- The Washington Times - Thursday, January 16, 2003

WASHINGTON, Jan. 16 (UPI) — The State Department has asked Congress to set aside money for an organization charged with building nuclear reactors in North Korea and supplying the communist state with fuel oil, a move which critics said signaled a willingness by the Bush administration to renegotiate a defunct agreement with Pyongyang.

United Press International learned Thursday that in the last week, the State Department asked Congress to add $3.5 million to the 2003 budget to fund the Korean Peninsula Energy Development Organization, created in 1995 to implement the construction of two light water nuclear reactors and provide heavy fuel oil shipments to North Korea.

Under a 1994 deal called the "Agreed Framework," the United States pledged to help provide key components and technology for the nuclear power plants in exchange for undertakings from Pyongyang to mothball their fast breeder reactor and seal spent fuel rods under international supervision. The used fuel from fast breeder reactors can be re-processed into plutonium and made into nuclear weapons. Light water reactors do not produce material useful for a weapons program.

The concrete for the light water reactors has never been poured and the technology from KEDO has never been shipped to North Korea. The United States halted fuel oil shipments last year after saying that North Korea had admitted it had a secret "second track" weapons program to enrich uranium.

Both sides have said that the 1994 deal is now essentially defunct. Earlier this week, Secretary of State Colin Powell told The Wall Street Journal, "We would need a new arrangement and not just going back to the existing Agreed Framework."

State Department officials Thursday insisted that the money was set aside only as a drip feed for the organization — to pay administrative costs and salaries for KEDO in 2003.

But other administration and congressional staff say the decision to set aside money leaves the administration the option to renegotiate the 1994 agreement with North Korean leader Kim Jong Il.

In December, the White House told Congress it would not request funding for KEDO for 2003.

"The East Asia desk at the State Department succeeded in convincing the secretary of state to try to keep KEDO alive in case there is an Agreed Framework part 2," one Republican congressional staffer told UPI. "This is a huge retreat for the administration."

Earlier this week Assistant Secretary of State for East Asian Affairs James Kelly offered North Koreans the potential carrot of resumed fuel shipments to North Korea, once it had verifiably dismantled its fast breeder reactor.

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