The United Arab Emirates (UAE) is a federation of seven emirates (principalities): Abu Dhabi, Dubai, Sharjah, Ajman, Fujayrah, Umm Al Qawayn, and Ras Al Khaymah. National authority rests in the hands of a Federal Supreme Council, which is composed of the hereditary rulers of the country's constituent emirates and elects the national president from among its members. Sheikh Khalifa bin Zayed Al Nahyan, the ruler of Abu Dhabi, was elected UAE president in 2004 following the death of his father Sheikh Zayed bin Sultan Al Nahyan, who had ruled Abu Dhabi since 1966 and served as UAE president since 1971. Sheikh Khalifa was reelected for a second five-year term in November 2009. In practice, the wealthier and more powerful emirates of Abu Dhabi and Dubai exercise the strongest influence over the country's affairs; under current convention, the ruler of oil-rich Abu Dhabi serves as the UAE president, and the ruler of the UAE's commercial hub, Dubai, serves as vice president. The Supreme Council appoints the Prime Minister and the Council of Ministers (cabinet), which initiates legislation for ratification by the Supreme Council and the president. The United States and the UAE have enjoyed close and cooperative relations in recent years, in spite of periodic differences with regard to political reform, the Israel-Palestinian conflict, counterterrorism, and U.S. policies regarding Iraq and Iran. Military cooperation and arms sales form a key pillar of U.S.-UAE relations. The UAE hosts frequent port calls and shore visits for U.S. naval vessels and allows the U.S. military to use Al Dhafra air base in support of a variety of missions in the U.S. Central Command (CENTCOM) area of operations. In 2007 and 2008, the Bush Administration notified Congress of over $19.4 billion in potential arms sales to the UAE, including what would be the first overseas sale of the Terminal High Altitude Air Defense system. In 2009 and 2010, the Obama Administration notified Congress of a further $8.8 billion in potential sales, including the potential sale of 60 remanufactured and new AH-64D Block III APACHE helicopters. Bilateral trade has increased in recent years, with 2009 U.S. exports valued at over $12.2 billion, making the UAE the largest U.S. export market in the Middle East. The Bush Administration began negotiating a free trade agreement with the UAE in 2004, but did not conclude the negotiations. The United States does not import a significant amount of oil from the UAE. However, the UAE exports over 2 million barrels of oil per day, making it a key global energy producer. The government of the United Arab Emirates (UAE), like others in the Middle East, has announced plans to acquire nuclear energy production technology as a means of meeting projected national energy consumption needs. Renewed global interest in nuclear power has led some experts and observers to express concern that the projected spread of nuclear technology in coming years could contribute to nuclear proliferation. In the Middle East, added scrutiny is often applied to the motives and choices of regional actors regarding nuclear technology because of concern that Iran's nuclear program and Israel's presumed nuclear weapons may motivate other regional governments to seek nuclear technology for strategic or military purposes. Other concerns about nuclear safety relate to potential terrorist attacks or political instability, both of which have threatened some regional countries in recent years. UAE officials report that they have considered these potential risks carefully, and have announced plans and measures intended to address proliferation and security concerns. Most prominently, the UAE has based its nuclear program on a decision to forgo domestic uranium enrichment or fuel reprocessing and to rely on international market sources for its nuclear fuel services. This decision has significantly reduced proliferation concerns among many observers, including some members of Congress. Policymakers and advisers in the government of Abu Dhabi, in consultation with representatives from the other six emirates, have set out an ambitious agenda for the program and are guiding its implementation. In April 2008, the UAE government issued a policy statement that provides a rationale for the country's perceived need for nuclear energy and states guiding principles for the nuclear energy program. Operating and regulatory bodies have been formed and have begun their formal work. The end goal of the program, according to officials and related documents, is to build and operate a "fleet" of nuclear power plants to generate electricity for the UAE, supported by advanced, indigenously managed safety, regulatory, and security agencies. In January 2010, the UAE announced that it had chosen the Korea Electric Power Corporation (KEPCO of South Korea) to construct the first of four APR1400 nuclear reactors that would sell electricity to the Abu Dhabi Water and Electricity Authority. During 2010, the UAE's administrative preparations have continued apace, including site selection, environmental surveys, and security planning. The plant construction is to take place at Baraka, near Abu Dhabi's western border with Saudi Arabia (see Figure 1 below). All four plants are scheduled to be online by 2020. South Korea's export financing bank Kexim has agreed to supply $10 billion in financing to support the KEPCO project in Abu Dhabi. In November 2010, KEPCO was invited to purchase shares in the Emirates Nuclear Energy Corporation (ENEC) that is to operate the plants. UAE officials estimate that their country must expand its power generation and transmission capacity from the current level of 16 gigawatts to 40 gigawatts by 2020 in order to meet projected demand increases, which they estimate will continue growing at a 9% annual rate. In spite of the recent slowdown in global and domestic economic activity, representatives of the UAE nuclear program believe that the energy demand projections they are using to justify and plan the acquisition of nuclear plants remain accurate, particularly in light of planned industrial and commercial projects in energy-intensive sectors in the emirate of Abu Dhabi. To date, UAE officials and representatives have not publicly shared economic cost and energy use data referred to in briefings on their nuclear program. In arguing for nuclear energy as a solution to the country's projected energy needs, the UAE government policy statement concludes that "known volumes of natural gas that could be made available to the nation's electricity sector would be insufficient to meet future demand." The UAE currently exports roughly 600 million standard cubic feet per day of natural gas to Japan under long-term supply arrangements and imports roughly 2 billion cubic feet of natural gas from Qatar via the underwater Dolphin pipeline system. Similarly, UAE officials believe that crude oil and diesel could be "logistically viable" sources of energy, but would impose high economic opportunity costs (as a result of lost export revenue) and environmental costs. Officials determined that coal could be a more economical solution, but would have even greater environmental costs and, as an import, also would raise concerns for the UAE about the security of supply. UAE officials believe that solar and wind energy sources could supply "only 6-7% of peak electricity demand by 2020," even after "aggressive development." The end goal of the program, according to officials and related documents, is to build and operate a "fleet" of nuclear power plants to generate electricity for the UAE, supported by advanced, indigenously managed safety, regulatory, and security agencies that will be developed over time and with outside assistance. The UAE government is seeking to bring its first nuclear power plant online by 2017 along with required facilities and equipment for safety, storage, and system management. Under current plans, capacity would expand thereafter to three further nuclear power plants. A contract bidding and award process concluded in late 2009, and UAE officials chose South Korea's Korea Electric Power Corporation (KEPCO) as the primary engineering, procurement, and construction contractor. A number of U.S. and European firms have secured administrative and financial advisory contracts with the program. No specific decisions have been made regarding the source of nuclear fuel for the planned nuclear reactor or on handling spent reactor fuel. The UAE currently has no nuclear material under IAEA safeguards. It signed the NPT in 1995 and completed a Small Quantities Protocol in 2003. Non-nuclear weapons states without significant nuclear programs or nuclear material are permitted to conclude such Protocols. The UAE also has undertaken Technical Cooperation projects with the Agency, some of which are directly related to nuclear electricity generation. For example, a project begun in 1977 advised the government "on the establishment of a nuclear energy administration." A 1984 project focused on uranium exploration. More recently, a Technical Cooperation project approved in 2005 was designed to assess the "technical and economic feasibility" of a nuclear power and desalination plant. Active IAEA Technical Cooperation projects with the UAE focus on human resources development for atomic energy, feasibility studies for waste management, environmental monitoring, and nuclear accident early warning preparedness and response. A national law authorizing the program was adopted by the Federal Supreme Council in early October 2009. According to the State Department, the law, Federal Law 6 of 2009, "prohibits uranium enrichment and spent fuel reprocessing, creates a Federal Authority for Nuclear Regulation (FANR), and develops a nuclear material licensing and control system." UAE government representatives report that the UAE sought and received input on its draft nuclear law from the United States, United Kingdom, Japan, Korea, and France. In conjunction with the issuance of the law, a Board of Management for the FANR was announced, and the board named former U.S. Nuclear Regulatory Commission Executive Director for Operations Dr. William Travers as the FANR's first Director General. A nuclear energy policy advisory board reportedly has been formed, and UAE officials report that its members, though unnamed, include leading international nuclear energy industry officials.