Posts Tagged ‘IAEA’

CRF Mafia’s IAEA Provide Latest WMD Talking Point for Washington and Tel Aviv Hawks

December 7, 2012

U.N. nuclear chief: ‘Alleged weapons testing site was probably sanitized by Iran’…

21st Century Wire says: Yet, in the same breath, the UN and CFR puppet admits, “We cannot say for sure that we would be able find something”

By Joby Warrick
December 7, 2012

The United Nations’ chief nuclear official urged Iran on Thursday to allow inspection of a military base where Iranian scientists are suspected of conducting secret nuclear-weapons research, although he acknowledged that any traces of illicit activity have probably been removed.

The war propaganda never stops: they are dedicating to lying their way into war.

International Atomic Energy Agency Director General Yukiya Amano said the nuclear watchdog would try again next week to visit the Parchin military base, a sprawling complex where Iran is thought to have conducted tests on high-precision explosives used to detonate a nuclear bomb.

Iran has repeatedly refused to let IAEA inspectors visit the base, on the outskirts of Tehran. Instead, in the months since the agency requested access, satellite photos have revealed what appears to be extensive cleanup work around the building where tests are alleged to have occurred.

“We are concerned that our capacity to verify would have been severely undermined,” Amano told a gathering of the Council on Foreign Relations in Washington. He noted Iran’s “extensive” cleanup effort at the site, which has included demolishing buildings and stripping away topsoil.

“We cannot say for sure that we would be able find something,” Amano said.

Read more at Washington Post

(TRANSLATED IN ENGLISH: ‘A LOAD RECYCLED BULL S**T’)

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BIG ENERGY: WHY THE IEA SHILLS FOR HIGH PRICED OIL

November 27, 2012

Andrew McKillop
21st Century Wire
Guest Columnist

As the global energy game moves into the 21st century, the curtain is beginning with move back, unveiling the true nature of certain international organisations. The implications of this apocalypse should change to way we look at these institutions.

This year’s World Energy Outlook from the International Atomic Energy Agency (IEA), released in November, went further with the two policy obsessions of the IEA, described as “not very fashionable” by the IEA’s Turkish-born chief economist Fatih Birol in a November 15 interview with European Energy Review.

These “new and unfashionable” policy quests are: energy for all at an affordable price; and the struggle to prevent CO2 levels in the atmosphere exceeding 450 ppm (parts per million) by the 2035-2045 period.

The IEA quickly redefines the keyword terms: energy for all means, in particular, oil supplies for the 28 exclusively OECD member countries in the IEA: the IEA’s foundation in November 1974, after the first Oil Shock, by Richard Nixon and Henry Kissinger, laid down the IEA’s mandate of acting to ensure oil supply security for the OECD, and “affordable priced” oil.

For Nixon and Kissinger, the IEA was a second-best. Their original goal was to invade and occupy Saudi Arabia and ensure the free flow of cheap oil, Iraq-style. Their IEA was therefore set as an organization able to confront the Arab oil exporters using guile rather than force, by playing one exporter off against another with a range of different contract types, building up stocks of oil in the OECD countries, and forcing down oil prices.

This has nothing to do with the IEA’s new struggle against global warming – assuming, for starters, that global warming really exists, and is due to human emissions of CO2 from burning fossil fuels – especially coal, not oil. This new obsession of the IEA has however grown to become its single most important policy theme for advising energy ministries and government deciders in the OECD. And “fighting climate change”, according to the IEA is vital and obligatory.

The struggle needs higher energy prices, carbon taxes, emissions trading, carbon offsets and everything we now associate with “carbon finance”. The IEA’s goal for a “sustainable energy future”, and its related goal of “an efficient energy world” by about 2035 are costed by observers (and by the IEA itself) as anywhere up to $45 – $50 trillion in dollars of 2012 value.

Paying for that needs high-priced energy. The IEA is therefore a “price hawk” for oil. This year’s WEO repeats the IEA’s scenario forecast that by 2017 year average oil prices could attain $175 per barrel. We can change the “could” to “should” after reading this year’s WEO.

BACK TO GLOBAL WARMING

Incredible as it can seem to many, freshly re-elected Barack Obama is giving serious thought and attention to banning, or limiting – or taxing – oil and gas extraction by hydraulic fracturing. One part of Obama’s rationale for this is the “possible GHG (green house gas) release from fracking”. Another is a lot more down to earth. Passing a new energy tax, called a carbon tax, in the USA could garner $100 billion in tax revenues for the Federal government in its first year of operation. Cross party support to a carbon tax is growing rapidly in Congress. The extreme low price of gas in the US, due to fracking, provides an easy tax base for adding a new Federal tax and new State taxes.

In the US and soon worldwide, “fracking” has had and will have revolutionary effects on gas supply and gas prices. The drilling process has brought U.S. energy independence within reach – with the important rider that for now rapidly growing shale oil production, this needs $100 a barrel prices.

Some US oil and gas industry leaders remain enthusiastic but cautious that fracking will be fully endorsed by newly re-elected President Obama and by the majority of US state leaders, but this apparent full or majority industry support is belied by the damage to US energy corporation fortunes already produced by “overcheap” natural gas. There is almost no prospect of natural gas prices, in the US, even attaining one-half of gas prices in Europe and Asia. Gas industry hopes, at present, are that the US will have a cold winter, following a hot summer, and this may boost gas prices to around $5 per million BTU, about one-third of European and Asian prices, which prices gas energy in the US at $29 per barrel of oil equivalent. Oil prices still hover around $110 per barrel for Brent.

Open endorsement of fracking from Mr. Obama and state leaders would make fracking the cornerstone of US energy policy for decades to come. Conversely, if for any reason Obama distances himself from fracking, takes a more cautious and pro-environmental line, argues that fracking has a high climate change impact, and is a “disruptive technology” we may expect major changes – in particular a rise of gas prices in the US. The energy price factor is critical, and for Obama the subject of US natural gas has two tax-grubbing opportunity windows: either tax fracking, that is gas production; or tax gas with a carbon tax “to save the climate”, that is gas consumption. The huge difference between oil prices, on one hand, and gas prices on the other show the size of the tax-raising opportunity in the US.

The economic case for fracking is massive. This year’s WEO report however takes a studiedly neutral line on fracking, which reflects the huge range of opinions, in energy ministries of the OECD countries on this subject. US energy sector leaders, and their political friends in both main parties, have now eased off on the “energy independence” claim for fracking. They are now, more than ever, portraying domestic oil and gas production as a key way of generating tax revenues, spurring job creation in “repatriated industries”, cutting the trade deficit and saving the nation from going off the “fiscal cliff.”

The IEA faithfully reflects this emerging realworld consensus of the political elites. World energy prices should be moved up, not down, “to save the planet”, or at least increase state tax revenues and fight the burden of sovereign debt. Keeping oil prices high, worldwide, and keeping gas prices high, outside the US, are easily made conclusions on the IEA’s main policy advise, from this year’s WEO.

WHY HIGH PRICES: THE INDUSTRY ANGLE

The extreme difference between the case for US shale oil production, by fracking, and natural gas production, by fracking, is very simple to explain. US shale oil producers need high oil prices to “keep on frackin”, and claim to believe that oil prices “will not significantly decline” from curent levels around $100 a barrel. Conversely, US gas prices are the lowest since 1992 and set to stay that way. Gas fracking, in the US, has been too successful. Whatever US gas producers, like Chesapeake Corp or Exxon’s gas subsidiary XTO Energy want, it is not cheap gas.

Fiscal cliff reasoning is that tax reform, to be sure, is vital but the US cannot tax its way out of the crisis. Also, there is no way that savings can rise, the US cannot save its way off the cliff. Chasing growth is fine, but the US cannot rapidly grow its way out of the crisis. The alternate and providential way to make recovery feasible, is domestic energy. As the CEO of the US Chamber of Commerce, Karen A. Harbert, has said: “Every dollar that we generate from energy is a dollar that we don’t have to take out of the Defense Department, the entitlement area, or increase taxes, or send overseas.”

Official optimism that Obama and the White House will recognize that remains high.  While many Republicans and some energy industry leaders have doubted his sincerity, Mr. Obama’s campaign voiced strong support for expanded oil and gas drilling throughout his race against Mitt Romney.

The US will overtake Saudia Arabia as the world’s top oil producing country.

The IEA has played its own role by recently predicting that the US will become the world’s largest oil producer by about 2020, overtaking Saudi Arabia and putting the nation on course to be energy self-sufficient by 2030. Due to fracking, US natural gas output has risen by about 25% since 2007, removing any possible outlook of scarcity. Shale oil could or might do the same thing – but only if oil prices stay high.

This new energy reality puts pressure on the Obama administration to fully embrace fracking and avoid taking steps that could hamper it, many analysts conclude. Maintaining high and rising gas output, and bargain basement US gas prices, creates a huge tax window of opportunity. For oil, the situation is a lot more complex, but the goal of increasing US shale oil output sorely needs high-priced oil. Despite some major States – specially New York and California – remaining equivocal on allowing fracking, state level support to fracking has certainly continued to grow.

SQUARING THE CIRCLE

The probable or possible solution, for Obama and for other OECD country leaderships facing the same dilemma, is already on offer from the IEA, in this year’s WEO.

The IEA’s prediction the US can overtake Saudi Arabia by its oil production, due to shale oil, makes little reference to the oil price background for this forecast. The IEA’s commitment to a high-priced oil future is however clear – very few IEA scenarios give an outlook of oil prices declining below about $75 a barrel. Many IEA forecasts paint a picture of year average oil prices hitting as much as $175 a barrel by 2017. This uear’s WEO repeats the IEA forecast of a year average $215 per barrel by 2030. The IEA may be studiedly neutral on fracking, but its oil price outlook is high, very high.

Almost never given coverage in IEA reports and studies, high oil prices are now treated by the IEA as a major long-term – in fact permanent – part of the global energy scene. For national administrations like Obama’s, high oil prices and high turnover and profits for oil producing companies and corporations also have a simple bottom line: high taxation revenue potentials. The European example – several times cited by Steven Chu early on in his job as US Energy secretary – is that car drivers can be forced to pay $8.50 – $9 per US gallon for their fuel (around $378 per barrel), of which as much as 65% goes to the State as oil taxes. The high profits garnered by European oil companies on their home turfs, also generate large State tax revenues, despite the corporate tax hedging and evasion.

To be sure, “high gas(oline) prices” in the US are a politically sensitive subject, as Chu quickly realised, but little by little, US motorists are learning to think in small litres, not big gallons, and pay more for their fuel. Obama’s renewed “personal conviction” that the world faces a crisis of anthropogenic global warming, the recent hot summer, and hurricane Sandy, both in the US, all play strong supporting roles in the elite quest to raise energy prices – and taxes.

The bad example of fracking – slaying US natural gas prices and making major gas companies unable to pay taxes, or even stay in business – can be prevented from “migrating” to oil and killing the Golden Goose of high oil prices. For this to happen, Obama has to act to prevent oil prices eroding too far. Taxing shale oil fracking “to save the planet” is a certainly possible candidate, for his administration’s fiscal cliff-oriented endorsement of fracking and higher gas prices in the US would make the stark, even ridiculous difference between oil prices, and gas prices, less massive.

The IEA certainly hopes so and stolidly continues to forecast high oil prices.

….

Enough Already: No Evidence Iran Diverted Any Nuclear Material for Nuclear Weapons Program

September 17, 2012

….

SO WHAT IS ACTUALLY GOING ON IN SYRIA?

November 26, 2011

21st Century Wire
November 26, 2011

Patrick Henningsen, a political analyst from the US-based Infowars.com online magazine and Editor of 21st Century Wire, believes that the escalation of tensions over Syria between the world’s major powers may lead to a new chilling in world politics.

“I think we are going to see a new Cold War emerge in the next two years, and we are seeing the initial steps of that new Cold War right now,” he told RT.

Another chief concern is Russia’s close military co-operation with Syria – with reports of S-300 missile defense installations having been supplied from Moscow. Henningsen adds here:

“If the Western powers think they are going to get away with a no-fly zone in Syria, this is a very different prospect than Libya. This will be the first time, in Syria, and also, if you look forward – with Iran, that the West, actually, is engaging a country that has the ability to fight back”.

 

FUNKY TOWN FINANCE MEETS THE NUCLEAR RENAISSANCE

September 29, 2010

By Andrew McKillop
21st Century Wire
Sept 29th 2010

Like a Marlene Dietrich show in a remake of 1945 Berlin, surrounded by Soviet troop hordes, the nuclear sales show has to go on.  The vaunted “Nuclear Renaissance” which is being proclaimed by the industry could see more than 200 new reactors built during the 2010-2020 decade, rivalling the industry’s previous high-water mark of 1975-1985 when one new reactor came on line, on average, every 17 days. The image of cheap, clean, safe and low carbon energy which is also secure – despite the uranium being mostly imported – has seduced political deciders and the corporate elite, worldwide. But the reality behind this romantic green image of a nuclear panacea to future energy needs is something altogether different.

Welcome to Funky Town

Since 2004, a future globalized electrical village lit by the atom is the meat of the obsessional ad campaign run by the French Areva state-backed nuclear monopoly, under the banner of “semi-private” as portrayed in the business press. This longstanding and massive advertising campaign runs to the background music of the Lipps Inc 1970s disco dance track “Funky Town” (see and hear this advert at http://www.youtube.com/watch?v=E3B__ovj2jU).

   Areva wants to take you to Funky Town.

Everyone is boogying to DJ Friendly Atom in these richly detailed TV and print media offerings. The comic strip presentations often show Areva-owned clean and environment-friendly uranium mines in Canada – rather than Islamic militant-menaced Niger where Areva has a massive mine. The ads sometime flash dark-suited, smiling Men of Finance proffering hard cash at the edge of the stage, to underline the new illusion: nuclear power is very market friendly.

Indeed, nuclear power is market friendly and uranium mining is always clean and environmentally friendly in Funky Town. Quite often the reactors on the skyline are joined by serried ranks of friendly windmills and gleaming solar panels also delivering low carbon electricity. When in Funky Town, the revellers dance to the Areva tune.

The Atomic Reality

At the time when “Funky Town” was regular disco fodder circa 1977, nuclear power generation was still almost totally and exclusively reserved for the Organisation for Economic Co-operation and Development (OECD) countries, the USSR and to a smaller extent, China and India. It was almost exclusively State-controlled, State-financed and State-operated. Its strategic deployment and costs were ultimately linked to the real business of the atom – nuclear weapons making and state security which, of course, was a State secret.

Why nuclear economics “did not matter” back then is certainly an interesting economic question and brings us to the root of the nuclear illusion. The State was not in the background, rather it was entirely present at the forefront of the nuclear scene, for the simple reason that nuclear powered electricity is expensive. Producing electricity for the civil power grid was still a side issue and interest for the State, in the early 1970s. The real objective of the State-backed and State-controlled nuclear industry was plutonium brewing to make atomic weapons.

This context had lasted from the early age of the atom until the 1960s in the “old nuclear” countries – although America’s “Atoms for Peace” programme began with Eisenhower’s speech to the UN Assembly on Dec 8, 1953 (later called the “Atoms for Peace speech”). This programme was more an exercise in PR and communication, and wishful thinking, than making nuclear power a real world source of “cheap, clean and safe” electric power for the coming mass consumer society.

The first coming of civil nuclear power in the 1955-1965 period did not scale up and become “international” by extending outside the USA and Europe, until the end of the 1960s and early 1970s where nuclear power became an “export” to Japan, South Korea and Taiwan. In all cases, in each country, the start-up of their civil nuclear programmes was organized and structured by the State, from start to finish. The so-called nominally private operating companies that were founded were usually private only in name. All building, construction, land use, environmental, worker safety, and financial, economic or legal regulations – especially liability insurance in case of an accident – were taken charge of by the State, from start to finish.

The State was present and paid for the upstream – the power transmission and distribution infrastructures, fuel supply and fabrication, spent fuel removal and reprocessing, storage of wastes, and other nuts and bolts on the hardware side. The State was present and paid for the downstream – assured and constant financing at below-market rates, the creation of closed capital State-private holding companies and the massive gift of accident liability insurance. Data on how much this cost is clouded in controversy, and in many cases all documentation has been destroyed, but the French Reseau Sortir du Nucleaire estimates that in France, the “civil-isation” of the atom perhaps needed US $ 75 billion of state aid and support (some $300 billion by today’s standards). A conservative estimate.

To be sure, no other energy supply industry, with the possible small-scale exception of Green Energy, could ever dream of receiving this royal flush of State largesse. This surely helps explain why in 2010, “Funky Town” go-go financiers have massively crowded into the nuclear sector. While the state aid pickings are good, this is the place to be.

From Put Options to Development Aid

The French EDF ex-monopoly electricity supplier with the biggest number of nuclear reactors of any traded power company in the world, also the most debt-laden traded company in France, and with a share price down about 25% through Jan-Aug 2010, is using financial engineering to keep a foothold in the US nuclear power market. Using debt instruments, EDF bought half of Constellation Energy Group’s nuclear business for US$ 4.5 billion in 2008, thwarting a takeover of Constellation by Warren Buffett’s MidAmerican Energy Holdings Co. At the time, Constellation set up an option for a later possible sale of non-nuclear plants to EDF. Since then, the financial crisis and unsure economic recovery have taken their toll on high-priced assets of highly indebted corporations, such as electric power plants.

EDF and Constellation are now in dispute over Constellation’s option to sell EDF non-nuclear plants for as much as US $2 billion. The so-called put option – implying the value of these plants would fall – is due to expire in December 2010. EDF is Constellation’s biggest shareholder, but if Constellation exercised its put option, EDF would incur more debt or lower-performing assets and view this as a hostile move likely to jeopardize their relationship. This would in turn compromise plans to build new nuclear projects in the near future.

Closely linked to this example of financial engineering, is the Congressional decision on what will be the last government aids for nuclear power plant building in the USA- a decision that would likely go to Constellation. If the corporation backs out of nuclear expansion, due to financial stress caused by EDF in retaliation for Constellation using its put option, the chance of it building another friendly atom plant may be low.

Moving up a long way in funky financing, state-to-state bilateral deals in the nuclear power sector are now in high gear. Amounts in play are usually well above US $ 10 billion per project, and very complex mix-and-mingle methods and processes are used for their financing. From development aid finance, to market plays wielding put-and-call options, and natural resource based offset and compensatory trading all have a role for Funky Town financing of the atom.

As Iran unveils its own version of Funky Town, as it begins loading its new Bushehr nuclear reactor.

Like deals between South Korea and Abu Dhabi, Russia and Iran or France and Pakistan, the US-India arrangement targets business opportunities of epic dimensions. On the basis of the 2008 bilateral agreement, U.S. companies—most importantly Toshiba-Westinghouse and GE-Hitachi—are planning to build nuclear power plants in India. A linked American-Indian trade group claims that this business may ultimately be worth US $130 billion by 2030. At the basis of the long-running 30-year standoff between the USA and India was the question of uranium enrichment. During the negotiation of the 2008 agreement, Washington initially resisted giving India long-term consent to reprocess spent fuel subject to the agreement, because a 1982 U.S. National Security Decision Memorandum had limited such consent to the European Union and Japan. Business and plain sense however won the day: any questions of nuclear proliferation are in fact relics of a very distant past: India tested its first atom bomb in 1974 !

Already marshalled into this private-public ‘Marshall Plan’ for selling US nuclear power and services to India are the US Ex-Im (export-import) Bank, leading Wall Street private banks, and major downstream infrastructure companies such as Bechtel, all primed and ready to go. Under special arrangements for nuclear financing, US state agencies, especially the Ex-Im Bank can in some cases finance up to 85% of the initial sale for projects with a 15-year lifetime after an initial open-ended time period during which construction and hand-over to Indian buyers took place. Unlike smaller and specialized aid agencies like US AID, the Ex-Im Bank is an ideal vehicle for closely working with the big creative players of private finance, who shy well away from the atom for many reasons.

The next round in financing the new Nuclear Renaissance promises to be a lot less easy. Lined up on today’s buy side are a lengthening list of low-income and mid-income new nuclear countries wanting the atom. They include: Nigeria, Ghana, Sudan, Algeria, Egypt, Jordan, Kazakhstan, Indonesia, the Philippines, Bangladesh and others. Even “entry level” nuclear projects tend to cost US $ 2 – 5 billion, take years to construct and will have to be operated for a minimum of 30 – 40 years to make a profit and pay back initial costs. To be sure, the now standardized “operating life extensions” of 10 years here or there, may help avoid the prohibitive costs of decommissioning.

In a likely return to the dawn of civil nuclear power, the UN’s nuclear agency the IAEA could be extended to cover nuclear financing. When the IAEA was announced by US president Eisenhower in a Dec 1953 speech to the UN general assembly, his original proposal included power plant financing, building and fuel supply. As we know, the IAEA in fact was only given the “watchdog” anti-proliferation role that it still has. The World Bank and its regional bank affiliates were also excluded from financing the atom – and although today’s World Bank talk about nuclear power is positive, the financing is not there.

Modelled on the Global Renewable Energy and Energy Efficiency Fund, a US $ 100 billion fund that was definitely not approved at the December 2009 Copenhagen climate summit, the IAEA is working towards a “sister fund” known as the Global Nuclear Energy Fund for sustainable energy. In particular, this fund would aim to marshal and mobilize at least as much financing capability as the green energy fund: US $ 100 billion, but present and current promises, only from Europe, are of US $ 100 million. The nuclear fund would focus “small and innovative” nuclear power projects in low income countries, according to the IAEA.

Sovereign Debt to Global Debt

The UN’s Nuclear Suppliers Group has an impressive 45-nation list of supposed nuclear equipment and service suppliers, but these include countries like Iceland, Malta, Croatia, Cyprus and Romania, everyone short of the Vatican. The “serious suppliers” especially include the 5 UN Security Council permanent members, China presently mostly importing nuclear equipment and of course fuel, but quite soon planning to be a major builder of overseas power plants and operator of overseas uranium mines, like in India.

Most major suppliers, like the USA, France, Japan and Germany are also “seriously indebted” to new epic proportions following the 2008-2009 blow-out and collapse of the not-so-funky financial sector and its collateral damage to banks, and the economy in general. The result of all this is that selling nuclear power almost any place on the planet is now an attractive option – reinforced by the inevitable collapse of international financing and funding hopes for the green energy bubble at the December 2009 Copenhagen climate summit.

All illusions aside, the economic reality of Nuclear power is that it is expensive and comes in big slices. Country risk in a long list of New Nuclear countries is high and in the extreme, over and beyond the weapons proliferation, waste handling and storage challenges in these countries, and elsewhere. Financing the Nuclear Renaissance in 2010-2020 will almost surely shift to international and multilateral debt financing methods. The IMF will surely be there, and all creative methods will have a look-in to using nuclear power plants as the underlying security in a vast new upsurge in global debt trading.

A. McKillop copyright 2010

Andrew McKillop has more than 30 years experience in the energy, economic and finance domains. Trained at London UK’s University College, he has had specially long experience of energy policy, project administration and the development and financing of alternate energy. This included his role of in-house Expert on Policy and Programming at the DG XVII-Energy of the European Commission, Director of Information of the OAPEC technology transfer subsidiary, AREC and researcher for UN agencies including the ILO.

Contact: xtran9@gmail.com