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Australian Government - Department of Foreign Affairs and Trade

Advancing the interests of Australia and Australians internationally

Australian Government - Department of Foreign Affairs and Trade

Advancing the interests of Australia and Australians internationally

Director General’s Report

The Year in Review

The International Non-Proliferation Environment

The international non-proliferation framework continues to be widely supported by the international community. This is evidenced by the constructive spirit of engagement of the Non-Proliferation Treaty Preparatory Committee in May 2012. The level of wide support is also evidenced by the fact that only a consistently small minority of countries act in defiance of international non-proliferation obligations and norms. In contrast, a growing number of countries have strengthened their commitments to non-proliferation through, among other actions, entering into force an Additional Protocol with the International Atomic Energy Agency (IAEA) and ratifying the Comprehensive Nuclear-Test-Ban Treaty (CTBT). Indonesia's ratification of the CTBT in February 2012 is a key example of this. Indonesia is one of 44 countries that must ratify the CTBT to enable its entry into force. After Indonesia's ratification, only eight of those 44 countries are yet to ratify.

While the non-proliferation cause continues to be widely supported by the international community, a few challenging issues remain. Several countries continue efforts to obtain the capability to produce nuclear and chemical weapons, we still await the entry into force of the CTBT, and a decision to start negotiations on a possible fissile material cut-off treaty languishes in the Conference on Disarmament in Geneva. Notwithstanding, tackling these challenges remains achievable by working to increase subscription to key treaties by working with our international counterparts to strengthen international non-proliferation and disarmament norms.

The 2011 revolution in Libya and the ongoing conflict in Syria have raised concerns about the security and possible use of chemical weapons. Libya is a member of the Chemical Weapons Convention and has declared stockpiles of sulphur mustard that are awaiting destruction. But as the conflict in Libya in 2011 worsened, the security of chemical weapons was uncertain and it was even feared that chemical weapons might be used in the conflict. Fortunately the stockpile remained secure and chemical weapons were not deployed. Following the fall of the Gaddafi government, the Libyan National Transitional Council found, and subsequently declared to the Organisation for the Prohibition of Chemical Weapons (OPCW), a previously unknown and undeclared stockpile of chemical weapons. This transparency by the Libyan National Transitional Council should be commended and demonstrates the value in the international community maintaining its commitments and advocacy of international norms.

Throughout the reporting period, the crisis in Syria continued and the Syrian government stated that they might use chemical weapons against external aggressors. While Syria had announced it would not use chemical weapons against its citizens, any use of chemical weapons would be unacceptable and only increase instability in the region. The situations in Libya and Syria demonstrate the need for the universalisation of the Chemical Weapons Convention and the global elimination of these devastating and atrocious weapons.

Furthermore, it was only last year that Syria was reported to the United Nations Security Council (UNSC) by the IAEA Board of Governors for the construction of a facility that was "very likely"[1] an undeclared nuclear reactor. UNSC action did not follow and, while there were some positive signs of cooperation between the IAEA and Syria before the current unrest began, many questions surrounding the Syrian nuclear program remain unanswered.

Iran has continued its non-compliance with its international obligations and its safeguards agreement with the IAEA. A series of UNSC resolutions, most recently UNSCR 1929 of 2010, requires Iran to cease all reprocessing, heavy-water and enrichment related activities. However, Iran has continued to increase both its enrichment capacity and capability, continued the production of low enriched uranium (including uranium enriched to 19.75 per cent) and continued the construction of the IR-40 heavy water reactor at Arak. Of great concern was the February 2012 announcement of the introduction of three new advanced models of uranium centrifuges that will be introduced to the Pilot Fuel Enrichment Plant at Natanz.

The November 2011 IAEA report on Iran's nuclear program contained the most extensive description of the IAEA's information concerning the possible military dimensions of Iran's nuclear program. The IAEA's analysis of this information led to the conclusion that Iran had carried out activities "relevant to the development of a nuclear explosive device," and "that prior to the end of 2003, these activities took place under a structured program, and that some activities may still be ongoing." This report resulted in a resolution by the IAEA Board of Governors calling on Iran to engage and cooperate to restore confidence in the exclusively peaceful purpose of their nuclear program. The IAEA reported that it remains unable, in part due to the lack of cooperation by Iran, to provide credible assurance of the absence of undeclared nuclear material and activities in Iran.[2]

On 13 April 2012, the Democratic People's Republic of Korea (DPRK) attempted to launch a satellite on a long range missile in defiance of UNSC resolutions. The failed test was widely condemned by the international community. In the aftermath of the missile test there was significant media speculation that the DPRK would conduct a nuclear test, particularly given that nuclear tests had followed unsuccessful missile tests in 2006 and 2009. To date, the DPRK has not conducted a third nuclear test; however, such a test could come with very little warning. The threat of a nuclear weapons test, the revelation of a significant uranium enrichment program and the construction of a new nuclear reactor at Yongbyon has lifted the DPRK once again as a nuclear proliferation concern over the last year. Bilateral and multilateral negotiations have failed to yield lasting results, the DPRK's weapons of mass destruction proliferation network remains a threat and the nuclear situation in the DPRK itself continues to elude resolution.

Nuclear Non-Proliferation and Safeguards Developments

International Atomic Energy Agency Safeguards

At the practical implementation level, good progress was made in strengthening the IAEA safeguards system. The number of countries that have entered into force an Additional Protocol – the instrument by which countries give the IAEA additional information and increased access – increased significantly; at 30 June 2012 there were 116 countries with an Additional Protocol in force and 30 that had been signed or approved by the IAEA Board of Governors. Of the 62 non-nuclear-weapon states with significant nuclear activities that are a Party to the Nuclear Non-Proliferation Treaty (NPT), 53 (or 85 per cent) have an Additional Protocol in force. The Additional Protocol is firmly established as part of the NPT comprehensive safeguards standard. As a result of implementing Additional Protocols, the IAEA reported in its Safeguards Statement for 2011 that for 58 countries it had found no indication of undeclared nuclear material or activities, and that all nuclear material in these countries remained in peaceful activities.

In 2011–12, the IAEA continued its development of the state-level concept for safeguards implementation. The state-level concept is designed to improve the efficiency and effectiveness of safeguards implementation by taking greater account, in an objective manner, of all available safeguards information on a country, rather than the traditional, and somewhat inflexible, criteria-based approach. This was discussed in detail on pages 15–17 of the 2010–11 ASNO Annual Report. ASNO contributed to this development in the IAEA through reviewing the IAEA's progress, conceptual frameworks, and communication strategies through my membership on the IAEA's Standing Advisory Group on Safeguards Implementation and through publishing and presenting on this subject at international meetings and conferences.

Nuclear Security

In March 2012, ASNO took the lead in supporting Prime Minister Julia Gillard at the Seoul Nuclear Security Summit which was attended by 53 countries and five international/regional organisations. Australia was able to deliver on its Washington Summit commitments and set out its vision for what could be done to sustain efforts on nuclear security in the future. The leaders at the Seoul Summit produced a new Communiqué, and also agreed to hold a third summit in 2014 in the Netherlands.

In April, Australia joined the IAEA's newly established Nuclear Security Guidance Committee (NSGC) that will oversee the production of the IAEA's nuclear security series of guidance documents. ASNO attended the inaugural meeting of the NSGC which established the Committee's terms of reference and agreed the review and production process for new IAEA Nuclear Security Series documents.

Regional Developments

In April 2012, I took up the position as chair of the Asia-Pacific Safeguards Network (APSN) upon Mr John Carlson's retirement from this position. I would like to take this opportunity to formally thank Mr Carlson for his leadership as the APSN's founding chair. The APSN held its second plenary meeting in Jeju Island, Republic of Korea, from 5 to 7 July 2011. The plenary meeting was attended by 12 countries, the IAEA and the European Commission. A representative from Myanmar's Department of Atomic Energy attended an APSN plenary meeting for the first time. The meeting was hosted by the Korea Institute of Nuclear Non-Proliferation and Control, and sponsored by the Korea Ministry for Education, Science and Technology and the European Commission. Resulting from the meeting, five working groups were established to advance APSN's work in areas such as safeguards capacity building, awareness raising and communications (more details on

ASNO contributed to a Seminar on Good Practices in the Processing and Control of Uranium Ore Concentrate, held by the IAEA in Namibia, which promoted dialogue between industry, government and international organisations on the regulation of uranium ore concentrates in Africa. Twelve African countries with current or likely future uranium mining activities were represented while presentations were made by representatives from Australia, Brazil, Canada, Kazakhstan, and the United States of America.

Bilateral Safeguards Developments

Australia and Euratom exchanged notes to bring into force a new nuclear cooperation agreement on 1 January 2012. Subsequently, on 1 May June 2012, Mr Philip Lowe (Director General for Energy, European Commission) and I, signed the new Administrative Arrangements underpinning the Agreement bringing these Administrative Arrangements into effect.

Australia and the United Arab Emirates held a second round of negotiations on a nuclear cooperation agreement in October 2011 and ad referendum text was agreed.

Domestic Developments

During the reporting period, the IAEA conducted four design information verification inspections, three routine inventory verification inspections and one short notice inspection in Australia. The IAEA also undertook two complementary access visits in accordance with Australia's Additional Protocol. The IAEA confirmed that Australia had met all of its IAEA safeguards requirements. ASNO also conducted domestic safeguards inspections and visits of several permit holders.

In January 2012, Dr Carl-Magnus Larsson, CEO of the Australian Radiation Protection and Nuclear Safety Agency (ARPANSA) and I jointly issued the Australian Nuclear Science and Technology Organisation (ANSTO) the terms of reference for nuclear security reviews required under the respective licences issued by ARPANSA and ASNO. The review is to be conducted in stages and completed by the end of 2012. An important element to the review, Australia's nuclear Design Basis Threat, was revised to account for the current terrorist threat environment.

In February 2012, Dr Larsson and I signed a memorandum of understanding between ASNO and ARPANSA on cooperation and exchange of information. The memorandum of understanding acknowledges the value of cooperation between the two agencies in order to effectively implement our legislative responsibilities and regulatory functions.

Australia's high standard of nuclear security was recognised in January 2012. The non-government Nuclear Threat Initiative, published a Nuclear Materials Security Index providing a baseline assessment of worldwide nuclear security conditions. Australia was ranked first of 32 countries with weapons-useable materials.

Comprehensive Nuclear-Test-Ban Treaty Developments

At 30 June 2012, 183 countries had signed the CTBT and 157 had ratified, including 36 of the 44 countries which must ratify the Treaty to trigger its entry into force (known as Annex 2 states). The importance of action on the CTBT has again been underlined by many countries, at the CTBT Article XIV conference in New York in September 2011, and by NPT Parties in Vienna in May 2012 participating in the 2012 Preparatory Committee for the 2015 NPT Review Conference. The need to support work to establish the verification system for the CTBT was stressed also at both meetings.

However, the CTBT will not enter into force until all of the remaining eight Annex 2 states ratify[3]. In this respect the ratification of the Treaty by Indonesia in February 2012 was widely welcomed. Ratification of the CTBT by all of the NPT nuclear-weapon states (NWS) is widely seen as necessary to stimulate most of the remaining ratifications by Annex 2 states. At a meeting in Washington in June 2012 the NWS reiterated their commitment to promote and ensure the swift entry into force of the CTBT and its universalization. The meeting also explored ways to enhance the momentum for completing the verification regime, including the on-site inspection component.

Around 85 per cent of CTBT International Monitoring System (IMS) facilities are now operational. However, progress with remaining stations may take some time, in some cases due to political obstacles, for example where the host country is yet to sign the CTBT. Twenty of Australia's 21 IMS facilities are operational. All 20 have been certified as meeting CTBT requirements. Work to install the final station at Davis Base, Australian Antarctic Territory is being planned.

Judgments about compliance with the CTBT will be made by parties to the Treaty, based on technical analyses carried out by National Data Centres. At both the CTBT Article XIV Conference and the NPT Preparatory Committee, CTBT signatories were encouraged to establish the technical analysis capacity needed for them to carry out their task in verification of the CTBT. A new focus on the development of National Data Centre capacity emerged during the year in the work of the CTBT Organization and supportive countries, including Australia.

Chemical Weapons Convention Developments

Fifteen years after entering into force, the Chemical Weapons Convention (CWC) has 188 Parties. No new countries have joined the Convention since May 2009. Universal adherence to the CWC is fundamental to ensuring a world free of chemical weapons, but it remains elusive despite ongoing diplomatic efforts. There are two countries that have signed, but are yet to ratify the Convention (Israel and Myanmar) and six yet to accede to it (Democratic People's Republic of Korea, Syria, Egypt, Angola, Somalia and South Sudan).

Parties together with the Organisation for the Prohibition of Chemical Weapons (OPCW) continue to strive towards achieving the disarmament objective of the CWC. By 30 June 2012, 76 per cent (approximately 54,011 metric tonnes) of all Category 1 and 2[4] chemical weapons that have been declared by seven chemical weapons Possessor States had been destroyed under strict verification by the OPCW.

The final extended deadline under the CWC for destruction of all declared stockpiles of chemical weapons passed on 29 April 2012. As previously foreshadowed, not all Possessor States (Russian Federation, the United States, Libya and Iraq) were able to meet this deadline. ASNO worked with the Australian Embassy in The Hague to engage in OPCW discussions on how to best handle the missed deadline. The 16th Conference of the States Parties in December 2011 agreed to a decision that ensured continued verification of chemical weapons destruction and required Possessor States to provide planned completion dates. The Russian Federation, United States and Libya subsequently submitted their planned completion dates of December 2015, September 2023 and December 2016, respectively. Iraq continued to work closely with the OPCW Technical Secretariat (OPCW TS) to characterise the remnants of chemical weapons it declared that had remained since United Nations Special Commission days.

ASNO supported ongoing efforts by the OPCW TS to promote the full and effective implementation of the CWC, and in particular through its work with the Dili Embassy in coordinating a technical assistance visit to East Timor by the OPCW TS. Universal adherence to all the provisions of the CWC is essential to the global chemical weapons ban and to ensuring that these weapons are not developed, stockpiled, otherwise acquired or used. In particular, national implementation involves obligations under Article VII to designate a CWC National Authority (186 Parties have done so) and to establish the necessary legislative and administrative arrangements to enable its implementation and the prosecution of offenders. Progress made by Parties towards the implementation of Article VII in the reporting year was slow and, therefore, more work needs to be done. While 139 Parties have informed the OPCW TS of measures taken in this regard, only 88 Parties have legislation covering all key areas.

In 2011–12, ASNO facilitated four routine OPCW inspections at declared chemical facilities in Australia. Three inspections were conducted at 'Other Chemical Production Facilities' and the fourth at a facility processing Schedule 2 chemicals. The success of these inspections demonstrates Australia's compliance with the CWC, and reflects positively on the cooperation of Australia's chemical industry.

ASNO participated in an OPCW Challenge Inspection Field Exercise in Thailand, fulfilling the role of the Requesting State Party, from 31 October to 4 November 2011 (see report on page 31). The exercise was jointly organised by the OPCW TS and the Government of Thailand at an industrial chemical plant. Australia accepted the OPCW's invitation to participate as Australia regards Challenge Inspections as an important verification mechanism under Article IX of the Convention for addressing concerns about possible non-compliance with the CWC. The experience enhanced Australia's understanding of the Challenge Inspection process and highlighted the importance of training and exercising these provisions in the field. A number of recommendations were made and lessons identified which will help inform the OPCW's future training requirements and enhance confidence in the OPCW TS preparedness to conduct a challenge inspection.

ASNO participated in the Tenth Regional Meeting of National Authorities of States Parties in Asia in Colombo from 26 to 28 June 2012 and delivered two presentations on regional and sub-regional cooperation on CWC implementation and Australia's chemical trade controls. Australia recognises the importance of engagement with regional counterparts in Asia and attendance at these meetings continues to strengthen cooperation on CWC implementation issues.

Other Non-Proliferation Developments

Fissile Material Cut-off Treaty

Initiatives by a number of countries in the United Nations and the Conference on Disarmament (CD) have been unable to break the diplomatic impasse preventing negotiations on a fissile material cut-off treaty (FMCT). The requirement that all CD members agree to negotiations has continued to be a blockage. The opportunity for ASNO experts to build on technical discussions has been limited given the delay in negotiations.

Nuclear Disarmament Verification

Effective and widely accepted verification measures will be necessary if reductions in nuclear arsenals are to continue, and to actively involve countries other than the United States and Russia. The United Kingdom and Norway have undertaken joint research since 2007 to develop procedures and techniques to verify the dismantlement of nuclear warheads, highlighting the contribution that non-nuclear weapon states can make. ASNO has followed the UK/Norway initiative (UKNI) closely, including identifying how Australia could engage. Representatives from ASNO and ANSTO participated actively in a workshop in London in December 2011 reviewing progress in the UKNI and considering how additional countries could contribute.

The Year Ahead

The following developments in the international security environment are likely to impact on ASNO's work during 2012–13:

  • Iran's nuclear program and the IAEA's continuing efforts to resolve questions about possible military dimensions
  • international efforts by governments, non-government organisations and industry to strengthen nuclear security ahead of the Netherlands Nuclear Security Summit in 2014
  • ongoing efforts to commence negotiations on a fissile material cut-off treaty
  • continued interest in developing and promoting understanding at all stages of nuclear development in the Asia-Pacific region and elsewhere
  • changes in the IAEA's safeguards system to the holistic state-level concept, and working with the IAEA on how this will impact safeguards in Australia
  • Syria's acknowledgment in July 2012 that it would use chemical weapons against external aggressors
  • Libya's declaration of new discoveries of chemical weapons stockpiles not previously declared under the former Gaddafi government.

In addressing the challenges posed by the international security environment, ASNO will continue to provide technical analysis and policy advice to the Australian Government in the areas of non-proliferation and disarmament. ASNO will continue to ensure international treaty and regulatory obligations are met.

Internationally, ASNO will continue to work with the IAEA and other member countries on strengthening the safeguards system, including through Australia's membership of the IAEA Board of Governors, and through the Australian Safeguards Support Program, the Standing Advisory Group on Safeguards Implementation, and the US-led Next Generation Safeguards Initiative. ASNO will also work on strengthening the IAEA's nuclear security guidelines.

Regionally, ASNO will continue its outreach program to build operational capability in the areas of safeguards and nuclear security and non-proliferation treaty implementation, including through further development of the Asia-Pacific Safeguards Network.

ASNO will continue to manage Australia's network of bilateral nuclear cooperation (safeguards) agreements, including the tracking of Australian Obligated Nuclear Material (AONM) around the world. ASNO will seek signature of the negotiated bilateral nuclear cooperation agreement with the United Arab Emirates[5]. ASNO will also continue to work with others in the Department of Foreign Affairs and Trade as well as other departments and agencies to develop a framework for the supply of Australian uranium to India, in particular on the development of a bilateral nuclear cooperation agreement.

Domestically, to ensure safeguards and nuclear security requirements are met, ASNO will work with ANSTO and other permit holders, and furthermore with industry and relevant regulatory authorities in the establishment of new uranium mines. ASNO will work with ARPANSA to assess the recommendations arising from ANSTO's security review and provide feedback as required.

ASNO will host a workshop on promoting the IAEA's International Physical Protection Advisory Services (IPPAS) in November 2012 ahead of facilitating an IAEA IPPAS review mission of Lucas Heights in late 2013.

ASNO will continue to work with the CTBT Organization (CTBTO) and other Australian agencies to establish the key elements of CTBT verification: the International Monitoring System (IMS); the International Data Centre (IDC); on-site inspection (OSI) and National Data Centre (NDC) capabilities. ASNO coordinates whole-of-government efforts to establish and maintain Australia's IMS stations and NDC, and has an active and leading role in the CTBTO's work on OSI.

Efforts to get negotiations on an FMCT underway will likely remain high on the international agenda in 2012-13. Most interested countries have said that they prefer the CD as the venue for FMCT negotiation, but some have said that it could become necessary to progress discussions outside the CD. ASNO will continue to support Australia's work in this area as opportunities arise, focusing in particular on how an FMCT can be effectively verified.

ASNO will continue to build Australia's engagement in technical issues related to the verified dismantlement of nuclear weapons as international developments allow.

ASNO will collaborate closely with the OPCW and other Parties to promote the objectives of the CWC, including by sharing Australia's experience implementing the CWC with regional counterparts. ASNO will support OPCW efforts to promote universal adherence to the CWC and to address chemical terrorism. Australia will continue to work bilaterally with non-State Parties, such as Myanmar, to support them in their accession or ratification to the CWC.

ASNO will host a visit to Australia by Ambassador Ahmet Üzümcü, the Director-General of the OPCW, in July 2012. This visit will help raise greater awareness and understanding of the CWC and the OPCW's role among policy makers, think-tanks, students and academia as well as industry and government.

ASNO will continue to participate and engage with other States Parties in workshops and field exercises associated with Challenge Inspections. The lessons learned and experiences gained from the OPCW Challenge Inspection Field Exercise in Thailand in 2011 will continue to be shared and built upon in the year ahead.

ASNO will assist in Australia's preparation and participation in the Third Review Conference of the CWC in 2013. Review Conferences are held every five years to review the operation of the CWC, taking into account any relevant scientific and technological developments. Australia will participate in the Open-Ended Working Group which will consider all issues related to the agenda for the CWC Review Conference as well as the future directions and priorities of the OPCW.

Dr Robert Floyd
Director General ASNO

[1] Report by the IAEA Director General. GOV/2011/30: Implementation of the NPT Safeguards Agreement in the Syrian Arab Republic, 25 May 2011 (p.24).

[2] Report by the IAEA Director General. GOV/2012/23: Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions in the Islamic Republic of Iran, 25 May 2012 (p.51).

[3] The eight Annex 2 states that have yet to ratify the CTBT are: China, DPRK, Egypt, India, Israel, Iran, Pakistan and the USA.

[4] Paragraph 16 of Part IV(A) of the Verification Annex to the CWC determines that for the purposes of destruction of declared chemical weapons they are divided into the following categories: Category 1: chemical weapons on the basis of Schedule 1 chemicals and their parts and components; Category 2: chemical weapons on the basis of all other chemicals and their parts and components; Category 3: unfilled munitions and devices, and equipment specifically designed for use directly in connection with employment of chemical weapons.

[5] The Agreement between Australia and the United Arab Emirates (UAE) for Nuclear Cooperation in the Peaceful Uses of Nuclear Energy was signed by the Australian Foreign Minister Senator the Hon Bob Carr and the UAE Foreign Minister His Highness Sheikh Abdullah on 31 July 2012 in the UAE.

Prime Minister Julia Gillard, the former Prime Minister of Pakistan Yousaf Raza Gillani and the Prime Minister of Thailand Yingluck Shinawatra at the Seoul Nuclear Security Summit in March 2012
Prime Minister Julia Gillard, the former Prime Minister of Pakistan Yousaf Raza Gillani and the Prime Minister of Thailand Yingluck Shinawatra at the Seoul Nuclear Security Summit in March 2012



Department of Foreign Affairs and Trade