Volume #23 - 797.|
EXPORTATIONS D'URANIUM : POLITIQUE
Note pour le secrétaire d'État aux Affaires extérieures|
BRIEF FOR MEETING OF HEADS OF MISSION IN EUROPE, LONDON, MAY 1956: CANADIAN POLICY CONCERNING THE EXPORT OF URANIUM|
1. Canada is already a very substantial producer of uranium, and there is little doubt that production could be significantly expanded if that were desired and the necessary financial arrangements made. Existing production, and that which does not yet exist but can be brought in before September 30, 1957, is obligated until 1962 to the US Atomic Energy Commission. Thus we would not have available for export elsewhere (except perhaps under a special arrangement to the UK) anything more than the merest token quantities until the end of 1957. If the Government should so decide, however, and if it should make the necessary financial and other arrangements, it would probably be possible to produce uranium for export to other countries beginning in 1958. This would probably be soon enough to meet the practical needs of those countries, provided the necessary decisions are taken and the governments concerned are informed in the fairly near future.
2. The decisions involved are of two kinds, one group relating to financial and commercial considerations and the other to political and security consideration. Uranium produced in Canada may be sold only to Eldorado Mining and Refining Ltd. (a Crown Company). So far Eldorado has been willing to conclude the special price contracts necessary to attract the required investment capital only in cases where these can be matched against USAEC purchase contracts. In other words, Eldorado until now has acted in this connection as an underwriter between the Canadian producers on the one hand and the USAEC as monopoly purchaser on the other. If uranium is to be marketed elsewhere it will have to be decided (1) whether Eldorado will continue to serve as an underwriter, matching purchase contracts from abroad against domestic production contracts, (2) whether Eldorado will branch out into buying uranium for ultimate sale abroad but concluding its purchasing contracts without awaiting specific commitments from potential buyers, or (3) whether the Atomic Energy Control Act shall be amended to permit Canadian producers to sell to purchasers other than Eldorado. There would be subsidiary decisions required concerning pricing policy and other related matters, but the fundamental point would be to determine the role to be played by the Canadian government (and financial liability to be assumed by it) in marketing uranium.
3. On the political and security side, it will be necessary to decide what purchasers will be acceptable and on what terms they would be permitted to purchase. There is not yet a clear picture of what control system will be established under the proposed International Atomic Energy Agency, nor of the relationship of that control system to bilateral agreements which may be concluded outside the Agency. Equally the Government has not yet decided what safeguards, if any, it would require of purchasing governments in connection with uranium exported from Canada, and what role Eldorado might play in this connection.
4. The points touched on above indicate the range of important decisions yet to be taken before the Government can declare an explicit policy on the marketing of uranium abroad. Preparatory work on these matters is proceeding and it is hoped that recommendations on at least some of these matters will be ready for submission to Ministers shortly. In the meantime, it is clear that our supplies of uranium are ample to provide that material in quantities far beyond any foreseeable domestic requirement. Subject to the solution of the problems indicated above, therefore, it seems proper to look forward to supplying uranium to other countries in substantial quantities, both as a wholesome commercial development and in order to make available to friendly countries the raw material on which to base their atomic energy programmes.
5. In recent months enquiries have been made by various European
governments. Pending decisions on the questions indicated above,
we have been at some pains to encourage friendly European
governments to look to Canada for their uranium supplies. The
line that has been taken is indicated in the attached extract
from a statement made by Mr. Wilgress at the OEEC Ministerial
Meeting which took place earlier this spring.6
There are also
attached for convenience of reference certain extracts from
Hansard containing relevant statements by Mr. Howe and
It will be recognized that the various projects for
co-operation among European countries in atomic energy matters
will have a bearing on Canada's uranium export policy; some
comments on Canada's attitude towards Euratom and the OEEC
proposals for atomic co-operation are provided in the brief on