- The Washington Times - Thursday, October 3, 2002

The Pentagon spent nearly $100 million to build facilities in Russia to convert liquid rocket propellant for commercial use, only to find out later that Moscow already used the components in its space program, says a government report.
The Pentagon spent $95.5 million as of July to design and build the plants to turn heptyl and amyl components in rocket fuel for nuclear-tipped intercontinental ballistic missiles into consumer products.
But Russia informed the United States in February it had already used the fuel in its space program, according to the 44-page report signed by David K. Steensma, the Defense Department's deputy assistant inspector general for auditing.
"We are left with a big white elephant," said a defense source, speaking on the condition of anonymity.
The inspector general's report states that the Pentagon's Defense Threat Reduction Agency (DTRA) is now spending $1.2 million for maintenance and security while it decides what to do with the buildings.
"As a result, the heptyl and amyl disposition facilities that cost the United States $95.5 million will not be required for their intended purpose," the IG report states.
Mr. Steensma recommends that in the future the DTRA negotiate firm contracts with commitments from Russia on how it plans to dispose of weapons components before investing millions of U.S. taxpayer money into any facilities. The contract needs to "provide adequate transparency rights to Department of Defense, and include remedies," says the report, a copy of which was provided to The Washington Times.
The report also urges the DTRA to exercise more oversight. "The director, Defense Threat Reduction Agency could have more assurance that Russia will provide weapons systems for disposal by performing more complete inspections of equipment provided to Russia and by identifying other potential uses that Russia may have for weapons systems that Russia has agreed to provide for disposal," the IG report said.
A spokesman for the agency declined to comment.
But the report says the agency director did not dispute the IG's findings. The agency has plans for an auditing team that will monitor Russian proceeds from rocket-fuel sales and make sure they fund other threat-reduction programs.
"The planned actions are positive steps in the right direction," the IG report states.
The threat-reduction agency oversees an 11-year-old program in which the United States supplies billions of dollars to help Russia dispose of chemical, nuclear and other weapons. Congress authorized the program in the 1991 Soviet Nuclear Threat Reduction Act. The aim is to consolidate and destroy much of the massive Cold War arsenal left over after the breakup of the Soviet Union, and reduce the chance that such material could fall into the hands of rogue nations or terrorist groups.
In March, Deputy Defense Secretary Paul Wolfowitz asked the Pentagon inspector general, Joseph E. Schmitz, to investigate a Cooperative Threat Reduction Program to convert 30,000 metric tons of liquid rocket fuel from decommissioned ICBMs into a more benign substance. Sen. Pat Roberts, Kansas Republican and Senate Armed Services Committee member, also has pushed for an investigation.
Congress has provided $4.7 billion since 1992 for Russia, as well as the former Soviet republics of Belarus, Georgia, Kazakhstan, Moldova, Ukraine and Uzbekistan.

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