Invap's major reactor contract was for a 22 MW(th) reactor built in Egypt in the 1990s. This is Invap's only contract for a medium-sized reactor; all others have been much smaller.

A few comments on ARPANSA's press release regarding the Egyptian (which is copied below)
* it is hard to know how well ARPANSA's statement relates to reality in the absence of independent evidence (ARPANSA's CEO was hand-picked by ANSTO's executive director, and six ex-ANSTO staff members now work in ARPANSA's regulatory branch)
* there is an acknowledgement from ARPANSA of a "small number of important technical issues that still need resolution if Egypt is able to operate the reactor at full power. Of particular interest in the Australian context is the method of calculating the power peaking factor in the reactor core and the formation of bubbles in the reactor pool."
* what other problems exist?
* what safety issues arise, in Egypt, and, potentially, in Australia?
* articles below (e.g. Bulletin, July 4, 2001) raise safety issues not discussed by ARPANSA. What's the story?
* leaving aside safety issues, clearly there are performance issues, and as ARPANSA notes this is not unprecedented. The scientific utility of the proposed new reactor in Australia is already a bone of contention, given that the reactor will be well down the global list when judged on important criteria such as neutron flux level. In addition, I understand that ANSTO no longer intends to equip the planned reactor with a 'hot source' which was described in the EIS with some enthusiasm (e.g. p.4-9 and p.5-22).

"At this stage we do not have any evidence of there being technical problems that are problems that shoot home to construction," ANSTO's executive director Helen Garnett said in a Senate estimates hearing on June 4, 2001. It seems hard to square Garnett's comment with ARPANSA's findings. The same applies to Minchin's comments at the same Senate hearing. Moreover, ANSTO and the federal government seem convinced (or intent on convincing others) that teething problems have now been resolved, which does not sit easily with ARPANSA's comments.

Other propagandists have been still less convincing. In the Canberra Times on September 5, 2000, Leslie Kemeny asserts that the "Argentinian company has built a similar facility for Egypt. For the past four years the Egyptian reactor has been an invaluable research tool for scientists and engineers and a much needed producer of medical radio-isotopes."

ANSTO and the federal government have refused to divulge findings from their visits to Egypt. However, The Bulletin on May 16 2000 ('Having a great time ... wish you were here', Fred Brenchley) discussed a leaked report from a bureaucrat in Minchin’s department describing a working tour of overseas research reactors. The report discusses taxi rides in Indonesia, wine making in Korea, the pyramids and a museum in Egypt, and the usual tourist haunts in France and Canada. As for the research reactors, “I’m obviously at the foot of a very steep learning curve”, the bureaucrat said.

Egypt has devoted considerable resources to missile development (see for example the Carnegie Proliferation Brief, Vol IV, No. 3, March 15, 2001 <www.ceip.org>). In fact Argentina, Egypt and Iraq have collaborated in the past on missile development (http://www.ceip.org/programs/npp/nppargn.htm). (Did Argentina ssist with Iraq's civil nuclear program ... and did this feed into Iraq's covert weapons program, by design or inadvertently?)

Egypt was believed to be pursuing a covert nuclear weapons program in the 1960s and 70s, under cover of an ambitious nuclear power program, when tensions with Israel were high, but that did not progress far. Egypt is not currently pursuing a nuclear weapons program, and is keen to see nuclear disarmament proceed apace, in particular by Israel. It is however possible that one of the reasons for Egypt's interest in a sizeable 22 MW reactor is to lower the lead-time for nuclear weapons (e.g. research, training, possibly plutonium production). A 1997 report on the Arabic News website says, “Cairo confirmed that its new reactor is for peaceful purposes and works according to the regulations of the international laws. It called on any country which might feel ‘uncomfortable’ about the reactor to remember that the USA transformed a nuclear reactor designated for peaceful purposes in the State of Tennessee, USA into a nuclear reactor for military purposes, thus violating the nuclear pact.” <www.arabicnews.com/ansub/Daily/Day/971011/1997101137.html>

Of course, the above comment needs to be seen in the context of regional (and broader) politics, not least Israel's arsenal of nuclear weapons (thanks to technical support from France and others, and political support from the US and others), and Iraq's nuclear weapons program which would have advanced further than it did if not for the bombing of its nuclear facilities by Iran in 1979, Israel in 1981 and the USA in 1991.

Overall, there are many questions and few answers concerning the Egyptian reactor and the implications this may have for Australia.

The CEO of ARPANSA, Dr John Loy, and the Director of the agency's Regulatory Branch, Mr Don Macnab, inspected the Egyptian research reactor ETRR 2 over two days in September.  They also held discussions with Egyptian Atomic Energy Agency (EAEA) officials about the INVAP built reactor at Inshas, which has many similar features to the one the Argentine company is contracted to design and construct for ANSTO at Lucas Heights.  ARPANSA continues to assess the ANSTO construction licence application lodged in May.

Dr Loy said, “Don and I knew of issues raised between the EAEA and INVAP about the commissioning of the ETRR 2 reactor.  These issues were also referred to in the most recent Senate inquiry into the replacement research reactor, and in an article in The Bulletin on 10 July.  We decided to ask the Egyptian authorities if we might inspect the facility for ourselves and hear directly from them what their experiences were in the construction and commissioning of the reactor.”

Both ETRR 2 and ANSTO’s proposed replacement research reactor are pool reactors of around 20 megawatts power, designed for the irradiation of materials and the production of radioisotopes and neutron beams.  Shared design features include a chimney surrounding the core, a warm water layer, control rod drives below the core, heat removal systems and plant layout and configuration.  However, some significant differences result from the different roles and priorities of the two operating organisations. Most notably, the ANSTO reactor has a heavy water reflector that also operates as the second shutdown system, whereas the ETRR 2 reactor has a beryllium reflector and a liquid gadolinium shutdown.

Dr Loy and Mr Macnab were impressed by the openness of the Egyptian authorities and by the detailed examination of the issues that they have undertaken. During the discussions, it became clear that there are a small number of important technical issues that still need resolution if Egypt is able to operate the reactor at full power. Of particular interest in the Australian context is the method of calculating the power peaking factor in the reactor core and the formation of bubbles in the reactor pool. That such issues arise in the commissioning of a new reactor design is not surprising or unprecedented.*  The ARPANSA officers thanked the EAEA and INVAP representatives for their cooperation and noted their evident commitment to jointly address the outstanding matters and resolve them.

Dr Loy and Mr Macnab agreed with the Egyptian authorities that it would be important for there to be continuing contact between Australia and Egypt - both on the specific issues currently being addressed and in the longer term, should the Australian reactor proceed to construction and commissioning.  They also thanked the Egyptian Minister of Electricity and Energy, Dr Ali F. El-Saiedi, for permitting the visit and the Chair of the EAEA, Dr Fayza Masoud, for making her time available and that of many officers.

* Technical issues have arisen in the commissioning of new reactor designs before now. Canada has not yet been able to fully operate its new ‘Maple’ reactors, constructed for radioisotope production, and the HANARO reactor in South Korea had to operate at less than maximum power for some time after commissioning.

Tucked away in an isolated part of the Egyptian desert about half an hour out of Cairo is a nuclear research reactor with a trail of problems that lead all the way to Australia.

Known as ETRR-2, it was built by the Argentinian group INVAP, and although "hot commissioned" for testing in 1997, it has yet to be fully accepted by the Egyptians. ETRR-2 is the reference reactor cited by INVAP in its successful bid to build Australia's $286m new nuclear research reactor planned for Lucas Heights in Sydney's southern suburbs. Australia had said it wanted "proven designs", and each of the four final tenderers - INVAP, Siemens (Germany), Technicatome (France) and AECL (Canada) - had to cite existing reference reactors they had built.

ETRR-2 is something of an enigma. Built by the Argentinian new boys on the nuclear block, compared with the more experienced French, German and Canadians, reports began circulating that it had never worked properly. However, the Australian Nuclear Science and Technology Organisation (ANSTO), which awarded the contract to INVAP, says it meets specifications and any problems are "dollar issues".

"Doubts and rumours still linger about the Egyptian reactor," said a recent Senate select committee report chaired by Labor senator Michael Forshaw. "The committee is not completely satisfied that it has been able to lift the cloud of suspicion surrounding this reactor." Its reservations were fuelled by ANSTO's refusal to divulge findings from its own visits to ETRR-2.

ETRR-2 is now under a fresh spotlight. A report circulating in Canberra purports to be details of a briefing by Egyptian Atomic Energy Authority (EAEA) officials last December - six months after INVAP won the Australian contract - of both safety and efficiency problems of ETRR-2. It says the Argentinians have been given another year of "supplementary test operation".

The Australian Radiation Protection and Nuclear Safety Agency (ARPANSA) is aware of the claims and has raised them with ANSTO. While ANSTO awarded the contract and will operate the reactor, ARPANSA has final approval through the building and commissioning stages, including the power to slap on a "hold" order.

"There are a number of safety issues raised [in the EAEA report] and we will be concerned to ensure that the vital safety features are proven fully during construction and commissioning", Dr John Loy, ARPANSA's chief executive officer, told The Bulletin.

While the EAEA briefing lists nine areas of Egyptian concern about ETRR-2, many are not relevant to the planned Australian reactor, which in many respects will be different. It will have a sophisticated guide hall for advanced neutron beam research, where ETRR-2 does not. But there are three main areas of safety concern:
* ETRR-2 has a power peaking problem and difficulty in measuring power fluxes in the core. Power peaking leaves no remaining safety margin for changes to the core arrangements, critical for research. EAEA assesses the peaking threat to core arrangement changes as "too risky". Experts say measuring of maximum power within the core is a key safety issue in ensuring there is no fuel meltdown or other major problem.
* The natural convection flaps do not close and open as foreseen and have been redesigned and remade several times. This is a critical cooling system, and will be a red alert issue for local authorities, possibly even subject to an ARPANSA "hold" order.
* INVAP contracted for a reactor to operate in an ambient temperature of 34C. "It turned out later that the supplied cooling tower limits the operation at full power to an ambient temperature of 24C only," it says. "In July and August [in Egypt], no full power of operation will be possible".

With Sydney summer temperatures often exceeding 24C this would also be a problem, and a key performance issue that goes right to the heart of the relationship between INVAP and Egyptian nuclear authorities.

ETRR-2's alleged problems can be viewed in several ways. Are they design and construction faults that can be sheeted home to INVAP, or are they management and oversight issues that should have been dealt with by the Egyptians in their relationship with INVAP? Some liken it to buying a car - the manufacturer might say that the car performs to promise, but for the buyer, the rattles make it a lemon.

Whoever is to blame, the message is that the "rattles" have persisted for a worrying four years before full commissioning. Problems with new nuclear research reactors, however, are not unusual.

Egyptian officials confirmed that the flux measurement was a problem which INVAP was still working on. Professor El Fouly, vice-chairman of the EAEA, while acknowledging all new reactors have problems, said ETRR-2 was simply shut down when a fault occurred. ETRR-2 operated "on and off", with INVAP gaining "valuable data and experience which they are not paying for".

Fouly believed Australia would fare better by checking all the calculations, design and materials - something Egypt did not do before their project started. "[The Australians] are going better than we proceeded."

Is the EAEA happy with its INVAP reactor? "I cannot say so," he said. "It is something we have spent a lot of money on, and we have to get benefit out of it." The flux problem meant the reactor could be utilised at 15 megawatts of power rather than the 22MW of the original design. "We are working on this," he said, confirming that the EAEA had sought help from French companies in working out codes for the reactor.

Fouly's comments point to a difficult relationship between the Egyptian authorities and INVAP. Apart from seeking French assistance, the EAEA has sought technical aid from the International Atomic Energy Agency. For its part, INVAP says the five-year ETRR-2 project was completed on schedule and within budget. INVAP maintains 25 engineers on-site on "new contracts".

This supplier-client relationship is clearly high on Australia's agenda. "We will want a strong relationship and we will want to keep making sure that relationship works well," says ARPANSA's John Loy, who will hold the whip hand on the new Lucas Heights. "It is particularly critical as you reach the final stages of design and construction."

Both ANSTO and Industry Minister Nick Minchin have been careful in their comments, appearing to sheet home problems more to the Egyptians than the Argentinians. "At this stage we do not have any evidence of there being technical problems that are problems that shoot home to construction," ANSTO's executive director Professor Helen Garnett told Forshaw in an estimates committee meeting on June 4.

Minchin said stories that the Egyptian reactor was not able to operate according to the terms of its contract were "all scuttlebutt and rumour-mongering by certain people with certain vested interests". INVAP had assured him that ETRR-2 was built to contractual specifications. "Their position on this is that for a whole variety of reasons - internal reasons involving Egypt - the thing is not being operated at full capacity," he said. "That is not a matter of technical capacity but of operational arrangements involving Egypt."

Asked specifically about the three issues of flux problems, faulty convection flaps and cooling, ANSTO acknowledged that it is "aware that the EAEA has in recent times raised [these] three matters in connection with the performance of their ETRR-2 research reactor".

ANSTO said it had reviewed each of these matters in connection with the design of the new reactor and "is satisfied that the replacement research reactor will meet all safety and performance requirements".

Specifically, said ANSTO, the power peaking (flux) and engineering tolerances used in the safety analysis report had been independently checked by ANSTO to ensure safety and performance specifications were met. The natural convection flaps can operate within their design parameters, and ANSTO would verify this during commissioning and before acceptance. The secondary cooling system would ensure full power in "the most adverse summer conditions".

ANSTO is right to be wary. With Forshaw's committee looking over its shoulder and now revelation of specific problems at the reference site for Australia's new reactor, its reputation is clearly on the line. Its early insistence on "proven design" sits oddly with ETRR-2's problems. Forshaw says that if the Egyptian reactor cannot operate at full power, "one has to question what we are getting ourselves into".

ETRR-2 does not have the cold source and neutron guide specified for the new reactor. INVAP now has the task of integrating a reactor designed for medical isotope production with a major scientific research facility. Australia cannot afford a repeat of Egypt where the reactor is not accepted and in full operation four years after test commissioning. Lucas Heights is Australia's one shot at guaranteeing medical isotope supplies and a front row place in future nuclear research.

Bulletin - letters - July 17, 2001

Congratulations to Fred Brenchley for another fine piece of investigative journalism on the planned new reactor at Lucas Heights (July 10, Faulty Powers).

That said, I want to take issue with his final words: "Lucas Heights is Australia's one shot at guaranteeing medical isotope supplies and a front row place in future nuclear research."

In fact, many doctors, including the President of the Association of Physicians in Nuclear Medicine, did not know that the Lucas Heights reactor was shut down for maintenance for three months last year. Isotope supply was interrupted very little, if at all.

As for scientific research, the government did not even consult its own science advisers before its September 1997 decision to build a new reactor. Moreover, the neutron flux of the proposed new reactor is far down the list in the international context - 25th on the list when I last counted, in 1999. And keep in mind that performance rarely matches predictions in these matters. The proposed reactor simply won't be capable of 'front row' science.

On the other hand, Australia does have an opportunity to take the lead in closely related fields, such as the production of radiopharmaceuticals using particle accelerators (including cyclotrons). As an example of the potential, in recent years the reactor supply of palladium-103, a cancer therapeutic, dried up. Scientists in the United States took up the challenge and successfully developed a cyclotron method to produce the same isotope. Problem solved.

Non-reactor technologies offer broadly equivalent medical and scientific benefits - with very little or no legacy of radioactive waste.

Dr. Jim Green
Chippendale, NSW

Bulletin - letters - August 1, 2001

Fred Brenchley's report "Faulty Powers" (B, July 10) on the plethora of safety problems encountered by the Egyptian nuclear reactor chosen for Australia's new reactor bodes very badly for the standard reactor the federal government is proposing.

In view of the Senate report's criticism that the Australian Nuclear Science and Technology Organisation has been unco-operative, secretive and unaccountable to parliament and the community throughout its process to secure the reactor, I do not see how this organisation should be trusted to operate such a facility.

Brenchley's final remark, that "Lucas Heights is Australia's one shot at guaranteeing medical isotope supplies and a front-row place in future nuclear research", is misinformed. The future of nuclear research is in alternatives to the outdated, polluting and unsafe reactor technology, such as cyclotrons, synchrotrons and other spallation sources that provide solutions to these problems. We do not need a reactor for medical isotopes. The reactor was shut down for three months last year, yet there was no disruption to isotope supply.

It's time the federal government got serious about innovation and invested in what is truly the way of the future. The Egyptian desert is not where we should be looking.

Councillor Tracie Sonda
Mayor, Sutherland Shire Council
Sutherland, NSW

The selection by ANSTO of unproven Argentinian company INVAP to build a new reactor at Lucas Heights in Sydney has presented the government with some additional headaches, says Fred Brenchley.

Prime Minister John Howard must be wondering about the contribution to his misfortunes from the array of government statutory agencies.

First CASA, the civil aviation regulator, manages to not only ground a major part of Ansett's jet fleet but to call into question its own professionalism as a regulator. If CASA has made airline safety a political issue, APRA has done it in spades for insurance. The prudential regulator's eye-off-the-ball on HIH has lit what Financial Services Minister Joe Hockey rightly calls a "bushfire".

This week will see Howard wearing another potential political embarrassment from a statutory agency. A Labor-chaired Senate inquiry into the proposed $286m replacement nuclear research reactor at Lucas Heights in Sydney will put under scrutiny the Australian Nuclear Science and Technology Organisation (ANSTO) and its selection of the relatively unproven Argentinian company INVAP to build the new reactor.

If reports circulating in Canberra are right, the Senate inquiry broaches the issue of an Audit Office inquiry into ANSTO's process of selecting INVAP. It is also understood to be calling for an inquiry into the need for a replacement reactor, whether any needed reactor should be relocated away from Lucas Heights in Sydney's south, and also that a future order be based on independent verification and validation.

That throws a thunderbolt not only into the Liberal seat of [Hughes] around Lucas Heights (held by Danna Vale) but into South Australia, where nuclear waste "dumping" has become a hot issue, with a site near Woomera singled out for a low-level waste deposit. One of ANSTO's failings in selecting INVAP was not assuring that the Argentinians had back-end solutions for waste processing. Another was in not subjecting each tenderer to individual environmental impact assessment.

A Coalition senators' minority report - the inquiry was established by a Labor-Democrat vote - apparently disagrees with the criticism of ANSTO's selection process, but may leave open the issue of whether the INVAP selection should have been independently verified. The minority report is also expected to defend Australia's medical and scientific need for a replacement reactor. Lucas Heights is also a big contributor to the local economy.

In view of the Labor majority report, Kim Beazley may support calls for the project to be put on hold pending investigation. That leaves Industry Minister Nick Minchin, already battling to retain the Mitsubishi plant for his home state of South Australia, with added pressure on nuclear waste. One option for Minchin is to support the idea of independent verification, leaving ANSTO to hang out to dry.

The Government's assessment of the Argentine company which won the contract for the new Lucas Heights nuclear reactor was based on viewing a reactor in Egypt which has been operating only part-time since construction, a Senate committee heard yesterday.

The Australian Nuclear Science and Technology Organisation's executive director, Professor Helen Garnett, also admitted that Government officials did not visit INVAP's head office in Argentina during the process leading up to the awarding of the tender.

"The reference reactor for INVAP was the Egyptian reactor," Professor Garnett told the Senate select committee on the replacement research reactor at Lucas Heights.

"We did also make other inquiries as to [their] other facilities and we received our responses."

Professor Garnett told the Herald that rumours that the Egyptian reactor had only been open part-time since it began operation about three years ago were true.

She said it was because the Egyptians had decided to install more monitoring equipment after it was built.

"The contract for the Egyptian reactor was very clear - it was a contract with an option to put in additional facilities," she said.

"Once the reactor was operational, the Egyptians determined they were going to put in testing control loops.

"I believe that the testing control loops are in and the reactor is now operational ... [also] some [reactors] don't operate on an ongoing basis. They're stop-start."

The Egyptian reactor had met the "power and flux and performance" requirements ANSTO had wanted to see.

At the inquiry yesterday, Professor Garnett played down a theory pushed by INVAP's opponents that it may have been awarded the tender because it was the cheapest bid, saying it was the best on "performance, not price".

"I think we have already said it wasn't on price ... they [the four preferred tenderers] were so close to each other [in price]," she said.

She also produced a guarantee from the Argentine Government that it would back INVAP financially, if necessary, and pointed out that INVAP was working with NASA to produce satellites.

Yesterday's hearing was the first since Labor and the Democrats set up the select committee in August. Hearings in Sydney at the end of the month will hear from critics of INVAP and the new reactor.

INDUSTRY, SCIENCE AND RESOURCES PORTFOLIO: Australian Nuclear Science and Technology Organisation
Date: 4 June 2001
Committee name: ECONOMICS LEGISLATION COMMITTEE
Page: 100ff
Proof: YES
Database: Estimates Comm
Source: SENATE

Senator FORSHAW - You will recall that, during the Senate inquiry, there was some evidence given by Technicatome but refuted by INVAP and by ANSTO regarding problems, or supposed problems, with the reactor that had been built by INVAP in Egypt. I am sure you will recall that issue being debated. It seems that this issue will not go away, not because I am going to ask further questions about it, but because there are still rumours going around - and indeed, within the nuclear industry itself - that there are problems with the reactor in Egypt. Are you aware of whether there are or there are not some problems that have been encountered with respect to that reactor?

Prof. Garnett - All we are aware of is that there are some differences of opinion to do with what we have been advised are contractual issues.

Senator FORSHAW - So you are saying the argument is about whether INVAP did what they were supposed to do under the contract?

Prof. Garnett - I do not know enough about it other than that there are contractual issues which are really, as I understand it, dollar issues.

Senator FORSHAW - The reports that I have heard and read are, for instance, that the reactor does not operate or cannot operate at full power because of insufficient coolant capability or capacity for the reactor core. Have you heard that proposition?

Prof. Garnett - I heard that some time ago. I am also aware that Egypt has used on a number of occasions IEA (JG - sic - IAEA) teams. I think they have had the IEA teams through now, I am not sure, four or five times. I am aware of an IEA report that indeed signed off on the reactor from the point of view of it operating at full power back when it was commissioned.

Senator FORSHAW - We received that report and that evidence during the committee's inquiry. But this is more recent.

Prof. Garnett - It was signed off as meeting the requirements back in November or December 1998.

Senator FORSHAW - But if it were true, and if this is the reason why it is reported that the Egyptians will not finalise payment to INVAP, it would be a pretty serious problem, would it not?

Prof. Garnett - That depends on whether the reactor is functioning, and the advice that we have had, as witnessed by the reports by experts who went when the reactor was commissioned, is that the reactor can function and does function.

Senator FORSHAW - I can have a car that goes, too, but that does not mean it is going as well as it should and is what I expected to get. If ANSTO has heard these reports, have you sought to ascertain whether there is any truth to them?

Prof. Garnett - We have done what we would need to do, which is to send somebody from the point of view of asking, 'Are there any lessons for us to learn?' I can clearly say, as we have said before, that the only lessons for us are the lessons that we had learnt well in advance, which was to specify very clearly in the request for tender what we wanted delivered and have the contract written in such a way.

Senator FORSHAW - Did you send somebody over to have a look at this?

Prof. Garnett - We certainly sent people earlier, but we sent somebody earlier this year.

Senator FORSHAW - What, to go to Egypt?

Prof. Garnett - He went through Egypt on another visit, yes.

Senator FORSHAW - Who was that?

Prof. Garnett - The head of our Nuclear Technology Division.

Senator FORSHAW - Who is that?

Prof. Garnett - Professor Horlock.

Senator FORSHAW - Did he investigate this issue?

Prof. Garnett - It was not a matter of investigating it. The issue was a follow-up, as any organisation would do when you have a contract with an organisation. You will find that in construction, businesspeople will go back to recent customers to identify if there are any lessons learnt that might be appropriate. I have just given you the outcome of that.

Senator FORSHAW - What are you saying to me? Are you saying that you do not think that there is a problem or that there could be a problem but it is not a matter of concern?

Prof. Garnett - I am saying that at this stage we do not have any evidence of there being technical problems that are problems that shoot home to construction.

Senator FORSHAW - Could what I just mentioned - that it does not operate at full power because of insufficient cooling capability -

Prof. Garnett - I am not aware of that particular allegation.

Senator FORSHAW - If that was to be the case, it would be a problem associated with construction surely?

Prof. Garnett - I come back -

Senator FORSHAW - Or design?

Prof. Garnett - No, I come back to the comment that I made earlier that when the reactor was commissioned it was witnessed to go to full power by third-party people who wrote a report on that which says that the design and construction of it were able to support the full operation of it.

Senator FORSHAW - Is it feasible that it could have done that and now that there could be a problem along the lines that I have just mentioned? It went to full power when it was first tested and signed off. You are the expert, Professor Garnett. Is it possible that a problem could show up of this magnitude or of this seriousness now?

Prof. Garnett - I think that that statement can be read in three or four or five different ways. What I am saying to you is that I am not aware of that particular issue in the way that you have read it out.

Senator FORSHAW - But if it was correct, it would certainly be a serious matter?

Prof. Garnett - If it is due -

Senator FORSHAW - That is why I am about to ask you: wouldn't it be a serious issue for a reactor of this type, which is like the new reactor as proposed for Lucas Heights, that is, a pool-type reactor?

Prof. Garnett - I have not got the relevant experts here to answer that question. But from everything that I have been advised I would say that there can be an issue to do with operations.

Senator FORSHAW - Are you aware whether or not the French nuclear safety bureau has been called in or is assisting the Egyptian nuclear authority to address this issue?

Prof. Garnett - No. I am aware that they have used the IEA on numerous occasions. I am also aware that at least one of their staff previously worked in France.

Senator FORSHAW - It was commented on during the Senate committee, when the witness from Technicatome appeared, that they had been engaged. That was refuted by INVAP, but it has been reported that in fact Technicatome has been engaged to assist in trying to resolve this problem with this reactor.

Prof. Garnett - That is not consistent with reports that we have.

Senator FORSHAW - Would you mind taking my questions on notice and just seeing if there is any further updated information that you are able to obtain and advise the committee?

Senator Minchin - As far as I am aware, there is absolutely no external evidence whatsoever that the Egyptian reactor was not built to and is not able to operate according to the terms of the contract. Unless and until such evidence is produced, this is all scuttlebutt and rumour mongering by certain people with certain vested interests. When I was in Argentina, I sought a full explanation from INVAP on their view on this. They certainly assured me that the thing was built to contractual specifications. Their position on this is that for a whole variety of reasons - internal reasons involving Egypt - the thing is not being operated at full capacity. That is not a matter of technical capacity but of operational arrangements involving Egypt.

Senator FORSHAW - That is what was put to our committee. I understand precisely what you have put and I have heard that myself. My concern is that I keep hearing things to the contrary. I would not be asking these things if I did not think that these reports were coming from sources that were at least reputable. You call it scuttlebutt. It has not been put to me as scuttlebutt. I am trying to ascertain whether it is true or not. One could conceive hypothetically of a situation where it is not in the interests of people to advertise the fact that there are problems if they have them. Anyway, we will see what we can find out.

Senator Minchin - But as you would well know, there are a whole variety of reasons why people might want to assert there are problems where there are none. As I say, I come back to the point that as far as I am aware - contradict me if you can - there is no external evidence that this reactor in Egypt was not built according to the contractual specifications and is not able to operate according to those specifications.

Section titled: Reference reactor

6.130 A number of community groups and media organisations have raised significant concerns about INVAP’s previous record with respect to the Egyptian and Peruvian reactors.

6.131 As noted by Technicatome, one of its main concerns was the assessment of proven experience in the design and construction of a research reactor. For Technicatome and others, the Egyptian reactor has emerged as an important indicator of a flaw in the checks made by ANSTO of INVAP’s capability to meet ANSTO’s performance specifications. They have suggested that the Egyptian reactor, used by INVAP as its reference facility, is less than successful.

6.132 Mr Minguet from Technicatome told the Committee that the reactor reached criticality at the end of 1997 but after three years ‘is not yet commissioned and tested’. Further, he stated that the reactor is very different from the technology specified by ANSTO. More specifically, according to Technicatome, the Egyptian reactor had no neutron guide or experimental facility installed.

6.133 Indeed, Technicatome told the Committee that they had been approached by the Egyptians to equip their reactor with a cold neutron source and guides. For Technicatome this was proof that no such equipment had been installed. Mr Minguet told the Committee: "It is the reason why we were surprised when we were told that the performance of the selected tenderer was better than what we have announced because we did not know on what grounds they assessed the preference they announced."

6.134 Siemens also questioned the checks made of the preferred tenderer both at pre-qualification and contact stages. It had doubts about the performance of the Peruvian RP Research Reactor and specifically mentioned several unforeseen failures causing temporary unavailability of the facility already under low duty cycles.

6.135 As explained earlier, a team from ANSTO undertook a site visit to the 22MW research reactor facility in Egypt (ETRR-2) to ascertain first hand the experiences of the owner/operator. ANSTO was afforded unrestricted access to the senior owner/operator executive, and to the operators of the facility and detailed discussions took place.
The Committee is not privy to any findings that may have been reached during the visit to the Egyptian reactor. This remains an inherent weakness in ANSTO’s assurances to the Committee.

6.136 Nonetheless, Professor Garnett assured the Committee that ANSTO had made inquiries about INVAP’s reference reactor in Egypt as well as other facilities and that they had received positive responses. In the Professor’s words: "…appropriate verbal inquiries were made of a range of parties…the Argentinian facilities are well and truly meeting the specifications. The Peruvians have also confirmed that they are meeting their specifications."

6.137 It should be noted that ARPANSA, as part of its assessment of INVAP during the process for issuing a construction licence, will look at the experience of the Egyptians and the construction and operation of that reactor.

6.138 Indeed, Mr Don McNab, Director, Regulatory Branch, ARPANSA, explained that ARPANSA’s senior mechanical engineer has already visited the Egyptian reactor and been accorded a thorough view of it. He talked to the engineers of INVAP about its design, construction and operation and also conferred with the Egyptian operator and the Egyptian regulator. Overall, he gained the impression that the reactor was well constructed and well-designed and that the restrictions in its operation were due to demand rather than a limitation in its design and construction.

6.139 In answer to its critics, INVAP told the Committee that the Egyptian facility reached full power operation in March 1998 leading to the Preliminary Acceptance of the facility by the reactor owner. It stressed that the Egyptian regulatory body had  issued permits allowing for INVAP to proceed with the commissioning and full power operation tests of the reactor which led to the Preliminary Acceptance of the facility. In brief INVAP asserts, ‘the reactor has reached nominal power and has since then been able to operate at this power’.

6.140 According to recent advice received by ANSTO from the IAEA, there are two relevant reports on the Egyptian reactor—a safety analysis report carried out by a Canadian IAEA expert in December 1998 and another by two IAEA experts during commissioning. According to an IAEA officer, Mr Z. Domaratzki, both reports made a number of recommendations but overall were very positive. He explained to ANSTO that there was nothing on allegations that had been raised in the Australian media on failure in the fuel, bubbles in the cooling circuit or related matters.

6.141 In turning to the Peruvian reactor, INVAP noted that the IAEA has been asked to give assistance to virtually every nuclear research reactor operator in the world as it is one of their roles to provide advice. It informed the Committee that the IAEA has not been asked ‘to solve problems concerning the Peruvian reactor’ which has been issued with its Preliminary and Final Acceptance.

6.142 INVAP did, however, agree that the Egyptian reactor is not equipped with a cold source or neutron guides. Even so, it maintains that the important issue for the replacement research reactor project is not whether the reference reactor has such facilities but rather that INVAP has the ability to meet ANSTO’s requirements. It informed the Committee: "We have…the core technologies, know-how and project management integration expertise that allows us to design and construct nuclear research reactors, using the appropriate subcontractors, while retaining the responsibility for the performance of the facility. We have put together for this project a team of the best worldwide experts in every field, giving preference to those that can add value to it."

6.143 In detailing its readiness to undertake the project, INVAP told the Committee that it has wide experience in research reactors and particularly in overseas projects. It noted that it has formed a very strong alliance with the best Australian companies in their fields and have included the best worldwide expertise—‘the Petersburg Nuclear Physics Institute from Russia, which has the world experts in cold neutron sources; Mirrotron from Hungary, one of the few manufacturers of neutron guides in the world; and German and French experts as well’.

As outlined by the RRRP Deputy Project Manager, Mr Juan Ordonez: "Our strategy when presented with a project of this kind is to get the best available anywhere…We have put together a team with very good Australian companies for the part that is to be done here in Australia. We also get the best expertise in the world in each field we need to comply with the requirements of ANSTO."

6.144 Using the argument about proven experience to its own advantage, INVAP pointed out that in 1999 it was successful in an international bid for a radioisotope production plant in Egypt. It concluded: "We won that again. We signed the contract…We are in a very competitive market…What I want to make clear is that the customer is satisfied…I want it to be clear for the record that these people, our customers, are satisfied otherwise they would not have signed a new contract."

6.145 Doubts and rumours still linger about the Egyptian reactor. The Committee is not completely satisfied that it has been able to lift the cloud of suspicion surrounding this reactor. Similar questions remain about the Peruvian reactor also. It would certainly have wished to dispel the speculation by producing incontrovertible evidence on these reactor’s performance.

6.146 Having said that and noting that those closely associated with the proposed replacement reactor are confident in the ability of INVAP to design and construct the facility, the Committee draws attention to the words of caution from the Academy of Science. Professor John White, Secretary for Science Policy, Australian Academy of Science told the Committee: "…but the academy still has some concerns about the ability of INVAP to produce what we would call an integrated project—that is to say, they have to take information and, indeed, material from various sources to produce the performance which they have suggested. It is not a criticism that I am making. It is an expression of ignorance, so that it is on the basis of caution that one does raise the question about the integration of the project. … Building a successful reactor, from the point of view of doing the science and technology, as well as the irradiations, is rather like constructing a chain. You must have the fuel right, and you must have the configuration of the core right to make the best use of the fuel to get the highest intensities. You must then conduct the neutrons in such a way to a cold source to produce the special wavelengths that are needed for the science, and we could in principle be one of the best reactors in the world if that is done properly. Then you must have these things called neutrons guides, which conduct the neutrons out of the reactor area into a room which can be used by ordinary scientists."

6.147 This view highlights the importance for careful monitoring and checking during the construction and early operational stages of the new reactor as well as the need for transparency in reporting its progress.

Argentina is building a nuclear reactor in Egypt that will give Cairo its first access to bomb quantities of fissile material, possibly enough plutonium to make one nuclear weapon per year. Although Egypt's nuclear program is now open to international inspection, there is reason for Cairo's foreign suppliers to proceed with caution: High-level Egyptian officials continue to say that Israel's nuclear arsenal is reason enough for Arab nations to build their own atomic bombs. In addition, Cairo is now building ballistic missiles capable of carrying nuclear warheads.

Egypt's Foreign Minister Amre Mousa is adamant that Israel should be blamed if other Mideast nations build the bomb: "If there is a nuclear program in Israel, then we can blame nobody and no country if they want to acquire the same ... this is an invitation to an arms race - a very, very serious and dangerous policy." The Foreign Minister's remarks were made this summer at a gathering of Mideast experts and journalists in Washington, DC. No one at the meeting brought up the fact that virtually all Arab states, including Egypt, Libya and Syria, are members of the Nuclear Non-Proliferation Treaty, which obliges them not to pursue nuclear weapons.

Egypt joined the Treaty in 1981, but is now one of its leading critics. In 1995, Egypt strongly opposed efforts to extend the Treaty indefinitely. In April of last year, Amre Mousa argued that Israel's failure to adhere to the NPT means the treaty is "incapable of safeguarding Egypt" and has created "an extremely dangerous situation" in the Middle East.

Egypt's nuclear history

At the center of Egypt's nuclear program is the Inshas Nuclear Research Center in Cairo. Inshas hosts a 2-megawatt, Soviet-supplied research reactor that started in 1961 and runs on ten-percent-enriched uranium fuel. The reactor was shut down for renovation during the 1980s, but started up again in 1990. According to Egypt's Atomic Energy Agency, the reactor should serve Egypt's research needs for the next ten years, by which time Egypt hopes to have completed a larger research reactor to replace it.

Egypt also runs a number of other research facilities at Inshas. These include a small French-supplied hot cell complex for plutonium extraction research, the Middle East's first industrial electronic accelerator, and a pilot nuclear fuel factory, completed in 1987, used to process natural uranium mined in Egypt. In addition, Egypt plans to build a larger fuel fabrication plant, reportedly with help from Germany.

Egypt's expanded nuclear activity has raised some eyebrows in Israel. In 1990, the Israeli press reported that Egypt was cooperating with Pakistan, Iraq and Argentina to build a plutonium-producing reactor for nuclear weapons. Argentina later revealed that it was preparing to supply a 20-MWt research reactor to Egypt under international inspection, though Argentina faced competition from other bidders, including the Atomic Energy of Canada Ltd., and France's nuclear giant, Framatome.

By September 1992, Egypt had signed a contract with Invap, Argentina's leading nuclear organization, to build a 22-megawatt research reactor at Inshas. According to statements by an official at Argentina's embassy in Washington, DC, construction began in March 1993. In 1995, Egypt's Rose al-Yusuf' magazine reported that Egypt's Minister of Electricity and Energy, Mahim Abazah, had confirmed that a shipment of supplies was en route from Argentina in April, and that the reactor would be completed in 1997. Egyptian officials still expect the reactor to start operation next year.

As Cairo was making up its mind about which type of research reactor to buy, U.S. and Canadian officials reportedly steered Egypt away from Chinese models. In exchange for giving up Chinese imports, Egypt was reportedly promised help from the Atomic Energy of Canada Limited (AECL) and the U.S. Bechtel company to study the feasibility of building power reactors in Egypt. The industry trade newsletter, Nucleonics Week, reported in September 1992 that the AECL-Bechtel study found that only 30 percent of a Canadian-style power reactor could be locally produced in Egypt.

Egypt still hopes to import power reactors. Egyptian officials have talked since the early 1980s about building up to eight 1,000-MWe reactors to supply up to 40 percent of Egypt's electricity needs. By mid-1985, three international supplier groups had bid to build the first two reactors: one group led by Germany's Kraftwerk Union, a second Franco-Italian group led by Framatome, and a third headed by Westinghouse of the United States. The reactors would be sited at El-Dabaa, outside Alexandria, and would be owned and operated by Egypt's Nuclear Power Plants Authority. But as the Risk Report went to press, the Egyptian government had not announced the award of any contract.

Uranium processing

Egypt has also been busy surveying its uranium ore resources. Cairo would like to develop its own ability to make uranium fuel for nuclear reactors. Egypt's Nuclear Materials Authority has directed uranium exploration to concentrate on four areas in the eastern desert: Gabal Gattar, El Missikat, El Erediya and Um Ara. A new uranium-bearing area, Gabal Kadabora, has been discovered in the central eastern desert and is now under evaluation. In addition, the Nuclear Materials Authority is constructing a pilot scale plant to extract uranium from phosphoric acid. Cairo has reportedly signed contracts with Australia, Canada and Niger to buy mining technology and for help in processing uranium ore.

A RIFT is developing between federal bureaucrat Max Moore-Wilton and Industry Minister Nick Minchin over awarding the contract for the new Lucas Heights nuclear reactor to Argentinian company INVAP.

The Advertiser has been told Mr Moore-Wilton, the secretary of the Department of Prime Minister and Cabinet, is working behind the scenes, apparently to try to reverse the decision and award the contract to French firm FRAMATOME. Mr Moore-Wilton, one of Prime Minister John Howard's most trusted advisers, is understood to be concerned at the "foreign policy implications" of not awarding the contract to the French.

The French Government is also upset at the decision to let INVAP build the $280 million reactor and French Ambassador Pierre Viaux will meet Senator Minchin tomorrow when he is expected to raise the issue.

It is understood Mr Moore-Wilton has also been holding talks with representatives of other parties involved. About a month ago, Cabinet approved INVAP as the preferred tenderer to build the new reactor following an assessment of bids by the Australian Nuclear Science and Technology Organisation.

Before Cabinet approved INVAP, the recommendation was ratified by the Foreign Affairs Department.

Signing the agreement is due to take place next month.

It is understood Mr Moore-Wilton did not raise any concerns before or during the Cabinet discussion.

Controversy has surrounded INVAP with speculation raised over its dealings with countries such as Iran, Cuban and Egypt.

More importantly, there was no well-defined proposal by INVAP as to what fuel the new reactor would use, whether it could be reprocessed and where the waste would be stored.

Senator Minchin attempted to dispel disquiet over the fuel on Monday by declaring whatever was used could be reprocessed.

The Government has an agreement with French company COGEMA to reprocess about 1300 spent fuel rods produced by the current Lucas Heights reactor.

COGEMA is the dominant shareholder of FRAMATOME and Mr Viaux said recently there was no guarantee the French would reprocess fuel rods from the new reactor if they did not build it.

It is understood Senator Minchin will not back down on what was a Cabinet decision.