Russia hopes U.S. Congress will pass nuclear pact

MOSCOW Thu Feb 19, 2009 11:37am EST

MOSCOW (Reuters) - Russia hopes better ties with the new U.S. administration could help to revive a bilateral civilian nuclear pact potentially worth billions of dollars in trade, a senior Russian official said on Thursday.

The deal would open the U.S. nuclear fuel market and Russia's vast uranium fields to companies from both countries by removing Cold War restrictions in the sector.

The agreement was signed last May but former President George W. Bush withdrew it from Congress in September, a move widely seen as punishment for Russia's war with Georgia.

"I think that under the new administration, America will finally show a pragmatic approach and that this agreement will be resubmitted," said Mikhail Lysenko, head of international cooperation at Russia's state nuclear corporation, Rosatom.

"I hope the new administration will submit the agreement (to Congress) as it really is a deal that is beneficial to both the United States and Russia. We have had no signals yet from Washington on the issue," he told Reuters.

The war in Georgia drove rocky U.S.-Russian ties to post-Cold War lows. But Moscow hopes U.S. President Barack Obama could adopt a more pragmatic approach to bilateral ties giving them a new start.

Diplomats say the civilian nuclear deal is likely to become part of wider negotiations with Washington about a range of issues including Iran, transit routes to Afghanistan, strategic arms reduction and U.S. plans for a missile defense shield.

The United States has signaled that it could slow plans to deploy a missile defense system in Europe if Moscow helps efforts aimed at preventing Iran from obtaining nuclear weapons.

The 123 deal, so-called because it falls under section 123 of the U.S. Atomic Energy Act, is required before countries can cooperate on nuclear materials.

It is critical to the Global Nuclear Energy Partnership, or GNEP, which the United States and Russia have discussed for several years as a way to expand peaceful nuclear energy development and mitigate proliferation risks.

Russia and the United States control the largest arsenals of nuclear weapons in the world and both have ambitious plans to build hundreds of new reactors for power production.

Russia, one of the world's biggest sellers of enrichment services, has long been trying to break into the nuclear markets of the United States and European Union.

Former President Vladimir Putin reformed the nuclear sector and crafted a nuclear behemoth called Atomenergoprom to compete with the biggest nuclear companies on the world market.

(Editing by Janet Lawrence)

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