Tracking Number:  395149

Title:  "US, North Korea Agree on Reactor Project Terms." Deputy Assistant Secretary Thomas Hubbard and North Korean Vice Minister Kim Gye Gwan have agreed on the terms for the provision of light water nuclear reactors for Pyongyang. (950613)

Date:  19950613


06/13/95 U.S., NORTH KOREA AGREE ON REACTOR PROJECT TERMS (Transcript: 6/13 Hubbard/Kim Gye Gwan briefing) (2840) Kuala Lumpur -- After three weeks of meetings, the United States and North Korea agreed on terms to facilitate the light water reactor (LWR) project specified under the October 1994 U.S.-DPRK Agreed Framework.

In a joint statement released June 13, Deputy Assistant Secretary Thomas Hubbard and DPRK Vice Minister Kim Gye Gwan agreed the Korean Peninsula Energy Development Organization (KEDO) will finance and supply the LWR project, conduct a site survey and select a prime contractor and program coordinator for the project.

In addition, the two countries agreed to a June 1995 visit by a team of U.S. experts to expeditiously implement safe storage of spent fuel rods and to begin meetings on a phased delivery of heavy fuel oil in accordance with the Agreed Framework.

In separate remarks, Hubbard said North Korea will maintain the freeze on its existing nuclear program. He said North Korea understood the light water reactor model selected will be of South Korean origin and the prime contractor will be a South Korean firm. He further indicated that North Korea agreed it will now negotiate directly with KEDO on outstanding issues related to the DPRK/KEDO Agreement on supply of the LWR project.

Following is the official transcript of the briefing: (begin transcript) KUALA LUMPUR, JUNE 13 HUBBARD: Good afternoon, let me begin the session by reading the joint statement that Vice Minister Kim and I have agreed to here in Kuala Lumpur with the authority of our governments. The statement is dated today, June 13, in Kuala Lumpur.

The delegations of the United States of America and the Democratic People's Republic of Korea held talks in Kuala Lumpur from May 19 to June 12, 1995 with respect to implementation of the U.S.-DPRK Agreed Framework of October 21, 1994. Both sides reaffirmed their political commitments to implement the U.S.-DPRK Agreed Framework, and with particular regard to facilitating the light water reactor (LWR) project as called for in the Agreed Framework, decided as follows:

1. The United States reaffirms that the letter of assurance from the U.S. President dated October 20, 1994 concerning the provision of the LWR project and interim energy alternatives continues in effect. The Korean Peninsular Energy Development Organization, or KEDO, under U.S. leadership, will finance and supply the LWR project in the DPRK as called for in the Agreed Framework. As specified in the Agreed Framework, the U.S. will serve as the principal point of contact with the DPRK for the LWR project. In this regard, U.S. citizens will lead delegations and teams of KEDO as required to fulfill this role.

2. The LWR project will consist of two pressurized light water reactors with two coolant loops and a generating capacity of approximately 1,000MW(e) each. The reactor model, selected by KEDO, will be the advanced version of U.S.-origin design and technology currently under production.

3. The Commission for External Economic Relations, representing the DPRK Government, and KEDO will conclude a supply agreement at the earliest possible date for the provision of the LWR project on a turnkey basis. On the basis of this statement, the DPRK will meet with KEDO as soon as possible to negotiate the outstanding issues of the LWR supply agreement. KEDO will conduct a site survey to identify the requirements for construction and operation of the LWR project. The costs of this site survey and site preparation will be included in the scope of supply for the project. KEDO will select a prime contractor to carry out the project. A U.S. firm will serve as program coordinator to assist KEDO in supervising overall implementation of the LWR project. KEDO will select the program coordinator. A DPRK firm will enter into implementing arrangements as necessary to facilitate the LWR project.

4. In addition to the LWR project, the two sides decided to take the following steps towards implementation of the Agreed Framework.

First, experts from the two sides will meet in the DPRK as soon as possible in June to agree on a schedule and cooperative measures for phased delivery of heavy fuel oil in accordance with the Agreed Framework. KEDO will begin immediately to make arrangements for an initial delivery of heavy fuel oil, subject to conclusion of the above agreement.

Secondly, the U.S.-DPRK Record of Meeting of January 20, 1995, on safe storage of spent fuel will be expeditiously implemented. In this regard, a U.S. team of experts will visit the DPRK as soon as possible in June to begin implementation.

That is the end of our joint press statement -- the fruit of more than three weeks of discussions here in Kuala Lumpur. I would like now to invite Vice Minister Kim to say a few words.

KIM (in Korean):I think the Kuala Lumpur joint DPRK-U.S. press statement is a product of the joint efforts that the DPRK and the United States have made and it clearly shows the willingness and commitment of both governments to implement the Geneva Agreed Framework.

KIM (in Korean):I think with the announcement of this joint press statement, we can say that we removed stumbling blocks to the smooth implementation of the Geneva Agreed Framework. However, it is at an early stage. We have more difficult tasks to settle. For our part, the DPRK side is prepared to sincerely implement the Geneva Agreed Framework as in the past.

KIM (in Korean):I would like ...inaudible...short briefings on the results of these talks, and as soon as this ceremony is over, I will go to my mission and meet separately with your press. I would be very grateful if you would attend my press conference. Thank you very much.

HUBBARD: Perhaps we could shake hands now. Let me just walk you out. (Hand-shake takes place) I will make another brief statement, I'll try to be very quick, so that you can all also join Ambassador Kim's press conference at his embassy.

(Mr. Hubbard escorts Ambassador Kim out and then returns to conference.) Q: Mr. Hubbard, it's obviously ..... HUBBARD: If I could wait just a minute, I think I would like to begin with a brief supplementary statement and one of the television journalists asked if we could wait just a minute...

This supplementary statement is aimed at clarifying some of the points that are in the joint statement that Ambassador Kim and I just released. As you know since May 19, delegations of the United States and the Democratic People's Republic of Korea have met here in Kuala Lumpur to discuss implementation of the U.S.-DPRK Agreed Framework and in particular to resolve a number of important issues related to the light water reactor project.

I am pleased that these meetings have resulted in agreement on the key issues, as reflected in the joint press statement that our two delegations have just issued. During our talks the U.S. and DPRK agreed that the Korean Peninsular Energy Development Organization, or KEDO, will select the reactor model. As specified in the agreement establishing KEDO, the reactors will be of the type currently under production at Ulchin, South Korea. We also agreed that KEDO will select a prime contractor to carry out the LWR project. The prime contractor, which will be a South Korean firm, will be responsible for all aspects of the LWR project, including design, manufacture, construction and management. Finally, the DPRK has agreed it will now negotiate directly with KEDO on outstanding issues related to the DPRK/KEDO Agreement on supply of the LWR project.

Besides the LWR project, we and the DPRK delegation led by Vice Foreign Minister Kim Gye Gwan also discussed a number of other issues directly related to implementation of the Agreed Framework. The two sides reaffirmed their commitment to implementing all provisions of the Agreed Framework. In this context, the DPRK will maintain the freeze on its existing nuclear program. The DPRK agreed to receive this month a team of U.S. technical experts to begin implementation of our bilateral understanding on steps related to safe storage of the DPRK spent fuel rods. This is an important step forward.

We also agreed to begin discussions as quickly as possible on cooperative steps to monitor the phased delivery of heavy fuel oil KEDO is committed to provide the DPRK. We anticipate reaching rapid agreement on these monitoring steps in a schedule for delivery of one hundred thousand tons of oil by October 21 as called for in the Agreed Framework.

During these meetings we repeatedly stressed to the North Koreans the need to engage in dialogue with the South as called for in the Agreed Framework. North-South dialogue is essential, both for full implementation of the Agreed Framework and for the creation of a stable peace on the Korean Peninsula. Our negotiations here have come to a successful conclusion. In large parts this is due to the strong support that my delegation has received from our allies, the Republic of Korea and Japan. Consultations and coordination among our governments could not have been closer. We also offer our thanks to the Government of Malaysia for allowing us to hold our talks in this hospitable and vibrant city.

Thank you. I will now take your questions. I would like to ask you to please stand and please identify yourselves as you ask questions. Q: Tom Mintier from CNN. The two central issues that were part of the negotiations, the type of reactor and the country of origin for that reactor, is that the most difficult thing to bring the agreement on.

HUBBARD: Well, our main purpose in coming here was to resolve those two issues. We believe we have achieved that objective. The agreement makes it very clear that KEDO will select the reactor model. It makes it clear that KEDO will select the prime contractor. As a member of KEDO, as a representative of the government that is a member of KEDO, I think I can tell you with some confidence that both reactor model and the prime contractor will be South Korean.

Q: I am Bill Tarrant from Reuters. If that's the case then what was the -- what kindly induced North Korea to agree after three long weeks of almost daily negotiations in which sometimes the talks have appeared to almost be on the verge of breaking down? What finally induced them in the end, do you think?

HUBBARD: Well, you should probably address that question to the North Koreans. I can only speculate on what induced them to come around. I fundamentally believe that North Korea wishes our Agreed Framework to be carried forward, that North Korea wishes to receive the light-water reactors that have been promised, and that can become a critical part of their national development. I believe that North Korea wishes better relations with United States, wishes to become a more active member of the international community, and when faced with our firmness of purpose, when faced with the realization that we were serious in our intent to provide these reactors and in our intent to provide South Korean reactors, I believe the North Koreans must have drawn the conclusion that the benefits of going forward outweighed the disadvantages.

Q: ....inaudible.... The negotiations of North Korean delegates show that they have a sense of ..inaudible... And also another question...what is the prospect of your liaison office opening between Pyongyang and Washington and the prospect of further amelioration in your relations?

HUBBARD: The North Korean delegation agreed in our joint statement that KEDO will select the reactor model and that it will be a turn-key project. We made very clear to the North Koreans throughout these discussions that the reactor models to be provided would be those currently under production in South Korea, we do believe the North Koreans are fully aware of that and fully understand that. As for our process of establishing liaison offices, we agreed in the Agreed Framework last October that we would establish liaison offices in each others capitals when we have resolved the consular and other technical issues involved in establishing those offices. We do plan to go forward and establish the offices, but we have not yet resolved all of those technical issues. We will move forward when we have done so.

Q: inaudible ....from the Daily Telegraph. Is it possible that the North Korea could reject the decision of KEDO to ...inaudible....whoever is selected to supply those reactors?

HUBBARD: Well, I believe that the North Koreans take seriously this joint statement that we just issued today. The joint statement states that KEDO will select the reactor model. In the statement the North Koreans agreed to accept the reactor model provided by KEDO, so I see no reason why they should reject that later.

Q: ...inaudible...Bernama News Agency: In the press statement there a program coordinator and ....inaudible..... what is the role of the program coordinator and what is the relation between the program coordinator and the prime contractor?

HUBBARD: The program coordinator mentioned in this document will work directly for the Executive Director of KEDO. The main responsibility of the program coordinator will be to ensure that the reactor project is carried out, will be to assist the KEDO Executive Director in ensuring that the project is carried out in accordance with the supply agreement which will be entered into by KEDO and the prime contractor.

Q:....inaudible...Kyoto News: Is there any document that both sides agreed to besides this joint statement?

HUBBARD: This is the only statement to which we have agreed during these meetings here.

Q: ...inaudible....That means you didn't sign any agreements...inaudible... you didn't sign anything?

HUBBARD: We didn't sign any agreement. Q: ...inaudible...back-track on this joint agreement? ...inaudible....because you didn't sign anything?

HUBBARD: As I said at the outset, we issued this joint press statement with the full authorization of our governments. We take the statements seriously and we assume the North Koreans do too. We do not expect them to back track.

Q: ...inaudible...Asahi Shinbun...inaudible...: Yesterday around this time, I heard you were supposed to leave for Washington ...inaudible.....releasing a joint statement. Would you tell, what made you change your mind?

HUBBARD: Well, I think yesterday Ambassador Kim indicated that he was planning to leave very early this morning. I indicated to him that at that time I was not authorized to issue this joint statement, and that certainly I would not be able to issue it before 8:45 this morning, when he was scheduled to leave. I had to consult with my capital, and of course, my capital was to consult with our allies in this project, the ROK and Japan. I am pleased that those consultations were completed, that I was authorized to issue this statement today. I am also pleased that Ambassador Kim was authorized not only issue this statement, but also to remain in Kuala Lumpur long enough so that we could issue it together. Developments moved somewhat more quickly than I had anticipated late yesterday.

Q: Is there any chance that KEDO will discuss .....inaudible.....other than the site survey and the site preparations that went on in the agreement?

HUBBARD: Yes, Scope of supply is one of the remaining issues that must be addressed in the upcoming talks between KEDO and the DPRK. As far as I know, as I understand it, the position of KEDO is that the scope of supply for this project should be what is normal for a project of this type. You, of course, are aware that the North Koreans have been demanding more than that. These are issues that will be worked out in the upcoming negotiations between KEDO and the DPRK. As I say, I expect KEDO will take the position that the scope of supply for this project will be that which is normal for projects of this type.

Q: Will there be any more economic assistance in this, under this? There were reports earlier that North Korea was demanding up to one billion dollars more in aid under this Agreed Framework. Did that come up in this discussion? Will there be more economic aid?

HUBBARD: That specific issue did not arise in these talks. We did not discuss any further economic aid, and we did not discuss any demands for an additional one billion dollars in project cost. As I say what we have agreed to here is to get this project started, to begin the project with those initial steps that have to be undertaken if it is to go forward and that, as indicated in this statement, involves site survey and site preparation. The cost of those will be far, far below one billion dollars.

Thank you very much. (end transcript) NNNN

File Identification:  06/13/95, EPF204; 06/13/95, AXF202; 06/13/95, EUR211; 06/13/95, NEA206; 06/15/95, ERF402
Product Name:  Wireless File
Product Code:  WF
Languages:  Russian
Document Type:  TRA
Thematic Codes:  1AC
Target Areas:  EA; AF; EU; NE
PDQ Text Link:  395149