U.S. Firm May Build Russian Nuclear Plant : Energy: General Atomics agrees to develop a facility that would burn weapons-grade plutonium to produce electricity.

A San Diego firm has signed a joint venture agreement with Russia’s Ministry of Atomic Energy to develop an advanced nuclear reactor in Russia that would burn weapons-grade plutonium to produce electricity, the firm announced Friday.

The agreement by General Atomics creates the first joint venture by a U.S. company and Russia to find a private-sector solution to Russia’s plutonium oversupply problem. That nation is seeking to dispose of its massive stockpile of plutonium without depriving itself of the electrical power produced by its nuclear weapons complex and the many jobs in its nuclear establishment.

Privately held General Atomics is aiming for leadership of the world market for commercial nuclear power--a moribund industry for the past decade that could be revived with new nuclear reactor designs, company executives said.

“We would be the leader in the design and systems integration of these reactors,” said Walter Simon, General Atomics senior vice president. By some estimates, the market for such reactors could reach $50 billion to $150 billion over the next 20 years.

Meanwhile, the Energy Department announced Friday that an agreement to end Russia’s current plutonium production was ready for signing by Vice President Al Gore and Russian Prime Minister Victor Chernomyrdin.

The agreement provides for study of how to replace the power produced by weapons reactors in Tomsk and Kranoyarsk. General Atomics hopes the study, along with parallel efforts at the Defense Department, will lead the U.S. government to endorse the General Atomics plan for a new reactor.

General Atomics, which employs 1,400 people in San Diego and another 1,400 at a subsidiary in Germany, has long been in the nuclear business. It has produced 70 reactors, mainly for nuclear research.

Unlike any existing commercial or military reactor, the General Atomics design relies on helium to cool the reactor core and drive a high-speed turbine. It is touted as a major advance in efficiency and safety because the reactor would be self-cooling in an emergency and produce little waste heat.

“It is the consensus of experts that this is a meltdown-proof machine,” Simon said.

The reactor would burn plutonium pellets encased in graphite or ceramic, which would moderate the nuclear reaction and prevent a runaway chain reaction.

But the joint venture faces major financial hurdles. A large portion must be underwritten by the U.S. government, but the Energy Department has made no commitments.

So far, General Atomics has underwritten the effort.

General Atomics’ Simon estimates the reactor would cost $525 million, cheap by nuclear standards, because of Russia’s low construction costs.

The Energy Department is still considering whether it favors burning or permanently burying about 50 tons of surplus U.S. plutonium.

Energy Secretary Hazel O’Leary is said to be opposed to burning any plutonium in reactors.