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The nomination comes as questions swirl over whether Iraq has weapons of mass destruction, the primary justification for the US-led war on Iraq.
Washington and London insist that deposed Iraqi leader Saddam Hussein had these weapons, but to date no such weapons have been found in Iraq.
Kay, 63, will be based in Iraq and "will be in charge of refining the overall approach for the search for Iraq's weapons of mass destruction," the CIA said in a statement
He will receive "direct support" from the Defense Department's Iraq Survey Group, the CIA said.
"David Kay's experience and background make him the ideal person for this new role," CIA Director George Tenet said in the statement. "His understanding of the history of the Iraqi programs and knowledge of past Iraqi efforts to hide WMD will be of inestimable help in determining the current status of Saddam Hussein's illicit weapons."
Working for the International Atomic Energy Agency (IAEA) and the former United Nations Special Commission (UNSCOM), Kay served as chief nuclear weapons inspector on three inspection missions in Iraq between 1991 and 1992.
He has also served as a senior fellow at the Potomac Institute think tank in Arlington, Virginia.
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