French President Nicolas Sarkozy completed a sweeping tour of the Middle East last week, taking in several Gulf nations in a three-day visit. It was his third trip to the region in as many weeks, and once again, business was high on the agenda. By the time he left on January 17, Sarkozy had signed an agreement with the United Arab Emirates (UAE) that will see the building of two 1,600MW nuclear reactors by French firms over the next decade. For its part, the UAE has already applied to the International Atomic Energy Agency (IAEA) to supervise any potential civil nuclear activity.
Sarkozy is not shy in stating his policy: he believes Arab Muslim nations have as much right to civil nuclear power as the West, and he knows that France - with its 50 nuclear reactors and wealth of industry knowledge - is exceptionally well-placed to take advantage of future growth in the nuclear market. Where the US has faltered - uncertain if the region is sufficiently stable - France is proceeding boldly, with the UAE agreement joining recently signed deals with Algeria and Libya.
The agreements mark a significant resurgence of French interest, and indeed ambition, in the Middle East. Nuclear cooperation in the UAE is set to go hand-in-hand with military partnership, with plans announced for the establishment of a permanent French base in the UAE to include around 500 soldiers, sailors and airmen, alongside a branch of the St Cyr military academy in Qatar. Meanwhile, a visit to Saudi Arabia on January 16 saw Sarkozy make a convincing bid for a $14bn plus border surveillance project, among total contracts with the kingdom estimated at a potential $60bn.
If Sarkozy's motives in the region are transparent, the UAE's are less easy to fathom. Despite abundant natural resources - or perhaps because of them - the emirates are increasingly keen to secure their independence from energy in the future. This means moving away from a reliance on oil and gas, and toward renewable and non-fossil fuel alternatives. Why the concern when sitting on so much cheap, abundant energy (nuclear remains significantly more expensive than either oil or gas)? Geopolitical concerns are one factor: the UAE sits along the Strait of Hormuz, a thin channel shared with Iran, through which much of the world's oil passes. It has long been seen as a future clash point by strategists across the globe. Nuclear power would reduce the immediate effect of a future blockade on the domestic UAE economy. Moreover, Iran's well-documented nuclear programme has increased the desire among nearby Arab states to develop their own.
Probably more important than geopolitics, though, is sustainability. The UAE currently has the third highest greenhouse emissions per head in the world - 34.1 tonnes, placing them just behind Qatar and Kuwait, according to 2004 figures. By comparison, the figure for the US is 20.6. There is an increasing realisation in the Gulf that oil and gas rich nations must, at the very least, be seen to do their part in reducing consumption. Plans recently announced by Abu Dhabi to build "the world's first carbon neutral city" by 2009 at Masdar are a major step toward achieving this goal, and it seems the UAE is hoping to become a world leader in this area. President Bush - also on a visit to the region - was this week treated to a preview of Masdar, including newly unveiled designs for a $15bn, 500MW hydrogen plant, to be powered by natural gas. The plant will use carbon capture technology to store CO2 gas in oil wells, reducing emissions and boosting oil output. The scheme will be carried out in conjunction with BP and Rio Tinto, the former of which had plans for a similar project at Peterhead in the UK thwarted by the British government.
Nuclear power remains the best bet in the medium term: costs per megawatt hour, though greater than oil or gas, are nonetheless still less than half those for renewable energy. France is likely to reap a major harvest in civil nuclear development in the next few years, as more nations come to view nuclear - until recently so unpopular - as once again an attractive alternative. French energy giants Suez, Total and Areva are all set to benefit from new contracts - including in the UK - with the only potential hurdle coming in the shape of France's domestic nuclear safety authority. The Nuclear Safety Authority (NSA) has the power to halt any projects involving French companies if it believes the correct legal and regulatory developments are not in place in a given country. André-Claude Lacoste, chairman of the NSA, recently said that attaining such a standard in countries like the UAE may take as long as 10 years.
