[Page 520]

172. Memorandum From the President’s Assistant for National Security Affairs (Scowcroft) to President Ford1

SUBJECT

  • Negotiation of a Nuclear Agreement with Iran

Following your instructions (Tab D),2 ERDA Administrator Seamans, accompanied by Under Secretary of State Maw, met with the Shah in Tehran to exchange views on those aspects of our draft nuclear agreement which remain unresolved. Dr. Seamans has reported to you in detail on the talks (Tab C),3 and the Shah has responded to your letter carried by Seamans (Tab B).4

The discussions focused primarily on the question of chemical reprocessing in national facilities and our perception of its relationship to a global non-proliferation strategy. The Shah emphatically reiterated his commitment to non-proliferation objectives for his country and for the world. However, while he would want to consult with the U.S. and actively seek our cooperation (or that of other major nuclear supplier states) in establishing a reprocessing facility in Iran on a joint basis, he has been unwilling to commit to such a joint venture as the sine qua non for our approval of the reprocessing of U.S.-supplied fuel in Iran.

It was agreed in the meeting with the Shah that Dr. Etemad, President of the Iranian Atomic Energy Commission, would come here to make a concerted effort at resolving our differences and reaching ad referendum agreement on the provisions of a nuclear agreement. Dr. Etemad will be in Washington on April 20–21 for these negotiations, and your decision is needed on our negotiating position.

The lack of a nuclear agreement represents a serious irritant in our relations with Iran. It also is an obstacle to the leading US private enrichment venture—Uranium Enrichment Associates—in obtaining Iran’s commitment to be a major investor and customer. It is in our interest, therefore, to be as forthcoming as possible, consistent with our non-proliferation objectives and Congressional attitudes.

The options for our position in our talks with Dr. Etemad are:

—Maintain our current position that reprocessing be carried out in Iran only on a multinational basis, with binational partnership between [Page 521]Iran and the supplier of the reprocessing technology (e.g., the U.S.) being an acceptable fallback.

—Same as above, however, if Iran is unable to find a partner(s), and we do not wish to participate, the U.S. would have the option to buy back (or exchange additional fuel for) Iran’s spent fuel to obviate the need for reprocessing. Finally, if we were not to exercise the buy-back option, Iran would be permitted to reprocess in a national plant, with the understanding that the U.S. could supplement the safeguards of the International Atomic Energy Agency with bilateral measures.

The first option is our present position and has been rejected by Iran. It would be the most acceptable to Congress. DOD continues to support it, but could be expected to reluctantly accept the second option (agency views are at Tab E).5

The second option introduces the new concept of buy-back and we are uncertain as to Iran’s reaction. For practical and philosophical reasons, they may not be willing to condition their reprocessing on an unpredictable future U.S. decision regarding buy-back. This second option would face greater resistance on the Hill than the first option but might still be acceptable. State and ACDA support the second option, and State would be willing to drop the buy-back provision as our final fallback position. ERDA prefers the second option and would support dropping the buy-back provision if, as they believe it will, the proposal proves unacceptable to Iran. DOD does not favor the second option out of philosophical concern for the proliferation impact.

It seems pointless and quite possibly counter productive to consider pursuing the first option. Our non-proliferation goals are largely met by the second option since it reserves to us the option to participate in an (eventual) Iranian reprocessing plant, either in the role of co-owner or as the provider of supplementary safeguards. I recommend you approve the second option and authorize the buy-back requirement be withdrawn if necessary to reach agreement. The overall position is consistent with our interest in maintaining close relations with Iran. Congressional and NRC support will be confirmed before returning the agreement for your approval.

Recommendation:

That you approve the second option and approve my signing the necessary implementing memorandum at Tab A.6

The Domestic Council concurs.

  1. Source: Ford Library, NSC Institutional Files, Box 64, NSDM 234. Confidential. Sent for action. A stamped notation on the memorandum indicates the President saw it.
  2. Not attached. See Document 162.
  3. Not attached. See footnote 4, Document 167.
  4. Not attached. See footnote 5, Document 167.
  5. Not attached. See footnote 7, Document 167.
  6. Ford initialed his approval of the recommendation.