ARCHIVESHISTORIQUES
DELACOMMISSION
COLLECTION RELIEEDES
DOCUMENTS "COM"
COM(79)23
Vol.1979/0010

Disclaimer
Conformément aurèglement(CEE,Euratom)n°354/83duConseildu1erfévrier1983
concernantl'ouvertureaupublicdesarchiveshistoriquesdelaCommunauté économique
européenne etdelaCommunauté européenne del'énergieatomique(JOL43du15.2.1983,
p.1),telquemodifiéparlerèglement(CE,Euratom)n°1700/2003du22septembre2003
(JOL243du27.9.2003,p.1),cedossierestouvertaupublic.Lecaséchéant,lesdocuments
classifiésprésentsdanscedossierontétédéclassifiés conformément àl'article5dudit
règlement.
Inaccordance withCouncilRegulation(EEC,Euratom)No354/83of1February1983
concerningtheopeningtothepublicofthehistoricalarchivesoftheEuropeanEconomic
Community andtheEuropeanAtomicEnergyCommunity (OJL43,15.2.1983,p.1),as
amendedbyRegulation(EC,Euratom)No1700/2003of22September2003(OJL243,
27.9.2003,p.1),thisfileisopentothepublic.Wherenecessary,classifieddocuments inthis
filehavebeendeclassified inconformitywithArticle5oftheaforementioned regulation.
InÜbereinstimmung mitderVerordnung(EWG,Euratom)Nr.354/83desRatesvom1.
Februar1983überdieFreigabederhistorischen ArchivederEuropäischen
Wirtschaftsgemeinschaft undderEuropäischen Atomgemeinschaft (ABI.L43vom15.2.1983,
S.1),geändertdurchdieVerordnung (EG,Euratom)Nr.1700/2003vom22.September2003
(ABI.L243vom27.9.2003,S.1),istdieseDateiderÖffentlichkeit zugänglich.Soweit
erforderlich,wurdendieVerschlusssachen indieserDateiinÜbereinstimmung mitArtikel5
dergenanntenVerordnungfreigegeben.

COMMISSION OFTHEEUROPEAN COMMUNITIES
COM(79 )23final
f .^
I- r., T c>
f :
*"** -- /N*Y/
■ VBrussel *6february 1979
•
ASPECTS OFEXTERNAL MEASURES BYTHECOMMUNITY INTHE
ENERGY SECTOR
(Communication oftheCommission totheCouncil )
COM(79 )23final

SUMMARY
Initscommunication totheCouncil onthe "Energy objectives for 1990
andprogrammes oftheMember States "(doc.C0M(78)613 final of
16November 1978 )theCommission listed aninitial setofexternal
measures tobecarried outbetween now and 1990 .
Inshort ,this will take thefollowing form :
-limiting theCommunity *sdependence onimports }
-diversifying supplies ;
-increasing stability ;
-stepping upcooperation with thedeveloping countries *
This document sets outtoexplain theway inwhich these objectives maybe
achieved sector bysector (coal ,oilandgas,uranium ),talcing into account
allthefactors making upanexternal energy policy (relations with the
producer States ,R&D,international organisations ),andtodetermine the
main features ofCommunity measures inthis field .
Itappears inevitable that ,inview ofthenewconditions which have
been imposed ontheworld energy market inrecent years ,theCommunity
initiative will supplement andreinforce theMember States *supply
measures .

ASPECTS OPEXTERNAL MEASURES BYTHE COMMUNITY INTHE
ENERGY SECTOR *
Since "theTreaties were signed ,therole ofenergy inworld economic
development hasproved decisive andeach Member State oftheCommunity
has ,inline with itsinterests ,adopted apolicy oraline ofbehaviour
towards theproducer States enabling ittocope with itsenergy requirements .
TheMember States have established close andfriendly relations ,some of
long standing ,with non-member countries ,inparticular with those countries
producing oiloruranium ,based oneconomic interests orhistorical links .
They rightly consider that therelations allow them –andcontinue toallow
them –tocope with thedifficulties which could arise intheir energy
supply .
However ,atamoment when there arestill serious effects ofthe1973-1974
crisis (during which ,itmayberecalled ,solidarity between theMember
States washardly evident )andwhen possible risks oftension maybe
detected inthemore orless near future (inparticular asregards oil),it
isnecessary toidentify theaspects ofCommunity action which would give
thepolicies hitherto pursued bytheMember States intheexternal sector
theconsistency which they sometimes lack .
*This document should beread inthelight ofthereflections contained
inthedocument "Energy objectives for 1990 programmes ofthe
Member States ",andinparticular paragraphs 18-20 thereof .

Whatever thedifferences intheir respective situations ,they share
certain basic interests andinthefirst place thesecurity oftheir
energy supplies .Furthermore ,theincrease intheir exports ofenergy
products andequipment will help them tobalance their trade figures .
TheCommunity 'srole ineach ofthemain sectors -coal ,oilandgas ,
uranium –must beassessed onthe basis ofthese interests . More
general energy developments must also betaken into consideration :
international discussions andnegotiations ,development ofalternative
sources ,research anddevelopment and ,ofcourse ,cooperation with the
developing countries .*
COAL
1.Supply
Coal supply raises fewproblems asregards imports from non-
member countries .In1978 theCommunity consumed around 287
million tonnes ofcoal ,ofwhich 46million tonnes -16$-were
imported .Internal production isspread unequally among the
Member States oftheCommunity (88$concentrated inGermany
andtheUnited Kingdom )whereas imports aremore diversified :
-Poland 33$
–United States 16%
-Republic of
South Africa 23$
-Australia 15$
-USSR 9$
-other countries 4$
2.Trade System
Most coal products **aresubject not toaCCTbut tonational duties ,
allofthem consolidated .These duties areoften zero duties ,except
intheFederal Republic ofGermany where there arespecific duties on
coals andagglomerates ,inItaly onagglomerates ,inFrance onbrown
*Communi cation from theCommission totheCouncil (COM(78)355 final of
1August 1978):cooperation with developing countries inthefield of
energy .
**CCTheadings 27.01,27.02 and27.04.

-3-
coals andagglomerates .Except fortheGerman andItalian duties ,
these duties arelow .Prance andBenelux have asystem ofimport
licences andGermany animport quota (5*5million tonnes ayear until
1981 ).
Under Chapter XoftheECSC Treaty theMember States retain
responsibility fortheir commercial policy asregards coal .However ,
incertain circumstances ,theCommission isauthorised totake measures
oraddress recommendations totheMember States regarding customs
duties ,theadministration oflicences ,dumping practices andthe
quantitative restrictions concerning non-member countries .
3.Outlook
The Commission has already stressed theneed totake account ofthe
varying situations within theCommunity and toreconcile thediverging
interests oftheMember States .*Todate ,these have proved too
contradictory for acompromise tobefound oncommercial policy .
However ,itismore than ever indispensable totake into account both
thelong-term structural problems ofcoal supplies and theshort –term
cyclical difficulties concerning outlets forCommunity coal .
The Community ^basic task isstill therefore toease theshort-term
cyclical difficulties currently facing Community producers .The
Commission has thus proposed support measures for theintra-Community
trade incoking coal andpower station coal without adopting any
restrictive measures oninternational trade .
Nevertheless ,asystem formonitoring imports ofpower station coal
wassetupin1977 sothat theCommission could closely follow the
import trend andalways beinformed ofthesituation .Quantitative
restrictions would notnecessarily lead togreater consumption of
Community coal buttoincreased dependence onoil ,totheextent that
Community coal isnotcompetitive atinternational level .
*Medium –term guidelines forcoal 1975 "to1985 O.J•C22of30.1.1975

-4-
Three types ofmeasure should ,besystematically encouraged :
-theparticipation ofEuropean ooal companies injoint ventures in
non-ipember countries ,particularly bymeans ofECSC loans .
-theconclusion oflong-term contracts between Community users
andoverseas producers .
-whenever called forbycommercial interests ,theorganisation
oftechnical cooperation with non-member countries todevelop
processes forconverting coal into hydrocarbons (liquefaction ,
gasification ).
TheCommunity 'sdependence onoutside sources appears most evident
asregards oil :in1977 "theCommunity ^crude oilimports (485million
tonnes )represented more them 50#ofgross energy consumption andmore
than 92#oftheCommunity ^gross oilconsumption .*
Thefollowing table lists themain suppliers andtheproportion of
Community imports accounted forbyeach ofthese countries .01L
1.Supply
Saudi Arabia
Iran
Iraq
Libya
Kuwait
Nigeria
Abu Dhabi
Eastern Europe
Algeria
Qat«.r
Norway148.9 mt30.7#
77.9 mt16.0%
47.8 mt 9.8#
39.3 mt 8.1#
30.3 mt 6.2#
29.6 mt 6.1#
25.3 mt 5.2#
21.2 mt 4.6#
17.3 mt 3.5#
8.5mt 1.756
7.0mt 1.4#
*The 1978 figures arenotyetavailable

-5-
Forsome ofthese countries ,exports totheCommunity form ahigh
proportion oftheir production (Norway 51%,Iraq 43%,Qatar 40%,
Libya 39%).
TheCommunity *sposition ofdependence isnotlikely tochange appreciably
since netoilimports in1990 ,asin1985,*could still account for
around 40%oftheCommunity *sgross energy consumption and80%of
itsgross oilconsumption .
Imports andexports ofpetroleum products ,nowpractically "balanced at
around 40million tonnes ,areofmarginal importance ,representing less
than 8%oftheCommunity *sgross oilconsumption .Theproblem of
imports ofthose products arises more inthemedium term inthetwin
context ofcurrent refining surpluses intheCommunity andthedesire
oftheexporting countries gradually tomake greater on-the-spot use
oftheir natural resources .
Theproportion ofgross energy consumption accounted forbyoilvaries
appreciably from Member State toMember State (reaching 80%inthecase
ofDenmark ). There isnoreal Community policy onsupplies ofcrude oil
andpetroleum products .However ,aconsistent approach totheCommunity 's
oilsupply problems will befacilitated bythepreparation ofannual import
forecasts andmedium-term balance sheets following consultations between
theinterested parties (Member States -oilcompanies -Commission ).
2.Tariff system **
Thetariff system hasbeen changed several times since theestablishment
oftheEEC .Thecustoms duty oncrude oilwas zero–rated intheEEC
Treaty (List FinanAnnex totheTreaty ).
*Estimates based ontheMember States *forecasts communicated as
part oftheexamination ofthenational programmes .
**CCTheadings 27.09-27.16 .

-6-
The customs duties onrefined ,petroleum products listed intheCCTwere
thus reduced orsuspended .Atpresent ,imported refined products are
exempt from duty when they aretobeprocessed inaCommunity refinery
orchemically converted inapetrochemical plant .There arepositive
duties of6%onlight andmedium oils and3.5% onheavy oils .
Following theconclusion ofassociation tfree trade orcooperation
agreements ,theCommunity hasgranted alarge number ofcountries
preferential tariffs ,either uptoacertain ceiling (theMaghreb countries ,
Egypt ,Syria ,Spain ,Turkey )orwithout anyquantitative restrictions
(EFTA ,ACP,Malta ,Lebanon ,Jordan ).
TheCommunity hasalso autonomously granted alldeveloping countries
tariff exemptions forpetroleum products imported from these countries
uptoanoverall ceiling foreach product which isfixed annually (now
2.6million tonnes ).Inaddition ,each country receiving these tariff
benefits hasitsexports restricted byacut-off of20%oftheoverall
ceiling .Iftheceiling orcut-off isexceeded ,theduty maybe
restored attherequest oftheCommission oraMember State .
In1977 imports ofrefined products represented about 6%oftheCommunity
market within which therefining industry iscurrently facing difficulties
ofasize which escapes nobody 'sattention .TheCommission intends to
prepare medium-term import forecasts andenter into consultations with
thesupplier countries andthecompanies sothat thedevelopment ofthis
trade maybemonitored more carefully andunderstood more effectively .
Initscommunication totheCouncil of23February 1978 onproductivity
intheCommunity oil-refining industry andpossible solutions ,the
Commission stated that ,assoon astherefining situation intheCommunity
hadimproved ,part oftheannual increase intheCommunity *sdemand for
petroleum products could becovered byanincrease inimports from oil-
producing countries .

Outlook
Theoilsector appears to "bethesector inwhich theCommunity could
consider taking newinitiatives .Governments andcompanies have to
date used theexisting market structure ; "because oftheconditions
which should prevail inthenext fewyears ,theCommunity will doubtless
have tosetupadditional machinery :
(a)Themain feature oftheperiod tocome isthepossibility of
tension ontheoilmarket "between 1985 and1990 "because
production will "besomewhat outofstep with consumption .This
tension will mean that oilprices will "beincreasingly fixed
inline with thefree play ofsupply anddemand onaseller 's
market .
TheCommunity must therefore putitself inaposition tocope with
these market conditions :theestablishment ofobjectives such as
netoilimports notexceeding 500million tonnes in19^5 is&step
inthis direction .
Inpractical terms ,this means that theCommunity must establish
regular relations with theproducer countries andtheir organisations
(OPEC ,OAPEC ).Thefirst meeting hasalready taken place between the
Commission andthelatter organisation .Further meetings areplanned
every sixmonths .TheCommunity must also make better useofthe
existing possibilities intheagreements already concluded with non-
member countries (such asAlgeria )andconsider theadvisability of
negotiating newagreements (containing asection onenergy )with
other producer countries .
(b)Nowthat oilisexpected tobecome scarcer intheyears tocome and
itisknown that noalternative energy (including nuclear energy and
coal )will completely fill this gapinthenext tenyears ,itis
evident that everything must bedone totrytoreduoe thedeficit ;

-8-
atpresent only newprospecting operations leading tonewdiscoveries
(such asthose recently made inMexioo )cansolve this problem .
Deposits insome ACPcountries have todate notbeen adequately
utilised asthey aresituated indifficult areas orpresent difficult
prospecting conditions (such asgreat depths ).
Inthis general context ,theCommunity could consider anextensive
range ofmeasures based ontwoessential aspects :
discussions with thenon-member countries concerned sothat they can
decide onvarious incentives (ontheadministrative ortaxlevel ,etc.)
tomake prospecting andexploitation more attractive totheEuropean
oil companies .
-thedevelopment ,forapplication inthenon-member countries ,ofa
Community incentive mechanism (subsidies toberepaid intheevent
ofsuccess ,possibly asystem ofcredit guarantees )foroilpros­
pecting ,based onthemechanism which iscurrently being discussed
bytheCouncil foroilprospecting intheCommunity ,butwhich could
bemore promising ifapplied toless well–developed regions .
Inthis connection ,theconclusion ofaEuro-Arab convention to
promote andprotect investment ,approved inprinciple bythefourth
meeting oftheGeneral Committee oftheEuro-Arab Dialogue of9December
1978 ,could offer areal advantage .
Finally ,theCommunity would have aninterest inencouraging non-member
producers todevelop adequate technology forusing their resources to
their best advantage .

-9-
Although appreciating thefact that thetransfers oftechnology are
covered "byindustrial contracts between economic operators ,the
Community could exert itsinfluence intwoways :
i)Encouraging thedissemination ofinformation obtained bythe
companies inimplementation ofRegulation (EEC)No3056/73f
under which technological development projects putforward by
theindustry benefit from Community aidwhich isrepayable in
theevent ofsuocess .Theoiltechnology conference tobe
organised bytheCommission inApril 1979 isagood example
ofwhat can beachieved inthis sector .
TheEuro-Arab Centre fortheTransfer ofTechnology ,the
establishment ofwhicfe was^approvld bythelastGeneral Committee
oftheEuro–Arab dialogue ,could possibly prove auseful means towards
this end .
ii)Aidforthetraining ofqualified staff ,either byorganising
various training courses intheCommunity orbyproviding teaching
ortraining staff forthetraining centres which already exist or
which are tobesetupinthenon-member countries *
GAS
1.Supply
In1977 theCommunity 'snatural gasretirements amounted toalmost 160
million toe,17%oftheCommunity *sprimary energy requirements .The
Netherlands covered 52*5% ofthis amount andimports from non-member
countries accounted for11%,theremaining 36.5% coming from other
production regions within theCommunity ,inparticular theNorth Sea .

-10-
This supply structure ischanging rapidly with thegradual exhaustion
oftheCommunity fields which arecurrently being exploited .
Dependence onimports from non-Community countries isincreasing
rapidly ;itwill probably reach 25$in1980 ,38$in1985andalmost 50$
in1990 .Import contracts have been concluded foratotal of93million
toeayear ,ofwhich around 30$will betransported bymethane tankers in
theform ofINC.*These lon^-term contracts offer abetter guarantee of
supply than import contracts forother types ofenergy ,without however
being completely free ofrisk .
Thefollowing table breaks down theCommunity 'snatural gasimports by
country oforigin andshows their development .
(•000million m^Groningen quality )
1toe ■1300m^
1978 1985 1990
Algeria 4*7 48.7 61.2
Libya 2.9 3.3 3.3
USSR 17.1 23.8 25.6
Norway 17*0 35.2 46.2
Iran - 8.1 10.0
Others ' - - 4.4
Total 41.7 119.1 150.7
Other types ofgas,inparticular LPG**(9*8million toein1916),account
foramodest proportion oftheCommunity 'senergy balance .However ,there
isevery indication ofsurpluses ontheworld market intheyears tocome ,
which could change theposition ofthese types ofgasontheCommunity
market .
♦Liquéfié dnatural gas .
**Liquefied petroleum gas

-11
2.Trade System
Allgasisadmitted ,into thecustoms territory oftheCommunity atzero
duty andwithout aquota .Themarket istherefore completely free and
open ,ensuring anexcellent trading position forthese products .
3.Outlook
Thenatural gasmarket will continue toexpand despite thelevelling off
ofCommunity production .Imports will thus play anincreasingly important
role incovering theCommunity 'sgasrequirements .Fortheforeseeable
future ,theworld reserves ofnatural gasarehigh enough topermit
this trend .Furthermore ,theUnited States' energy policy inthegas
sector should strengthen theCommunity 'sposition ontheworld market .
This favourable trend nevertheless raises anumber ofworries about the
security andcontinuity ofsupply andthehigh costs oflong-distance
transport .There arealso technical problems inexploiting natural gas
intheexporting countries andproblems infinancing theexport channels .
TheCommunity should examine allthese questions with theproducer countries
inanappropriate forum .Five points call forparticular attention :
1.Using thefinancing techniques which theCommunity nowhasatitsdisposal to
avoid delays insupplies totheCommunity asaresult oflack oftimely
approval ofthenecessary investment .
2.Rationalising theconstruction ofmethane tankers (theCommission
isalready granting financial support totheVerolme project for
building amethane tanker of300000m^permitting considerable
economies ofscale ).

-12-
3.Encouragingassociations ofimporters,atleastonsomeparts
ofthetransportroute(e.g.utilisationofI2JGterminalsor
jointgasstorageinstallations),failingconsortiaofthe
conventional type.
4.Implementingthenecessarymeasures(transportandstorage)
torecoverthegasflaredoffinthecountriesofthePersian
Gulf(120milliontoein1977)*
5.Interesting thegasindustryinusingfuturesurplusesofLPGto
increasethecalorificpowerofpoorgasandasarawmaterial
inpeakloppinginstallations .
Althoughthissubjectwasraised "bytheEuropeansideatthe
Euro–Arabdialogue,theproblemhasnotyet"beenexamined.
Afresheffortshould "bemadeinthisdirectiontointerest
theArabsideincooperationinthissector.

-13-
URANIUM
1.Supplv
In197° "theCommunity consumed about 10000tonnes ofnatural uranium
^while itsownproduction ,concentrated almost entirely inoneMember
State (France )amounted toless than 2500tonnes .In1985 and1990
Community requirements oould amount tomore than 20000and 30000
tonnes respectively .Internal production atthetime would "benomore
than 4000tonnes ,theCommunity *stotal resources now "being estimated
at120000tonnes .*
(Non–Community )production ofnatural uranium isnowmainly concentrated
intheUnited States (20000tonnes ofcapacity in1978),South Africa
(9000tonnes ),Canada (6500tonnes ),Niger andGabon (3500tonnes ).
Australia should join this list some time during thenext decade (reaching
6000tonnes in1985 )*
TheCommunity 'smain suppliers atpresent axeCanada ,Namibia ,Niger
andSouth Africa .These countries andAustralia will provide themajority
ofourimports intheyears tocome .This list shows thediversification
ofoursources ,anobvious condition forsecurity ofsupply .Thelist does
notappear toinclude other substantial suppliers for thenext decade ,
with thepossible exception oftheUnited States which will beanet importer
ofnatural uranium .Some South American andAfrican countries could join
thelist ofcountries supplying usinthenineties .China ,with .whom we
nowhave acooperation agreement ,could also become oneofoururanium
suppliers .
Consequently ,itiswith theabovementioned countries that themain
channels forsupplying Community undertakings with natural uranium
should beestablished inthe short andmedium term .These countries vary in
their control ofsupply conditions foressentially domestic reasons which are
thus difficult toforecasts quantities produced (inparticular Canada and
Australia ),andexportable (Canada ),price conditions ,conditions ofuse ,
etc.,nottomention conditions connected with thewish fornon-proliferation
(reprocessing ).
♦Resources "reasonably assured andestimated additional "

-14-
Inaccordance with theprovisions oftheEuratom Treaty and .taking into
account therecent development ofsupply structures intheCommunity a
joint approach istheonly way ofguaranteeing security of
supply oneconomically reasonable conditions andforwithstanding outside
pressures .Anapproach ofthis type should lead atCommunity level to
agreements laying down theframework for contracts to "benegotiated between
suppliers andusers .Itfollows that theposition ofusers would be
strengthened ifthey adopted anagreed line .Infact ,essentially
bilateral relations between Member States oftheCommunity and the supplier
countries arenot thebest guarantee for thesecurity ofsupplies toEEC
undertakings .*
Acceptance ofconditions negotiated bilaterally is,after all ,likely
tocompromise thecontinued existence ofthecommon market and the
equality ofaccess byCommunity users tooutside sources ofsupply .
2.Tariff system
Theautonomous duties for theEuratom headings aregenerally zero .** There
are some partial bindings tozero duty oraceiling rate .
3.Outlook
Theproduction ofthenuclear energy needed bytheCommunity requires
active cooperation with non-member countries andinternational
organisations asregards supply ,theassessment ofresources ,investments ,
control ofsecurity andresearch .
*TheCommissions communication totheCouncil onthe "encouragement of
European investment indeveloping countries "(C0M(78)23final of
26January 1978 )should berecalled inthis connection .
**CCTheadings 28.50-28.52 and81.04 .

-15-
TheCommunity currently hasagreements with theUSA ,Canada ,Brazil and
Argentina onthesupply ofnatural andenriched uranium .Unlike thecase
oftheUSAandCanada -which have played amajor role insupplying the
Community forthepast twenty years -thesupply clauses intheEuratom -
Brazil andEuratom-Argentina agreements have notyetproduced any
appreciable results .
(a)Allthese supply agreements areaccompanied "byconditions ofuse,
"basically acommitment tousenuclear material andequipment
exclusively forpeaceful purposes .Until theentry into force of
thenon-proliferation treaty only theEuratom control guaranteed
theexclusively peaceful use ofimported materials intheCommunity .
Since theentry into force oftheKPT ,outside suppliers require the
application oftheInternational Atomic Energy Agency 'scontrols (or
••guarantees ")tonuclear material which they send totheCommunity .
These guarantees areapplied inaccordance with thethree verification
agreements concluded bytheCommunity anditsMember States with the
IAEA .*
Foranumber ofyears some suppliers oftheCommunity have nolonger
been satisfied with IAEA guarantees alone but seek tosubject the
transfer ofnuclear materials andequipment toadditional conditions
which either restrict thepossible usage ofthenuclear materials
supplied totheCommunity (prior consent demanded bythesupplier
before "sensitive operations ")orincrease theoperating cost of
theinstallations (e.g. bystepping upoftheIAEA "verification ",
sometimes without excluding acertain retroactive nature ofthe
commitments tobeentered into .
These restrictions onfreedom ofuse could insome cases compromise
theCommunity *snuclear industrial strategies iftheir implementation
were tobesubject todecisions taken bynon-member countries .
*Euratom /7NWS/lAEA agreement of5April1973;Euratom/trK/lAEA agreement
of6September1976 andEuratom /Prance /lAEA agreement of27July1978*

-16-
Thefollowing points areinline with these preoccupations :
.therequests made bytheUSAand Canada torenegotiate thenuclear
cooperation agreements concluded "bythese countries with third countries ;
•thenegotiation ofmultilateral agreements (NPT ,international convention
onphysical protection );
arecent ruling bytheCourt ofJustice (14November 1978 )states that
theparticipation oftheMember States inaconvention onthephysical
protection ofnuclear materials ,installations andconsignments ,such
astheconvention currently being negotiated under theaegis ofthe
International Atomic Energy Agency ,iscompatible with theprovisions
oftheEAEC Treaty only iftheCommunity assuch asparty tothe
convention inthe same capacity astheStates for those fields falling
under itsjurisdiction ;
.adoption ofcodes ofgood conduct for theexporters ofnuclear
materials (theLondon Club );
.international nuclear fuel cycle evaluation (iNFCE ).
Atpresent ,itisdifficult toforecast theresults ofINFCE .However ,
itiscertain that this technical exercise will bepart ofaprocess
laying thefoundations foraninternational system tomake nuclear
development compatible with therequirements ofnon-proliferation .
Wearenowentering anewperiod inwhich international collaboration will
play aneven more essential role inthenuclear sector than inthepast .
Inthis connection ,theunderstandable interest oftheMember States
favours increased Community consolidation ,asthis would notraise
external barriers atall ,while attaching greater significance tothe
special nature oftheCommunity 'senergy situation .

-17-
TheCommission isfully aware that theenergy situation ofthe
Member States varies considerably .Itisnevertheless convinced
that ,inthemedium andlong-term view inwhich thedevelopment
ofpeaceful uses ofnuclear energy will "bebased ,theconsiderations
behind theeffort towards European integration –thegradual assertion
ofaseparate identity ,coupled however with preparedness fora
dialogue with thesuper-powers andtheother countries ofthe
world -should continue toplay afull role .
(b)Besides these political aspects ,commercial preoccupations have assumed
anincreasingly large place inthepast fifteen orsoyears (infact
since thebeginning ofnuclear-generated electricity ),putting
uranium andnuclear products among themajor items ofmany countries 1
trade balance :
•supply ofnatural uranium (and ,forsome ,enriched uranium )
ontheimport side ;
.ontheexport side ,enrichment oftheuranium ,fuel reprocessing ,
supply ofplants andnuclear materials areessential totheeconomic
life ofanincreasingly large number ofcountries ,including infirst
place theCommunity countries .
Enriched uranium
Astwoindustrial groups intheCommunity decided tosetupenrichment
plants atthebeginning oftheseventies –with theprospect ofnewenrichment
capacity from 1987 - "theCommunity *ssupply situation asregards enriched
uranium islikely toshow asurplus .Thelong-term contracts concluded with
outside sources ofsupply andthecapacities oftheenrichment plants setup
intheCommunity suggests that acertain quantity ofSWU*could appear in
themid-eighties andthis could beexported bytheCommunity producers .However ,
exports ofthis type must besubject totheprior authorisation oftheCommission
which ensures respect forthegeneral interests oftheCommunity andthe
international commitments entered into .
*Separate work unit .

-18-
TheCommunity assuch ,andtheCommission inparticular ,must spare
noeffort inpromoting these exports .
Reprocessing
Reprocessing tooisanessential service fortheCommunity asregards
exports .Without anticipating theexamination ofthis subject to "bemade at
theendofINFCE ,itshould berecalled that theCommunity isatpresent -
anddoubtlessly foranumber ofyears tocome –theonly body able to
offer reprocessing services tothose States whose nuclear installations
require it.This isanasset which justified allefforts made forpreserving
such anexceptional advantage .
RESEARCH AND DEVELOPMENT
1.About twothirds oftheCommunity *sprogrammes intheenergy R&D
sector takes theform ofprojects involving outside contractors
(indirect programmes ). TheCommunity maynotfreely dispose of
theresults ofthese programmes ;itscontractors arethus notobliged
togrant operating licences fortheir inventions ,whether patented or
not ,toanon-member country ,anational ofanon-member country oran
international organisation .*This considerably restricts thepossibility
oftheCommunity engaging ininternational cooperation relating toits
indirect R&Dprogrammes .Ontheother hand ,some countries donotallow
their contractors anyproperty ,rights ontheresults ofresearch financed
from public funds andoften demand the same from their partners incooperation
agreements .
2.TheCommunity isinfull possession oftheresults ofitsownprogrammes
(direct programmes ).Itcantherefore pass them onunder international
agreements which mayhave anoverall balance .Sometimes some elements of
♦However ,theCommission isentitled tosend some reports onthese
indirect action research projects (e.g. thefinal reports )tonon-
member countries orinternational organisations with which theCommunity
hasconcluded agreements inaccordance with Article 228oftheEECTreaty .

-19-
this overall "balance areeconomic (theacquisition ofoiloruranium )
oreven political .Butthedirect programmes form alimited part of
theCommunity 'senergy R&Dprogramme ,which itself accounts foronly
around 10^oftotal public expenditure inthis sector inthenine
Member States .
Despite these limitations ,theCommunity 'sinternational relations in
theenergy R&Dsector continue todevelop "both multi laterally and
bilaterally :
(a)Multilaterally ,theCommission ,along with itsMember States ,
contributes tothework oftheINFCE ,theOECD 'sNEA ,theOECD 's
IEAand theIAEA .Special mention should bemade ofcooperation
with theInternational Energy Agency onenergy R&D .TheCommission ,
ontheCommunity 'sbehalf ,hasconcluded eight agreements with the
IEAforimplementing this Agency 'senergy R&Dprogramme .This
cooperation has ledinparticular totheagreements implementing
thermonuclear fusion (textor andandsuperconducting magnet )and
theagreements onhydrogen research inwhich theCommunity plays
therole ofpilot organisation .
Theagreements which the Community has concluded with theIEA to
date ensure asuitable balance oftrade ,satisfying theCommission 's
contractors .Theproblems ofindustrial property have been resolved
case bycase .This shows that thedifficulties ofengaging ininternational
cooperation based onindirect programmes arenotinsurmountable .
(b)Bilaterally ,adistinction should bemade between cooperation with
advanced-technology countries andcooperation with other countries .
Ifitconsiders this valuable andif,inthecase ofindirect programmes ,
itsco–contractors agree ,theCommunity engages inprofitable cooperation
with highly-industrialised non-member countries such asSweden ,
Switzerland and theUnited States .When itisacase oforiented basic
research (cooperation between Euratom andSweden andEuratom and
Switzerland onthermonuclear fusion )andwhen theproblems of
industrial property canberesolved inrespect ofR&Dclosest to
themarketing stage ,bilateral cooperation with highly-industrialised

-20-
countries might sometimes bepreferred ifitpresents theopportunity
ofgoing further than cooperation inamultilateral framework ,while
still remaining 'balanced .Itisinthis spirit that theCommission is
examining thepossibility ofproposing totheCouncil cooperation on
anumber ofaspects intheenergy R&Dsector with Canada andthe
United States ,
3.Those countries which aremoderately orlittle developed intheR&Dsector
areeager toconclude energy R&Dagreements with theCommunity .Thespecific
nature ofdirect programmes currently concentrated onmatters ofconcern to
theCommunity ,acertain technological "backwardness ,thereluctance ofsome
Community *scontractors toseetheCommunity committing theresults ofthe
indirect programmes inagreements ofthis type orthepolitical nature ofsome
technologies have sofarruled outanymeaningful reply tothese increasingly
numerous requests ,inparticular asregards solar energy andsome aspects of
nuclear R&D .However ,theCommission believes that theCommunity hasarole
toplay vis-4^-visthedeveloping countries inthe'energy R&Dsector .The
role would bethat ofanintermediary "between theresearch institutes and
European technology owners andthedeveloping countries .Thedeveloping
countries could announce their specific requirements andthus permit the
Europeans tosteer their R&Dactivities more effectively .These contacts
could even reveal thevalue ofjoint R&Dprojects .Tothis end ,the
Commission isorganising theVarese conference onsolar energy in 19T9 «
DEVELOPMENT OFNEW SOURCES
TheCommunity ,inline with what wasdecided atthelatest summit meetings in
Bremen andBonn ,must give animportant place tothedevelopment ofalternative
energy sources and tocooperation inthis sector .
Itisaquestion notonly ofconsidering these problems from theangle of
strictly Community objectives "butalso ofexamining theextent towhich itis
possible toconsider thedevelopment ofrenewable energy sources aspart ofan

-21-
overall strategy ,taking into account therequirements andpotential
ofthedeveloping countries .Inthesolar sector inparticular ,andin
thecase ofgeothermal energy andbiomass techniques ,many developing
countries certainly offer more suitable operating conditions than the
Community countries .
Inthecommunication oncooperation with thedeveloping countries inthe
field ofenergy ,theCommission hasstressed thevalue ofcooperation ofthis
type .Inallthecontacts which ithaswith countries orgroups ofcountries
with which itislinked "byspecial relations ,theCommunity must propose the
establishment ofcooperation inthis sector .Apart from thepartner countries
oftheLom£ Convention ,this problem hasalready been mentioned incontacts
with OAPEC ,some Latin American countries andtheASEAN countries ,allof
whom have given afavourable answer .While taking account ofsimilar activities
already undertaken byother international organisations (thelist iscurrently
being drawn up),itshould besystematically proposed that these countries or
groupings should engage incooperation todevelop theuse ofrenewable sources
andtherational utilisation ofenergy atthesame time asexploiting conventional
sources more efficiently .
TheCommission proposes totackle theproblem inallthejoint committees
itattends with the countries with whom theCommunity hasagreements .
INTERNATIONAL ORGANISATIONS
Theproblem oftheCommunity 'srelations with organisations such astheIAEA
ortherole oftheCommunity indiscussions such astheINFCE hasalready been
mentioned .Anincreasing number ofinternational organisations nowdeal with
energy problems andtheCommunity assuch must play anactive role inthem all .
-International ^^£r£y_A£enc^ /OECD __
Wemust maintain close links with theIEAeven iftheparticipation ofonly
eight ofthenine Member States rules outtheadoption ofCommunity positions
except intheR&D sector .

-22-
Therecommendations currently being drawn upabout coal provide agood
example oftheneed totrytoharmonise thepositions adopted onthis
matter bytheeight other Member States ,taking into account theinterests
oftheCommunity andofallitsMembers andofcourse ofthepowers given to
theCommunity under theTreaties .
Similarly ,asregards cooperation with thedeveloping countries ,anad
hocgroup hasbeen setupwithin theOECD toexamine jointly thecooperation
activities ofallthecountries belonging tothis organisation ,particularly
bythenine Member States oftheCommunity ,asenvisaged intheBonn
communique .This group *sactivities will link upwith those currently
being undertaken bytheCommission atthe Council *srequest .
-United_N&tions General Assembly
Although theplenary committee oftheUnited Nations hasnotyetteckled
energy problems ,preparations should bemade toresume thedialogue on
this subject when themoment comes .Theproposed conference onnew or
renewable energy sources mayoffer theopening forsuch adialogue .The
preparation ofthedevelopment strategy mayalso provide anopportunity
todiscuss this .Without yettaking aprocedural decision which will depend
ontheoutcome ofthecurrent orfuture discussions attheUnited Nations ,the
Community should state itsbasic readiness totackle energy problems with the
interested countries inaspirit ofsolidarity and cooperation .
–Development £ommittee _^IMF^IBRD )
The Community should also support theinitiatives taken bysome industrialised
countries –including several Member States -toreinforce theWorld Bank*s
activities inrespect ofcooperation andthedevelopment ofenergy sources
inthedeveloping countries ,andrecommending that these questions should
beexamined bytheIMF/lBRD joint committee (Development Committee )which
isformally better suited than other bodies todeal with thetechnical and
financial aspects ofthese problems .

-23-
Despite thepractical difficulties towhich thesystem ofrepresentation to
this Committee maygive rise ,itwould "beadvisable inthis connection to
establish aCommunity position onthese matters .
Ec£n£mic_C°mmi ssionforEurope
This United Nations "body represents agood forum foranexchange ofinformation
andviews and ,possibly atalater stage ,forjoint studies onthedevelopment
ofenergy links between East andWest .
Forvarious reasons -which arepolitical innature -theEconomic Commission
forEurope does noteven have anenergy committee where these problems could
bediscussed .
Alltheactivities oftheEconomic Commission forEurope inthis sector have
been dominated since 1976 bytheSoviet proposal toconvene three high-level
pan-European conferences onenergy ,environment andtransport .TheCommunity
first rejected this initiative ,which fell outside theframework oftheEconomic
Commission forEurope .After ensuring that theconference ontheenvironment
took place within this framework ,itadopted afavourable position onexamination
ofenergy within theframework .Ittherefore called fortheestablishment ofa
group ofGovernment advisers onenergy with thestudy ofinformation problems
asone ofits first tasks .
Thequestion ofconvening apan-European conference cannot ofcourse be
seriously examined until asufficiently broad exchange ofinformation has
taken place .Itistherefore intheCommunity 'sinterest tosupport once
again ,atthenext session -inApril 1979 -oftheEuropean Commission for
Europe ,theidea ofsetting upagroup ofgovernment advisers onenergy .
TheUSSR and theother Socialist countries are ofconsiderable importance
intheworld energy sector notonly assuppliers ofenergy totheCommunity
(particularly gas)butalso asamajor element intheworld energy balance and
(possibly )intheprogrammes ofaidtothedeveloping countries .

-24-
CONCLUSION
Inthetwosectors inwhich external initiatives areofgreatest significance
inview ofthefact that itistherein that Community dependence isgreatest -
oilanduranium -theGovernments and companies have taken effective
measures .However ,inthewake ofacrisis which hasrevealed the
fragility ofthesystem itmaynowbeconsidered necessary togofurther
inthedirection ofCommunity action .
Asregards oi}.,some European companies claim that thecosts incurred asa
result ofsome oftheir activities (refining ,transport )nolonger assure
them thefunds needed forprospecting atthemoment when this ismost necessary .
Asregards uranium ,thenegotiations under waywith most oftheproducer
countries show that ,apart from commercial andfinancial aspects ,the
political considerations assume increasing importance andrequire the
intervention ofthepublic authorities astheonly body capable ofensuring
proper use ofthis product .
Inboth cases ,Community action isclearly thebest guarantee forsafeguarding
theinterests ofitsMember States ,either byhelping theoperators to
intensify their supply efforts byproviding theframework forgiving their
activities themaximum ofeffectivity .
TheCommission therefore submits thefollowing proposals totheCouncil :
Coal
The Community should :
. encourage thedevelopment ofjoint ventures between European
companies andtheproducer countries (forinstance ,bymeans ofECSC
credits );
encourage Community users toconclude long-term contracts with their
suppliers toallow them toconsider thenecessary investment ;
. develop ,incollaboration with thenon-member countries interested ,
itsR&Dactivities relating totheliquefaction andgasification ofcoal ,
and ofinterest for theEuropean industry .

-25-
Oil
TheCommunity will endeavour toestablish regular contacts with thegroups of
producer countries andinclude examination ofenergy problems initsbilateral
talks withalltheproducer States ,andintheagreements' itwillconclude .TheCommunity
will further attempt ,byappropriate means ,toencourage theoilcompanies to
increase prospecting throughout theworld ;itwill encourage theexchange of
technology andthetraining ofexperts from allthecountries interested by
means oftheinstruments atthedisposal oftheMember States .
Gas
TheCommunity will express itsinterest inthedevelopment oftheutilisation of
natural gasandwill study themeans ofsolving theproblems arising asregards
exploitation ,transport (construction ofmethane tankers )andstorage
(LUGterminals ).
Itwill study thepossibility ofusing themeans offinance atitsdisposal
topromote theuse ofgasintheCommunity .
Itwill encourage thegasindustry tostudy possible ways ofusing future
surpluses ofLPG .
Nuclear enerey
TheCommunity will attempt tofind asolution within theEuratom Treaty
totheproblems raised bythesupply ofnatural uranium tousers inthe
Member States :inthis connection ,theconclusion ofagreements under which
theoperators would sign thenecessary supply contracts appears tobethe
best means forreconciling commercial interests andpolitical imperatives .
TheCommunity will doallinitspower todefend theexport interests ofthe
Member States within existing international organisations oraspart of
discussions onvarious aspects ofthenuclear cycle ;enrichment ofuranium ,
reprocessing offuel ,export ofnuclear techniques andmaterial .

-26-
Research and development
Byconcluding agreements with thehighly-industrialised non-member countries ,
theCommunity will attempt toextend itsresearch anddevelopment activities
intheenergy sector .
Itwill increase itscooperation with thedeveloping countries inorder to
provide them assoon aspossible with processes enabling them tomake
maximum useoftheir various energy sources ,including newandrenewable
energy sources ._
International organisations
Inalltheinternational organisations inwhich itplays anactive role ,
theCommunity will display itsdesire tocontinue discussion ofenergy problems
inaspirit ofsolidarity andcooperation .