United States General Accounting Office

GAO Report to the Honorable Richard G.

Lugar, U.S. Senate

September 1999 NUCLEAR

NONPROLIFERATION

Status of Transparency

Measures for U.S.

Purchase of Russian

Highly Enriched

Uranium

GAO/RCED-99-194

GAO United States

General Accounting Office

Washington, D.C. 20548

Resources, Community, and

Economic Development Division

B-283458 

September 22, 1999

The Honorable Richard G. Lugar

United States Senate

Dear Senator Lugar:

After the breakup of the Soviet Union in the early 1990s, there was great

concern that weapons-grade material from retired Russian nuclear

weapons, such as highly enriched uranium and plutonium, could be stolen

or reused in nuclear weapons if not disposed of or properly protected. In

the case of highly enriched uranium, one solution was to dilute this

nuclear material into low enriched uranium so that it could be made into

fuel for commercial nuclear power reactors. In February 1993, the United

States agreed to purchase from Russia 500 metric tons of highly enriched

uranium extracted from dismantled Russian nuclear weapons over a

20-year period.1

 Russia agreed to dilute, or blend-down, the material into

low enriched uranium before shipping it to the United States. From June

1995 through December 31, 1998, 1,487 metric tons of low enriched

uranium, derived from 51 metric tons of highly enriched uranium, was

delivered to the United States. USEC implements the commercial contract

under the agreement and pays Russia for the deliveries of low enriched

uranium.2

 Russia is expected to receive about $12 billion from the

agreement. As of April 1999, USEC had paid Russia almost $940 million.

In accordance with the 1993 agreement, the United States and Russia

negotiated a series of access and monitoring measures, known as

transparency measures, at four nuclear material processing facilities that

are located in closed Russian nuclear cities.3

 These transparency measures

are designed to provide confidence that the arms control objectives of the

agreement—reducing the number of Russian nuclear warheads—and the

nonproliferation objectives—reducing Russia’s inventory of

weapons-grade highly enriched uranium—are met. More specifically, these

measures are intended to provide confidence that the highly enriched

uranium is extracted from dismantled Russian nuclear weapons and that

the highly enriched uranium is then blended into low enriched uranium at

1

Formally known as The Agreement Between the Government of the United States of America and the

Government of the Russian Federation Concerning the Disposition of Highly Enriched Uranium

Extracted From Nuclear Weapons (Feb. 18, 1993).

2

Formerly a government-owned corporation, the United States Enrichment Corporation was privatized

in July 1998 and is now known as USEC Inc., or USEC.

3

Russia’s 10 closed nuclear cities performed the most sensitive aspects of Russia’s nuclear weapons

production. Access to the closed cities is restricted, and they are geographically isolated.

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B-283458 

three Russian facilities. U.S. officials implement the measures through

periodic monitoring visits to Russian facilities, where they observe the

processes involved with converting highly enriched uranium into low

enriched uranium, review nuclear material inventory records, and use

equipment that measures the quality of the uranium to determine if it is

weapons grade and could be used in a nuclear weapon.

As you requested, this report examines (1) the transparency measures that

are in place, (2) whether these measures ensure that the nonproliferation

objectives of the agreement are met, and (3) the proposals for additional

transparency measures. This report is the unclassified version of a

classified report that we issued to you on July 8, 1999. In addition to

information on these three objectives, the classified report included

information on whether the transparency measures ensure that the arms

control objectives of the agreement—that the highly enriched uranium

that is purchased by the United States is extracted from dismantled

Russian nuclear weapons—are met.

Results in Brief While most of the transparency measures have gradually been

implemented at four Russian nuclear material processing facilities, several

key measures have not yet been put into place. Moreover, under the

agreement, U.S. officials lack access to Russian nuclear weapons

dismantlement facilities and to the weapons dismantlement process. Some

of the low enriched uranium delivered to the United States—about

one-third—was shipped before the transparency measures had been

implemented at each of the Russian facilities. According to the

Departments of State and Energy, there was a deliberate decision by the

U.S. government that U.S. interests would be served by allowing a portion

of the highly enriched uranium to be blended into low enriched uranium

and to be rapidly removed from Russia while the details of the

transparency measures were being worked out. U.S. officials first visited a

Russian facility in February 1996 to implement the initial set of

transparency measures. In October 1996, Russian officials agreed to

strengthen the measures in return for a $100 million advance payment to

be credited against their future deliveries of low enriched uranium. The

most significant strengthened measures involve the (1) use of portable

U.S.-manufactured equipment at various stages to confirm the presence or

absence of weapons-grade highly enriched uranium and (2) installation of

U.S. equipment that can continuously monitor whether the highly enriched

uranium is blended into low enriched uranium. However,

continuous-monitoring equipment has been installed at only one of the

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B-283458 

three Russian blending facilities after a 2-year delay and has not yet gone

into routine operation. Russian officials have not agreed to a schedule for

installing the equipment at the two other blending facilities.

Transparency measures provide U.S. officials with confidence that

weapons-grade highly enriched uranium is being blended into low

enriched uranium at the three Russian blending facilities. Nevertheless,

U.S. officials will not be highly confident that all of the low enriched

uranium purchased under the agreement is coming from weapons-grade

highly enriched uranium until continuous-monitoring equipment is

operating at the Russian blending facilities. Furthermore, according to the

Department of Energy, U.S. officials rejected one cylinder of low enriched

uranium that was shipped to the United States in 1997 for purchase under

the agreement because it did not meet the agreement’s requirements.

In March 1998, the Secretary of Energy proposed to the Russian Minister

of Atomic Energy a number of additional transparency measures that

included providing U.S. officials with greater access to the Russian

nuclear-weapons-dismantlement process. However, Department of Energy

officials told us that although one Russian facility has recently expressed

an interest in a demonstration project, there has been no progress in

reaching an agreement with Russia’s Ministry of Atomic Energy on

adopting these additional measures.

Background Little official information is available on the sources, uses, and inventories

of highly enriched uranium (HEU) in Russia, according to a May 1998 report

by the Energy Information Administration (EIA).4 EIA estimates, however,

that Russia produced about 1,400 metric tons of weapons-grade HEU from

1950 through 1988, after which, Russia is believed to have stopped

producing HEU for defense purposes.5

 The inventory of HEU remaining in

Russia was estimated to be 1,270 metric tons at the end of 1994. EIA

reported that not all HEU in Russia was used in nuclear weapons. For

example, some HEU has been used as fuel for plutonium-production,

4

Commercial Nuclear Fuel From U.S. and Russian Surplus Defense Inventories: Materials, Policies, and

Market Effects, EIA (May 1998).

5

Uranium, in its natural form, comprises a mixture of several isotopes (forms of the same element with

different atomic weights). Less than 1 percent of natural uranium is the isotope uranium 235 (U-235),

the fissionable isotope used in nuclear weapons and reactors. Uranium that is enriched to a

concentration of over 90 percent U-235 is highly enriched and is weapons-grade material. Uranium that

is enriched to a concentration of from 3 to 5 percent U-235 is low enriched uranium and is

commercial-reactor-grade material.

Page 3 GAO/RCED-99-194 U.S. Purchase of Russian HEU
B-283458 

research, and naval propulsion reactors.6 EIA noted that most of the

uranium used to produce HEU in the former Soviet Union reportedly came

from fuel that was used in plutonium-production reactors.

In January 1994, USEC signed a commercial contract with Techsnabexport

to implement the February 1993 government-to-government agreement.

Techsnabexport is a commercial arm of the Ministry of the Russian

Federation for Atomic Energy (MINATOM) and is the Russian executive

agent for the agreement. In November 1996, USEC and Techsnabexport

signed an amendment to the commercial contract that established an

agreement on the quantities and prices of low enriched uranium (LEU) for 5

years. The agreement provided for USEC to purchase LEU derived from 18

metric tons of HEU in 1997, 24 metric tons in 1998, and 30 metric tons

annually from 1999 through 2001. According to USEC, from June 1995

through December 1998, USEC received 1,487 metric tons of LEU, as shown

in figure 1.7

 From August 1998 through March 1999, Techsnabexport

suspended the contracted deliveries of LEU to USEC, in part, because of

Russia’s dissatisfaction with progress in reaching an agreement on the

price it would receive for the natural uranium that makes up a portion of

the LEU. As a result, USEC received only 60 percent of the 1998 LEU

shipments it had contracted for delivery. An agreement on the natural

uranium was reached in March 1999, and a USEC representative stated

that Techsnabexport delivered the last of the 1998 LEU shipments in

June 1999.

6

Not all HEU is considered to be weapons-grade material. Any uranium enriched to 20 percent of U-235

or greater is considered to be highly enriched. Under the 1994 Transparency Protocol, the United

States has the right to monitor only the concentration of U-235 in the uranium being processed.

7

According to USEC, this quantity of LEU is derived from 51 metric tons of HEU, which the

Department of Energy estimates is equivalent to the amount of HEU found in about 2,040 nuclear

warheads.

Page 4 GAO/RCED-99-194 U.S. Purchase of Russian HEU
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Figure 1: Annual Amounts of LEU

Delivered to the United States From

1995 Through 1998

0

200

400

600

800

1000

1200

1400

1600

1996 1997 1998 4-yr.

Total

1995

371

480 450

1487

186

Metric tons of LEU

Calendar year

Source: USEC.

Several U.S. and Russian government agencies are involved in the

negotiation and implementation of the transparency measures. A

Department of State official is designated as the Chief HEU Transparency

Negotiator for the United States, and a Department of Energy (DOE) official

is the Deputy Chief Negotiator. DOE’s Office of Nonproliferation and

National Security, contracting with most of DOE’s national laboratories and

several of its operations offices, implements U.S. transparency activities,

such as staffing and organizing U.S. monitoring visits to the Russian

facilities. DOE spent about $44 million on HEU transparency activities from

fiscal year 1994 through fiscal year 1998.8

 Lawrence Livermore National

Laboratory spent about $20 million, or about 45 percent of the total funds

that DOE has provided, during this period. For the Russian Federation,

MINATOM is responsible for negotiating and implementing the transparency

measures.

The March 1994 Protocol on HEU Transparency Arrangements established

the Transparency Review Committee as the formal bilateral mechanism

8

DOE plans to spend an additional $45 million for HEU transparency activities for fiscal year 1999

through fiscal year 2001.

Page 5 GAO/RCED-99-194 U.S. Purchase of Russian HEU
B-283458 

for U.S. (DOE and State Department) and Russian (MINATOM) officials to

negotiate specific transparency measures at Russian and U.S. facilities and

to discuss and resolve issues arising from the implementation of the

measures. From 1994 through 1997, U.S. and Russian officials held six

meetings of the Transparency Review Committee. An additional meeting

of the executive members of the committee was held in February 1998.9

Transparency

Measures Have Been

Gradually

Implemented at

Russian Facilities

From February 1996 through May 1999, transparency measures were

gradually implemented at four Russian nuclear material processing

facilities. However, under the agreement, U.S. officials lack access to

Russian nuclear weapons dismantlement facilities and to the process

whereby nuclear weapons are dismantled. In October 1996, Russian

officials agreed to strengthen the measures at the Russian facilities in

return for a $100 million advance payment to be credited against their

future deliveries of LEU. Although Russian officials have allowed DOE to

implement many of the transparency measures that were agreed to in

1996, there have been some delays and impediments in implementing

them.

Russian and U.S. Facilities

That Process HEU and

LEU

Currently, four Russian facilities process the HEU and six U.S. facilities

process the LEU purchased under the agreement, as shown in figure 2.

Under the agreement, the United States does not have access to the

Russian weapons dismantlement facilities or to the weapons

dismantlement process.10 The Russian facilities are administered by

MINATOM. Of the four Russian facilities, only three blend HEU into LEU. The

Seversk facility is currently the only one that performs all of the processes

related to the conversion and blending of HEU into LEU. (For a discussion of

the fourth facility—Mayak—see pp. 10-11.) USEC operates one of the six

U.S. facilities, the Portsmouth uranium enrichment facility, in Piketon,

Ohio. USEC sends the LEU from the Portsmouth facility to five U.S. nuclear

fuel fabricators that make nuclear reactor fuel for commercial nuclear

power reactors. (See app. I for a description of the processes for

converting and blending HEU into LEU at the Russian and U.S. facilities.)

9

In 1996, the United States also established a U.S. interagency committee, chaired by the National

Security Council, to oversee the implementation of the U.S. national security and commercial

objectives of the HEU purchase agreement. In May 1998, the committee was formalized by an

executive order of the President as the Enrichment Oversight Committee and includes representatives

from the Departments of State, Defense, and Energy; the intelligence community; and other federal

agencies.

10According to DOE, there are four Russian nuclear weapons dismantlement facilities: Sverdlovsk-45,

Zlatoust-36, Avangard, and Penza-19.

Page 6 GAO/RCED-99-194 U.S. Purchase of Russian HEU
B-283458 

Figure 2: Russian Federation and U.S. Facilities That Process HEU and LEU, as of June 1999

Siemens Power Corporation,

Richland, WA

Washington

D.C.

To U.S.

St. Petersburg

Moscow

United States

Russia

Portsmouth

Gaseous

Diffusion Plant, (USEC)

Piketon, OH

ABB/Combustion

Engineering, Inc.

Hematite, MO

Westinghouse Nuclear,

Columbia, SC

GE Nuclear Energy,

Wilimington, NC

Ural Electrochemical

Integrated Enterprise,

Novouralsk Siberian Chemical

Enterprise,

Seversk

Krasnoyarsk

Electrochemical

Plant,

Zelenogorsk Mayak Production

Association,

Ozersk

Framatome Cogema Fuels,

Lynchburg, VA

Legend

HEU shipments

LEU shipments

Source: DOE.

Transparency Measures at

the Russian Facilities

Specific transparency measures, applicable to both Russian and U.S.

facilities, are identified in 16 technical annexes to the March 1994 Protocol

on HEU Transparency Arrangements that were signed from 1995 through

1998 as a result of six meetings of the Transparency Review Committee

Page 7 GAO/RCED-99-194 U.S. Purchase of Russian HEU
B-283458 

and one meeting of its executive members.11 The date when each technical

annex was signed generally determined when U.S. monitors could begin

implementing the transparency measures at the Russian facilities.12 As a

result, about one-third of the shipments of LEU that were sent to USEC

under the commercial contract, from 1995 through 1998, were not subject

to transparency measures. (App. II provides a list of the 16 technical

annexes that grant specific monitoring and access rights at the Russian

and U.S. facilities. It also provides more information on the LEU shipments

that were not subject to the transparency measures.)

Originally, two Russian facilities processed HEU—the Seversk and Ural

facilities. In 1996, the Krasnoyarsk plant began to process HEU. According

to DOE, starting in 1996, U.S. monitors were allowed to perform the

following activities at these facilities:

• Observe the chemical processes whereby the HEU is transformed from

metal chips—fragments of nuclear weapons components—into a gaseous

form of HEU for blending purposes.13

• Visit the areas where HEU is blended into LEU.

• Apply tamper-indicating devices—U.S. tags and seals—to HEU and LEU

containers to help monitors identify and track the movement of the

material through the different processes or from one facility to another.

• Review and obtain copies of Russian nuclear material control and

accounting documents to track the amount of HEU and LEU that is being

processed.14

• At the Ural facility, from February 1996 through October 1998, U.S.

monitors were able to take random samples of uranium, up to four times a

year at the point where the uranium is blended (blendpoint), to measure

the enrichment levels of the uranium that was being processed to

determine whether HEU was being blended into LEU.

11Russia also has the reciprocal right to implement transparency measures in the United States to

determine whether the Russian LEU is fabricated into fuel for commercial nuclear power reactors and

is not refabricated into HEU that could be used in U.S. nuclear weapons. From 1996 through 1998,

MINATOM officials visited U.S. facilities seven times to implement these measures. In October 1998,

representatives of the Portsmouth uranium enrichment facility told us that they would not produce

weapons-grade HEU from the Russian LEU because they are prohibited by federal nuclear-licensing

requirements from this activity. Moreover, the United States no longer requires new HEU for weapons

production.

12In the case of the Ural facility, U.S. monitoring visits began after the technical annex for the facility

had been initialed by the parties but before it was signed.

13During these chemical processes—oxidation and fluorination—the HEU metal chips are heated to

convert them into an HEU oxide, and the HEU oxide is then converted into HEU hexaflouride, or UF6.

14When reviewing and obtaining documentation at the Russian facilities, U.S. monitors have access to

some sensitive commercial information but do not have access to classified national security

information.

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In October 1996, MINATOM agreed to a list of additional measures designed

to strengthen transparency at the Russian facilities. In December 1996,

MINATOM received an advance payment from USEC of $100 million in

exchange for agreeing to implement these additional measures. Some of

these measures include the following:

• Use of U.S.-manufactured portable equipment that measures the

enrichment of the uranium and confirms the presence or absence of

weapons-grade HEU at various stages of the conversion and blending

processes. Since U.S. monitors are not certified to work in Russian

facilities, Russian technicians, witnessed by U.S. monitors, operate the

portable uranium detection equipment and record the results.

• Access to areas where HEU weapons components are received from the

Russian dismantlement facilities and are stored in sealed containers.

• Ability to observe the process in which the weapons components are cut

into metal chips.

• Access to the areas where the HEU oxide is chemically treated to remove

certain impurities.15

• Installation of U.S. equipment that can continuously monitor the

enrichment levels and material flow rate at the points where HEU is

blended into LEU.

16 This equipment is shown in figure 3.

15This chemical process is called purification.

16Oak Ridge and Los Alamos National Laboratories developed the continuous-monitoring equipment

for installation at Russian blending facilities. According to equipment specifications, the equipment is

designed to measure the flow rates of the uranium, tracking the amount of uranium that is being

blended to within plus or minus 20 percent. The LEU blendstock that is used to blend HEU into LEU is

uranium that has been enriched up to 1.5 percent U-235 by using depleted uranium containing less than

0.7 percent U-235.

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Figure 3: U.S. Equipment That Continuously Monitors the Blending of HEU Into LEU

Uranium Enrichment

Monitor

Flow Monitor

LEU Detector

Flow Monitor

HEU Detector

UF6 Flow

Uranium Enrichment

Monitor

Flow Monitor

LEU Detector

Flow Monitor

HEU Detector

UF6 Flow

Source: DOE.

DOE started to implement most of the strengthened measures during

monitoring trips to three of the Russian facilities beginning in 1997. In a

February 1998 memo, DOE reported that Russian officials had implemented

95 percent of the strengthened transparency measures that were linked to

USEC’s December 1996 advance payment of $100 million. The fourth

facility, Mayak, started to process HEU under the agreement in 1997, but

Page 10 GAO/RCED-99-194 U.S. Purchase of Russian HEU
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the transparency measures were not implemented there until after the

technical annex had been signed for the facility in February 1998.

U.S. monitoring visits can occur up to six times each year at the Russian

facilities, and each visit can last up to 5 days. U.S. monitors are required to

notify MINATOM 30 working days in advance of their visits to the Russian

facilities. Currently, DOE selects its monitors from a list of 100 persons

from DOE, DOE’s national laboratories and its contractors, and other U.S.

agencies. The first monitoring trip took place in February 1996 at the Ural

facility. According to DOE, from February 1996 through March 1999, U.S.

monitors made 50 visits to the four Russian facilities, as shown in table 1.17

 In order to gain daily access to the HEU-blending process, in August 1996,

DOE established a permanent monitoring office at the Ural facility in

Novouralsk, Russia. Two to four U.S. monitors, who are rotated every 2

months, usually staff the permanent office and can visit the facility daily.18

Because DOE now staffs a permanent monitoring office at the Ural facility,

there has not been a need for periodic monitoring visits there since

August 1996.

17From fiscal year 1994 through fiscal year 1998, about 35 percent of the total $44 million that DOE

funded for implementing the transparency activities was spent on U.S. monitoring visits and on the

establishment and maintenance of a permanent presence office in the Russian Federation.

18According to DOE, 55 U.S. monitors rotated through the permanent office at the Ural facility from

August 1996 through March 1999.

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Table 1: U.S. Visits to Russian

HEU-Processing Facilities From

February 1996 Through March 1999 Facility

Familiarization

visitsa

Monitoring

visits

Technical

visitsb Total

Ural

Electrochemical

Integrated Plant 3 3 4 10

Siberian

Chemical

Enterprise 2 15 0 17

Krasnoyarsk

Electrochemical

Plant 1 11 3 15

Mayak

Production

Association 2 6 0 8

Total 8 35 7 50

aU.S. monitors visited the Russian facilities before transparency measures were in place to

familiarize themselves with the facilities’ operations.

bU.S. monitors can visit the Russian blending facilities to assist in the installation of U.S.

continuous-monitoring equipment.

Source: DOE.

Delays and Impediments to

Implementing Some

Measures at the Russian

Facilities

Although Russian officials have allowed DOE to implement most of the

strengthened transparency measures that were agreed to in 1996, there

have been delays and impediments to implementing some of them. Despite

these difficulties, State Department and DOE officials believe that the

measures have given them unprecedented access to facilities in Russian

closed cities. Since 1996, DOE has continued to negotiate for access to the

process whereby HEU weapons components are cut into metal chips. Both

Russian and U.S. officials consider information about the design of their

weapons to be classified, including the shapes of their weapons

components. Accordingly, DOE has suggested that weapons components

could be shrouded during the metal-chipping process when U.S. monitors

are present to allow them to witness the process without revealing

classified information. DOE officials told us that the Mayak facility has

recently expressed an interest in conducting a demonstration of shrouding

weapons components during the metal-chipping process but that MINATOM

has not yet approved this proposal.

Moreover, the installation of U.S. continuous-monitoring equipment at the

Russian Ural facility was delayed for 2 years. The delay was due to a

number of factors, including requirements by the Russian government to

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license and certify the equipment before it was installed and concerns by

Russian officials about how data generated by the equipment would be

used by the United States. In January and February 1999, DOE officials and

national laboratory staff installed and tested the monitoring equipment at

the Ural facility. During this test, U.S. officials found that the equipment

could accurately detect the enrichment levels of the uranium but that the

equipment needed some adjustments to properly measure the amount of

LEU that was being processed. Before the equipment can go into routine

operation at the facility, these technical problems must be fixed, and a

revised technical annex and other agreements for the facility must also be

approved and signed by the United States and the Russian Federation.

According to a February 1999 cable from the U.S. Embassy in Moscow,

DOE and MINATOM had not resolved their differences over how the United

States will remove or use the data generated by the monitoring equipment

and what steps both parties will take to resolve any discrepancies that may

occur between the data generated by the equipment and the Russian

facility’s own documentation of its nuclear material.

DOE and Lawrence Livermore officials told us that they plan to install

continuous-monitoring equipment at the second Russian blending facility

at Krasnoyarsk by the end of September 1999. However, DOE is waiting to

ship the equipment to Krasnoyarsk until the Department receives final

approval from MINATOM to install and operate the equipment. According to

DOE, an agreement has not yet been reached with MINATOM on the details

for installing the equipment at Seversk, the third Russian blending facility.

A DOE official told us that before the equipment can be installed at these

two blending facilities, MINATOM would likely require that the technical

annexes related to the transparency procedures for these facilities be

revised and renegotiated. A MINATOM official told us in September 1998 that

he considered the installation of the equipment at the Ural facility to be a

pilot test and that there were no specific plans for installing the equipment

at the other two facilities. DOE officials disagreed with MINATOM’s statement

because, in October 1996, Russian officials had granted the United States

the right to install this equipment at the Ural, Krasnoyarsk, and any future

Russian blending facilities. At the time of our review, this matter had not

yet been resolved.

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Confidence Exists

That Weapons-Grade

HEU Is Blended Into

LEU

Transparency measures provide U.S. officials with confidence that

weapons-grade HEU is being blended into LEU at the Russian blending

facilities. Nevertheless, U.S. officials have stated that until

continuous-monitoring equipment is installed at the three Russian

blending facilities, they will not be highly confident that all of the LEU that

the United States is purchasing is coming from blended HEU. Furthermore,

in response to the concerns we raised, DOE improved its procedures for

collecting information on the LEU cylinders shipped under the agreement

through its arrangements with USEC.

U.S. Officials Have

Confidence That LEU Is

Coming From

Weapons-Grade HEU

DOE and Lawrence Livermore officials told us that they have confidence

that weapons-grade HEU is being blended into LEU at the Russian blending

facilities.19 DOE and Lawrence Livermore officials told us that until

continuous-monitoring equipment is installed at the three Russian

blending facilities, they will not be highly confident that blending is

occurring and that all of the LEU that the United States is purchasing is

coming from blended HEU. For example, although the

continuous-monitoring equipment has been installed at the Ural facility,

this facility is scheduled to blend only 12 metric tons of the total 30 metric

tons of HEU to be delivered as LEU for 1999.

There are several ways in which U.S. monitors can gain confidence that

weapons-grade HEU is being converted and blended into LEU at the Russian

facilities. U.S. monitors are allowed to use U.S. portable equipment, apply

identifying U.S. tags and seals to containers and equipment that indicate

tampering, and obtain Russian nuclear material inventory documentation

on the HEU and LEU in containers at each step of the conversion and

blending processes. According to Lawrence Livermore officials, the

equipment allows U.S. monitors to determine, with high confidence, that

the HEU that is being processed when the U.S. monitors are present is

weapons-grade material. Since 1997, six times a year, U.S. monitors have

been able to visit areas at the Mayak and Seversk facilities where sealed

containers that were used to ship HEU weapons components are stored.

They can also observe the HEU after it has been cut into metal chips. At

two blending facilities—Seversk and Krasnoyarsk—U.S. monitors can

observe and measure the enrichment of the HEU in containers six times a

year as they are fed into the blendpoint.

19Our July 8, 1999, classified report discusses U.S. officials’ confidence that the HEU that has been

purchased under the agreement is coming from Russian dismantled nuclear weapons.

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At the Ural facility, permanent monitors have daily access to the blending

area, where they can apply U.S. tags and seals to HEU in containers and to

some equipment, and can obtain Russian documentation that shows the

amounts of HEU and LEU that are being blended. From February 1996

through October 1998, U.S. monitors were able to randomly request that

Russian technicians take samples of the HEU and LEU at the blendpoint. An

analysis of the samples, which were limited to being taken four times a

year, provided a snapshot of the enrichment levels of the HEU and LEU in

the pipes at the time of sampling. As of October 1998, DOE reported that a

total of 11 samples had been taken and analyzed by Russian technicians

under observation by U.S. monitors. The analysis showed that

weapons-grade HEU was being blended.20 When put into routine operation,

the continuous-monitoring equipment that was recently installed at the

Ural facility will provide U.S. monitors with a continuous record of

whether blending is occurring. As a result, random samples will no longer

be taken there.

DOE and Lawrence Livermore officials have stated that because the access

granted to U.S. monitors is limited at each of the Russian facilities, they

are unable to track the HEU through the entire process as it is converted

and blended into LEU. Additionally, State Department and Lawrence

Livermore officials told us that the continuous-monitoring equipment does

not provide U.S. monitors with information on whether the HEU that is

being blended is of weapons origin.

One Cylinder of LEU Was

Rejected Under the

Agreement

In 1997, U.S. monitors discovered that one cylinder of LEU that was

shipped to the United States did not meet the requirements of the

agreement. In an October 27, 1997, letter, the Department of State

informed MINATOM that it would not accept the cylinder under the HEU

purchase agreement. According to an April 1998 unverified press account,

U.S. officials were uncertain of whether the cylinder contained LEU that

came from HEU from nuclear warheads. However, according to USEC

officials, on February 1, 1999, USEC paid Russia’s Techsnabexport for the

cylinder under a separate commercial agreement. Figure 4 shows the

disputed cylinder.

20DOE paid the Russian Ural facility $124,391 to perform all 11 of these analyses.

Page 15 GAO/RCED-99-194 U.S. Purchase of Russian HEU
B-283458 

Figure 4: Disputed Cylinder of LEU

Rejected Under HEU Purchase

Agreement

Source: Portsmouth Uranium Enrichment Facility.

USEC Documentation and

Reporting

Until recently, U.S. monitors did not always obtain documentation on the

contents of all of the LEU cylinders shipped under the agreement in a

timely manner. A USEC representative told us that USEC had not been

required to regularly share cylinder documentation data with DOE but, as a

matter of practice, had shared this information with DOE upon request.

During our review, we raised concerns with DOE officials about whether

they should formalize their data-sharing arrangement with USEC and

receive USEC documentation more routinely. In response to our concerns,

in March 1999, DOE officials formally requested that USEC send them the

results of USEC’s and the Russian facilities’ documentation on the

contents of the LEU cylinders on a monthly basis. DOE officials stated that

by regularly receiving this information from USEC, they could be more

Page 16 GAO/RCED-99-194 U.S. Purchase of Russian HEU
B-283458 

confident that the LEU obtained under the agreement is consistent with the

process of blending HEU. USEC provided DOE with the first of these

monthly reports on May 7, 1999.

U.S. Officials Are

Seeking Additional

Transparency

Measures

In March 1998, the Secretary of Energy proposed a number of additional

transparency measures to the Russian Minister of Atomic Energy. In

September 1998, we asked MINATOM officials if they planned to grant any

broader access to U.S. transparency monitors. MINATOM officials responded

that broader access for U.S. monitors, such as access to the Russian

weapons dismantlement process, would have to be negotiated in the

context of other arms control agreements.21 DOE officials also

acknowledged that it could be difficult to achieve broader access for U.S.

monitors in the absence of an arms control agreement whereby both the

United States and Russia could verify reductions in nuclear weapons and

classified information about nuclear weapons could be exchanged.

Agency Comments We met with officials from the Departments of State and Energy to receive

the Departments’ comments on a draft of this report. Specifically, we

obtained comments from the Director, Office of Policy and Regional

Affairs for Russia and the New Independent States, Department of State,

and the Deputy Director, Office of Arms Control and Nonproliferation,

Department of Energy. The Departments of State and Energy stated that

the report’s findings were fair and balanced.

The Departments of State and Energy also provided technical comments

that were incorporated into the report as appropriate.

Scope and

Methodology

To examine the status of the implementation of the transparency

measures, we reviewed the February 1993 government-to-government HEU

purchase agreement, the September 1993 Memorandum of Understanding

Relating to Transparency and Additional Arrangements, the March 1994

Protocol on HEU Transparency Arrangements, and 16 technical annexes to

the 1994 Protocol, signed from 1995 through 1998, that grant specific

monitoring and access rights at the U.S. and Russian facilities. We also

21In our report entitled Weapons of Mass Destruction: Effort to Reduce Russian Arsenals May Cost

More, Achieve Less Than Planned (GAO/NSIAD-99-76, Apr. 13, 1999), we discuss the status of a facility

that is being constructed with U.S. funds at the Mayak nuclear complex to store plutonium removed

from dismantled Russian nuclear weapons. The report found that Russian negotiators had not yet

agreed to U.S. proposals aimed at confirming that the plutonium to be stored at Mayak would originate

solely from dismantled nuclear weapons and would support Russia’s dismantlement of nuclear

weapons.

Page 17 GAO/RCED-99-194 U.S. Purchase of Russian HEU
B-283458 

reviewed the records of five of the six meetings of the bilateral

Transparency Review Committee, which occurred from September 1994

through November 1997. According to DOE officials, no records were

issued for the fifth meeting of the committee in December 1996 and the

meeting of the executive members of the committee in February 1998

because the signed transparency annexes served as the records of these

meetings. We obtained and reviewed unclassified and classified reporting

cables from the U.S. Department of State and the U.S. Embassy in

Moscow, Russia, covering the period from 1992 through 1999. DOE

provided us with trip reports covering the period from 1994 through 1999,

which documented U.S. monitors’ visits to the Russian facilities to

implement the transparency measures. To identify DOE’s funding of

transparency activities from fiscal year 1994 through fiscal year 2001, we

also obtained budgetary and expenditure data from DOE. We reviewed

relevant technical and energy trade publications covering the period from

1991 through June 1999.

In Washington, D.C., we met with officials from the Department of State’s

Office of Policy and Regional Affairs for Russia and the New Independent

States; DOE’s Offices of the Undersecretary, Nuclear Energy, Science and

Technology, Arms Control and Nonproliferation, and International Nuclear

Safety and Cooperation; DOE contractors from Lawrence Livermore

National Laboratory; and EIA. Several U.S. officials whom we met with had

served as U.S. monitors who staffed DOE’s permanent office at the Russian

Ural facility or regularly participated in the monitoring visits to the

Russian facilities. We also met with officials from the Department of

Defense and several agencies that represent the U.S. intelligence

community.

We visited Moscow, Russia, in September 1998 to meet with various U.S.

officials from the U.S. Embassy and with Russian officials from MINATOM

and one of its commercial subsidiaries—Techsnabexport.

To discuss the commercial aspects of the purchase agreement that had an

impact on transparency measures, we also met with and gathered

information from representatives of USEC—the U.S. executor of the

agreement—in Bethesda, Maryland. We met with the President of Edlow

International Company, in Washington, D.C., who was responsible for

managing all of the shipments of the LEU from St. Petersburg, Russia, to

the United States. We visited the two uranium enrichment facilities

operated by USEC—the Portsmouth facility in Piketon, Ohio, and the

Paducah, Kentucky, facility. We also met with representatives of one of the

Page 18 GAO/RCED-99-194 U.S. Purchase of Russian HEU
B-283458 

five U.S. fuel fabricators—GE Nuclear Fuel, in Wilmington, North

Carolina.

We conducted our review from August 1998 through June 1999 in

accordance with generally accepted government auditing standards.

We are sending copies of this report to Senator Jesse A. Helms, Chairman,

and Senator Joseph R. Biden, Ranking Minority Member, Senate

Committee on Foreign Relations; Representative Benjamin A. Gilman,

Chairman, and Representative Sam Gejdenson, Ranking Minority Member,

House Committee on International Relations; and other appropriate

committees.

We are also sending copies of this report to the Honorable Madeleine K.

Albright, the Secretary of State; the Honorable Bill Richardson, the

Secretary of Energy; the Honorable William S. Cohen, the Secretary of

Defense; and other interested parties. If you have any questions or need

additional information, please contact me or Gene Aloise, Assistant

Director, on (202) 512-3841. Other major contributors to this report were

Sarah Veale, Victor Sgobba, and Duane Fitzgerald, Ph.D.

Sincerely yours,

(Ms.) Gary L. Jones

Associate Director, Energy,

 Resources, and Science Issues

Page 19 GAO/RCED-99-194 U.S. Purchase of Russian HEU
Contents

Letter 1

Appendix I 

Processes for

Converting and

Blending Highly

Enriched Uranium

Into Low Enriched

Uranium at Russian

and U.S. Facilities

22

Appendix II 

Technical Annexes

Establish

Implementation of

Transparency

Measures

23

Technical Annexes Implement Transparency Measures 23

Some Shipments Were Not Subject to Transparency 24

Table Table 1: U.S. Visits to Russian HEU-Processing Facilities From

February 1996 Through March 1999

12

Figures Figure 1: Annual Amounts of LEU Delivered to the United States

From 1995 Through 1998

5

Figure 2: Russian Federation and U.S. Facilities That Process

HEU and LEU, as of June 1999

7

Figure 3: U.S. Equipment That Continuously Monitors the

Blending of HEU Into LEU

10

Figure 4: Disputed Cylinder of LEU Rejected Under HEU

Purchase Agreement

16

Figure II.1: Titles of Transparency Annexes to 1994 HEU

Transparency Protocol, by Major Category

24

Figure II.2: Some LEU Shipments Were Not Subject To

Transparency Measures

25

Page 20 GAO/RCED-99-194 U.S. Purchase of Russian HEU
Contents

Abbreviations

DOE Department of Energy

EIA Energy Information Administration

GAO General Accounting Office

HEU highly enriched uranium

LEU low enriched uranium

MINATOM Ministry of the Russian Federation for Atomic Energy

Page 21 GAO/RCED-99-194 U.S. Purchase of Russian HEU
Appendix I 

Processes for Converting and Blending

Highly Enriched Uranium Into Low

Enriched Uranium at Russian and U.S.

Facilities

Four Russian facilities convert and blend highly enriched uranium (HEU)

into low enriched uranium (LEU) through the following processes:

• Seversk and Mayak receive HEU weapons components from the Russian

weapons dismantlement facilities, cut the components into metal chips,

and heat the HEU metal chips to convert them into oxide.

• Seversk and Mayak chemically treat the HEU oxide to remove certain

impurities.22 Seversk and Krasnoyarsk combine the purified HEU oxide

with fluorine to produce HEU hexafluoride, also known as UF6.

• Seversk, Krasnoyarsk, and Ural blend the HEU into LEU. During the blending

process, the HEU is blended with uranium that is enriched up to a level of

1.5-percent U-235—called blendstock—to produce LEU.

• Seversk, Krasnoyarsk, and Ural load the LEU into cylinders that contain

about 1.5 metric tons of LEU each. The cylinders are transported by rail to

St. Petersburg, Russia, and from there, they are shipped to the United

States.

Once the LEU arrives in the United States, six U.S. facilities perform the

following processes:

• The Portsmouth uranium enrichment facility may further change the

enrichment of the LEU to meet USEC customers’ commercial specifications

or the cylinders may be sent as received to the five U.S. nuclear fuel

fabricators.

• The five U.S. nuclear fuel fabricators convert the LEU into reactor fuel and

sell it to electric utilities in the United States and other countries.

22Some of the initial shipments of LEU under the agreement contained traces of plutonium and other

impurities. In order to meet the U.S. uranium industry’s standards for product purity, Russia began to

process the HEU to remove any impurities starting in 1996 at the Seversk facility.

Page 22 GAO/RCED-99-194 U.S. Purchase of Russian HEU
Appendix II 

Technical Annexes Establish

Implementation of Transparency Measures

Sixteen technical annexes to the 1994 Transparency Protocol implement

access and monitoring procedures at the U.S. and Russian facilities subject

to the 1993 government-to-government HEU purchase agreement. From

1995 through 1998, the United States and the Russian Federation signed

these annexes, some of which were revised as new Russian facilities or as

new processes were added. As a result, some of the shipments sent to the

United States under the commercial agreement from the Russian facilities

were not subject to the transparency measures. The technical annexes

governing the U.S. monitoring of Russian facilities will continue to be

revised if the HEU conversion and blending activities of the Russian

facilities change or when new transparency activities are implemented,

such as installing equipment that continuously monitors whether HEU is

being blended into LEU at the three Russian blending facilities.

Technical Annexes

Implement

Transparency

Measures

From 1995 through 1998, U.S. and Russian negotiators signed 16 technical

annexes to the 1994 Transparency Protocol that established specific

access and monitoring rights at U.S. and Russian facilities. When two

additional Russian facilities started to process HEU under the agreement

and some of the facilities added new processes, technical annexes had to

be negotiated for each of these facilities, and some annexes had to be

revised and renegotiated to accommodate the new processes, as

demonstrated by figure II.1.

Page 23 GAO/RCED-99-194 U.S. Purchase of Russian HEU
Appendix II 

Technical Annexes Establish

Implementation of Transparency Measures

Figure II.1: Titles of Transparency Annexes to 1994 HEU Transparency Protocol, by Major Category

Administration

Processes

Procedures for U.S. Monitoring of Russian Facilities

Procedures for Russian Monitoring of U.S. Facilities

a Annex 3 was initialed by the parties on 11/22/95 which allowed U.S. monitoring visits to begin at the Ural facility.

Annex 4

Portsmouth,

4/2/96,

revised 12/20/96

Annex 3a

Ural,

4/2/96,

revised 12/20/96

Annex 7

Analytical

Methods for

U-235,

4/3/96

Annex 1

Transparency

Review

Committee,

7/28/95

Annex 6

Fuel

Fabricators,

4/2/96,

revised 12/20/96

Annex 5

Seversk,

4/2/96,

revised 12/18/96

& 2/11/98

Annex 8

Tags and

Seals,

11/22/95

revised 4/4/96

Annex 2

Notification of

Visits & Related

Arrangements,

7/28/95

Annex 15

Krasnoyarsk,

12/20/96

amended 2/11/98

Annex 9

Technological

Process

Descriptions,

4/4/96

Annex 10

Financial

Arrangements,

4/4/96

Annex 16

Mayak,

2/11/98

Annex 12

Equipment,

4/4/96, revised

12/18/96

Annex 11

Reexport of

Russian LEU,

4/3/96

Annex 13

Radioactive

Standards,

4/4/96

Annex 14

Exchange of

HEU Material

Reports,

4/3/96

Source: Department of Energy.

Some Shipments Were

Not Subject to

Transparency

Some LEU shipments were sent to the United States under the 1994

commercial contract between USEC and Techsnabexport before the

transparency measures had been implemented at each of the Russian

blending facilities. According to the Departments of State and Energy,

Page 24 GAO/RCED-99-194 U.S. Purchase of Russian HEU
Appendix II 

Technical Annexes Establish

Implementation of Transparency Measures

there was a deliberate U.S. government decision that U.S. interests would

be served by allowing a portion of the HEU to be blended into LEU and to be

rapidly removed from Russia while the details of the transparency

measures were being worked out. In addition, by allowing the shipments

to begin before the transparency measures were in place, Russia could

begin receiving much needed financial revenue from the HEU agreement.

From 1995, when the first LEU deliveries started, through 1998, about

one-third—496 metric tons of the total 1,487 metric tons—of the LEU sent

to the United States was not subject to transparency measures, as shown

in figure II.2. The amount of LEU that was not subject to transparency

measures was equivalent to about 17 metric tons of HEU. For example,

officials from Lawrence Livermore National Laboratory told us that

because the technical annex was not signed for the Ural facility until 1996,

the United States was not permitted to monitor any of the 1995 LEU

shipments sent to the United States under the agreement. All of the 1995

LEU shipments came from that facility.

Figure II.2: Some LEU Shipments Were

Not Subject to Transparency Measures

0

100

200

300

400

500

1995 1996 1997 1998

Metric tons of LEU

Calendar year

Subject to transparency

Not subject to transparency

Source: Department of Energy.

(141372) Page 25 GAO/RCED-99-194 U.S. Purchase of Russian HEU
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