LWRs 1



As we predicted, information is now leaking out that the North Koreans came to Geneva with a revival of their bid for LWRs. According to Japanese press reports, Kim Kye Gwan’s cryptic “proposal” to end North Korea’s uranium enrichment program—mentioned in his press opportunity following the talks--was precisely a revival of the LWR proposal.

The LWR issue has a long and unfortunate pedigree. In this two-part post, we provide a few of the historical markers; our thanks to Dan Pinkston at the International Crisis Group, Seoul, for some helpful comments and leads.

North Korea had long sought LWRs from the Soviets, but we pick up the story in 1992. When Hans Blix visited Korea in May of that year, the North Koreans asked if the IAEA could help acquire LWRs. The proposal was tabled in talks with the US in mid-1993, and drew a decidedly mixed reaction. On the one hand, those on the US team with technical knowledge considered it “totally hair-brained” according to Dan Oberdorfer’s The Two Koreas.  But the political types immediately pounced on the opening; the North Koreans were looking for a deal.

The LWR deal was central to the Agreed Framework, signed on October 21, 1994, which ended the first nuclear crisis (the Arms Control Association has a useful analysis as well as the documents).  Virtually the entire document is taken up with outlining the sequence of steps around the LWR deal, which involved a complicated cost-sharing agreement reached in 1998. The total project would cost $4.6 billion, with the ROK providing about 70% of the cost, largely in the form of the reactor itself. Japan was on the hook for 116.5 billion yen (approximately $1 billion) and the EU kicking in 75 million euros (technically, ECU’s at the time). Once the supply contract was signed and the US and the other parties had agreed to shipping heavy fuel oil as “compensation” for lost power, Yongbyon would be “frozen.”

But critics of the agreement focused in on the timing of other obligations: the DPRK would not come into full compliance with its IAEA  safeguards until the project was nearly completed (before the delivery of critical components) and full dismantlement would not occur until the LWR project was fully completed, and even then the scope of “dismantlement” was not entirely clear, at least in the document (the entire complex? Just the 5MWe reactor?). The US, South Korea and Japan will not go that route again.

The Korean Peninsula Energy Development Organization (KEDO) was the entity charged with overseeing the LWR project. The project was effectively stopped with the onset of the crisis in late 2002, but KEDO was not officially terminated until May 31, 2006. Its website still maintains a collection of all relevant documents, including detailed annual reports with pictures of the site. Curtis Melvin’s North Korea Economy Watch has a good selection of articles covering the termination of KEDO.

Next time, the revival of the LWR deal leading up to the Joint Statement of September 2005 and the ultimate link of these issues to the problem of the North Korean energy grid.

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