News


Tracking Number:  418468

Title:  "KEDO, DPRK Conclude Supply Agreement for LWR Project." Fact sheet and text of joint press statement on the agreement between the Korean Energy Development Organization (KEDO) and North Korea on the supply of a light-water-reactor (LWR) to North Korea. (951218)

Date:  19951218

Text:
*SFF109

12/18/95 KEDO, DPRK CONCLUDE SUPPLY AGREEMENT FOR LWR PROJECT (Texts: Joint press statement, fact sheet) (1990) Washington -- The Korean Peninsula Energy Development Organization (KEDO) and the Democratic People's Republic of Korea (DPRK) reached an agreement December 15 on the supply of a light-water-reactor project to the DPRK.

Following are the texts released by the White House of the joint DPRK-KEDO press statement and fact sheet:

(begin text of news release) The Democratic People's Republic of Korea (DPRK) and the Korean Peninsula Energy Development Organization (KEDO) today concluded in New York City an agreement on the supply of a light-water-reactor (LWR) project to the DPRK. This Supply Agreement, which is the result of talks that began September 11 in Kuala Lumpur and resumed October 16 in New York City, was concluded in accordance with the DPRK-U.S. Agreed Framework of October 21, 1994, and the DPRK-U.S. Joint Press Statement of June 13, 1995.

Throughout these negotiations, both delegations conducted themselves in a professional and constructive manner that led to the successful conclusion of the negotiations. Ambassador Ho Jong, who led the DPRK delegation, and Ambassador Stephen Bosworth, KEDO's's Executive Director who led the KEDO delegation, signed the Agreement.

This Agreement marks an important step towards the full implementation of the DPRK-U.S. Agreed Framework and the DPRK-U.S. Joint Press Statement of June 13, 1995. Both the DPRK and KEDO will continue to perform in good faith and cooperative spirit their respective undertakings. Within the next few days, KEDO will send a third site survey team to the survey area, and during the coming months the DPRK and KEDO will hold a series of further discussions on additional details concerning the LWR project.

(end text of press release) (begin text of fact sheet) THE SUPPLY AGREEMENT SIGNED BETWEEN THE KOREAN PENINSULA ENERGY DEVELOPMENT ORGANIZATION (KEDO) AND THE GOVERNMENT OF THE DEMOCRATIC PEOPLE'S REPUBLIC OF KOREA (DPRK) ON DECEMBER 15,1995

Scope of Supply

KEDO will provide two light-water-reactor (LWR) units with a total generating capacity of approximately 2,000 MW(e) to the DPRK on a turnkey basis. The reactor model, selected by KEDO, will be of advanced U.S.-origin design and technology.

The LWR project will conform to a set of codes and standards equivalent to those of the IAEA and the U.S. and applied to the reactor model selected by KEDO.

KEDO will be responsible for: -- Site survey and preparation -- Technical documents necessary for the operation and maintenance or the LWR plants

-- Certain preconstruction infrastructure integral to and exclusively for use in the construction of the LWR plants

-- A comprehensive training program for the operation and maintenance of the LWR plants, including provision of full-scope simulator

-- Inventory of spare parts, wear parts, consumables and special tools as KEDO deems necessary for a two-year period of plant operation

-- A low and medium radioactive waste storage building with a ten-year storage capacity for the two LWR plants

-- Nuclear fuel for the initial loading of each LWR, including such fuel rods as may be necessary to preserve safety for initial operation

-- Certain technical support services for operation and maintenance of the first LWR plant for one year after its completion

-- Other items Terms of Repayment KEDO shall finance the cost of the tasks and items specified above. KEDO will be repaid by the DPRK interest free over 20 years, inclusive of a three-year grace period, beginning with completion of each LWR. Repayment will occur in equal, semiannual installments.

Repayment may be in cash, cash equivalents or through transfer of goods. Delivery Schedule KEDO will develop a delivery schedule for the LWR project aimed at achieving a delivery date of 2003. This delivery schedule is mutually conditional with the following steps by the DPRK. DPRK will:

-- Continue to freeze its graphite-moderated reactors and related facilities, and refrain from building the same

-- Allow the IAEA to resume ad hoc and routine inspections of facilities not covered by the nuclear freeze when the Supply Agreement is signed

-- Continue to cooperate on the safe storage and ultimate disposition of spent fuel from its 5 MW(e) experimental reactor

-- Remain a party to the Treaty on the Non-Proliferation of Nuclear Weapons and allow implementation of its safeguards agreement under this Treaty

-- Come into full compliance with its IAEA safeguards agreement when a "significant portion" of the LWR project is completed, but before the delivery of key nuclear components

-- Conclude a bilateral agreement for peaceful nuclear cooperation with the U.S. prior to the delivery of key nuclear components (if U.S. firms provide such components).

-- Transfer spent fuel from its 5 MW(e) reactor from the DPRK when the delivery of key nuclear components for the first LWR begins

-- Begin to dismantle its frozen graphite-moderated reactors and related facilities upon completion of the first LWR and complete dismantlement upon completion of the second LWR

(A separate protocol on the delivery schedule is scheduled to be concluded in 1997)

Implementing Arrangements KEDO will select a prime contractor to carry out the LWR project and will conclude a commercial supply contract with this contractor.

KEDO will select a U.S. firm as program coordinator to assist KEDO in supervising overall implementation of the LWR project.

The DPRK will recognize KEDO's independent juridical status and shall accord KEDO and its staff privileges and immunities in the DPRK as necessary to carry out KEDO's functions.

The DPRK will take steps to protect the safety of and to extend consular protection to all personnel sent to the DPRK by KEDO, its contractors and subcontractors

Services

The DPRK will process for approval all applications, permits, licenses, etc. necessary for completion of the LWR project expeditiously and free of charge.

KEDO, its contractors and subcontractors and respective personnel shall be exempt from DPRK taxes, duties and charges in connection with the LWR project.

The DPRK shall, to the extent possible, make available at a fair price port services, transportation, labor, potable water, food, off-site lodging and offices, communications, fuel, electrical power, materials, medical services, currency exchanges and other financial services, and other amenities necessary for living and working by personnel sent to the DPRK by KEDO, its contractors and subcontractors.

KEDO, it contractors and subcontractors shall be allowed unimpeded access to the project site and to appropriate and efficient transportation routes to and from the project site.

KEDO, its contractors and subcontractors shall be allowed unimpeded use of available means of communications in the DPRK. KEDO, its contractors and subcontractors shall also be permitted to establish secure and independent means of communications for their offices based on a timely and case-by-case review of equipment requests and in accordance with relevant telecommunications regulations of the DPRK.

(A separate protocol on services -- including services provided to KEDO, its contractors and subcontractors -- is scheduled to be concluded during 1996)

Site Selection and Study KEDO will conduct a site survey of Kumho area new Sinpo City. The DPRK shall cooperate and provide KEDO with access to relevant available information.

(A separate protocol on site take-over is scheduled to conclude during 1996) Quality Assurance and Warranties KEDO is responsible for the design and implementation of a quality assurance program in accordance with the set of codes and standards equivalent to those of the IAEA and the U.S. and applied to the reactor model selected by KEDO.

KEDO will guarantee the generating capacity of each LWR at the time of completion.

KEDO will guarantee civil construction work and the major components of each plant for two years after completion. The guarantee on major components will not exceed five years after the shipment of such components.

(A separate protocol on quality assurance and warranties is scheduled to be concluded in 1996)

Training KEDO will design and implement a comprehensive training program in accordance with nuclear-industry practice. Training will be held at mutually agreed locations as soon as practicable.

(A separate protocol on training is scheduled to be concluded in 1996) Operation and Maintenance KEDO will assist the DPRK to obtain LWR fuel (other than that provided in initial loading) through commercial contracts.

KEDO will assist the DPRK to obtain spare and wear parts, consumables and special tools and technical services through commercial contracts. KEDO will provide these items for an initial two-year period of plant operation.

KEDO and the DPRK will cooperate to ensure the safe storage of spent fuel from the LWR plants. If requested by KEDO, the DPRK must relinquish any ownership rights over the LWR spent fuel and agree to the transfer of the spent fuel out of the DPRK through commercial contracts.

Nuclear Safety and Regulation KEDO is responsible for assuring that the design, manufacture, construction, testing and commissioning of the LWR plants are in compliance with safety and regulatory codes and standards equivalent to those of the IAEA and the U.S. and applied to the reactor model selected by KEDO.

The DPRK is responsible for the safe operation and maintenance of the LWR plants, appropriate physical and environmental protection, and the safe storage and disposal of radioactive waste, including spent fuel.

Prior to shipment of any fuel assemblies, the DPRK will observe the provisions set forth in following Conventions:

-- Convention on Nuclear Safety -- Convention on Early Notification of a Nuclear Accident -- Convention on Assistance in the Case of a Nuclear Accident or Radiological Emergency

-- Convention on the Physical Protection of Nuclear Material After completion of the LWR plants, KEDO and the DPRK will conduct safety reviews to ensure the safe operation and maintenance of the LWR plants.

In the event of a nuclear emergency or accident, the DPRK will permit immediate access to the site and information by personnel sent by KEDO, its contractors or subcontractors to determine the extent of safety concerns and to provide safety assistance.

Nuclear Liability. The DPRK will ensure a legal and financial mechanism is available in the event of a nuclear incident.

The above-mentioned legal mechanism will include the channeling of liability to the operator on the basis of absolute liability.

The DPRK will ensure that the operator is able to satisfy such liabilities. Prior to the shipment of any fuel assemblies to the DPRK, the DPRK will enter into an indemnity agreement with KEDO.

Intellectual Property and Non-Replication KEDO and the DPRK agree to protect the confidentiality of the other side's intellectual property.

Neither KEDO nor the DPRK will replicate or copy any of the equipment or technology of the other side provided in connection with the LWR project.

Assurances The DPRK assures the following: -- The reactors, technology and nuclear material transferred for the LWR project as well as any nuclear material used therein or produced through the use of such items will be used exclusively for peaceful, non-explosive purposes

-- The above items will be used properly and exclusively for the purposes of the LWR project

-- The above items will not be transferred outside the DPRK without prior consent by KEDO

-- The DPPK will apply IAEA safeguards to the LWR project -- The DPRK will not reprocess or increase the enrichment level of any nuclear material for the LWR project or any nuclear material used in or produced through the use of any reactor or nuclear material transferred in connection with the LWR project

Actions in the Event of Noncompliance In the event of late payment or nonpayment by either side with respect to financial obligations incurred implementing the Supply Agreement, the other side will have the right to assess and apply penalties against that side.

(A separate protocol on actions in the event of noncompliance is scheduled to be concluded in 1996).

(The above information is only a summary of certain parts of the Supply Agreement signed by KEDO and the DPRK on December 15, 1995. It does not encompass all aspects of the Supply Agreement.)

(end text of fact sheet) NNNN


File Identification:  12/18/95, SFF109
Product Name:  Wireless File
Product Code:  WF
Keywords:  TREATIES & AGREEMENTS; NUCLEAR REACTORS; KOREA (NORTH)/Economic & Social; KOREAN ENERGY DEVELOPMENT ORGANIZATION (KEDO); NUCLEAR POWER PLANTS
Document Type:  TXT
Thematic Codes:  1EA
Target Areas:  AF; AR; EA; EU; NE
PDQ Text Link:   418468