The U.N.’s International Atomic Energy Agency said its Board of Governors has approved an agreement with Kazakhstan for the establishment of a nuclear fuel Low Enriched Uranium Bank, which will maintain a reserve of LEU “as an assurance supply mechanism for Member States in case they cannot obtain LEU on the global commercial market, through State-to-State arrangements or through any other means.”
The plan is to stockpile up to 90 tons of LEU at a fuel bank in Kazakhstan case of emergency supply problems around the world. The bank would keep a form of fuel on hand used by most nuclear reactors around the world, the IAEA said.
The IAEA Board also approved a transit agreement with the Russian Federation for the transport if the IAEA LEU through its territory to and from the supply cache.
“The conclusion of the two agreements, with today’s approval by the Board of Governors, represents a significant milestone for this important project, enabling us to proceed to full-scale implementation,” said IAEA Director General Yukiya Amano in a statement.
The IAEA Board of Governors authorized the establishment and operation of the IAEA LEU Bank on 3 December 2010. On 29 July 2011, Kazakhstan offered to host the IAEA LEU Bank in response to the Agency’s request for Expressions of Interest. Since 2011, Kazakhstan and the IAEA have been working on the technical details for the establishment of the IAEA LEU Bank and have negotiated the Host State Agreement governing the establishment and hosting of the Bank.
The IAEA LEU Bank will be owned and controlled by the IAEA but operated by Kazakhstan. Safety and security of the IAEA LEU Bank will be governed by Kazakhstan’s legal and regulatory requirements, and will meet the applicable provisions of the IAEA’s safety standards and security guidance documents. The LEU will also be subject to IAEA safeguards.
The IAEA LEU Bank will keep a supply of LEU on hand sufficient to run a 1,000 MWe light-water reactor. Such a reactor can power a large city for three years. The IAEA LEU Bank will be located at the Ulba Metallurgical Plant in Oskemen in northeastern Kazakhstan. The Ulba plant has been handling and storing nuclear material, including LEU, safely and securely for more than 60 years.
The reserve bank is expected to be operational in two years. One third of the $150 million required to set up the bank comes from U.S. investor Warren Buffett through the Nuclear Threat Initiative, a U.S.-based program that first proposed the reserve bank in 2006. Another third of the funding comes from the U.S. government. Other contributions to set up the LEU reserve has been donated by the European Union, Kuwait, the United Arab Emirates, Norway and Kazakhstan.
"Assurances of supply can provide Member States with additional confidence in their ability to obtain nuclear fuel in an assured and predictable manner," the IAEA said, "in particular in the event there is some unforeseen disruption in existing fuel supply arrangements."
The reserve bank is intended as a "supply mechanism of last resort," the agency said. As such, one of the guiding principles of the reserve bank is that the supply not be used to distort the commercial market or interfere with individual efforts to establish a reserve fuel supply. "Other assurance of supply ... include a guaranteed physical reserve of LEU maintained by the Russian Federation at the International Uranium Enrichment Center in Angarsk, Russian Federation, and a UK assurance of supply guaranty for suppliers of LEU enrichment services. The United States also operates its own LEU reserve," the agency said.
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