Libya Stalls on Pledge To Destroy Atomic Fuel

Libya is sitting on a stockpile of almost 200 barrels of uranium despite agreeing in 2003 to dismantle its nuclear program, the Daily Telegraph has learned.

The news that Libya has not yet complied with the international agreement to get rid of its supply of uranium will be a particular blow to President Sarkozy of France after his recent move to deepen ties with the regime of Colonel Muammar Gadhafi.

It will also be an embarrassment to France's first lady, Cecilia Sarkozy, who traveled to Libya last month to help negotiate the release of the six Bulgarian and Palestinian Arab medics accused of infecting children with HIV.

Within days of that visit, France signed a memorandum of understanding with Libya involving the possible construction of a nuclear reactor for civilian purposes.

The uranium, in the form of more than 1,000 tons of yellow cake ore, is being stored at a military base at the desert town of Sabha. Nuclear experts with knowledge of the stockpile estimate its value at about $400 million.

Uranium is used to power nuclear power stations, but it can also be enriched to make nuclear weapons.

The Sabha base was linked with Libya's nuclear weapons program in a report by the International Atomic Energy Agency in 2004. The base, some of which is believed to be underground, was also alleged to have been a chemical weapons facility.

After Colonel Gadhafi officially abandoned Libya's nuclear weapons program in December 2003 in return for the lifting of American and European sanctions, the IAEA was supposed to oversee the country's disposal of its uranium. A source close to the situation said: "Gadhafi has gone through the pro forma process with the IAEA, but he has delayed and delayed. He wants to use the uranium as a bargaining chip to get a reactor."

However, there is a view among nuclear experts that Colonel Gadhafi is very unlikely to be allowed to have a nuclear reactor, even if it is used for civilian purposes, due to fears Libya could use the technology to restart its military nuclear program.

America, Britain, and other member states of the IAEA, the world's nuclear watchdog, do not believe Libya should be given nuclear know-how, sources said, and are likely to block France's attempt to strike a deal with Colonel Gadhafi.

Questions might also be asked about how Libya came to possess the uranium in the first place. Industry insiders believe it was mined in Niger and acquired by Libya during the period of sanctions.

If France were to strike a deal with Libya over nuclear energy, the work would almost certainly be carried out by Areva, the largest nuclear company in the world.

A spokesman for Areva said discussions between France and Libya were "more political and not at this time commercial." However, he added that some talks between Areva and the Libyan government had taken place. The UK's official position on whether Libya should be able to build civil nuclear reactors is not clear.

Business people operating in the nuclear world are increasingly dealing with companies and authorities once firmly on the blacklist of places where nuclear technology should not be allowed.

This follows a tacit agreement among Western governments that nuclear expertise should be shared as one of the ways to bring down carbon emissions from other fuels.

However, there is still a firm view that certain countries must be barred from joining the nuclear club.