The private company pushing the Donald Trump administration to fast-track sales of nuclear-power technology to Saudia Arabia is the latest incarnation of a long-running entity that periodically pitches “impossible” nuclear projects, one executive wrote in an email published this week by the House Oversight and Reform Committee.
The details are part of a second interim staff report released Monday by committee Chairman Elijah Cummings (D-Md.), who is investigating allegations by White House whistleblowers that the politically connected firm IP3 wants the administration to approve sales of U.S. nuclear reactors and fuel to Riyadh — possibly uncoupled from the strict nonproliferation agreements usually required for such deals.
After the report landed, a bipartisan group of senators led by Sens. Lindsey Graham (R-S.C.) and Chris Van Hollen (D-Md.) on Wednesday proposed a bill that would block financing to export U.S. nuclear technology to Saudi Arabia, until its government agreed to abide by those strict nonproliferation standards.
The House Oversight Committee’s report, meanwhile, nuclear industry mistrust of IP3, as illustrated by a series of partially redacted emails from unidentified executives with nine companies identified only by number.
Some of these people said certain federal officials worry IP3 wants the White House to play fast and loose with export control laws and nonproliferation standards.
In an internal company email dated Feb. 10, 2019, an unidentified executive from “Company 5″ called IP3 a “shitshow,” and “the Theranos of the nuclear industry.”
IP3 “used to be known as Alex Copson Partners and has been around in some form since the mid-1990s,” the Company 5 higher-up said.
Theranos is the disgraced medical company that shut down in 2018 after peddling so-called revolutionary blood-testing technology that several independent inquiries exposed as quackery.
IP3 is led by CEO Michael Hewitt, a retired U.S. Navy rear admiral who split from the eponymous Alex Copson Partners around 2016 to form the new company.
In the words of the executive from Company 5, both companies were founded to push for nuclear power-related projects that require “massive policy changes to achieve and then wish to be paid to effect the required policy changes.”
Both companies once included on the payroll former Trump national security adviser Michael Flynn, who resigned in disgrace from that post in 2017 after admitting he lied about contacts with the Russian government prior to Trump’s inauguration.
The Company 5 executive said Copson, in the “mid-late 1990s,” pitched the idea of shipping radioactive waste to “some small Pacific island,” and that he possibly had “inappropriately enticed local officials to consider the proposal.”
As for IP3’s efforts to broker a deal for a U.S.-built Saudi Arabian nuclear-power fleet, “DOE and [the Department of] State have been all over this issue for years,” the Company 5 executive wrote. “The professional staff do not like the idea of IP3 running around them.”
A senior executive with an outfit identified as “Company 1” wrote in an internal email on Feb. 27, 2018, that “IP3 has a questionable reputation to some people in the USG [U.S. Government] and elsewhere.”
The executive also wrote that Company 1 in 2018 got a call from an official with the Department of Commerce, who wanted to know whether Company 1 was “part of IP3.”
“I said no,” the executive wrote. “The Commerce official said he’s hearing answers like that from several companies he’s calling.”
By this year, a nuclear executive from “Company 3” was preaching total disavowal of IP-3, according to an internal email released by the House Oversight Committee. “I do not think [it’s] a good idea to wrap ourselves around IP3 or anything they do,” the Company 3 executive wrote in a Jan. 9, 2019 email.
Despite keeping IP3 at arm’s length, U.S. industry has been willing to share nuclear know-how, if not hardware or fuel, with Riyadh. The Department of Energy this year granted seven unidentified U.S. nuclear companies Part 810 authorizations — named for the part of the Atomic Energy Act that enables such authorizations — to export some unclassified civilian nuclear-power information to Saudi Arabia.
A foreign nation that wants to build a nuclear-power fleet based on U.S. technology ordinarily needs to sign a 123 agreement, which is named for another section of the Atomic Energy Act. Such agreements, coordinated by the State Department with advice from DOE and the Commerce Department, require an importing nation to create only peaceful nuclear power programs, with strict safeguards to prevent the technology from being weaponized.
If a potential importer signs a 123 agreement, Congress can only object to associated technology transfers by passing a joint House-Senate resolution.
Last week, the Republican minority on the House Oversight Committee said the majority’s probe uncovered no “wrongdoing” by the Trump administration.
Solidarity in the Senate on ExIm Financing
In the wake of the House Oversight Committee’s report, Graham and Van Hollen, along with Sens. Edward Markey (D-Mass.) and Jerry Moran (R-Kan.), filed a bill to prevent any end-run around the so-called “gold standard” for nuclear technology exports.
The legislation, S.2338, would prohibit the United States Export-Import Bank from extending Saudi Arabia any credit to purchase nuclear technology until the country signs a 123 agreement, and agrees not to build any “sensitive nuclear facilities”: infrastructure that enables uranium enrichment, separation of plutonium separation from spent nuclear fuel, or production of heavy water.
Even if Saudi Arabia does agree to those strict caveats, the Export-Import Bank would still have to brief Congress about any impending nuclear-purchasing credit deal to the Kingdom not later than 30 days before finalizing the pact with Riyadh.
The bill awaits consideration by the Senate Banking, Housing, and Urban Affairs Committee.
