You may wonder why such a large fine for nickel powder. Well there is a partial answer to that, and the hint to the answer is the picture of the Oak Ridge gaseous diffusion uranium enrichment facility that illustrates this post. Gaseous diffusion enrichment requires a barrier that is used to separate isotopes of uranium, the goal being an output of fissionable uranium such as U-235. Apparently sintered nickel powder serves this purpose well. Sintered powder is powder that has been formed into a mass by high temperature and pressure alone without melting the powder. After this process, nickel creates a solid porous structure that permits the right isotopes to pass through and the others to stay behind, although it requires a multi-step cascading procedure. Sintered nickel powder was used as such a barrier in the gaseous diffusion plant at Oak Ridge.

Barrier technologies are, naturally, classified. But the description of ECCN 1C240.a probably gives a potential nuclear proliferator a good head start in developing a sintered nickel powder barrier. To be controlled under that ECCN, the nickel powder must be 99.0% pure and must have a mean particle size of less than 10 micrometers. I didn’t check each of the Novamet nickel powder exports alleged by BIS but five of them involved Novamet’s 4SP-10 powder, which judging from this specification sheet falls well within the parameters of ECCN 1C240.a.

That being said, and with requisite acknowledgment that this product could be used in uranium enrichment, there is certainly a foreign availability issue to consider here. The U.S. doesn’t mine or produce significant quantities of nickel. Russia is the largest producer, followed by Canada, Australia, and Indonesia. And nickel powder isn’t controlled under the Wassenaar Arrangement meaning that these countries can freely export nickel powder meeting the specifications described in ECCN 1C240.a. So, a $700,000 fine against Novamet seems far in excess of any injury that the exports might have caused.

UPDATE: Ed Fox, from DOE’s NNSA, points out in the comments that nickel powder is controlled by the Nuclear Suppliers Group. Indeed, it is listed on that group’s Guidelines for Transfers of Nuclear-Related Dual-Use Equipment, Materials, Software, and Related Technology under Category 2.C.16.a. That would prevent exports by Russia, Canada and Australia of nickel powder to certain countries. Singapore, another major producer of nickel, however, is not a member of the Nuclear Suppliers Group, although I can’t determine whether it has manufacturers who export nickel powder.

[P.S. The brief I mentioned earlier as my excuse for not posting more has been filed, so I should be on a more regular posting schedule.]

Although the ISIS report isn’t clear on this, it appears that Vanaki must have been charged under section 19 of the German law. Although the law prohibits exporting or brokering of “war weapons,” it is likely that the high-speed cameras were considered a dual-use item rather than a war weapon. In that case, section 19 would prohibit the brokering of the item to Iran if, and only if, Iran has a nuclear weapons program.

This lead to an unusual step by Vanaki’s defense which introduced the United States’ 2007 National Intelligence Estimate (“NIE”) on Iran which, the defense claimed, concluded that Iran had abandoned its nuclear program in 2003 and had not resumed it by 2007 when the high-speed cameras at issue were sold to Iran. The German trial court agreed and acquitted the defendant.

The prosecution appealed, and the appeals court sent the case back to the trial court for another trial. In reaching its decision, the appeals court pointed out that the trial court put too much reliance on the 2007 NIE. The NIE’s conclusion that it was “moderately confident” that Tehran had not resumed its nuclear weapons program was far from proof that it had, in fact, not resumed that program. The appeals court also relied on a supplemental report from the Bundesnachrichtendienst (“BND”), Germany’s foreign intelligence service, which discussed the development by Iran of a missile launcher as well as similarities in procurement practices by Iran and countries known to have nuclear weapons programs, such as Pakistan and North Korea. Based on this report, the appeals court found that it was now likely that Vanaki would be convicted on a retrial and sent the case back to the trial court.

Two things bear noting here. First, Germany’s export laws in this case, and in other cases that involve dual-use items, impose an intolerably heavy burden of proof in export prosecutions. In effect, the state has to prove that the country in question has a nuclear program, an element of proof that would be difficult and almost necessarily speculative in the case of many countries which are believed to be developing nuclear weapons but have not yet admitted that fact. Second, it appears that the BND assessment must provide some fairly certain intelligence demonstrating the existence and scope of Iran’s nuclear program. This may explain why Germany, unlike some other EU countries, has recently seemed more interested in restricting certain exports to Iran.

According to the Knoxville News-Sentinel, Oakley was an unskilled worker employed by Bechtel Jacobs which had a contract to dismantle the gaseous diffusion plant that was once used to enrich uranium at the East Tennessee Technology Park outside Knoxville. One of the tasks assigned to Oakley, according to Oakley’s attorney, was to break the gas diffusion barriers and associated equipment into pieces. The gas diffusion barriers are membranes used to separate isotopes of uranium.

Oakley’s attorney claims that although Oakley thought of these broken barriers as “trash,” they might still be of interest to the French. (It is not clear whether this is because Oakley didn’t really think the barriers were trash or because he thought that the French had an unusual interest in buying trash). So Oakley did what any patriotic American would do, he called the French Embassy in Washington, D.C., and offered to sell the pieces to them. The response of the French diplomats to Oakley’s call, again in the words of Oakley’s own attorney, was that “they laughed at him.” And then apparently they called the FBI. The FBI had an agent impersonate a French diplomat to conclude the transaction (or at least enough of it to indict Oakley). Am I the only one wondering whether the FBI agent put on a cheesy French accent as part of the sting?

If the facts are as presented above, Oakley’s prospects for acquittal do not look good and indeed he deserves to be punished. However, the huffing and puffing about the vast harm that might have occurred — from various government officials and the perpetual alarmists at Arms Control Wonk — needs to be tempered somewhat.

There is a reason that the gas diffusion enrichment plant had been in mothballs for some time and was being dismantled is that it was obsolete and had been replaced by cheaper and more efficient methods of uranium enrichment. According to a typically reliable assessment from GlobalSecurity.org:

Gaseous diffusion is unlikely to be the preferred technology of a proliferator due to difficulties associated with making and maintaining a suitable barrier, large energy consumption, the requirement for procuring large quantities of specialized stage equipment, large in-process inventory requirements, and long equilibrium times.

Nor is it clear even that providing the membrane itself would enable a potential proliferator to determine how it had been manufactured. So, Oakley probably broke the law, but probably doesn’t deserve to be seen as the latest Julius Rosenberg or AQ Khan.

The two arrested men are Parthasarathy Sudarshan, founder of Singapore-based Cirrus Electronics, and Mythili Gopal, president of Cirrus’s U.S. subsidiary. Cirrus’s U.S. subsidiary would source parts from U.S. vendors and then ship to Cirrus in Singapore from where they were trans-shipped to India. In one case, the indictment alleged that parts were shipped by Cirrus to the Vikram Sarabhai Space Centre, which is on BIS’s Entity List.

The indictment alleges participation in the illegal exports by two unnamed Indian officials: a consular official posted to the Indian embassy in Washington, D.C. and another official of the Aeronautical Development Establishment, an Indian government agency. A spokesman for the Indian government was, not surprisingly, non-committal about these allegations. According to the Mumbai Sunday Express:

Foreign Secretary Shiv Shankar Menon said: “We are looking into the allegations. Now they are only allegations…we will get back to you when we have something to say about it.”

No doubt the Foreign Secretary is concerned about the impact that these allegations may have on current negotiations of a 123 Agreement between the United States and India under which India will gain access to nuclear fuel, technology and reactors. (A “123 Agreement” is a nuclear cooperation pact fulfilling the conditions of section 123 of the Atomic Energy Act.)

The head of the Vikram Sarabhai Space Centre is already trying to spin the indictment according to this story in the Times of India:

Vikram Sarabhai Space Centre director, B N Sureesh, told TOI from Thiruvananthapuram, “We do not bluff.” He said whenever his organisation imports items, it always provides an end-user certificate. “So there is no question of us trying to obtain items by stating one purpose and quietly using it for another.”

Or maybe not.

When we can dig up the indictment, we’ll provide more information on exactly what the government has charged.

The ISN slapped sanctions on Rosboronexport and Sukhoi for transferring sensitive technology to Iran in violation of the Iran Nonproliferation Act of 2000. Rosboronexport is the firm that handles most arms exports from Russia and Sukhoi manufactures military and civilian aircraft. Rosoboronexport is chaired by Sergei Chemezov, an ex-KGB officer and friend of Vladimir Putin’s.

In imposing the sanctions, the ISN did not provide any details as to the particular transfers that were the basis for the imposition of sanctions. The ISN sanctions prohibit exports to either company of items on the ITAR or the CCL. The ISN sanctions list can be found here. (And you thought you knew the names and locations of all the export sanctions lists, didn’t you? Well, unless you knew about the ISN list, you didn’t.)

Monday’s statement by Churkin issued a not-so-veiled threat to hold new U.N. Iran Sanctions hostage if the U.S. does not lift the sanctions on Rosboronexport and Sukhoi:

If Russia is asked to vote on a Security Council resolution imposing sanctions on Iran for refusing to suspend uranium enrichment at the same time that Russian companies are subject to U.S. sanctions, it would be voting on a measure “which at least by implication supports sanctions which have already been imposed on us,” [Churkin] said.

In my view, the U.S. will be more than willing to use these sanctions as a bargaining chip to gain Russian support in the Security Council for expanded multilateral sanctions against Iran.