Oil-Rich Arab State Pushes Nuclear Bid With U.S. Help - WSJ.com

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Oil-Rich Arab State Pushes Nuclear Bid With U.S. Help

By JAY SOLOMON and MARGARET COKER

ABU DHABI -- The mating of the words "nuclear" and "Persian Gulf" normally sets off alarm bells in Washington. Yet this oil-rich Arab state just across the gulf from Iran is on a crash course to develop nuclear power with U.S. backing.

Dozens of American engineers, lawyers and businessmen have converged on Abu Dhabi in recent months to help the United Arab Emirates get the Arab world's first nuclear-power program running by 2017. "I don't know anyone else who has rolled out a nuclear program of this magnitude this fast," says Jeffrey Benjamin, an American engineer who in October was named project manager for Emirates Nuclear Energy Corp., which oversees Abu Dhabi's nuclear program.

Even as the U.S. remains determined to block Iran from developing nuclear weapons, President Barack Obama sees the U.A.E. program as a "model for the world," according to a senior White House official, and by mid-April could move to present a bilateral nuclear-cooperation treaty to Congress for approval. The ability to make electricity through nuclear power is a long way from the ability to build weapons -- and, proponents say, the agreement could make bomb-making harder.

The treaty, signed by former President George W. Bush during his last week in office, would allow American firms to engage in nuclear trade with the U.A.E. To build support, the U.A.E. is agreeing to buy approved nuclear fuel on the international market, rather than enriching uranium or reprocessing plutonium, both of which can be made into weapons-grade material. It will also open its facilities to random international inspections.

The U.A.E.'s push represents a test for nuclear-power advocates who want countries across the globe to go nuclear -- so long as they play by the rules. The U.S. and United Nations officials are championing the U.A.E. as a role model for other developing countries and as a counterexample to Iran. Tehran has repeatedly rebuffed international inspectors, while amassing large quantities of materials that can be used to build bombs. A spokesman at the Iranian mission to the U.N. says Iran's nuclear program is purely for civilian purposes, and says Tehran believes "peaceful nuclear programs" are the right of all signatures to the Nuclear Nonproliferation Treaty.

Reuters

Qatari Emir Sheik Hamad bin Khalifa al Thani, right, receives United Arab Emirates President Sheik Khalifa bin Zayed al Nahyan at Doha international airport on Sunday. Leaders of the 22-member Arab League gathered in the Gulf Arab state of Qatar for a two-day summit meeting.

Some U.S. lawmakers have threatened to block the U.A.E. deal, saying the risks of letting that country split the atom are too large. They cite the U.A.E.'s history as a transit point for sensitive military technologies to Iran, Iraq and Libya. They also make the slippery-slope argument: If one Arab country has nuclear power, others may pile in, and perhaps down the road, seek nuclear weapons as well. Both Saudi Arabia and Egypt have recently announced their desire to develop nuclear-power programs with U.S. assistance.

Western and Asian companies are already salivating at the chance for lucrative contracts with the U.A.E., which has set the end of April as the rough deadline for bids. General Electric Co. and Westinghouse Electric Co. are among the U.S. firms interested in the initial $20 billion in reactor work, say officials familiar with the bidding process. GE and Westinghouse declined to comment.

Facing ambitious timelines set by officials bent on growth, Mr. Benjamin, the American engineer, and his colleagues rarely get far from the Emirates Nuclear Energy headquarters in downtown Abu Dhabi. Many live in an apartment building next to the office and exercise at the same gym. Mr. Benjamin lives three floors above his office.

Surge in Demand

The U.A.E. began exploring nuclear power three years ago as it faced a surge in electricity demand, say Emirati officials. The Persian Gulf country is a federation of seven states, among them Abu Dhabi, the capital, and Dubai. It has among the largest oil reserves in the world. But it's short of the natural gas that is used to fuel power and water-desalination plants, and imports most of its gas from neighboring Qatar.

Abu Dhabi's ruler, Sheik Khalifa bin Zayed al Nahyan, commissioned a white paper that concluded the country's electricity demand would reach 40,000 megawatts by 2020 from around 16,000 megawatts currently. Nonnuclear options, such as coal-fired plants, solar energy or alternative fuels, were seen either as insufficient to meet demand, too expensive or harmful to the environment.

"Nuclear power was seen both as practical and clean," says Hussain al Nowais, an Abu Dhabi industrialist who took part in the study.