II 

Calendar No. 349 

110TH CONGRESS 

1ST SESSION S. 1138 

[Report No. 110–151] 

To enhance nuclear safeguards and to provide assurances of nuclear fuel 

supply to countries that forgo certain fuel cycle activities. 

IN THE SENATE OF THE UNITED STATES 

APRIL 18, 2007 

Mr. LUGAR (for himself, Mr. BAYH, and Mr. HAGEL) introduced the following 

bill; which was read twice and referred to the Committee on Foreign Relations 

SEPTEMBER 11, 2007 

Reported by Mr. BIDEN, without amendment 

A BILL 

To enhance nuclear safeguards and to provide assurances 

of nuclear fuel supply to countries that forgo certain 

fuel cycle activities. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Nuclear Safeguards 

5 and Supply Act of 2007’’. 


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1 SEC. 2. TABLE OF CONTENTS. 

Sec. 1. Short title. 

Sec. 2. Table of contents. 

Sec. 3. Appropriate congressional committees defined. 

TITLE I—NUCLEAR SAFEGUARDS AND NUCLEAR FUEL SUPPLY 

Sec. 101. Findings. 

Sec. 102. Declaration of policy. 

Sec. 103. Safeguards Analytical Laboratory. 

Sec. 104. Safeguards technology development program. 

TITLE II—NUCLEAR FUEL SUPPLY 

Sec. 201. Authority for bilateral and multilateral nuclear fuel supply mechanisms. 

Sec. 202. Report on the establishment of an international fuel authority. 

Sec. 203. Sense of the Senate on IAEA fuel supply. 

2 SEC. 3. APPROPRIATE CONGRESSIONAL COMMITTEES DE3 FINED. 

4 In this Act, the term ‘‘appropriate congressional com5 mittees’’ means the Committee on Foreign Relations of 

6 the Senate and the Committee on Foreign Affairs of the 

7 House of Representatives. 

8 TITLE I—NUCLEAR SAFEGUARDS 

9 AND NUCLEAR FUEL SUPPLY 

10 SEC. 101. FINDINGS. 

11 Congress makes the following findings: 

12 (1) The Treaty on the Non-Proliferation of Nu13 clear Weapons, done at Washington, London, and 

14 Moscow July 1, 1968, and entered into force March 

15 5, 1970 (commonly known as the ‘‘Nuclear Non16 Proliferation Treaty’’ or ‘‘NPT’’) and the safeguards 

17 system of the International Atomic Energy Agency 


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1 (IAEA) are indispensable to international peace and 

2 security. 

3 (2) Congress has long supported efforts aimed 

4 at effective and efficient assurances of nuclear fuel 

5 supply, the strengthening of IAEA safeguards, and 

6 assistance to the developing world for nuclear and 

7 non-nuclear energy sources, as embodied in the Nu8 clear Non-Proliferation Act of 1978 (22 U.S.C. 3201 

9 et seq.). 

10 (3) The February 22, 2005, Report of the 

11 IAEA Experts Group on Multilateral Approaches to 

12 the Nuclear Fuel Cycle found that, in addition to in13 creased verification activities in various nations such 

14 as Iran, another factor contributing to significant 

15 and troubling demands on the IAEA safeguards sys16 tem was that ‘‘the civilian nuclear industry appears 

17 to be poised for worldwide expansion’’ and that 

18 ‘‘[r]apidly growing global demand for electricity, the 

19 uncertainty of supply and price of natural gas, soar20 ing prices for oil, concerns about air pollution and 

21 the immense challenge of lowering greenhouse gas 

22 emissions, are all forcing a fresh look at nuclear 

23 power. As the technical and organizational founda24 tions of nuclear safety improve, there is increasing 

25 confidence in the safety of nuclear power plants. In 


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1 light of existing, new and reawakened interest in 

2 many regions of the world, the prospect of new nu3 clear power stations on a large scale is therefore 

4 real. A greater number of States will consider devel5 oping their own fuel cycle facilities and nuclear 

6 know-how, and will seek assurances of supply in ma7 terials, services and technologies.’’ 

8 (4) The same report also found, ‘‘Two primary 

9 deciding factors dominate all assessments of multi10 lateral nuclear approaches namely ‘Assurance of 

11 non-proliferation’ and ‘Assurance of supply and serv12 ices.’ Both are recognised overall objectives for gov13 ernments and for the NPT community. In practice, 

14 each of these two objectives can seldom be achieved 

15 fully on its own. History has shown that it is even 

16 more difficult to find an optimum arrangement that 

17 will satisfy both objectives at the same time. As a 

18 matter of fact, multilateral approaches could be a 

19 way to satisfy both objectives.’’ 

20 (5) The same report also found, ‘‘The non-pro21 liferation value of a multilateral arrangement is 

22 measured by the various proliferation risks associ23 ated with a nuclear facility, whether national or mul24 tilateral. These risks include the diversion of mate25 rials from [a multilateral nuclear approach or MNA] 


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1 (reduced through the presence of a multinational 

2 team), the theft of fissile materials, the diffusion of 

3 proscribed or sensitive technologies from MNAs to 

4 unauthorised entities, the development of clandestine 

5 parallel programmes and the breakout scenario. The 

6 latter refers to the case of the host country ‘break7 ing out’, for example, by expelling multinational 

8 staff, withdrawing from the NPT (and thereby ter9 minating its safeguards agreement), and operating 

10 the multilateral facility without international con11 trol.’’ 

12 (6) The 2004 Report of the United Nations 

13 Secretary-General’s High-Level Panel on Threats, 

14 Challenges and Change found that creating incen15 tives for countries to forego the development of do16 mestic uranium enrichment and reprocessing facili17 ties is essential, and that such suggestions, if imple18 mented swiftly and firmly, offer a real chance to re19 duce the risk of a nuclear attack, whether by states 

20 or non-state actors, and that such proposals ‘‘should 

21 be put into effect without delay’’. 

22 (7) On February 11, 2004, President George 

23 W. Bush stated, ‘‘The world’s leading nuclear ex24 porters should ensure that states have reliable access 

25 at reasonable cost to fuel for civilian reactors, so 


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1 long as those states renounce enrichment and re2 processing. Enrichment and reprocessing are not 

3 necessary for nations seeking to harness nuclear en4 ergy for peaceful purposes.’’ 

5 (8) According to some experts, global energy 

6 demand will grow by 50 percent in the next 20 

7 years, predominantly in the developing world. 

8 (9) Nuclear power may play an increasing role 

9 in electricity supply to both the developed and the 

10 developing world over the next several decades. 

11 (10) The Government Accountability Office 

12 (GAO) stated in testimony before Congress in Sep13 tember 2006 that a significant factor limiting the ef14 fectiveness of the current IAEA safeguards system is 

15 that ‘‘more than half, or 111 out of 189, of the 

16 NPT signatories have not yet brought the Additional 

17 Protocol into force, including the United States’’. 

18 (11) The GAO also testified that an additional 

19 ‘‘weakness in implementing strengthened safeguards 

20 is that safeguards are significantly limited or not ap21 plied in about 60 percent, or 112 out of 189, of the 

22 NPT signatory countries—either because they have 

23 an agreement (known as a small quantities protocol) 

24 with IAEA, and are not subject to most safeguards 


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1 measures, or because they have not concluded a 

2 comprehensive safeguards agreement with IAEA’’. 

3 (12) The GAO also testified that ‘‘while IAEA 

4 is increasingly relying on the analytical skills of its 

5 staff to detect countries’ undeclared nuclear activi6 ties, the agency is facing a looming human capital 

7 crisis. In the next 5 years, IAEA will experience a 

8 large turnover of senior safeguards inspectors and 

9 high-level management officials. Delays in filling 

10 critical safeguards positions limit IAEA’s ability to 

11 implement strengthened safeguards.’’ 

12 (13) Outdated and unnecessary staff restric13 tions have prevented the IAEA from maintaining 

14 and equipping a well-trained cadre of professional 

15 staff at the IAEA’s Safeguards Analytical Labora16 tory (SAL), located at Seibersdorf, Austria. 

17 (14) A goal of the Department of State’s budg18 et request for fiscal year 2007 for United States vol19 untary contributions to the IAEA was 

20 ‘‘[s]trengthening quality control and sensitivity of 

21 analyses by the Safeguards Analytical Laboratory 

22 (SAL) and the Network of Analytical Laboratories, 

23 and reviewing needs for possible refurbishment or 

24 replacement of SAL’’. 


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1 (15) Considerable investment is needed for SAL 

2 to meet future IAEA requirements as its workload 

3 is growing, the laboratory’s infrastructure is aging, 

4 and IAEA requirements have become more demand5 ing, and while initial plans have been made for lab6 oratory enhancement and are currently pending 

7 budgetary approval (sometime in 2009), the simple 

8 fact is that, as more countries implement IAEA 

9 safeguards, many more nuclear samples come to 

10 SAL for analysis. 

11 (16) Any proposals for the creation of bilateral 

12 or multilateral assurances of supply mechanisms 

13 must take into account, and be achieved in a manner 

14 that minimizes, the risk of nuclear proliferation or 

15 regional arms races and maximizes adherence to 

16 international nonproliferation regimes, including, in 

17 particular, the Guidelines of the Nuclear Suppliers 

18 Group (NSG), and the IAEA Additional Protocol. 

19 (17) Any proposal to create an assurance of 

20 supply mechanism in or with a certain country or 

21 group of countries should not result in decreased 

22 emphasis on existing nuclear safeguards verification 

23 efforts and compliance challenges. 

24 (18) The existing funding, planning, and execu25 tion of IAEA safeguards is not sufficient to meet the 


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1 predicted growth in the future of civilian nuclear 

2 power, and therefore any growth in civilian nuclear 

3 power must be evaluated against the challenges it 

4 poses to verification of the assurances of peace and 

5 security provided by the IAEA safeguards system. 

6 (19) The existing IAEA safeguards system, and 

7 the Additional Protocol and the Guidelines of the 

8 NSG, represent the current, minimum standards for 

9 controlling access to and trade in civilian nuclear 

10 technology and should continue to be improved, ex11 panded, and strengthened. 

12 SEC. 102. DECLARATION OF POLICY. 

13 (a) CONTINUATION OF EXISTING POLICY.—It shall 

14 remain the policy of the United States— 

15 (1) to create mechanisms to provide adequate 

16 supplies of nuclear fuel consistent with the provi17 sions of the Nuclear Non-Proliferation Act of 1978 

18 (22 U.S.C. 3201 et seq.), in particular title I of such 

19 Act (22 U.S.C. 3221 et seq.); 

20 (2) to strengthen the IAEA safeguards system 

21 consistent with the provisions of the Nuclear Non22 Proliferation Act of 1978 (22 U.S.C. 3201 et seq.), 

23 in particular title II of such Act (22 U.S.C. 3241 et 

24 seq.); and 


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1 (3) to cooperate with other nations, inter2 national institutions, and private organizations to 

3 assist in the development of non-nuclear energy re4 sources under title V of the Nuclear Non-Prolifera5 tion Act of 1978 (22 U.S.C. 3261 et seq.). 

6 (b) DECLARATION OF NEW POLICY.—It shall be the 

7 policy of the United States to discourage the development 

8 of enrichment and reprocessing capabilities in additional 

9 countries, encourage the creation of bilateral and multilat10 eral assurances of nuclear fuel supply, and ensure that 

11 all supply mechanisms operate in strict accordance with 

12 the IAEA safeguards system and do not result in any ad13 ditional unmet verification burdens for the system. 

14 SEC. 103. SAFEGUARDS ANALYTICAL LABORATORY. 

15 (a) AUTHORIZATION OF APPROPRIATIONS.—In addi16 tion to the amount requested by the President for United 

17 States Voluntary Contributions to the IAEA for Fiscal 

18 Year 2008, an additional $10,000,000 is authorized to be 

19 appropriated under this Act for the refurbishment or pos20 sible replacement of the IAEA Safeguards Analytical Lab21 oratory. 

22 (b) REPORT.—Not later than 180 days after the date 

23 of the enactment of this Act, the Secretary of State shall 

24 submit to the appropriate congressional committees a re25 port on the refurbishment or possible replacement of the 


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1 IAEA Safeguards Analytical Laboratory pursuant to sub2 section (a). 

3 SEC. 104. SAFEGUARDS TECHNOLOGY DEVELOPMENT PRO4 GRAM. 

5 The Secretary of State is authorized, in cooperation 

6 with the Secretary of Energy and the Directors of the Na7 tional Laboratories and in consultation with the Secretary 

8 of Defense and the Director of National Intelligence, to 

9 pursue a program— 

10 (1) to strengthen technical safeguards research 

11 and development; 

12 (2) to increase resources, identify near-term 

13 technology goals, formulate a technology roadmap, 

14 and improve interagency coordination on safeguards 

15 technology; and 

16 (3) to examine proliferation resistance in design 

17 and development of all future nuclear energy sys18 tems. 

19 TITLE II—NUCLEAR FUEL 

20 SUPPLY 

21 SEC. 201. AUTHORITY FOR BILATERAL AND MULTILATERAL 

22 NUCLEAR FUEL SUPPLY MECHANISMS. 

23 (a) IN GENERAL.—The President is authorized to 

24 create, consistent with title I of the Nuclear Non-Pro25 liferation Act of 1978 (22 U.S.C. 3221 et seq.), and other 


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1 applicable provisions of law, bilateral and multilateral 

2 mechanisms to provide a reliable supply of nuclear fuel 

3 to those countries and groups of countries that adhere to 

4 policies designed to prevent the proliferation of nuclear 

5 weapons and that decide to forgo a national uranium en6 richment program and spent nuclear fuel reprocessing fa7 cilities. 

8 (b) PURPOSE OF MECHANISMS.—The mechanisms 

9 authorized under subsection (a) shall, to the maximum ex10 tent practicable, take into account the following: 

11 (1) The economic rationale for a country or 

12 countries pursuing nuclear power, including existing 

13 sources of power for such country or countries. 

14 (2) Whether such country or countries are in 

15 compliance with their obligations under applicable 

16 safeguards agreements and additional protocols with 

17 the IAEA. 

18 (3) Whether or not the development in such 

19 country or countries of the complete nuclear fuel 

20 cycle would impose new, costly IAEA safeguards 

21 measures that cannot be supported by current IAEA 

22 safeguards implementation in such country or coun23 tries, such that there is a reasonable assurance that 

24 all nuclear materials in such country or countries 

25 are for peaceful purposes and that there are no 


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1 undeclared nuclear materials or activities in such 

2 country or countries. 

3 (4) An evaluation of the proliferation dangers 

4 of such country or countries developing nuclear fuel 

5 cycle facilities for the production and disposition of 

6 source and special nuclear materials. 

7 (5) Whether or not the country or countries 

8 that would be recipients of nuclear fuel or other as9 sistance provided by the United States are or have 

10 ever been designated as state sponsors of terrorism 

11 pursuant to section 620A of the Foreign Assistance 

12 Act of 1961 (22 U.S.C. 2371), section 40 of the 

13 Arms Export Control Act (22 U.S.C. 2780), or sec14 tion 6(j) of the Export Administration Act (50 

15 U.S.C. App. 2405(j)). 

16 (6) If done under a bilateral supply mechanism, 

17 whether IAEA safeguards are being applied or will 

18 be applied to any facility, site, or location where 

19 international nuclear fuel supply activities are to be 

20 carried out. 

21 (7) Whether, in the case of a multilateral sup22 ply mechanism, procedures are in place to ensure 

23 that when United States funds are used or when 

24 United States nuclear materials are to be used, exVerDate Aug 31 2005 03:52 Sep 12, 2007 Jkt 059200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\S1138.RS S1138

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1 ported, or reexported, all applicable provisions of 

2 United States law are followed. 

3 (8) Whether the recipient country or countries 

4 of any fuel provided under this Act are or will be5 come a party, prior to the commencement of any nu6 clear fuel supply under this Act, to— 

7 (A) the Nuclear Non-Proliferation Treaty; 

8 (B) in the case of a non-nuclear-weapon 

9 State Party to the Nuclear Non-Proliferation 

10 Treaty, a comprehensive safeguards agreement 

11 that is in force, pursuant to which the IAEA 

12 has the right and obligation to ensure that safe13 guards are applied, in accordance with the 

14 terms of the agreement, on all source or special 

15 fissionable material in all peaceful nuclear ac16 tivities within the territory of such country, 

17 under its jurisdiction, or carried out under its 

18 control anywhere, for the exclusive purpose of 

19 verifying that such material is not diverted to 

20 nuclear weapons or other nuclear explosive de21 vices; 

22 (C) an additional protocol; 

23 (D) the Convention on Nuclear Safety, 

24 done at Vienna September 20, 1994, and en25 tered into force October 24, 1996; 


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1 (E) the Convention on Physical Protection 

2 of Nuclear Materials, done at Vienna October 

3 26, 1979, and entered into force February 8, 

4 1987; and 

5 (F) the Convention on Supplementary 

6 Compensation for Nuclear Damage, done at Vi7 enna September 12, 1997. 

8 (9) The extent to which the recipient country or 

9 countries have or will have prior to the commence10 ment of any nuclear fuel supply under this Act effec11 tive and enforceable export controls regarding nu12 clear and dual-use nuclear technology and other sen13 sitive materials comparable to those maintained by 

14 the United States. 

15 (10) The conformity of the safety and regu16 latory regimes in the recipient country or countries 

17 regarding the nuclear power sector with similar 

18 United States laws and regulations. 

19 (11) The history of safety or environmental 

20 problems associated with any nuclear site, facility, or 

21 location in the recipient country or countries in the 

22 past, and the potential for future safety or environ23 mental problems or issues in connection with the ci24 vilian nuclear power development plan of the country 

25 or countries. 


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1 (12) Whether the recipient country or countries 

2 have resident within them any persons or entities in3 volved in the illicit trafficking of nuclear weapons, 

4 nuclear materials, or dual-use nuclear technology. 

5 (13) Whether the recipient country or countries 

6 have or will have sufficiently open and transparent 

7 civilian power markets such that United States firms 

8 may benefit from any such bilateral or multilateral 

9 supply mechanisms. 

10 (c) RULE OF CONSTRUCTION.—Nothing in this Act 

11 shall be construed to provide any authority with respect 

12 to bilateral cooperation with another country or countries 

13 or any international organization or organizations in 

14 atomic energy that is additional to the authority provided 

15 under the Atomic Energy Act of 1954 (42 U.S.C. 2011 

16 et seq.) and all other applicable laws and regulations in 

17 effect on the date of the enactment of this Act. 

18 SEC. 202. REPORT ON THE ESTABLISHMENT OF AN INTER19 NATIONAL FUEL AUTHORITY. 

20 (a) REPORT REQUIRED.—Not later than 180 days 

21 after the date of enactment of this Act, the President shall 

22 submit to the appropriate congressional committees a re23 port detailing the feasibility of establishing an Inter24 national Nuclear Fuel Authority (INFA) as called for in 


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1 section 104 (a)(1) of the Nuclear Non-Proliferation Act 

2 of 1978 (22 U.S.C. 3223(a)(1)). 

3 (b) CONTENT.—Without regard to any previous re4 ports submitted under section 104 (a)(1) of the Nuclear 

5 Non-Proliferation Act of 1978 (22 U.S.C. 3223), the re6 port required under subsection (a) shall evaluate, with re7 spect to the feasibility of the establishment of the Inter8 national Nuclear Fuel Authority, the following: 

9 (1) United States laws and regulations that 

10 could be affected by the establishment of an INFA. 

11 (2) What the cost to the United States Govern12 ment could be of establishing an INFA. 

13 (3) Potential locations for the INFA. 

14 (4) The potential for creating a fuel supply 

15 bank under the control of the INFA. 

16 (5) Nuclear materials that should be placed 

17 within the control of the INFA, including which nu18 clear activities should be carried out by the INFA 

19 for the production of nuclear fuel or for use as fuel. 

20 (6) Whether the INFA should provide nuclear 

21 fuel services to recipient countries. 

22 (7) Whether a multilateral supply mechanism, 

23 such as the INFA, is, in the judgment of the Presi24 dent, superior to bilateral mechanism for nuclear 

25 fuel supply. 


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1 (8) How such an international organization 

2 should operate to preserve freedom of markets in 

3 nuclear fuel and avoid undue interference in the effi4 cient operation of the international nuclear fuel mar5 ket. 

6 (9) The degree and extent to which such a mul7 tilateral supply mechanism should be under the con8 trol of, or a subordinate organization within, the 

9 IAEA, including whether establishing such an INFA 

10 would be superior or preferable to allowing the 

11 IAEA, pursuant to Article IX of the Statute of the 

12 IAEA, to become an international broker of nuclear 

13 fuel and nuclear fuel services, including with respect 

14 to an examination of the costs to IAEA Member 

15 States of effectively carrying out clauses (1) through 

16 (4) of paragraph (H) of such Article. 

17 (10) The likely receptivity of the major coun18 tries involved in the supply of nuclear fuel and nu19 clear services to the creation of a multilateral supply 

20 mechanism such as the INFA or one under the 

21 IAEA. 

22 SEC. 203. SENSE OF THE SENATE ON IAEA FUEL SUPPLY. 

23 It is the sense of the Senate that— 

24 (1) consistent with the long-standing support 

25 provided by Congress for the nuclear verification and 


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1 technical cooperation projects of the IAEA, and with 

2 a view toward effective verification of safeguards and 

3 a desire to ensure that the expansion of nuclear 

4 power remains only for peaceful purposes, the 

5 United States should support, either in annual vol6 untary and off-budget contributions to the IAEA, or 

7 in the provision of nuclear fuel to the IAEA, a nu8 clear fuel bank within the IAEA; 

9 (2) the Senate commends the President for the 

10 September 26, 2005, announcement at the 49th Ses11 sion of the General Conference of the IAEA that the 

12 United States will reserve up to 17 metric tons of 

13 highly enriched uranium for an IAEA verifiable as14 sured supply arrangement; 

15 (3) the Senate commends the efforts of the Nu16 clear Threat Initiative (NTI) to contribute 

17 $50,000,000 to the IAEA to help create a low en18 riched uranium stockpile owned and managed by the 

19 IAEA; and 

20 (4) a combination of public and private efforts, 

21 including the provisions of law previously enacted in 

22 the Nuclear Non-Proliferation Act of 1978 (22 

23 U.S.C. 3201 et seq.) and other applicable laws, ini24 tiatives supported by the President, efforts provided 

25 for by private groups, and the recommendations of 


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1 many relevant studies, such as those cited in section 

2 101, will be necessary to effectively and flexibly 

3 manage the growth of civilian nuclear power in a 

4 manner that does not result in undue burdens on 

5 the IAEA safeguards system. 


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Calendar No. 349 

110TH CONGRESS 

1ST SESSION S. 1138 

[Report No. 110

–151] 

A BILL 

To enhance nuclear safeguards and to provide asforgo certain fuel cycle activities. surances of nuclear fuel supply to countries that 

SEPTEMBER 11, 2007 

Reported without amendment 


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