N. Korea asked to pay $1.9b for aborted nuclear project

Washington had awarded Pyongyang light-water reactors under 1994 deal to freeze nuclear development.

Kim Jong Il 298.88 (photo credit: AP)
Kim Jong Il 298.88
(photo credit: AP)
A US-led international consortium has asked North Korea to pay US$1.9 billion (€1.5 billion) in compensation for an aborted project to build two light-water reactors for power generation in the communist country, a South Korean official said Tuesday. The reactors - which are of a type difficult to divert for military purposes - were a reward under a 1994 deal between Washington and Pyongyang to freeze North Korea's nuclear development. The consortium, which also involved South Korea, Japan, and the European Union, formally terminated the project last year amid the renewed standoff over the North's pursuit of nuclear arms. The Korean Peninsula Energy Development Organization, or KEDO, has demanded that North Korea pay the money to compensate for the cost of the project, a South Korean Foreign Ministry official said, asking not to be named due to ministry protocol. South Korea's Yonhap news agency reported that the North has not responded to the agency's demands, which had been made three times in writing since last September. The official said it was unclear whether the North is not responding to the demand or refusing to pay. North Korea has previously blamed the United States for the breakdown of the project, demanding unspecified compensation from Washington. Some US$2.4 billion was spent on the project as of the end of 2004, including the cost of heavy fuel oil that was provided to the North as a substitute energy source until the reactors' completion, according to the KEDO Web site. The fuel oil shipments were halted in late 2002 after the US said North Korea admitted to a secret uranium enrichment program in violation of the 1994 agreement - triggering the latest nuclear standoff with the North. Since 2003, North Korea has participated in negotiations with South Korea, China, Japan and Russia and the US over its nuclear program, but no breakthroughs have been made. In October, the North conducted its first nuclear test.