US firms push Washington to restart nuclear pact talks with Riyadh

US firms attracted by Saudi Arabia’s plans to build nuclear reactors are pushing Washington to restart talks with Riyadh on an agreement to help the kingdom develop atomic energy, three industry sources said.

Saudi Arabia has welcomed the lobbying, they said, though it is likely to worry regional rival Iran at a time when tensions are already high in the Middle East.

One of the sources also said Riyadh had told Washington it does not want to forfeit the possibility of one day enriching uranium – a process that can have military uses – though this is a standard condition of US civil nuclear cooperation pacts.

“They want to secure enrichment if down the line they want to do it,” the source, who is in contact with Saudi and US officials, said before US Energy Secretary Rick Perry holds talks in Riyadh early next week.

Another of the industry sources said Saudi Arabia and the United States had already held initial talks about a nuclear cooperation pact.

Read: Saudi Arabia to extract uranium for ‘self-sufficient’ nuclear programme

US officials and Saudi officials responsible for nuclear energy issues declined to comment to Reuters for this article. The sources did not identify the US firms involved in the lobbying.

Under Article 123 of the US Atomic Energy Act, a peaceful cooperation agreement is required for the transfer of nuclear materials, technology and equipment.

In previous talks, Saudi Arabia has refused to sign up to any agreement with the United States that would deprive the kingdom of the possibility of one day enriching uranium. Saudi Arabia, the world’s top oil producer, says it wants nuclear power solely for peaceful uses – to produce electricity at home so that it can export more crude. It has not yet acquired nuclear power or enrichment technology.

Riyadh sent a request for information to nuclear reactor suppliers in October in a first step towards opening a multi-billion-dollar tender for two nuclear power reactors, and plans to award the first construction contract in 2018.

Reuters has reported that Westinghouse is in talks with other US-based companies to form a consortium for the bid. A downturn in the US nuclear industry makes business abroad increasingly valuable for American firms.

Reactors need uranium enriched to around 5 percent purity but the same technology in this process can also be used to enrich the heavy metal to a higher, weapons-grade level. This has been at the heart of Western and regional concerns over the nuclear work of Iran, which enriches uranium domestically.

Riyadh’s main reason to leave the door open to enrichment in the future may be political – to ensure the Sunni Muslim kingdom has the same possibility of enriching uranium as Shia Muslim Iran, industry sources and analysts say.