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DE RUEHTA #2298/01 3290830
ZNR UUUUU ZZH
R 240830Z NOV 08 ZDK
FM AMEMBASSY ASTANA
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RUEHZL/EUROPEAN POLITICAL COLLECTIVE
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RUCPDOC/DEPT OF COMMERCE WASHDC
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RUEATRS/DEPT OF TREASURY WASHDC

UNCLAS SECTION 01 OF 02 ASTANA 002298 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PARM PGOV ENRG MNUC KNNP TRGY UK KZ
SUBJECT: KAZAKHSTAN APPROVES LIMITED FUNDING TO MAINTAIN 
U.S.-FUNDED SODIUM PROCESSING FACILITY 
 
REF: STATE 89507 
 
¶1.  (U) Sensitive but unclassified.  Not for public Internet. 
 
¶2.  (U) This is an action request.  Please see paragraph 
nine. 
 
¶3.  (SBU) SUMMARY:  On November 5, U.S. and Kazakhstani 
officials met in Aktau to celebrate the construction of the 
$3.35 million U.S. government-funded sodium processing 
facility (SPF).  Completing the SPF was the U.S. 
government,s final step in the irreversible decommissioning 
of the BN-350 plutonium breeder reactor.  The SPF was 
designed to assist in disposing of the remaining radioactive 
sodium from the reactor in an ecologically safe way.  The 
Kazakhstani government committed to funding the SPF,s 
maintenance after its construction, but on November 5, 
representatives of the government of Kazakhstan said they had 
received enough funding only to maintain the facility for one 
or two years.  The contractor that had overseen efforts to 
build and fund the facility, the National Nuclear Technology 
Safety Center (NTSC), requested U.S. assistance in lobbying 
the government of Kazakhstan for more budgetary assistance in 
the long-term.  If the government of Kazakhstan does not 
properly maintain the SPF, the sodium could pose a future 
environmental hazard.  END SUMMARY. 
 
CONSTRUCTION COMPLETED AT U.S.-FUNDED FACILITY 
 
¶4.  (SBU) On November 5, U.S., UK, and Kazakhstani officials 
celebrated the construction of the $3.35 million U.S. 
government-funded sodium processing facility (SPF) in Aktau. 
Completing the SPF was the U.S. government,s final step in 
the irreversible decommissioning of the BN-350 plutonium 
breeder reactor.  The SPF, modeled on technology used at 
Idaho National Laboratory,s Experimental Breeder Reactor, is 
designed to process an estimated 56 liters of solidified 
residual sodium from the BN-350 reactor into sodium 
hydroxide.  The material can then be stored in a safe 
condition for long-term storage.  The Kazakhstani government 
previously committed to building a Kazakhstani-funded 
geo-cement stone facility (GSF) in which the sodium hydroxide 
solution generated by the SPF would be combined with 
blast-furnace slag and solidified in steel drums for 
long-term storage.  The initial development of geo-cement 
stone technology was a collaborative project between the 
United States and Kazakhstan.  In the second &plant-design8 
phase, the United Kingdom has been providing technical 
assistance. 
 
SUB-CONTRACTOR MAEC CAUSED NUMEROUS DELAYS 
 
¶5.  (SBU) Construction of the U.S. project, which began in 
March 2004, was completed by the target date of November 
¶2008.  During construction, however, MAEC-Kazatomprom often 
balked at implementing orders from the U.S. government,s 
Kazakhstani primary contractor, NTSC, causing project delays. 
 Since the BN-350 reactor and SPF are located on its 
territory, MAEC is responsible for assisting NTSC to procure 
funds to maintain the SPF.  However, given MAEC,s resistance 
to NTSC guidance in the past, Executive Director Irina 
Tazhibayeva expressed concern about being able to secure 
funding resources to maintain the SPF until the GSF is 
complete. 
 
LONG-TERM PROSPECTS FOR SPF MAINTENANCE FUNDING UNCLEAR 
 
¶6.  (SBU) Tazhibayeva told U.S. officials that NTSC worked 
carefully with MAEC to put together a detailed funding 
request for MEMR.  MEMR, in turn, passed this proposal to the 
Ministry of Budget and Planning, which reportedly denied the 
proposal due to the effects of the financial crisis, but gave 
MAEC &plan of priority measures8 (PPM) funding, sufficient 
to maintain the facility for one or two years.  Marat 
Nurgaziyev, Kazatomprom,s Deputy Director of Labor and 
Safety, stated that &any funding, other than PPM funding, 
 
ASTANA 00002298  002 OF 002 
 
 
would be difficult to obtain, even in 2010.8  The current 
reality is in stark contrast to previous expectations. 
NTSC,s Tazhibayeva told U.S. officials that Kazakhstan,s 
former Minister of Energy and Mineral Resources, Baktykozha 
Izmukhambetov, made commitments to use Kazakhstani government 
funds to maintain the sodium processing facility. 
 
FUNDING OUTLOOK FOR THE GEO-CEMENT STONE FACILITY BLEAK 
 
¶7.  (SBU) The most serious impact will be on construction of 
the Geo-cement Stone Facility.  Although Alexandr 
Onichshenko, Director of the primary contractor for the GSF, 
stated PPM funding was adequate for completing the GSF,s 
design, it is not enough to build the facility.  Under 
Izmukhambetov, Tazhibayeva indicated MEMR had given 
assurances that Kazakhstan would definitely build the 
Geo-cement Stone Facility by 2012, but at the November 5 
meeting, one Kazakhstani official called the project 
&tentative.8  Nurgaziyev stated that &as for actual work 
on the Geo-cement Stone Facility, we will have to develop 
plans for 2009-2010, and when the PPM budget is approved next 
year, we will see if it is possible.8  Tazhibayeva requested 
that the U.S. and U.K. assist NTSC, MAEC-Kazatomprom and MEMR 
to request adequate funding for the SPF and GSF facilities 
from the Ministry of Budget and Planning.  In an indication 
of the relative lack of importance of these projects to the 
Kazakhstani government, the highest ranking attendees were 
MEMR Representative and Deputy Chairman of the Kazakhstan 
Atomic Energy Agency Alexander Kim, Deputy Director of 
MAEC-Kazatomprom Andrey Mogilin and Kazatomprom,s Deputy 
Director of Labor and Safety Marat Nurgaziyev. 
 
UK CONCERNED ABOUT LACK OF KAZAKHSTANI FUNDING 
 
¶8.  (SBU) The UK Embassy,s Deputy Head of Mission, Michael 
Welch, agreed that it is in the best interests of all three 
countries (the United States, the United Kingdom and 
Kazakhstan) to complete the SPF and GSF facilities as soon as 
possible.  In his remarks at the November 5 meeting and the 
press ceremony, Welch emphasized the significant investments 
the UK government had made in these projects, and stressed 
that the UK government hopes to see the projects brought to 
completion with Kazakhstani funding as soon as possible. 
Tazhibayeva intends to make an additional request for funding 
in early December 2008, and asked for assistance in 
encouraging Kazakhstani government support. 
 
¶9.  (SBU) ACTION REQUEST:  Post requests guidance from 
Washington on seeking additional funding from the government 
of Kazakhstan on the Sodium Processing and Geo-cement Stone 
Facilities, especially given existing unfulfilled requests to 
fund other BN-350 projects, in particular, the $25 million 
dollars that the Government of Kazakhstan has already 
committed to spend for the transfer of spent fuel in fiscal 
year 2009.  In particular, post requests that the Department 
consider coordinating with London before directing the U.S. 
and British Ambassadors in Astana to make a joint demarche on 
this subject.  Per reftel, the U.S. government already made a 
supplemental request, submitted in letters sent in September 
2008 from then-Ambassador Ordway to the Minister of Energy 
and Mineral Resources Sauat Mynbayev and Prime Minister Karim 
Masimov, for $15 million dollars to purchase casks for the 
transfer of BN-350 spent fuel.  END ACTION REQUEST. 
HOAGLAND