British Telegraph 1985
SECURITY BAN ON DEAL WITH RUSSIA
CUSTOMS INTERVENE TO STOP CARGO
March 30, 1985.
By JOHN PETTY, Commercial Correspondent, and
DAVID SHEARS in Washington
Britain has succeeded in blocking, at the last moment, the shipment to Russia of sophisticated equipment used in making material for missile nose-cones, a senior American official disclosed yesterday. He said a Soviet ship was actually entering a British port to pick up the shipment when the Government intervened.
The shipment of Scottish made equipment would have given Russia vital secrets to improve warhead-carrying rockets. The vacuum induction furnaces from Consarc Engineering of North Road, Bellshill, Glasgow, would have enabled Russia to make carbon-carbon, a lightweight new material with immense heat-resisting qualities.
It is used to coat rocket cones and is also used in rocket nozzles. Warheads on Russian missiles are thought to be less reliable because they do not have such good heat resistance when re-entering the Earth's atmosphere. This can cause them to wobble and go off target.
A loophole in security measures nearly let the consignment through. Furnaces specifically designed to produce the material are on the banned list.
The Consarc furnaces did not come into this category, but at the last minute, with the Soviet ship Mekhanik Yevgrafov already in British waters to collect the equipment, it was realized that they could easily be adapted.
The contract had been won openly and with government approval. It was cleared by the Trade and Industry Department. Then came the alert, and an inter-departmental government committee took a new look at it and ordered Customs and Excise to intervene.
It is believed that the Cabinet took the decision to revoke the export license.
According to the American source, the incident occurred within the last month. It was the latest in a series of Allied seizures of western strategic goods bound for Russia in recent years.
Consarc Engineering is a subsidiary of the Consarc Corporation of Rancocas, New Jersey, which in turn is a subsidiary of Inductotherm Corporation, also of Rancocas.
Consarc will be able to seek compensation from Government or through the Export Credits Guarantee Department, the State sponsored insurance organization for exporters. It was stressed that Consarc had done nothing wrong in accepting the order and arranging to ship it.
Carbon technology is a field in which Britain leads the world and in which Russia lags behind the West.
The Government is conducting an "urgent review" of security arrangements to prevent anything else slipping through the net. Exporters are being consulted to make sure there are no more loopholes to be plugged.
An international committee known as CoCom meets regularly to draw up lists of strategically sensitive materials and equipment which may not be exported to Communist countries. It consists of members of NATO and a few other nations, such as Japan.
Computer equipment has been featured strongly in the list of goods kept out of the Russian bloc. There was a big row between Britain and America in 1982 over the shipment of Scottish made turbines by John Brown Engineering to Russia.
The current review of items on the CoCom proscribed list includes energy cells, lasers, microwave equipment, electronic vacuum tubes, electromagnetic wave absorbers, acoustic wave devices, magnetic metals, hydraulic fluids, boron compounds, fluorocarbon materials and synthetic rubbers.
The "proscribed destinations" are chiefly Bulgaria, China, Czechoslovakia, East Germany, Hungary, Poland, Rumania and the Soviet Union.
Inexplicably, the equipment involved in the proposed British shipment was not on the CoCom list of embargoed strategic goods. That is why the shipment was at first routinely approved by the Department of Trade, the American source said. But then the matter was considered at a higher level and subsequently debarred by an inter-departmental decision.
Customs offices intervened in Hull just as the Soviet ship was entering the port to pick up the shipment, the Washington official said.
American experts say that Russia lacks this technology at present, and Soviet missile warheads are therefore less capable than American ones of resisting the heat generated by re-entry into the earth's atmosphere.
One official explained: "If you have a nose-cone that suffers damage from the heat, it will wobble in flight and be less accurate."
Mr. Henry Rowan, president of Inductotherm, confirmed that the planned shipment had been halted, but disputed the American official's claim that Russia lacked similar equipment.
Other industry sources said they believed that the Soviet Union had already acquired such material from Sweden, France and other sources, including possibly Britain.
Mr. Rowan said his firm had been given permission to export the equipment to Russia, but was suddenly notified on February 8 in a Telex message from the Department of Trade that the rules had been changed and the export deal prohibited.
Mr. Rowan said he believed that Russia already possessed both induction furnaces and isostatic presses. Of the two kinds of equipment, he believed that the presses were more strategically sensitive than the furnaces.
More articles appeared after the press release
SCOTS EXPORT COUP SUNK BY RED ALERT
A Scots firm may have been "duped" into helping Russians with nuclear missile technology.
For special Scottish - built furnaces could have produced carbon - carbon, a substance used to coat rocket warheads.
Only a last-minute move by Customs and Excise officials prevented the multi-million pound consignment from Consarc Engineering, of Bellshill, Lanarkshire, being loaded on to a Soviet ship at Hull last month.
And as news of the incident leaked out last night, Labour MP Jimmy Hamilton, who lives in the town, said he would be demanding an inquiry into the order.
He explained: "This company has an excellent reputation and I believe they may have been duped by the Russians."
The lightweight material produced from the ovens has immense heat - resisting properties.
And Soviet missiles are thought to be less accurate than their Western counterparts because their heat resistance is not so good.
Consarc won the contract openly, and it was originally cleared by the Department of Trade.
But an inter-departmental Government committee then took a further look at the order and decided it was "not in the national interest."
The company, which may now be compensated under exports-insurance arrangements, is a subsidiary of the Consarc Corporation of New Jersey.
Other headlines in the British Press repeated the same story with a different slant.
- WHITEHALL ACT TOO LATE OVER SOVIET CONTRACT
- MIX-UP OVER "STRATEGIC" EQUIPMENT
- SHIP LEAVES UNDER THE COVER OF DARKNESS
- EXPORT BAN UNDER FIRE
- FIRM'S ORDER BANNED
- SLIP-UP OVER SOVIET DEAL
- BANNED CARGO IS IN RUSSIA