II 

★(Star Print)

110TH CONGRESS 

1ST SESSION S. 1138 

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 and Mr. BAYH) introduced the following bill; which 

was read twice and referred to the Committee on Foreign Relations 

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’’. 

6 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. 


ccoleman on PRODPC74 with BILLS
2 

•S 1138 IS1S 

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. 

1 SEC. 3. APPROPRIATE CONGRESSIONAL COMMITTEES DE2 FINED. 

3 In this Act, the term ‘‘appropriate congressional com4 mittees’’ means the Committee on Foreign Relations of 

5 the Senate and the Committee on Foreign Affairs of the 

6 House of Representatives. 

7 TITLE I—NUCLEAR SAFEGUARDS 

8 AND NUCLEAR FUEL SUPPLY 

9 SEC. 101. FINDINGS. 

10 Congress makes the following findings: 

11 (1) The Treaty on the Non-Proliferation of Nu12 clear Weapons, done at Washington, London, and 

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

14 5, 1970 (commonly known as the ‘‘Nuclear Non15 Proliferation Treaty’’ or ‘‘NPT’’) and the safeguards 

16 system of the International Atomic Energy Agency 

17 (IAEA) are indispensable to international peace and 

18 security. 

19 (2) Congress has long supported efforts aimed 

20 at effective and efficient assurances of nuclear fuel 

21 supply, the strengthening of IAEA safeguards, and 


ccoleman on PRODPC74 with BILLS
3 

•S 1138 IS1S 

1 assistance to the developing world for nuclear and 

2 non-nuclear energy sources, as embodied in the Nu3 clear Non-Proliferation Act of 1978 (22 U.S.C. 3201 

4 et seq.). 

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

6 IAEA Experts Group on Multilateral Approaches to 

7 the Nuclear Fuel Cycle found that, in addition to in8 creased verification activities in various nations such 

9 as Iran, another factor contributing to significant 

10 and troubling demands on the IAEA safeguards sys11 tem was that ‘‘the civilian nuclear industry appears 

12 to be poised for worldwide expansion’’ and that 

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

14 uncertainty of supply and price of natural gas, soar15 ing prices for oil, concerns about air pollution and 

16 the immense challenge of lowering greenhouse gas 

17 emissions, are all forcing a fresh look at nuclear 

18 power. As the technical and organizational founda19 tions of nuclear safety improve, there is increasing 

20 confidence in the safety of nuclear power plants. In 

21 light of existing, new and reawakened interest in 

22 many regions of the world, the prospect of new nu23 clear power stations on a large scale is therefore 

24 real. A greater number of States will consider devel25 oping their own fuel cycle facilities and nuclear 


ccoleman on PRODPC74 with BILLS
4 

•S 1138 IS1S 

1 know-how, and will seek assurances of supply in ma2 terials, services and technologies.’’. 

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

4 deciding factors dominate all assessments of multi5 lateral nuclear approaches namely ‘Assurance of 

6 non-proliferation’ and ‘Assurance of supply and serv7 ices.’ Both are recognised overall objectives for gov8 ernments and for the NPT community. In practice, 

9 each of these two objectives can seldom be achieved 

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

11 more difficult to find an optimum arrangement that 

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

13 matter of fact, multilateral approaches could be a 

14 way to satisfy both objectives.’’. 

15 (5) The same report also found, ‘‘The non-pro16 liferation value of a multilateral arrangement is 

17 measured by the various proliferation risks associ18 ated with a nuclear facility, whether national or mul19 tilateral. These risks include the diversion of mate20 rials from [a multilateral nuclear approach or MNA] 

21 (reduced through the presence of a multinational 

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

23 proscribed or sensitive technologies from MNAs to 

24 unauthorised entities, the development of clandestine 

25 parallel programmes and the breakout scenario. The 


ccoleman on PRODPC74 with BILLS
5 

•S 1138 IS1S 

1 latter refers to the case of the host country ‘break2 ing out’, for example, by expelling multinational 

3 staff, withdrawing from the NPT (and thereby ter4 minating its safeguards agreement), and operating 

5 the multilateral facility without international con6 trol.’’. 

7 (6) The 2004 Report of the United Nations 

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

9 Challenges and Change found that creating incen10 tives for countries to forego the development of do11 mestic uranium enrichment and reprocessing facili12 ties is essential, and that such suggestions, if imple13 mented swiftly and firmly, offer a real chance to re14 duce the risk of a nuclear attack, whether by states 

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

16 be put into effect without delay’’. 

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

18 W. Bush stated, ‘‘The world’s leading nuclear ex19 porters should ensure that states have reliable access 

20 at reasonable cost to fuel for civilian reactors, so 

21 long as those states renounce enrichment and re22 processing. Enrichment and reprocessing are not 

23 necessary for nations seeking to harness nuclear en24 ergy for peaceful purposes.’’. 


ccoleman on PRODPC74 with BILLS
6 

•S 1138 IS1S 

1 (8) According to some experts, global energy 

2 demand will grow by 50 percent in the next 20 

3 years, predominantly in the developing world. 

4 (9) Nuclear power may play an increasing role 

5 in electricity supply to both the developed and the 

6 developing world over the next several decades. 

7 (10) The Government Accountability Office 

8 (GAO) stated in testimony before Congress in Sep9 tember 2006 that a significant factor limiting the ef10 fectiveness of the current IAEA safeguards system is 

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

12 NPT signatories have not yet brought the Additional 

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

14 (11) The GAO also testified that an additional 

15 ‘‘weakness in implementing strengthened safeguards 

16 is that safeguards are significantly limited or not ap17 plied in about 60 percent, or 112 out of 189, of the 

18 NPT signatory countries—either because they have 

19 an agreement (known as a small quantities protocol) 

20 with IAEA, and are not subject to most safeguards 

21 measures, or because they have not concluded a 

22 comprehensive safeguards agreement with IAEA’’. 

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

24 is increasingly relying on the analytical skills of its 

25 staff to detect countries’ undeclared nuclear activiVerDate Aug 31 2005 01:04 May 08, 2007 Jkt 059200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S1138.IS S1138

ccoleman on PRODPC74 with BILLS
7 

•S 1138 IS1S 

1 ties, the agency is facing a looming human capital 

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

3 large turnover of senior safeguards inspectors and 

4 high-level management officials. Delays in filling 

5 critical safeguards positions limit IAEA’s ability to 

6 implement strengthened safeguards.’’. 

7 (13) Outdated and unnecessary staff restric8 tions have prevented the IAEA from maintaining 

9 and equipping a well-trained cadre of professional 

10 staff at the IAEA’s Safeguards Analytical Labora11 tory (SAL), located at Seibersdorf, Austria. 

12 (14) A goal of the Department of State’s budg13 et request for fiscal year 2007 for United States vol14 untary contributions to the IAEA was 

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

16 analyses by the Safeguards Analytical Laboratory 

17 (SAL) and the Network of Analytical Laboratories, 

18 and reviewing needs for possible refurbishment or 

19 replacement of SAL’’. 

20 (15) Considerable investment is needed for SAL 

21 to meet future IAEA requirements as its workload 

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

23 and IAEA requirements have become more demand24 ing, and while initial plans have been made for lab25 oratory enhancement and are currently pending 


ccoleman on PRODPC74 with BILLS
8 

•S 1138 IS1S 

1 budgetary approval (sometime in 2009), the simple 

2 fact is that, as more countries implement IAEA 

3 safeguards, many more nuclear samples come to 

4 SAL for analysis. 

5 (16) Any proposals for the creation of bilateral 

6 or multilateral assurances of supply mechanisms 

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

8 that minimizes, the risk of nuclear proliferation or 

9 regional arms races and maximizes adherence to 

10 international nonproliferation regimes, including, in 

11 particular, the Guidelines of the Nuclear Suppliers 

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

13 (17) Any proposal to create an assurance of 

14 supply mechanism in or with a certain country or 

15 group of countries should not result in decreased 

16 emphasis on existing nuclear safeguards verification 

17 efforts and compliance challenges. 

18 (18) The existing funding, planning, and execu19 tion of IAEA safeguards is not sufficient to meet the 

20 predicted growth in the future of civilian nuclear 

21 power, and therefore any growth in civilian nuclear 

22 power must be evaluated against the challenges it 

23 poses to verification of the assurances of peace and 

24 security provided by the IAEA safeguards system. 


ccoleman on PRODPC74 with BILLS
9 

•S 1138 IS1S 

1 (19) The existing IAEA safeguards system, and 

2 the Additional Protocol and the Guidelines of the 

3 NSG, represent the current, minimum standards for 

4 controlling access to and trade in civilian nuclear 

5 technology and should continue to be improved, ex6 panded, and strengthened. 

7 SEC. 102. DECLARATION OF POLICY. 

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

9 remain the policy of the United States— 

10 (1) to create mechanisms to provide adequate 

11 supplies of nuclear fuel consistent with the provi12 sions of the Nuclear Non-Proliferation Act of 1978 

13 (22 U.S.C. 3201 et seq.), in particular title I of such 

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

15 (2) to strengthen the IAEA safeguards system 

16 consistent with the provisions of the Nuclear Non17 Proliferation Act of 1978 (22 U.S.C. 3201 et seq.), 

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

19 seq.); and 

20 (3) to cooperate with other nations, inter21 national institutions, and private organizations to 

22 assist in the development of non-nuclear energy re23 sources under title V of the Nuclear Non-Prolifera24 tion Act of 1978 (22 U.S.C. 3261 et seq.). 


ccoleman on PRODPC74 with BILLS
10 

•S 1138 IS1S 

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

2 policy of the United States to discourage the development 

3 of enrichment and reprocessing capabilities in additional 

4 countries, encourage the creation of bilateral and multilat5 eral assurances of nuclear fuel supply, and ensure that 

6 all supply mechanisms operate in strict accordance with 

7 the IAEA safeguards system and do not result in any ad8 ditional unmet verification burdens for the system. 

9 SEC. 103. SAFEGUARDS ANALYTICAL LABORATORY. 

10 (a) AUTHORIZATION OF APPROPRIATIONS.—In addi11 tion to the amount requested by the President for United 

12 States Voluntary Contributions to the IAEA for Fiscal 

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

14 appropriated under this Act for the refurbishment or pos15 sible replacement of the IAEA Safeguards Analytical Lab16 oratory. 

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

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

19 submit to the appropriate congressional committees a re20 port on the refurbishment or possible replacement of the 

21 IAEA Safeguards Analytical Laboratory pursuant to sub22 section (a). 


ccoleman on PRODPC74 with BILLS
11 

•S 1138 IS1S 

1 SEC. 104. SAFEGUARDS TECHNOLOGY DEVELOPMENT PRO2 GRAM. 

3 The Secretary of State is authorized, in cooperation 

4 with the Secretary of Energy and the Directors of the Na5 tional Laboratories and in consultation with the Secretary 

6 of Defense and the Director of National Intelligence, to 

7 pursue a program— 

8 (1) to strengthen technical safeguards research 

9 and development; 

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

11 technology goals, formulate a technology roadmap, 

12 and improve interagency coordination on safeguards 

13 technology; and 

14 (3) to examine proliferation resistance in design 

15 and development of all future nuclear energy sys16 tems. 

17 TITLE II—NUCLEAR FUEL 

18 SUPPLY 

19 SEC. 201. AUTHORITY FOR BILATERAL AND MULTILATERAL 

20 NUCLEAR FUEL SUPPLY MECHANISMS. 

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

22 create, consistent with title I of the Nuclear Non-Pro23 liferation Act of 1978 (22 U.S.C. 3221 et seq.), and other 

24 applicable provisions of law, bilateral and multilateral 

25 mechanisms to provide a reliable supply of nuclear fuel 

26 to those countries and groups of countries that adhere to 


ccoleman on PRODPC74 with BILLS
12 

•S 1138 IS1S 

1 policies designed to prevent the proliferation of nuclear 

2 weapons and that decide to forgo a national uranium en3 richment program and spent nuclear fuel reprocessing fa4 cilities. 

5 (b) PURPOSE OF MECHANISMS.—The mechanisms 

6 authorized under subsection (a) shall, to the maximum ex7 tent practicable, take into account the following: 

8 (1) The economic rationale for a country or 

9 countries pursuing nuclear power, including existing 

10 sources of power for such country or countries. 

11 (2) Whether such country or countries are in 

12 compliance with their obligations under applicable 

13 safeguards agreements and additional protocols with 

14 the IAEA. 

15 (3) Whether or not the development in such 

16 country or countries of the complete nuclear fuel 

17 cycle would impose new, costly IAEA safeguards 

18 measures that cannot be supported by current IAEA 

19 safeguards implementation in such country or coun20 tries, such that there is a reasonable assurance that 

21 all nuclear materials in such country or countries 

22 are for peaceful purposes and that there are no 

23 undeclared nuclear materials or activities in such 

24 country or countries. 


ccoleman on PRODPC74 with BILLS
13 

•S 1138 IS1S 

1 (4) An evaluation of the proliferation dangers 

2 of such country or countries developing nuclear fuel 

3 cycle facilities for the production and disposition of 

4 source and special nuclear materials. 

5 (5) Whether or not the country or countries 

6 that would be recipients of nuclear fuel or other as7 sistance provided by the United States are or have 

8 ever been designated as state sponsors of terrorism 

9 pursuant to section 620A of the Foreign Assistance 

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

11 Arms Export Control Act (22 U.S.C. 2780), or sec12 tion 6(j) of the Export Administration Act (50 

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

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

15 whether IAEA safeguards are being applied or will 

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

17 international nuclear fuel supply activities are to be 

18 carried out. 

19 (7) Whether, in the case of a multilateral sup20 ply mechanism, procedures are in place to ensure 

21 that when United States funds are used or when 

22 United States nuclear materials are to be used, ex23 ported, or reexported, all applicable provisions of 

24 United States law are followed. 


ccoleman on PRODPC74 with BILLS
14 

•S 1138 IS1S 

1 (8) Whether the recipient country or countries 

2 of any fuel provided under this Act are or will be3 come a party, prior to the commencement of any nu4 clear fuel supply under this Act, to— 

5 (A) the Nuclear Non-Proliferation Treaty; 

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

7 State Party to the Nuclear Non-Proliferation 

8 Treaty, a comprehensive safeguards agreement 

9 that is in force, pursuant to which the IAEA 

10 has the right and obligation to ensure that safe11 guards are applied, in accordance with the 

12 terms of the agreement, on all source or special 

13 fissionable material in all peaceful nuclear ac14 tivities within the territory of such country, 

15 under its jurisdiction, or carried out under its 

16 control anywhere, for the exclusive purpose of 

17 verifying that such material is not diverted to 

18 nuclear weapons or other nuclear explosive de19 vices; 

20 (C) an additional protocol; 

21 (D) the Convention on Nuclear Safety, 

22 done at Vienna September 20, 1994, and en23 tered into force October 24, 1996; 

24 (E) the Convention on Physical Protection 

25 of Nuclear Materials, done at Vienna October 


ccoleman on PRODPC74 with BILLS
15 

•S 1138 IS1S 

1 26, 1979, and entered into force February 8, 

2 1987; and 

3 (F) the Convention on Supplementary 

4 Compensation for Nuclear Damage, done at Vi5 enna September 12, 1997. 

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

7 countries have or will have prior to the commence8 ment of any nuclear fuel supply under this Act effec9 tive and enforceable export controls regarding nu10 clear and dual-use nuclear technology and other sen11 sitive materials comparable to those maintained by 

12 the United States. 

13 (10) The conformity of the safety and regu14 latory regimes in the recipient country or countries 

15 regarding the nuclear power sector with similar 

16 United States laws and regulations. 

17 (11) The history of safety or environmental 

18 problems associated with any nuclear site, facility, or 

19 location in the recipient country or countries in the 

20 past, and the potential for future safety or environ21 mental problems or issues in connection with the ci22 vilian nuclear power development plan of the country 

23 or countries. 

24 (12) Whether the recipient country or countries 

25 have resident within them any persons or entities inVerDate Aug 31 2005 01:04 May 08, 2007 Jkt 059200 PO 00000 Frm 00015 Fmt 6652 Sfmt 6201 E:\BILLS\S1138.IS S1138

ccoleman on PRODPC74 with BILLS
16 

•S 1138 IS1S 

1 volved in the illicit trafficking of nuclear weapons, 

2 nuclear materials, or dual-use nuclear technology. 

3 (13) Whether the recipient country or countries 

4 have or will have sufficiently open and transparent 

5 civilian power markets such that United States firms 

6 may benefit from any such bilateral or multilateral 

7 supply mechanisms. 

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

9 shall be construed to provide any authority with respect 

10 to bilateral cooperation with another country or countries 

11 or any international organization or organizations in 

12 atomic energy that is additional to the authority provided 

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

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

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

16 SEC. 202. REPORT ON THE ESTABLISHMENT OF AN INTER17 NATIONAL FUEL AUTHORITY. 

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

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

20 submit to the appropriate congressional committees a re21 port detailing the feasibility of establishing an Inter22 national Nuclear Fuel Authority (INFA) as called for in 

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

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


ccoleman on PRODPC74 with BILLS
17 

•S 1138 IS1S 

1 (b) CONTENT.—Without regard to any previous re2 ports submitted under section 104 (a)(1) of the Nuclear 

3 Non-Proliferation Act of 1978 (22 U.S.C. 3223), the re4 port required under subsection (a) shall evaluate, with re5 spect to the feasibility of the establishment of the Inter6 national Nuclear Fuel Authority, the following: 

7 (1) United States laws and regulations that 

8 could be affected by the establishment of an INFA. 

9 (2) What the cost to the United States Govern10 ment could be of establishing an INFA. 

11 (3) Potential locations for the INFA. 

12 (4) The potential for creating a fuel supply 

13 bank under the control of the INFA. 

14 (5) Nuclear materials that should be placed 

15 within the control of the INFA, including which nu16 clear activities should be carried out by the INFA 

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

18 (6) Whether the INFA should provide nuclear 

19 fuel services to recipient countries. 

20 (7) Whether a multilateral supply mechanism, 

21 such as the INFA, is, in the judgment of the Presi22 dent, superior to bilateral mechanism for nuclear 

23 fuel supply. 

24 (8) How such an international organization 

25 should operate to preserve freedom of markets in 


ccoleman on PRODPC74 with BILLS
18 

•S 1138 IS1S 

1 nuclear fuel and avoid undue interference in the effi2 cient operation of the international nuclear fuel mar3 ket. 

4 (9) The degree and extent to which such a mul5 tilateral supply mechanism should be under the con6 trol of, or a subordinate organization within, the 

7 IAEA, including whether establishing such an INFA 

8 would be superior or preferable to allowing the 

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

10 IAEA, to become an international broker of nuclear 

11 fuel and nuclear fuel services, including with respect 

12 to an examination of the costs to IAEA Member 

13 States of effectively carrying out clauses (1) through 

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

15 (10) The likely receptivity of the major coun16 tries involved in the supply of nuclear fuel and nu17 clear services to the creation of a multilateral supply 

18 mechanism such as the INFA or one under the 

19 IAEA. 

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

21 It is the sense of the Senate that— 

22 (1) consistent with the long-standing support 

23 provided by Congress for the nuclear verification and 

24 technical cooperation projects of the IAEA, and with 

25 a view toward effective verification of safeguards and 


ccoleman on PRODPC74 with BILLS
19 

•S 1138 IS1S 

1 a desire to ensure that the expansion of nuclear 

2 power remains only for peaceful purposes, the 

3 United States should support, either in annual vol4 untary and off-budget contributions to the IAEA, or 

5 in the provision of nuclear fuel to the IAEA, a nu6 clear fuel bank within the IAEA; 

7 (2) the Senate commends the President for the 

8 September 26, 2005, announcement at the 49th Ses9 sion of the General Conference of the IAEA that the 

10 United States will reserve up to 17 metric tons of 

11 highly enriched uranium for an IAEA verifiable as12 sured supply arrangement; 

13 (3) the Senate commends the efforts of the Nu14 clear Threat Initiative (NTI) to contribute 

15 $50,000,000 to the IAEA to help create a low en16 riched uranium stockpile owned and managed by the 

17 IAEA; and 

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

19 including the provisions of law previously enacted in 

20 the Nuclear Non-Proliferation Act of 1978 (22 

21 U.S.C. 3201 et seq.) and other applicable laws, ini22 tiatives supported by the President, efforts provided 

23 for by private groups, and the recommendations of 

24 many relevant studies, such as those cited in section 

25 101, will be necessary to effectively and flexibly 


ccoleman on PRODPC74 with BILLS
20 

•S 1138 IS1S 

1 manage the growth of civilian nuclear power in a 

2 manner that does not result in undue burdens on 

3 the IAEA safeguards system. 

Æ 


ccoleman on PRODPC74 with BILLS