Kingdom says enrichment would be for nuclear power, but it opens up possibility of military uses of uranium.

Saudi Arabia wants to enrich uranium for its nuclear power programme, the kingdom’s new energy minister said on Monday, potentially complicating talks with Washington about an atomic pact and the role United States companies might play in the arrangement.

Uranium enrichment has been a sticking point with the US, especially after Crown Prince Mohammed bin Salman said in 2018 that the Sunni Muslim kingdom would develop nuclear arms if regional rival Shia Muslim Iran did so.

The world’s top oil exporter says it wants to use nuclear power to diversify its energy mix, but enrichment also opens up the possibility of military uses of uranium.

“We are proceeding with it cautiously … we are experimenting with two nuclear reactors,” Prince Abdulaziz bin Salman said, referring to a plan to issue a tender for the Gulf Arab state’s first two nuclear power reactors.

Ultimately, the kingdom wanted to go ahead with the full cycle of the nuclear programme, including the production and enrichment of uranium for atomic fuel, bin Salman told an energy conference in Abu Dhabi.

The tender is expected in 2020, with US, Russian, South Korean, Chinese and French firms involved in preliminary talks about the multibillion-dollar project.

Although atomic reactors need uranium enriched to around five percent purity, the same technology can also be used to enrich the heavy metal to higher, weapons-grade levels.

Saudi Arabia has backed US President Donald Trump‘s “maximum pressure” campaign against Iran after he withdrew the US from a 2015 nuclear pact that curbed Iran’s disputed nuclear programme in exchange for sanctions relief.

In order for US companies to compete for Saudi Arabia’s project, Riyadh would normally need to sign an accord on the peaceful use of nuclear technology with Washington.

The US would like to sign this pact, known as a 123 agreement, a senior US official said at the conference.

“It’s important for us, with regards to US technology, we’re going to pursue a 123 agreement,” said the Deputy Secretary of the US Department of Energy, Dan Brouillette.

“We would like to see a 123 agreement accompany any agreement to transfer US technology or use US technology in Saudi or any other place,” he added.

Reuters has reported that progress on the discussions has been difficult because Saudi Arabia does not want to sign a deal that would rule out the possibility of enriching uranium or reprocessing spent fuel – both potential paths to creating a nuclear bomb.

International concerns about the dual technology helped lead to the 2015 nuclear deal between Iran and global powers. Under the deal, Iran can enrich uranium to around the normal level needed for commercial power production.

But in response to US sanctions imposed since Washington withdrew from the deal in May last year, Iran has been breaching the limits it imposed on its atomic activities step by step.