Saudis have leverage to keep uranium enrichment rights in a US nuclear deal

U.S. Energy Secretary Rick Perry and Saudi delegates meet today in London to begin discussions that could pave the way for American companies to sell billions of dollars’ worth of nuclear technology to the kingdom. While details of these negotiations are unknown, the Saudis likely would refuse any deal from their American ally that offered fewer concessions than what the Obama administration gave U.S. adversary Iran in its own nuclear agreement, most especially the right to uranium enrichment.

Riyadh is always eager to strengthen political, scientific and economic ties with Washington but it will, in all likelihood, look to other suppliers if the United States insists on the so called “gold standard” agreement that would require Saudi Arabia to forfeit its uranium enrichment rights in exchange for U.S. nuclear support. After all, in addition to the United States, Russia, China, France, South Korea and Japan all have expressed varying degrees of interest in supporting Saudi Arabia’s nuclear bid, giving the kingdom alternatives.

{mosads}Over the past year, a clear shift in Saudi-Russia relations, most especially in the realm of energy cooperation, has made Moscow an early favorite to potentially replace Washington for such a project. In October, King Salman became the first Saudi monarch to visit Russian President Vladimir Putin in Moscow. And in February, Russian Energy Minister Alexander Novak and his Saudi counterpart, Khalid Al Falih, met in Riyadh to discuss the possibility of Russia building two nuclear reactors for the kingdom by 2019.

Allowing Moscow to gain a nuclear foothold in Saudi Arabia would deal a serious blow to U.S. regional influence and prestige. It also could sink America’s moribund nuclear power industry. With domestic nuclear energy consumption set to halve by 2050, Westinghouse, which filed for bankruptcy last year, must look to international markets to stay afloat. The kingdom, which wants to build 16 nuclear reactors producing a combined 17.6 gigawatts of energy by 2040, which would provide Westinghouse and the U.S. nuclear industry with a lifeline.

Concerns that compromising on the “gold standard” would allow Saudi Arabia to develop a nuclear weapon are unfounded. While it is true that the technologies used to enrich uranium into fuel for energy can be used to create fuel for nuclear weapons, any agreement the Saudis sign will be governed by strict international protocols that prevent the kingdom from importing or developing enrichment technology before it implements all non-proliferation safeguards required by international law.

Saudi Arabia is a signatory to the Nuclear Non-Proliferation Treaty, which required it to relinquish its right to nuclear weapons in exchange for the peaceful use of nuclear technology. Riyadh also has an agreement with the International Atomic Energy Agency, which commits it to accepting IAEA safeguards for all peaceful nuclear activities conducted on its soil.

Most important, Riyadh has not yet signed on to the IAEA Additional Protocol, which is needed to verify that Saudi Arabia is not conducting any undeclared nuclear activity. With the exception of North Korea, all prospective suppliers of nuclear enrichment technology are subject to Nuclear Suppliers Group (NSG) restrictions on technology transfers to non-nuclear states. This includes Pakistan, which applied for NSG membership in 2016 and which also wants an NSG waiver removing key restrictions on Islamabad’s ability to import nuclear technology. Were Pakistan (or any other state) to transfer enrichment technology to Saudi Arabia before Riyadh signed the Additional Protocol (and implemented a host of additional safeguards), it would risk expulsion from the NSG and become an international pariah.

Though much attention is given to Saudi Arabia’s geopolitical rivalry with Iran, the Saudis’ nuclear push is driven almost entirely by economic concerns. Within 20 to 25 years, Saudi Arabia estimates its domestic oil consumption, which exceeds 3 million barrels per day, will match oil production. Even with economic diversification efforts well under way, the kingdom will continue to rely heavily on oil export income for decades to come. Using cost-effective alternative energy sources to offset domestic consumption is the only way for Saudi Arabia to export enough oil to keep the state fiscally solvent.

Furthermore, exploiting an estimated 60,000-plus tons of uranium ore is essential to turning mining into one of the “new pillars” of the economy, as set out by Vision 2030, the kingdom’s blueprint for socioeconomic transformation.

Under these conditions, the United States has far more to gain from accommodating the Saudis than not. In addition to checking Russia’s growing regional influence and propping up the U.S. nuclear industry, an accord could deter Iran’s nuclear push. By linking technology transfer restrictions to Iranian compliance with the much-contested Joint Comprehensive Plan of Action, Washington could hypothetically dispatch enrichment technology (e.g., centrifuges) to Riyadh in the event that Tehran violated its agreement or resumed its nuclear weapons program after the “sunset provisions” expire.

Outside of Iran, Saudi Arabia can cite U.S. accords with Morocco, Turkey and Egypt. Although each of these countries requires U.S. permission to enrich uranium, none was required to forfeit its enrichment rights, weakening any arguments that the “gold standard” is a necessary safeguard in the volatile Middle East.

Given these regional precedents and viable alternatives in Russia and others, the kingdom has the incentive — and the leverage — to insist on an agreement that does not require it to forego its enrichment rights. Washington should listen, lest the “gold standard” cost the United States a golden opportunity.

Ali Shihabi is founder of Arabia Foundation, a Washington-based think tank.