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On June 22, the United States announced that it had signed a nuclear cooperation agreement with Saudi Arabia. This type of agreement broadly authorizes trade in nuclear technology, equipment, and materials, but only if the agreement and the country in question meet defined nonproliferation requirements. They are called Section 123 agreements for the section of the 1957 U.S. Atomic Energy Act that lays out the specific conditions for them. But the legal terms of Section 123 are only the minimum requirements in law: On top of the legal standards are nonproliferation policies that have been held by the United States over the last few decades. Press reports indicate that the Trump administration has set aside some of the most important ones, including trying to prevent the spread of uranium enrichment technology, to get this nuclear deal over the line.
This is likely to prove a persistent source of friction in Washington as the deal undergoes congressional scrutiny. Concerns with Saudi nuclear proliferation have been rife in the United States for years, but they took on a particular emphasis after Saudi officials said that they would match Iran’s nuclear program — including nuclear weapons if need be. Since then, questions have emerged about other Saudi nuclear activities, though these have been unsubstantiated and denied. The concessions made by the United States in this negotiation — establishing a process that could permit Saudi Arabia to acquire uranium enrichment technology and allowing the Saudis to refuse enhanced international inspections — will make those concerns worse.
Of course, by the time you read this, the entire agreement may have been put aside because of President Donald Trump’s renewed enthusiasm for leveraging the nuclear deal to get Saudi Arabia to normalize its relations with Israel. This issue was one of the most important impediments to the Biden Administration’s attempt to conclude its own nuclear deal. But, according to press reports attributed to U.S. sources, the United States abandoned this objective in its negotiations under Trump. It is no surprise for the issue to reemerge as a stumbling block.
In all, the unfortunate choices made by the Trump administration may complicate the Saudi 123 agreement and have deleterious effects on U.S. nuclear commerce.
The specific terms of a 123 agreement are spelled out in the underlying legislation, but they boil down to the foreign country involved guaranteeing that it will permit inspections of its nuclear facilities by the International Atomic Energy Agency, maintain physical security arrangements for any transferred materials, not retransfer nuclear material or sensitive information to other countries without U.S. consent, and seek U.S. advance approval before enriching, reprocessing or transferring U.S. provided materials. These requirements are intended to provide the United States with confidence that, if it provides support to a foreign nuclear program, it won’t abet nuclear weapons production elsewhere. This is not just an important element of U.S. national security, but also a U.S. legal obligation under the Nuclear Non-Proliferation Treaty, in which the United States committed not to assist non-nuclear weapon states with acquiring nuclear weapons.
Still, these obligations are intended to constitute a nonproliferation floor. Following revelations about the Iranian and Libyan nuclear programs in 2003 and 2004, the United States has tried to expand global requirements for nuclear commerce. Two stand out in connection to the U.S.-Saudi deal.
First, the United States sought to prohibit the spread of uranium enrichment and plutonium reprocessing, including by trying to get the members of the Nuclear Suppliers Group to agree not to make any transfers of enrichment or reprocessing technology to countries that don’t have this technology. The United States also sought to require adherence to the Additional Protocol — an agreement with the International Atomic Energy Agency that provides for enhanced nuclear inspections — before any Nuclear Suppliers Group country would agree to any nuclear transfer whatsoever.
The United States tried to get its enhanced nonproliferation positions accepted more broadly, with varying degrees of success. The Nuclear Suppliers Group developed a more permissive criteria-based approach for enrichment or reprocessing transfers that, among other elements, stipulated transfers “should … only” be authorized with the Additional Protocol in place or if they are taking place in the context of a similarly inspected regional arrangement — such as the Brazil-Argentine Agency for the Accounting and Control of Nuclear Materials.
Having failed to secure more serious requirements on a global scale, the United States tried to lead with these policy preferences in its own nuclear cooperation with foreign countries. The primary example was the U.S. nuclear cooperation agreement with the United Arab Emirates in 2009. This agreement, which became known as the “gold standard” 123 agreement, secured the Emirates’ commitment to foreswear development of enrichment or reprocessing technology and accept the Additional Protocol as a condition of supply.
Notwithstanding this good example, the United States found it difficult to get other states to accept similar terms, and U.S. competitors refused to take the same high road. In particular, Russia and China have been winning contracts while the United States has fallen off the map. U.S. insistence on rigid nonproliferation requirements is not the sole explanation by any means for this commercial position: Generous financial terms probably explain at least part of the attraction for working with the Russians and Chinese. But U.S. nonproliferation policy may have presented a complicating factor.
Even as early as the Obama administration, the United States changed its own preference, accepting the idea that it would evaluate each potential partner’s acceptance of enrichment or reprocessing limitations independently rather than have a blanket policy. Although this made some sense as a means of getting past the enrichment or reprocessing issue with potential partners — like Vietnam, which did not accept the enrichment or reprocessing limitation — a practical result was confusion as to the criteria by which this evaluation would be conducted. To some, the criteria-based approach seemed like discrimination, especially in the case of Saudi Arabia. A long time U.S. partner, it was difficult to convince the Saudis that they should accept restrictions that other countries did not, even if the United Arab Emirates served as the pioneer case in the Middle East.
For these reasons, it is not necessarily a bad thing that the Trump administration reportedly sought to change things up. The details remain unclear as the signed text has yet to be released: U.S. officials have also alluded to two “secret side letters” that accompany the agreement and may complicate our understanding of it. At least two innovations are apparently part of the new deal: a more nuanced approach to international inspections and a conditional approach to enrichment or reprocessing programs in Saudi Arabia.
On the first, the United States has accepted Saudi Arabia’s refusal to implement the Additional Protocol. The Saudis will still permit International Atomic Energy Agency inspections of its declared nuclear facilities, in line with its existing agreements with the International Atomic Energy Agency. There may be some future arrangement with the International Atomic Energy Agency that grants additional inspector rights — perhaps utilizing the regional model of the Agency for the Accounting and Control of Nuclear Materials referenced above — but the primary responsibility for additional inspections will reportedly fall to the United States.
Second, reportedly, there will be a joint U.S.-Saudi study of the economics around enrichment in Saudi Arabia. If it concludes in favor of enrichment, then the United States will assist the Saudis in building an enrichment capability, with the technology subject to black-boxing. Black boxing refers to a set of procedures and technologies that shield how something works so that only the input and the output can be understood. For example, if you wanted to black box an electric guitar, you should show the amplifier and you would hear the sound, but you would put the guitar player behind a curtain. If the study concludes that enrichment is not warranted, the Saudis appear to have accepted a 10-year moratorium on pursuing enrichment. But, after that point in time, Saudi Arabia would be free to develop enrichment or reprocessing capabilities with U.S. blessing.
Both concessions present problems and explain the reflexive objections that nonproliferation experts have raised. But in both cases, the issue ought to be about how far the concessions went rather than some of the concepts that underlay them.
For example, on inspections, it is troubling that the Saudis have refused to accept the Additional Protocol and, in fact, dragged their heels for 21 years to accept the comprehensive inspections system required under the Nuclear Non-Proliferation Treaty. It would be better for the international nonproliferation system and global confidence in Saudi Arabia’s nuclear program for the Saudis to join the Additional Protocol. This would permit the International Atomic Energy Agency to provide an impartial assessment of credible allegations of illicit nuclear activities and, hopefully, put them to rest. From a purely U.S. angle, however, one can see the logic of insisting on U.S. inspections and monitoring instead — at least while Saudi Arabia’s nuclear program remains nascent. The trouble begins as that program matures.
Likewise, the idea of conducting an evaluation of the economic feasibility of an enrichment program in Saudi Arabia before it begins is a sensible idea on both economic and security grounds. If the study concludes that enrichment is economically unjustifiable, then a subsequent Saudi decision to embark on such a program independent of the United States would be an obvious red flag. Even more important, the idea of using black-boxing of technology as part of a transfer scheme has considerable merit. Although not foolproof, finding technical means to shield the technological and operational details of sensitive nuclear facilities while still providing countries with confidence that they’ll be able to obtain nuclear fuel — and resulting energy — could reduce some of the impetus for proliferation in the first place.
Changes should be made to the nuclear agreement with Saudi Arabia, building on the foundation of what has been agreed. This could come either from the executive branch — after all, the president may choose not to send the agreement to Congress over the dispute concerning normalization with Israel — or from Congress through its oversight function. This has precedent: In January 2009, then-Secretary of State Condoleezza Rice signed the first version of the 123 agreement with the United Arab Emirates, only for the Obama administration to enter into office and seek changes. It was re-signed after further negotiations in May 2009.
The most important changes concern the implementation of inspections and use of black-boxing technology, which should be linked and tied to the nature of the nuclear program in Saudi Arabia.
The core principle should be the nature of the nuclear activities ongoing in Saudi Arabia. If — because of the joint economic feasibility study — the Saudis decide not to proceed with uranium enrichment, then the United States could accept the continued level of inspections in the country. Although it might be ideal for the Saudis to adhere to the higher level of inspections under the Additional Protocol, the United States could accept that the absence of more sensitive nuclear facilities in the country makes this less necessary. But the concept of black-boxing would be applied to all nuclear facilities and materials provided pursuant to the agreement, including reactor components. The Saudis would be able to get access to sophisticated nuclear technology and resulting energy but would essentially be trading the knowledge of these facilities to secure a reduced inspection burden. I have outlined this idea further in a separate publication.
On the other hand, if the Saudis insisted on pursuing enrichment, then they would be expected to accept either the enhanced inspection requirements of the Additional Protocol or a regional inspectorate that would provide similar confidence to Saudi Arabia’s neighbors. This may, in fact, be what the agreement anticipates, though such details have yet to be made public. Black-boxing should still be utilized in this scenario, but would not be presented as a panacea. There are significant technical differences in the sensitivity of providing a black-boxed power reactor compared to a uranium centrifuge. Power reactors are less likely to be an immediate proliferation risk given their operating parameters and the need for other facilities and capabilities to be constructed to extract weapons-useful material. Centrifuges, by contrast, can be immediately turned to producing nuclear weapons material. For this reason, inspections and access to appropriate technical data that could be made available publicly would be necessary complements.
These changes are also important if the United States is to contain the broader fallout from this agreement, and to correct the impression conveyed that the issue of Saudi uranium enrichment is solely an economic rather than a security issue.
In particular, Israel’s concerns are real here. Although the Israelis might be prepared to accept a Saudi nuclear program operating under the Additional Protocol and without enrichment or reprocessing if the United States insisted, normalization was the path to reduce otherwise understandable Israeli anxieties. Israel has taken aggressive action to counter the development of sensitive nuclear facilities in its neighbors before, with military action against Iraq in 1981, Syria in 2007, and Iran in 2025 serving as the obvious examples. A military conflict between Israel and Saudi Arabia is by no means certain if this agreement goes forward, but absent normalization, there is greater risk than would be ideal. A regional model involving Israel, built on a graduated concept of inspections and black-boxing, would both reduce tensions and could itself be a pathway to normalization more generally.
Others in the region would also benefit. The United Arab Emirates can renegotiate its 123 agreement with the United States if another country in the region gets a better deal from the United States, and its relationship with Saudi Arabia is rocky. Turkey and Egypt have often been mentioned as potential nuclear competitors, should a nuclear race erupt in the region. Iran’s nuclear program clearly needed no inspiration from Saudi action, but it will look at the U.S.-Saudi agreement and cherry-pick from it as it looks to cement its nuclear status in future negotiations.
When the text emerges, Congress ought to give it the full scrutiny it demands and seek changes, especially to prevent precedents that we might not prefer. Would the United States be comfortable with China providing an enrichment plant to Cuba, absent the Additional Protocol but with solely Chinese safeguards? How about Russia to Iran? All are possible if this agreement is not sufficiently robust.
Richard Nephew is a senior research scholar at Columbia University’s Center on Global Energy Policy and the Bernstein adjunct fellow at the Washington Institute for Near East Policy. He has served in multiple positions in the U.S. government, including as deputy special envoy for Iran under President Joseph Biden.
Image: The White House via Wikimedia Commons
