERGY ON BN-350, SEMIPALATINSK AND ALATAU

Classified By: Ambassador Richard E. Hoagland, 1.4 (b),(d)


1. (S) SUMMARY: On November 12, the Ambassador discussed
non-proliferation issues, specifically the transfer of BN-350
spent-fuel and the Semipalatinsk and Alatau projects, with Minister
of Energy and Mineral Resources Sauat Mynbayev. The Minister
welcomed further cooperation on BN-350 security and transport, and
agreed in principle to accelerate work at Semipalatinsk next year.
In relation to the blending down of highly-enriched uranium (HEU) at
Alatau, Mynbayev said that Kazakhstan's experts need to be convinced
that the research at Alatau using low-enriched uranium (LEU) will
work, but agreed to continue expert-level discussions to find a
mutually-acceptable solution. Mynbayev also discussed Italian oil
company ENI's investments in Kazakhstan following President Nursultan
Nazarbayev's November 6 visit to Italy, along with developments
related to the Eskene-Kuryk and Samsun-Ceyhan pipelines. END
SUMMARY.

BN-350 SPENT-FUEL TRANSPORT


2. (S) The Ambassador thanked the government of Kazakhstan for
providing its emergency response plan for the BN-350 spent fuel
shipment. Citing long-standing collaboration, he also recommended a
bilateral expert-level meeting in the near future to review all
transportation and security plans, which Mynbayev agreed to arrange.
Mynbayev welcomed the Ambassador's proposal to consider security
consultations with the possibility of an exercise conducted by U.S.
and Kazakhstani specialists, and said he would include this
suggestion in a second set of training requests, which the Ministry
of Energy and Mineral Resources (MEMR) will relay soon.


3. (S) In response to the Ambassador's inquiry about whether MEMR
has sufficient equipment for the spent-fuel transfer, Mynbayev
replied that Kazakhstan has all the equipment necessary for transport
and storage. Mynbayev noted the U.S. donation of much of the

security equipment. He said MEMR has already submitted to the U.S.
Department of Energy a list of required spare parts due to their
scarcity on the local market. Mynbayev also reiterated that
registration of the railcars, which will be used to transport the
fuel, has not been completed. (NOTE: The Moscow-based certification
agency for all railcars used in the Commonwealth of Independent
States is currently reviewing the railcar design. END NOTE.)

ACCELERATION OF WORK AT SEMIPALATINSK


4. (S) The Ambassador thanked the Kazakhstani government for
increasing security and supporting a faster pace of work at
Semipalatinsk this year. Given that we expect identification of 20
new tunnels, he pressed for even greater acceleration next year.
Mynbayev said that as soon as MEMR receives information about these
sites, its specialists will immediately prepare a work and monitoring
schedule. According to Mynbayev, in principle, MEMR is willing to
continue to accelerate its schedule.

ALATAU PROJECT


5. (S) The Ambassador also expressed appreciation for Kazakhstan's
cooperation on the sensitive project to blend down highly-enriched
uranium (HEU) at the Alatau Institute of Nuclear Physics. He
conveyed U.S. readiness for expert-level cooperation and interest in
concrete information about next steps. Mynbayev responded, "I
understand we have mutual commitments on this issue." Pushing back a
little, Mynbayev told the Ambassador that Kazakhstan is interested
not only in the removal of highly-enriched-uranium (HEU) fuel, but
also in the continuation of research -- using low-enriched-uranium
(LEU) fuel -- at the Alatau reactor. When the Ambassador reiterated
the need simply to encourage experts on both sides to find a
mutually-acceptable solution, Mynbayev immediately agreed, saying, "I
am ready to instruct my experts to discuss this issue."

ITALIAN OIL COMPANY ENI'S INVESTMENT IN KAZAKHSTAN'S SHIPYARDS


6. (C) The Ambassador also asked Mynbayev about the status of MEMR'S

ASTANA 00002007 002 OF 002


June announcement that the Italian energy company, ENI, intends to
build a shipyard in Kazakhstan's sector of the Caspian Sea to produce
63,000 dead-weight ton oil tankers. Mynbayev confirmed that MEMR
signed an agreement with ENI and created a working group to study the
project. However, he told the Ambassador, "The results of the
project are still unclear," and they depend on commercial demand for
the tankers. Mynbayev admitted that the tanker project is a
long-term endeavor, on which the partners will need to work well into

2010. The Minister said decisions about ownership and operation of
the vessels will influence the pace of the project. "We are still
negotiating with SOCAR over this, and the Kashagan consortium is very
interested as well," Mynbayev noted. According to the Minister,
although ENI representatives declared their readiness to invest in
the project, they will not provide the necessary cash until
resolution of all nuances. Further illustrating the complexity of
the project, Mynbayev told the Ambassador, "we're not even ready for
the onshore Eskene-Kuryk pipeline yet -- and that is the first step
on the road to a viable (trans-Caspian shuttle tanker) system." He
further explained that a French company has been awarded the
exclusive right to negotiate Eskene-Kuryk pipeline construction with
the government, but admitted that this large project will also take
time.

A POLITICAL REALITY: THE SAMSUN-CEYHAN PIPELINE


7. (C) The Ambassador also asked about Nazarbayev's October 22
announcement that Kazakhstan, along with Russia, will take part in
the construction of the Samsun-Ceyhan oil pipeline. "Theoretically
and politically," Mynbayev replied, "we're ready to do it." However,
Mynbayev again admitted that Kazakhstan has not worked out the
commercial aspects. Mynbayev responded positively to the
Ambassador's query about Kazakhstan's willingness to commit its own
crude to the pipeline, but declared it "far too early" for decisions
about which specific fields will provide the oil for Samsun-Ceyhan.
The Minister pointed out that Kazakhstan can ship oil through the
Caspian Pipeline Consortium (CPC) and across the Caspian via tanker
to Baku, and is in negotiations with Azerbaijan to develop the
Kazakhstan Caspian Transportation System (KCTS).

HOAGLAND