NATIONAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A030100010014-1
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 17
• Document Creation Date: December 20, 2016
• Document Release Date: September 21, 2006
• Sequence Number: 14
• Publication Date: May 9, 1977
• Content Type: REPORT

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Access to this document will be restricted to
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Monday May 9, 1977 CG NIDC 77-107C
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NATIONAL SECURITY INFORMATION
Unauthorized Disclosure Subject to Criminal Sanctions
DIA review(s) completed.
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National Intelligence Daily Cable for Monday, May 9, 1977.
1
ine NID a e is tor the purpose of informing
senior US officials.
CONTENTS
Page 1
ZAIRE: Military Situation
USSR: Natural Gas Prospects
BERLIN-EC: European Differences
SWEDEN: Nuclear Program
Page 3
Page 3
Page 6
Page 8
USSR-US:
Exchange Program
Page 11
NORTH AFRICA: Severe Drought
Page 12
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Syrian President Asad's visit to Moscow last
month may not have resulted in a major new arms accord, but
the Soviets have indicated the importance of the talks by re-
suming arms and spare parts shipments under old contracts. The
USSR would presumably prefer to delay signing a new military
aid package while it is seeking active participation in the
Arab-Israeli negotiating process as co-chairman of the Geneva
Middle East peace conference.
JA Syrian military mission arrived in Moscow several
days e ore Asad and held talks with Soviet officials for
nearly two weeks. Moscow failed to sign an annual military ac-
cord with the Syrians last year for the first time since 1969
and cut back on the level of arms shipments in the first months
of 1977. A renewal of deliveries indicates Moscow's wish to
surmount the frictions with Syria.
Syrian military officers who took part in the discus-
sions in Moscow have implied to US officials in Damascus that.
the talks included possible sales of MIG-25 aircraft. A Romanian
embassy officer in Damascus remarked privately earlier this
month that the Soviets had promised future deliveries to Syria
of such advanced weapons as MIG-25 aircraft.
I The Romanian also implied that new spare parts con-
tracts ad been signed. Another East European diplomat indicated
that the Soviets would not be meeting all of the Syrian request
for spare parts because Moscow wants to inhibit the possible
transfer of such items to Egypt.
Since the USSR is trying to convince both the US and
Israel that it deserves a major role in the Middle East peace
process, it would seem likely that the USSR would delay any
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signing of a new arms accord. The Soviets reportedly told Asad 25X1
that he could count on additional weaponry if the prospects for
Geneva failed, which would be consistent with previous Soviet 25X1
dealings with their arms clients in the Middle Fas i- _
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ZAIRE: Military Situation
//Zairian and Moroccan forces have renewed
their a vance on asaji, and President Mobutu is claiming
he has further evidence of Soviet support for the Katangans.
Mobutu's efforts to use these latest developments to generate
domestic and international support for his cause may be set
back, however, by reaction to stories circulating in Shaba
Region of atrocities against civilians by Zairian troops.//
Zairian and Moroccan forces, previously stalled mid-
way a ong the main route between Mutshatsha and Kasaji, renewed
their advance on Friday and reportedly have captured one small
village after heavy fighting. Zaire's government-controlled
press has trumpeted this modest progress as a "major victory."
I /Zairian President Mobutu is using an al-
lege y cap ure oviet SA-7 missile crate as his latest "proof"
of Soviet support for the invading Katangans. 25X1
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I IMobutu's efforts to attract wider support could be
o set, however, by stories local residents and missionaries
in Shaba are circulating of atrocities against civilians by
undisciplined Zairian troops. Attempting to head off expected
international reaction, Mobutu has reportedly given strict orders
to his commanders to prevent massacres and has publicly assured
Shabans of their safety. Zairian troops, however, are prone to
see every villager as a Katangan sympathizer and are often be-
yond the control of their officers.
Public reports of atrocities will put further pressure 25X1
on Mobutu's foreign supporters to cut their assistance to Zaire
and will provide more grist for his domestic critics.
I I i
USSR: Natural Gas Prospects
Soviet natural gas production will continue to ex-
pand into the 1980s and will provide some stability to the
shifting Soviet energy balance. Natural gas exports, however,
will not rival oil as an earner of hard currency.
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The growth in Soviet natural gas production will not
offset e effects of the decline in domestic oil supply that
CIA believes is likely between now and the early 1980s. DIA
estimates that the Soviets will acquire needed technology and
equipment from the West that will enable them to maintain and
possibly increase their current oil production through the mid-
1980s.
The USSR claims proven and probable reserves of 28
trillion cubic meters of natural gas, an 87-year supply at the
1976 rate of output of 321 billion cubic meters. US reserves
are barely more than 6 trillion cubic meters. While Soviet
natural gas output by 1985 could approach or exceed that of
crude oil in caloric terms, it will not be used to any great
degree to replace oil.
Most additional gas production will go to industrial
sectors that already use large amounts of gas and in which gas
is being substituted for fuels other than oil. Gas consumption
will continue to increase substantially in the chemical and
metallurgical industries, where it has been replacing coal and
coke. Household use will also increase but will not involve
gas-for-oil substitution since oil has not generally been used
directly for heating purposes.
Significant substitution of gas for oil probably will
be limited to electric power generation, in which oil-burning
thermal power plants can switch more readily to gas than to
coal. No such shift is apparently now planned for 1977 to 1980
because the Soviets intend to reduce the share of gas in total
thermal power plant fuel consumption in this period. Several
oil-burning plants in the European USSR, however, could make
the switch in the 1980s when the domestic oil shortage requires
it. Gas storage capacity near these plants would have to be ex-
panded substantially to avoid winter gas supply shortages.
I I Soviet gas will become an increasingly important ex-
port commodity but is unlikely to approach oil either in terms
of energy exported or hard currency earned. Net exports to East-
ern and Western Europe are to rise from 7 billion cubic meters
in 1975 to 41 billion cubic meters in 1980, but they will in-
crease to only 50 billion cubic meters in 1985.
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I I In order to increase gas exports more rapidly in the
mi - s, the USSR would have to purchase more large-diameter
pipe and other equipment from the West to expand its gas pipeline
system. At the same time, imports of natural gas from Iran are
increasing rapidly.
Natural gas exports in 1980 in caloric terms will
reach about one third of oil exports for that year. By 1985,
when we expect the USSR to be a net oil importer, gas shipments
will still equal only one half of the country's 1980 oil exports.
DIA estimates that Soviet recoverable oil reserves are larger
(85 billion barrels) than does CIA (35 billion barrels) and
should, if supplemented by escalated exploration and drilling,
enable the Soviets to remain oil exporters through 1985.
L Hard-currency receipts from sales of natural gas
s ou rise from $200 million in 1975 to approximately $1.4
billion in 1980 and $2.0 billion in 1985. Net earnings will be
lower. Hard-currency payments for Iranian gas will reduce earn-
ings, as will gas-for-pipe compensation deals with Western Eu-
rope, which require several years of gas deliveries before hard-
currency earnings begin. Earnings from oil exports are likely
to be about $2.7 billion in 1980.
Exports of liquefied natural gas could add $2 billion
1 o lion to annual hard-currency earnings, perhaps by the
late 1980s, under two proposed East-West cooperative ventures.
In both proposals, under negotiation since 1972, Soviet gas
would be shipped to the West in return for Western assistance
in developing Soviet liquefied natural gas facilities.
I The proposed North Star project, in which gas from
western Jiberia would be shipped to Western Europe and the US,
has been held up because of disagreement over pricing and pos-
sible US import restrictions on liquefied natural gas. Negotia-
tions on a similar venture involving gas exports from deposits
in eastern Siberia near Yakutsk to Japan and the US west coast
are proceeding slowly. US and Japanese participants will not
proceed with the project until proven gas reserves are regarded
as sufficient to support contemplated shipments over a 20-year
period. Even if development were to begin next year, shipments
would not start for at least a decade.
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/Soviet gas production capacity will continue to
grow rape y but not without difficulty. The key to growth will
be the pipeline capacity needed to carry gas from the huge new
fields in western Siberia to the western USSR and Europe. The
main bottleneck will be the installation of high-capacity com-
pressors. Most of these are imported from the West and have
long lead-times for negotiation, manufacture, and delivery.//
BERLIN-EC: European Differences
I British, French, and West German leaders--who will
e z President Carter today to discuss Berlin--view the
city as a point of leverage to further their own national in-
terests as much as a bellwether of East-West relations.
L The west's recent problems with the Soviets over Ber-
lin have involved West Berlin's ties to the EC because Moscow
refuses to acknowledge that EC treaties apply in West Berlin.
--The Soviets protest the role West Berlin is to have in
the directly elected European Parliament.
--EC negotiations with the Soviets on fishing rights in
newly established 200-nautical-mile zones are stalled,
partly because the Soviets will not recognize that the
treaty includes Berlin.
--The Soviets object to including Berlin in an economic
cooperation treaty involving West European and East
European countries.
Faced with these issues, the West Germans, French,
and British are pursuing their own distinct objectives.
I IWest Germany wants above all to reinforce West Ber-
lin's ties to West Germany and to Western Europe. EC agreements
with non-EC countries normally include a clause implicitly ex-
tending the agreement to Berlin, but West Germany argues that
any agreement between the EC and East European countries must
do so explicitly.
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Otherwise, the West Germans say, the EC will have
laq.Luuu 1-1 disagree" with the Soviets on this point and will
have no legal basis for applying such an agreement in Berlin.
I IWest Germany believes that the USSR will ultimately
accept erlin's inclusion in a fishing agreement because the
accord is in the Soviets' economic interest--and that this
would be precedent for a future EC agreement with the East.
I France backs West Germany on taking a hard line on
Berlin vis-a-vis the East while accommodating the Soviets on
broader East-West matters, including the Belgrade review of
the Conference on Security and Cooperation in Europe.
L The French have stopped short of giving full support
to Wes ermany's tactics in EC negotiations involving Berlin,
however--a reminder that Berlin is a card for France to play
against the West Germans as well as against the East.
E France also emphasizes its role as an occupying power
in Berlin because that is one of the few remaining political
symbols of great-power status.
In discussions about Berlin, France presses its argu-
ment that East-West issues focusing on Europe belong first in
a European forum rather than in NATO. The French thus prefer
that consultations with EC Commission experts on Berlin take
place in Brussels--among West European missions there and the
US mission to the EC--rather than at meetings of West Germany
and the Western powers occupying Berlin. Similarly, the French
have proposed that NATO military studies be provided to EC gov-
ernments so that they can adequately address--outside NATO--the
security implications of Soviet fishing interests in EC waters.
The UK's approach to the fishing agreement largely
re ec economic concerns, and the British seem unwilling to
press the Soviets on any aspect of the Berlin problem. They
have vigorously opposed holding an EC-Soviet fishing agreement
"hostage" to Soviet acceptance of the inclusion of Berlin, be-
cause the agreement is important for protecting the British
fishing industry. The British argue that West Germany can af-
ford to be tough on the issue because its profits from trade
with East Germany are not in jeopardy.
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I IThe other allies stress that it is precisely where
e soviets have real economic interests--for example, in a
fishing agreement--that they should be pushed to acknowledge
Berlin's EC role. The UK's partners argue that the alternative
approadh--focusing on Berlin's participation in a directly
elected European Parliament--risks drawing the West into dis-
cussions with the Soviets about the European
integration.
SWEDEN: Nuclear Program
The Swedish parliament has enacted legislation com-
pe zng the nuclear power industry to inform the government of
its plan for the reprocessing and storage of spent nuclear
waste before new reactors can be put into operation. The de-
termination of the acceptability of such a plan will rest with
Prime Minister FaZZdin's cabinet, which is deeply divided
along political lines on the merits of Sweden's nuclear policy.
Strict interpretation of the new legislation could preclude
any further development of nuclear power in Sweden.
Accused of having betrayed his ideals by not abol-
ishing the nuclear program completely, Falldin pressed hard
for the new legislation, terming it "an instrument for taking
Sweden out of the nuclear society." His energy minister has
said the bill will require the nuclear industry to demonstrate
that nuclear waste can be kept apart from all life for long
periods.
I I Falldin's Center Party--the largest in the govern-
ment coalition--took a hard stand on dismantling the nuclear
program before the September election, which unseated the So-
cial Democrats. In order to form a coalition excluding the So-
cial Democrats, however, Falldin had to compromise with the
Liberal and Conservative parties, which generally favor nuclear
power development.
Under the terms of the compromise, the five opera-
tional nuclear reactors will remain in use, but additional re-
actors can become operational only if strict environmental and
safety standards are met. A sixth reactor has been allowed to
begin operating on a trial basis.
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Permission to operate new reactors will be given
only if the nuclear industry can:
--Produce agreements that meet the need for storing used
fuel in a satisfactory way.
--Demonstrate how and where a completely safe final stor-
age of highly radioactive waste can take place.
--Present legally binding reprocessing agreements that
guarantee satisfactory treatment of spent fuel.
At stake are four nuclear reactors now under con-
struction and two in the planning stage. The six nuclear
plants now in operation have a total capacity of 3,760 mega-
watts. Successful operation of all 12 stations is needed to
achieve the parliament's goal of reducing the demand for oil
from 65 percent of energy consumption to 60 percent by 1985.
Spokesmen for the nuclear industry have expressed
guarded optimism that in time the bill's provisions can be
met, but they are apprehensive that the law gives the cabinet
unchecked power to block the operation of future reactors. To
meet the disposal standards, the partially state-owned nuclear
manufacturing conglomerate is developing a new method for the
safe containment and storage of nuclear waste.
A test of Falldin's determination to halt nuclear
expansion will come in October, when the cabinet must decide
whether to permit the country's sixth reactor to continue in
operation.
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USSR-US: Exchange Program
//The USSR and the US have an active scientific
exchange program on two major civilian applications of super-
conducting magnets--development of more efficient electrical
generators and of controlled thermonuclear power reactors. Su-
perconducting magnets also have potential military applications
as components for particle beam and laser weapon systems or to
create high-power, quiet propulsion systems for submarines. A
new Soviet proposal suggests Soviet interest in learning this
technology through the exchange program, but the US has only
provided end products.//
//Superconducting magnets can generate higher mag-
netic ie s and operate more economically than conventional
magnets. By increasing the power density of electric generators
and motors, they allow the development of compact sources of
electrical power. The US has more advanced design and fabrica-
tion capabilities for such magnets than does the USSR.//
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]//Ye. P. Velikhov, an official of the Soviet Kur-
chatov Institute of Atomic Energy, has proposed that the US de-
sign the superconducting magnet needed for the Soviets' large
experimental controlled-fusion reactor, the Tokomak-10TH. He
said the USSR would then build the magnets to US specifications
using Soviet personnel, equipment, and materials. In this way
the technological aspects of superconducting magnet construc-
tion--such as coil winding and component fabrication--would be
transferred from US to Soviet technicians.//
//The US has agreed to lend the Soviets a super-
con uc-ing magnet, but the Soviets probably will not learn any-
thing from the magnet that they could not have learned from
available unclassified literature. The magnet, which is to be
sent to the USSR in late June, will be used in the Soviets'
civilian program in exchange for permitting US scientists to
conduct experiments that could only be done at the Soviet fa-
cility. The arrangement does not include teaching construction
techniques.//
//The magnet being loaned is the most advanced
ever ui in the US, and its construction required develop-
ment of some new techniques that are important to US military
research and development efforts. The magnet itself is not of
direct military interest. The results of experiments in civil-
ian programs for generating electrical power using high magnet
fields provided by this magnet, however, will be of interest
for military development programs in both countries.
NORTH AFRICA: Severe Drought
A severe drought is causing a sharp drop in grain
yields in Algeria, Morocco, and Tunisia. The drought has wors-
ened existing agricultural difficulties caused by neglect and
the diversion of resources into mining and manufacturing. This
will have serious consequences for economic development in the
Mahgreb, as development funds will have to be diverted to pur-
chases of 3 million tons or more of grain, compared with about
2 million tons last year.
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In Algeria, the US agricultural attache is estimating
that the wheat crop is down some 30 percent, yielding 1.4 million
tons, compared with 2 million tons in the last crop year. To
meet domestic requirements, Algeria will have to import at least
1 million tons of grain this year--an increase over last year of
200,000 to 300,000 tons.
I I Morocco's wheat crop is likely to fall some 15 percent
rom e already depressed level of 2.1 million tons in the
1975-76 season. Imports will probably rise 20 percent from the
1 million tons imported last year, straining Morocco's port and
distribution facilities and adding to its already serious
balance-of-payments problems. Large government subsidies will
also be needed to keep bread prices down, upsetting government-
sponsored development plans and slowing economic growth.
In Tunisia, the drought has caused tremendous damage
to the wheat crop, which hit an all time high of 1.3 million
tons in the 1974-75 crop year. Output fell to about 800,000
tons in the following year and is likely to reach 600,000 tons,
at best, this season. Domestic requirements are probably in
the range of 1.4 million to 1.6 million tons. Imports needed
to make up the difference would exceed the capacity of Tunisia's
port and distribution system.
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