The Westinghouse Corp. is actively negotiating on a multi-million-dollar joint venture to exploit what may be a large uranium deposit in central Somalia in a bid to resolve its present critical problem of supplying its customers with sufficient quantities of nuclear power plant fuel.
The deal is reported to involve both the Somali government and an Eastern bloc country in an highly unusual tripartite mining consortium that would almost certainly become the largest business in this pedominantly cattle raising and banana growing Indian Ocean country, according to informed Somali and Western diplomatic sources.
However, a Washington report that the Somali government has given the go ahead of Westinhouse to begin exploring the extent of the deposits located in Mudugh, a district north of here, could not be immediately confirmed here.
Diplomatic sources here said that the outcome of the complicated negotiations underway now between Westinghouse and the Somali governmentr could well depend on whether there is any significant improvements in Somali-American relations which have been poor for the past eight years.
In fact, the Somali reaction to the Westinghouse proposal is now being taken here and in Washington as a test and indication of the future direction of relations between the two countries.
The Carter administration is now making a new overture toward Somalia following the sharp deterioration in the once close ties between the United States and neighboring Ethiopia.The two East African countries both have Marxist governments but are sowrn enemies because of a territorial dispute para.
Until recently, the United States was Ethiopia's principal foreign ally and arms supplier, making it virtually impossible for Washington to have good relations at the same time with this country whose main big power supporter is the Soviet Union.
One important factor in the proposed Westinghouse uranium venture, according to some Western sources here, is the reaction of the Soviet Union to an American multinational company becoming the largest foreign private investor in Somalia, particular since it involves a strategic mineral like uranism.
Westinghouse has sought to deal with this problem by trying to find a business partner in an Eastern European country to participate in the consortium and thus make it more acceptable to the Soviets. However, there is no confirmation here either that the giant American corporation has succeeded in getting a firm commitment from any mining or other concern from Eastern Europe to associate it self with the project.
Whether the Soviet Union is really in a position any longer to block the Westinghouse venture has become increasingly mounts over Moscow's recent decision to give strong backing, including arms, to Ethiopia.
Thus, it cannot be ruled out that the Somali government may agree to a partnership involving only it and Westinghouse to begin exploration of the uranium site.