The Carter administration yesterday disclaimed any intention of setting up a new international uranium "cartel," even though there has been top-level correspondence with Australia and Canada about the need for collaboration among "like-minded countries."
Testifying before the Senate Foreign Relations Committee, State Department officials Joseph S. Nye Jr. said the administration's aim is simply to create an international fuel "fund" that other countries could turn to if they felt shut off from their customary sources of nuclear fuel.
Nye, who is deputy of the under secretary of state for security assistance, said U.S. officials have discussed the same goals with other governments.
"There is not an Australian-Canadian-American cartel," Nye assured the committee.
Acting Chairman Frank Church (D-Idaho) said other countries may perceive the plan somewhat differently in light of the jump from $6 to $40 a pound for raw uranium, or "yellowcake," and the role of some American companies in the foreign-based "yellowcake" cartel that set out in 1972 to rigs bids and drive prices upward.
Alluding to the administration's plans for an "International Fuel Bank" that might serve as a contingency reserve for nations in need of nuclear fule, Church said, "It may very well appear that a cartel is forming whether that is the intent of the [U.S.-Australian-Canadian] governments or not."
The questioning was provoked by a series of letters between President Carter, Australian Prime Minister Malcolm Fraser and Canadian Prime Minister Pierre Trudeau. According to Jerome Levinson, counsel for Church's subcommittee on multinational corporations, the correspondence has already appeared in the Canadian and Australian press, but not here.
In the first letter, written in Canberra Feb. 4, Fraser expressed his interest in Carter's hopes for stronger restraints on nuclear weapons proliferation and added:
"Apart from our general commitment to non-proliferation, Australia's particular interest - and perhaps our scope in future to exert influence on international developments - relates to our potential as a supplier of uranium. Australia would certainly want nuclear material deriving from any uranium it may supply to be subject to stringent control."
Explaining that Australia is starting to focus on a national policy for nuclear safeguards, Fraser told the President: "Naturally we wish to take full account for any new thinking as it develops in this area, especially to ensure that our policies and those of the United States and other like-minded countries, such as Canada, are mutally reinforcing . . . I believe this constitute a particularly fertile and important area for cooperation and for coordination of the policies of our two countries."
Trudeau, who was sent a copy, wrote Fraser March 1 that he had raised "the importance of a suppliers" with Carter personally on Trudeau's recent visit to Washington.
The President followed up with a March 11 letter to Fraser that said in part: "If the U.S., Australia, Canada and other like-minded countries collaborate on policies for the supply of natural uranium, we can play a vital role in reducing the threat of proliferation."
Declaring that other nations would be welcomed to join some sort of international authority that nuclear fuel-short nations could patronize, Nye told a reporter that "we've talked to the French, the Germans and the Russians about this." He said that India, with its rich supplies of thorium, would be another possible member.