Russia and U.S. sign civilian nuclear pact

MOSCOW (Reuters) - Russia and the United States signed apact on Tuesday allowing the world's two biggest atomic powersto boost their nuclear trade and work on new ways to preventthe proliferation of nuclear weapons.

The civilian deal will open up the booming U.S. nuclearmarket and Russia's vast uranium fields to firms from bothcountries by removing Cold War restrictions that preventedbilateral trade potentially worth billions of dollars.

U.S. ambassador to Russia, William Burns, signed the dealwith the head of Russia's state nuclear corporation, SergeiKiriyenko, on the last full day of Vladimir Putin's presidency.

"The United States and Russia were once nuclear rivals --we are today nuclear partners," said Burns.

At the 2006 Group of Eight summit in St Petersburg,President George W. Bush and Putin ordered ministers to reach adeal but it has faced opposition from some U.S. congressmenbecause of Russia's nuclear cooperation with Iran.

A 123 agreement, so-called because it falls under section123 of the U.S. Atomic Energy Act, is required before countriescan cooperate on nuclear materials.

It is critical to the Global Nuclear Energy Partnership, orGNEP, which the United States and Russia have discussed formore than a year as a way to expand peaceful nuclear energydevelopment and mitigate proliferation risks.

"What this agreement allows us to do is to implement somevery creative ideas that both Russia and the United States haveput forward to deal with the growing challenge of proliferationof nuclear weapons," Burns said.

He said the deal would allow Washington and Moscow to moveforward on proposals for international nuclear fuel centres,which would sell developing countries access to nuclear energybut remove the need for their own enrichment programmes.

NUCLEAR GIANTS

Russia and the United States control the largest arsenalsof nuclear weapons in the world and both have ambitious plansto build hundreds of new reactors for power production.

Some U.S. politicians have said nuclear cooperation withRussia should be shunned because Moscow is helping Iran buildan atomic power station, but the Bush administration is keen tohave the pact approved this year.

State Department spokesman Sean McCormack said inWashington that now that the deal has been signed, it would besent to Congress for lawmakers to review "in due course".

When asked about speculation that Bush may not submit thedeal to Congress -- possibly leaving it for the next presidentto do -- McCormack said: "Usually we don't sign agreements wedon't intend to send to Congress for ratification."

Once the agreement is sent to lawmakers, it would go intoforce if Congress did not pass a disapproval resolution within90 legislative days. Russia's parliament, controlled by Putin'sparty, must also ratify the treaty.

Russia, one of the world's biggest sellers of enrichmentservices, has been trying to break into the nuclear markets ofthe United States and European Union.

"The signing of this agreement opens a gigantic field ofopportunities for the economic cooperation in the large andgrowing businesses linked to the civilian use of nuclearenergy," Kiriyenko said after the signing.

Tuesday's agreement simplifies life for companies in bothcountries and allows them to strike deals on trade in nuclearmaterials directly among themselves.

Putin has reformed Russia's nuclear sector to boostcompetition and open it up to atomic firms such as Japan'sToshiba, which owns U.S.-based Westinghouse Electric.

Russia has crafted a nuclear behemoth called Atomenergoprom-- which officials say is an atomic version of Russian gasgiant Gazprom -- to compete with the biggest nuclear companieson the world market.

(Additional reporting by Susan Cornwell in Washington;Editing by Sami Aboudi)