British Nuclear Fuels (BNFL) is aiming to make millions of pounds helping President George Bush build his controversial new generation of "battlefield" nuclear weapons, an investigation by The Independent on Sunday can reveal.
Ministers will this week be asked to explain why a joint venture, in which the controversial, government-owned company is a partner, is lobbying to build parts for the weapons, which threaten to break apart the international Nuclear Non-Proliferation Treaty.
The Westinghouse Savannah River Company has urged local people to write to the Bush administration and members of Congress to press them to construct a $3bn plant at its site near Aiken, South Carolina, so that it can provide plutonium triggers for the warheads.
Meanwhile the Government is assisting BNFL in another highly controversial business venture that increases the risk of nuclear proliferation. As reported in The Independent on Sunday two weeks ago, the Energy minister, Stephen Timms, is to visit Japan to try to persuade it to end a four-year ban on buying nuclear fuel containing plutonium from the company.
Proliferation experts say that exporting the so-called "mixed oxide" (Mox) fuel halfway around the globe will greatly increase the chances of terrorists getting hold of plutonium, which can easily be extracted from it, enabling them to obtain nuclear bombs.
The two developments severely undermine the Government's professed determination to stop the spread of weapons of mass destruction, the rationale both for the Iraq war and for intense diplomatic efforts to prevent Iran and North Korea developing nuclear weapons.
They come only two months after the company appeared to be turning over a new leaf by switching from producing plutonium to cleaning up nuclear contamination. Brian Watson, the director of its Sellafield site, announced that its its reprocessing plant, Thorp, which recovers plutonium and uranium from nuclear waste, would close by the end of the decade, and be converted into a waste-handling facility.
The Savannah River development would, however, mark a much more fateful new departure for the company. While it has, throughout its history, provided nuclear material for bombs, this would be the first time that it had been involved in the actual production of the weapons.
Last year the White House revealed, in its Nuclear Posture Review, that it wished to develop smaller battlefield nuclear devices, which could destroy reinforced bunkers holding chemical or biological weapons. Strategists believe that these relatively low-yield weapons would pose a more credible deterrent against rogue states, as the US would be more willing to use them than traditional weapons which would do much more widespread damage.
But experts also warn that they could breach the Nuclear Non-Proliferation Treaty, and lead to a new arms race.
Until now there has been no debate or discussion about BNFL's role in Britain. But the revelation that a company wholly owned by the Government is involved in efforts to develop such controversial new nuclear weapons has sparked fury among MPs.
Labour MP Llew Smith, who is to table a series of questions on the issue this week, said: "For BNFL to be using British taxpayers' money for boosting Bush's bombs is nothing short of scandalous."
And the Liberal Democrat Environment spokesman, Norman Baker, added: "It is outrageous that a publicly owned British company can do this with no discussion in the UK. It gives the lie to the idea that BNFL is only interested in peaceful activities. They seem more keen to build bombs for Bush. The public are not likely to support BNFL's role in making American bombs. They are even less likely to support a government that won't come clean on this issue."
BNFL's involvement stems from its 1999 purchase of the US nuclear giant Westinghouse. The US Congress declined to allow a foreign firm run its privately managed military nuclear sites and insisted that Westinghouse should operate at its most sensitive locations, such as Savannah River, as part of a joint operation with one of America's leading construction and engineering corporations, the Washington Group. The Westinghouse Savannah River Company (WSRC) was the result.
BNFL holds no shares in WSRC, but takes 40 per cent of the profits and has a powerful director on the board. It said in a statement: "The concurrence of this director is required for a number of strategic policy decisions." Westinghouse claims that it has not been directly lobbying the US government for the contract to build the triggers, although in public meetings its president, Robert Pedde, has asked members of the local community to contact their Congressional representatives.
Will Callicott, a spokesman for Mr Pedde, said: "We have an interest in any mission that would be a good fit for the site. But anything that you might call active lobbying is being done by the local community." In fact, the proposals have caused a fierce local debate, dividing those who see the potential contract as an opportunity to secure employment for the area and those who say the project is unnecessary and could cause pollution.
Mary Kelly of the South Carolina League of Women Voters, said the plan was "disastrous for the need to protect public health and the environment and the need to protect world peace through international co-operation and agreements".
Mr Timms has just postponed his visit from this week to early in the new year. He will try to persuade Japan to revoke a ban on taking Mox fuel that was imposed in 1999 after The Independent revealed that quality assurance documents concerning it had been falsified. This lost BNFL its main customer for the fuel.
Proliferation experts are deeply concerned that reinstating the order would cause enough plutonium to build hundreds of terrorist bombs to be transported across the world in lightly armed ships that would find it hard to repel a determined attack.
The Prime Minister, Tony Blair, has constantly reiterated that terrorists would make and use nuclear bombs if they could only get hold of plutonium. But he approved BNFL's plans to make and export Mox fuel only a few weeks after the September 2001 attacks on the United States, despite warnings from ministers of the dangers.