Absent successful U.S. negotiations China fills the void – US gold standard safeguards are key to prevent proliferation

Despite Saudi interest and the United States’ status as the world’s foremost producer of nuclear power,121 U.S.-Saudi nuclear cooperation has remained at a low level. Riyadh and Washington entered into a non-binding memorandum of understanding in 2008 that provided for low-level nuclear energy collaboration (and stated Saudi Arabia’s intent “to rely on existing international markets for nuclear fuel services as an alternative to the pursuit of enrichment and reprocessing”).122 The Trump administration controversially123 issued seven authorizations enabling U.S. companies to share unclassified nuclear technology with Saudi Arabia for marketing purposes.124 In 2022, the two countries entered into a nuclear safety cooperation memorandum of understanding.125

Since 2012, Riyadh and Washington have periodically attempted to negotiate an agreement pursuant to Section 123 of the Atomic Energy Act.126 Section 123 outlines the process for, and mandatory elements of, an agreement authorizing U.S. exports, for civilian purposes, of major nuclear material and equipment, including components of nuclear reactors. These “123 agreements” are subject to review by Congress, which can block them.127

As of December 2022, the United States had “123” nuclear cooperation agreements that govern cooperation with 47 countries, the IAEA, and Taiwan.128 In addition to the several nonproliferation commitments required by Section 123 itself, two of the agreements (Taiwan and the UAE) include a further legal commitment, by the recipient country, to forgo enrichment and reprocessing of any nuclear material (whether or not the United States is the source).129 Enrichment can be used to produce fuel for nuclear reactors, and enrichment and reprocessing can produce highly enriched uranium or separated plutonium, respectively, for nuclear weapons. The additional commitment to forgo enrichment and reprocessing is often referred to as the nonproliferation “gold standard.”130

U.S.-Saudi negotiation of a 123 agreement has reportedly stalled over Saudi rejection of “gold standard” language similar to the U.S.-UAE agreement.131 The Saudis have noticed that while the United States has been conditioning U.S.-Saudi nuclear cooperation on a commitment to forgo enrichment and reprocessing, the Iranians have not only enriched uranium but do so at near-weapons-grade levels132 and in a manner inconsistent with any Iranian civil nuclear power needs (Iran’s one nuclear power reactor — at Bushehr — does not require Iranian enrichment because its nuclear fuel is supplied by Russia).133 While the 2015 Joint Comprehensive Plan of Action (JCPOA) placed restrictions on Iran’s enrichment activities,134 it abandoned the previous international requirement that Iran cease “all enrichment-related and reprocessing activities.”135 The JCPOA’s restrictions were also to expire in a specified number of years,136 arguably legitimizing Iran’s development of an enrichment capacity capable of fueling a nuclear arsenal.

Another obstacle to a U.S.-Saudi 123 agreement is reportedly the U.S. insistence that Saudi Arabia supplement its agreement by entering into an Additional Protocol with the IAEA.137 The Additional Protocol provides the IAEA with additional inspection authorities. One hundred forty countries, plus the 27 member states of the European Atomic Energy Community (Euratom), have entered into Additional Protocol agreements with the IAEA.138 The UAE entered into such an Additional Protocol in conjunction with the U.S.-UAE 123 agreement.139 Indeed, in recent years, the United States has not negotiated any 123 agreements with countries that have not entered into an Additional Protocol.140

Congress has supported the executive branch’s nonproliferation policy toward Saudi Arabia, including on supplementing a 123 agreement with the “gold standard” and Additional Protocol. The Consolidated Appropriations Act for Fiscal Year 2023 (and several of its predecessors) prohibits the use of appropriated funds for Export-Import Bank support of nuclear exports to Saudi Arabia unless the kingdom has a 123 agreement “in effect;” “has committed to renounce uranium enrichment and reprocessing on its territory under that agreement;” and has “signed and implemented” an Additional Protocol with the IAEA.141

Both Congress and executive branch officials have repeatedly expressed concern that the Saudi nuclear program may be intended in part to position the kingdom for developing nuclear weapons.142 Saudi Arabia is a party to the Treaty on the Non-Proliferation of Nuclear Weapons, pursuant to which it is legally obligated “not to manufacture or otherwise acquire nuclear weapons.”143 However, several senior Saudi officials, including Crown Prince Mohammed bin Salman, have stated that if Iran acquires a nuclear bomb, the kingdom will follow suit. For example, in March 2018, Crown Prince Mohammed bin Salman said, “Saudi Arabia does not want to acquire any nuclear bomb, but without a doubt if Iran developed a nuclear bomb, we will follow suit as soon as possible.”144 Moreover, press reports have for two decades alleged that Saudi Arabia funded Pakistan’s nuclear weapons program and that Pakistan may be prepared to transfer nuclear weapons and technology if the Saudis request it.145

In recent years, Saudi Arabia has increased its nuclear cooperation with China, reportedly resulting in part from frustration with Washington’s strict terms and conditions.146 Riyadh and Beijing have reportedly signed at least three agreements on civil nuclear collaboration.147 The two countries are also actively mapping untapped Saudi deposits of mineable uranium ore.148 While some press reports have described the deposits as “potentially vast,”149 a joint publication by the IAEA and the Nuclear Energy Agency, released on April 3, 2023, described the Saudi search as thus far finding deposits that would be “severely uneconomic” to mine.150

Separately, China has provided Riyadh with technology the Saudis have recently started using to build ballistic missiles — the typical delivery system for nuclear weapons.151 There have also been unconfirmed reports152 that China has helped the Saudis construct a milling facility for extracting yellowcake from uranium ore.

The Saudi government has expressed strong interest in mining and milling uranium ore for both domestic use and export. In January 2023, the Saudi energy minister reiterated the kingdom’s desire to use domestic uranium resources for producing low-enriched uranium as nuclear fuel.153 Uranium mining could both facilitate a Saudi nuclear bomb program154 and provide the country with export revenue.

The United States does not have a monopoly on nuclear reactor technology. Other countries, including China and Russia, are capable of providing a full range of civil nuclear products and services and are highly unlikely to demand nonproliferation commitments as rigorous as those in 123 agreements, let alone insist on the Saudis forgoing enrichment and reprocessing.155

A U.S.-Saudi strategic partnership agreement would almost certainly address the following nuclear-related issues: a 123 Agreement; a “gold standard” or similar renouncement of enrichment and reprocessing; the Significant Quantities Protocol; the Additional Protocol; and uranium exports. The analysis below addresses each of these in turn.

As a matter of law, the United States cannot engage in major nuclear cooperation with Saudi Arabia, including the export of nuclear reactor components, without meeting the requirements of Section 123 of the Atomic Energy Act. In practice, this means the two countries must negotiate an agreement containing the elements set forth in Section 123.

The U.S government has long insisted that a U.S.-Saudi agreement for major nuclear cooperation not only meet the standard nonproliferation requirements of Section 123 of the Atomic Energy Act but also include the “gold standard” renouncement of enrichment and reprocessing which was added to the U.S.-UAE agreement.156

Because the “gold standard” is not required by Section 123,157 its inclusion is more flexible from a legal perspective. Robert Einhorn, who served in senior nonproliferation positions during the Clinton and Obama administrations, has delineated what he calls “a compromise that serves US interests, including its nonproliferation objectives, without undermining the kingdom’s ability to meet the practical needs of its civil nuclear energy program.”158 It is unclear if Einhorn’s 2018 proposal represents his current view. The most important points in the compromise include Saudi Arabia agreeing to the gold standard for the first 15 years of the 123 agreement, after which the United States could approve Saudi enrichment and reprocessing on a case-by-case basis.

Einhorn describes his compromise proposal as “serv[ing] US nonproliferation objectives without completely shutting the door to [Saudi enrichment and reprocessing] if, at some future time, the kingdom develops a genuine practical need to pursue such a capability for its civil nuclear program.” Einhorn defends his deviation from the “gold standard” on the grounds that since “in the case of Saudi Arabia, the gold standard is not realistically attainable,” the “real choice” for the United States is between a compromise and not having a 123 agreement with Saudi Arabia. Not having an agreement “could produce a net loss for nonproliferation” because the Saudis would simply purchase from Chinese, Russian, or other “nuclear suppliers less committed to rigorous nonproliferation conditions.”159

It is important to note that a U.S.-Saudi deviation from the “gold standard” would have implications for the United States’ already-existing 123 agreement with the UAE. The United States has committed to the UAE that if Washington enters into a 123 agreement with “any other non-nuclear weapon State in the Middle East” that contains less restrictive terms, the United States will, if requested by the UAE, “consult” with the UAE “regarding the possibility of amending” the Emirati agreement so as to match the terms of the less restrictive agreement.160 Thus, if the United States acquiesces to Saudi Arabia, it would likely come under considerable pressure from the UAE to renegotiate the agreement with them to match the Saudi terms.

To make matters more complicated, if the United States weakens nonproliferation criteria in the Middle East, and Saudi Arabia pursues enrichment and reprocessing with U.S. approval, this will potentially lead other American allies in the region (for example Egypt and Jordan) to demand the same capabilities or treatment. This would mean that these countries could get technically close to nuclear weapons and that the United States opened the door for this by loosening its own nonproliferation criteria for the Saudis.