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Brazil and Argentina's Nuclear Cooperation

Carnegie Endowment for International Peace - Proliferation Analysis
Irma Arguello

9 January 2009 | Link to the article

Argentine President Kirchner and Brazilian President Lula da Silva

In February 2008, Argentine President Kirchner and Brazilian President Lula da Silva signed a nuclear cooperation agreement, one of seventeen signed agreements related to infrastructure, energy, and defense. Since then, technicians from both countries have worked on defining potential joint projects, such as a "uranium enrichment enterprise" and a "model nuclear power reactor that would meet the needs of the electrical systems of both countries and, eventually, of the region."[1]

 

Outcomes of a first follow-up meeting in September 2008, together with remarks by some officials directly involved in the process, made evident that most key decisions were still pending.[2]

The scope of shared nuclear activities, strategies of cooperation, type of technology transfers, and sources of funding (an issue of utmost concern due to the global economic crisis) remain unresolved and, after almost a year, still generate more doubts than certainties.

Furthermore, public policy statements from the recently launched Brazilian National Defense Strategy, which identifies nuclear energy as a high priority, have raised concerns about nuclear cooperation with Argentina, particularly relating to technology transfers. In fact, the new Brazilian strategy focuses on "one-way" inflows, which let the country achieve a growing technological pool and suggests "exclusive uses of technology," which could be understood as "no outflow." These concepts seem to better suit the model of a fully advanced technological partner, guiding Brazil all the way through its own development.[3]

A Wide Range of Nuclear Activities

The September joint declaration describes future efforts as encompassing "30 structuring projects on reactors and nuclear waste, fuel cycle, nuclear applications and regulations." After a rather pragmatic kick-off, the number of announced nuclear commitments has increased over time. It is possible that the joint company (EBEN), which was originally conceived to enrich uranium, could take on other nuclear activities related to health, agriculture, production of radiopharmaceuticals, development of research reactors, and materials technology.[4] Yet, it is uncertain if such a broad approach can be efficiently implemented.

The idea of joint work on nuclear propulsion for the Brazilian submarine, as cited by the press from the very beginning, was quickly disregarded. Furthermore, the Brazilian government made clear that the project would go ahead exclusively under the Navy's supervision.[5]

Balance Between Partners

Brazil and Argentina have been engaged in nuclear development for decades, including in the operation of nuclear power plants.[6]

In 1979, Argentina launched a reprocessing project (at a pilot plant scale) in Ezeiza, Buenos Aires, which was never completed. In 1983, it announced uranium enrichment based on its own technology of gaseous diffusion at a small facility of 20,000 SWU/yr located in Pilcaniyeu, near Bariloche (which still exists). Then in 1997, the SIGMA program was developed to improve efficiency and competitiveness. Argentina's enrichment plant, however, has never operated on an industrial level.[7]

Brazil built its first significant module of enrichment in 1987 at the Navy's Experimental Center of Aramar in Iperó, São Paulo, based on local ultracentrifuge technology, and it moved forward, in fits and starts, in the development of nuclear-powered submarines.

In 2006, an industrial enrichment plant of 120,000 SWU/yr (six times bigger than the Argentine one) opened in Resende, Rio de Janeiro. The facility is able to enrich uranium at 3.5 percent required by Brazilian power reactors, and to supply fuel for future submarines (they will use enriched uranium at less than five percent). Brazilians hope to become self-sufficient in nuclear fuel (an important milestone in Brazil's strategic plans) by 2012.[8]

Brazil's expected contributions to the common initiative would be its proven enrichment technology, its uranium abundance (sixth in the world, even with only 30 percent of its territory explored), and its ability to define and execute long-term plans. Argentina could bring its experience as a successful nuclear exporter,[9] and worldwide recognition of its excellent nonproliferation credentials. Argentina's development of advanced intermediate power reactors such as the CAREM (Modular Elements of Central Argentina) would also be of help. This pressurized water reactor, categorized as a SMR (Small & Medium Reactor), has an outstanding reputation regarding security and proliferation resistance. In addition, its "modular" construction makes it easy to adjust its power to countries' stated electricity requirements.[10]

Argentina and Brazil are seen as having been successful in turning their nuclear competition into cooperation through mutual confidence. This approach is often considered as a model for other regions where potential nuclear proliferation risks may be perceived.[11] However, it is not yet certain that both countries will become competent partners by taking advantage of their joint strengths. Certain obstacles could endanger this process. Bureaucratic resistance, as well as possible asymmetries of interests and views – especially those related to the possibility of sharing proprietary technology – could upset the internal balance of the agreement and, therefore, its long-term sustainability.

Incentives (More than Just Energy)

Bilateral cooperation was announced as a measure to help manage the current South American energy crisis, but the impact could be of minor significance. Nuclear energy accounts for about three percent of current electricity generation in Brazil and seven percent in Argentina (albeit four percent in total installed capacity).

The 2030 Energy Plan for Brazil projects four new nuclear power stations of about 1,000 MW each. Brazil currently depends on hydroelectric power for 91 percent of generation, and nuclear industry officials have suggested the country needs to diversify its energy resources.[12]

Yet such large-scale projects seem to lie beyond both countries' technological capabilities, and would therefore likely rely on other joint projects between Brazil and more experienced nuclear partners prepared to transfer technology.[13]

Statements by the Brazilian Mines and Energy Minister Edison Lobão suggest that Brazil sees its nuclear development on a global scale. In this different scenario, the country could install more than 60,000 MW of nuclear energy within the next 50 years, or one power plant per year. Such figures have raised questions about their feasibility and should be considered with caution.[14]

Argentina still needs to develop mid- and long-term plans to define the number of reactors to be built, as well as their technology and fuel.

Other factors, such as increasing geopolitical influence and the opportunity to become a global player in the potentially lucrative market of nuclear fuel (before international restraints might possibly be implemented), could also play a role.

From a geopolitical perspective, such a build-up would help Brazil strengthen its regional and global leadership. Brazil's active role in the creation of UNASUR (Union of South American Nations) and its proposal to create a South American Defense Council, a sort of NATO for the region, are two indications of its bid for regional leadership.[15]

Brazil has also shown a sustained effort in extending its influence beyond the region, such as campaigning for a permanent seat on the United Nations Security Council, its participation in the BRIC with Russia, India, and China, and its intention to partner with developed countries in selective international projects such as the ITER (originally the International Thermonuclear Experimental Reactor) on nuclear fusion.

Mastery of sophisticated nuclear technology confers an international prestige that both Brazil and Argentina are eager to win. Argentina had exercised a Latin American nuclear leadership for a long time, but it faded due to successive political and economic crises. Under present circumstances, Argentina seems to be a very convenient partner for Brazil since it has know-how, is not competing for leadership, and seems to perceive the joint venture, despite its final scope, as a good opportunity to reactivate its decayed nuclear program.

This strategic alliance could also turn Brazil and Argentina into global suppliers of enriched uranium and advanced reactors of intermediate power (for those areas or aims that could not justify the option of bigger units).

Many nations are currently considering building nuclear power plants. Even though this trend has to be reassessed in light of the current global economic crisis, there may still be a significant market which the partners could supply.[16] This could mean big economic benefits, even though this factor is not seen as a main motivation in the short and medium terms. High quality and profitable production within an adequate commercial scale will not be enough. A relevant fact is that Brazil and Argentina are the only non-signatories of the International Atomic Energy Agency's (IAEA) Model Additional Protocol (AP) within the Nuclear Suppliers Group (NSG). If the AP was made a mandatory condition of supply, both states could face difficulties in developing a healthy foreign trade scheme for advanced technological products, since their nuclear industries are still dependent in many ways on imports from other nuclear suppliers.

A detailed analysis of the new Brazilian National Defense Strategy suggests that the signature of a "traditional" AP will not likely happen in the short term. In fact, the document clearly states that Brazil will not endorse any further restrictions derived from the Nuclear Non-Proliferation Treaty (NPT), if nuclear-weapon states do not show progress on their own disarmament.[17]

Nevertheless, experts do not ignore the possibility that Brazil could engage in a sort of special agreement including provisions of the AP. Qualified sources remark that some members of the NSG have encouraged Brazil to accept such an agreement, which could be finalized through government-to-government negotiations.[18]

Technological and Structural Dilemmas

Argentina and Brazil still need to work out technological decisions related to reactors and uranium enrichment and the choice of suitable bilateral management schemes, if the countries want to move forward with nuclear cooperation. One option would be organizing a bilateral holding company with each country keeping its own facilities and technologies.[19] At first glance, this option looks simpler, since it would mean that each partner would work with its available capabilities. However, asymmetries in efficiency and scale would be difficult to balance.

A second option would be to develop a brand new joint facility, independent from those that already exist in both countries. Here the likely choice would be Brazil's centrifuge technology, given its overall comparative advantage over gaseous diffusion.[20]

In any event, it is clear, as stated in its National Defense Strategy, that Brazil is eager to receive,[21] but not yet ready to share its strategic technologies (for example, enrichment), and that any such project would be carried out with an explicit exclusion of any potential technological transfers to Argentina.[22]

The above issue raises some critical questions: Would Argentina adopt a similar approach on the advanced reactors technology transfer? Is such technology of real interest to Brazil? What would be the role of the "non-expert" partner? How would national programs compete with bilateral projects, taking into account the scarcity of technological resources, manpower, and financing in both countries?

Final Considerations

The Brazilian-Argentine nuclear cooperation agreement still requires some steps to translate words into action.

An alliance with Argentina would allow Brazil to project a regional and global leadership – according to its expectations – from a more solid basis. New doors could open to attractive commercial opportunities as a global nuclear exporter. In addition, an alliance with Argentina could help Brazil gain more international trust and clear previous doubts over potential hidden intentions regarding its nuclear program.

For Argentina, nuclear cooperation could mean a reinvigoration of its nuclear industry and the opportunity to partner with Brazil, with great potential of achievement.

From a nonproliferation point of view, a bilateral venture carried out by two democratic countries, without regional conflicts, and operating under efficient control by international organizations such as the ABACC (Brazilian-Argentine Agency of Nuclear Materials Accounting and Control) and the IAEA, offers far more guarantees than independent projects developed in isolation.

In any case, nuclear alliances should be based on transparency and developed under close monitoring by the international community.

About the Author

Irma Arguello is founder and CEO of the Nonproliferation for Global Security Foundation - NPSGlobal, an international private and non-profit initiative, based in Buenos Aires.

Notes

1. See Clóvis Rossi, "Brasil e Argentina assinam pacto para enriquecer urânio," Folha de S. Paulo, February 23, 2008, and IAEA, "Communication Dated 3 March 2008 Received from the Resident Representatives of Argentina and Brazil to the Agency Concerning the Peaceful Uses of Nuclear Energy," INFCIRC/722, March 4, 2008.
2. Ministerio de Relaciones Exteriores de Argentina, "Visita de Estado de la Presidenta Cristina Fernández de Kirchner a Brasil: Declaración Conjunta," Brasilia, September 8, 2008.
3. Ministério da Defesa do Brasil, "Estrategia Nacional da Defesa," EM Interministerial no 00437/md/sae-pr, December 17, 2008.
4. "Empresa binacional enriquecerá urânio," Jornal do Comercio, Interview with Alfredo Tranjan Filho, President of Industrias Nucleares do Brasil (INB), August 25, 2008. Also see footnote 2.
5. See Ministério da Defesa, Assesoria da comunicação, "Submarino nuclear do Brasil terá reactor da Marinha brasileira"; and Marinha do Brasil, "Subamarino Scorpène. A posição da Marinha," December 2008.
6. Angra I and II supply to the Brazilian electric network about 2,000 MW, twice the amount of energy generated by the Argentine Atucha I and Embalse. Argentina reactivated Atucha II (745 MW) and has set 2010 as a deadline for its completion. Brazil could reactivate Angra III, of 1350 MW, to be finished by 2014. See IAEA, "Restarting Delayed Nuclear Power Plant Projects," Nuclear Energy Series No/NP-T-3.4, February 2008.
7. Roberto Cirimello and Juan Bergallo, "Nuclear Fuel Cycle Developments in Argentina," Americas Nuclear Energy Symposium, 2002.
8. Ministério de Minas e Enérgia do Brasil, Empresa de Pesquisa Energética, "Plano Nacional de Energia - 2030," Approved by the CNPE, Conselho Nacional de Política Energética, June 25, 2007.
9. Argentina has exported research and radioisotopes production reactors to Peru, Algeria, Egypt, and Australia.
10. Vladimir Kusnetsov, "Advanced Small and Medium Sized Reactors (SMRs) - Part 2," Presented on ICTP-IAEA Workshop on Nuclear Reaction Data, Trieste, Italy, May 19-30, 2008. The CAREM prototype is expected to be in operation near Buenos Aires by 2013.
11. The so-called "neighbor to neighbor control" was put into practice in 1991 with a bilateral agreement which defined a common international position and created the ABACC (Brazilian-Argentine Agency of Nuclear Materials Accounting and Control). Shortly afterwards, the IAEA became a partner and the Quadripartite Agreement entered into force in 1994. See O. Peixoto, A. Oliveira, and O. do Canto, "Safeguards in Latin American Countries: The Role of ABACC," LAS/ANS Symposium 2008, Rio de Janeiro, June 2008.
12. See footnote 8.
13. A similar model of partnership was defined in the Brazil-France Defense agreement. See Nonproliferation for Global Security, "Confirmed: Agreement with France Includes the Brazilian Nuclear Submarine," December 23, 2008
14. "Lobão afirma que país terá mais 50 usinas nucleares," Folha de São Paulo, September 13, 2008.
15. Susanne Gratius, "¿Hacia una OTAN sudamericana?," FRIDE, Comentario, April 2008.
16. World Nuclear Association, "The Nuclear Renaissance," Information Paper 104, updated August, 2008; and Sharon Squassoni, "The Realities of Nuclear Expansion," Congressional Testimony, House Select Committee for Energy Independence and Global Warming, Washington, D.C., March, 2008.
17. See footnote 3.
18. Mark Hibbs, "NSG states engaging Brazil on Additional Protocol, ENR," Nuclear Fuel, November 3, 2008.
19. Agência Brasil, "Brasil e Argentina vão negociar constituição de empresa para enriquecimento de urânio," Interview with Celso Amorim, February 22, 2008.
20. By 2017, gaseous diffusion is likely to be phased out as uneconomic. Even the SIGMA innovations are unlikely to close the competitiveness gap. See report "Uranium Enrichment," World Nuclear Association, September 2008.
21. See footnote 3, and "Brazil Launches its National Defense Strategy," Nonproliferation for Global Security, December 18, 2008.
22. Agência Estado, "Brasil e Argentina vão criar empresa binacional nuclear," August 24, 2008. Also Denise Chrispim Marin,"Projeto de binacional nuclear está pronto. Mas sem a Marinha," O Estado de São Paulo, August 24, 2008.




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