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EA-00-200 - CE Nuclear Power, LLC

December 8, 2000

EA-00-200

Richard Gerwels
Plant Manager
CE Nuclear Power, LLC
Hematite Fuel Manufacturing
3300 State Road P
Festus, MO 63028

SUBJECT:

NOTICE OF VIOLATION
(NRC Inspection Report No. 070-00036/2000004(DNMS))

Dear Mr. Gerwels:

This refers to the routine inspection conducted on August 23, 2000, at the Hematite Fuel Manufacturing (Hematite) facility, Festus, Missouri and the September 28, 2000, telephone conversation between personnel at the Hematite facility and the NRC. The inspection was conducted to review the material control and accounting program, and to review the circumstances surrounding an improper shipment of natural uranium oxide and gadolinium pellets to Sweden. This event was reported to the NRC on June 16, 2000. The inspection report was sent to you in a September 8, 2000, letter. During the September 28, 2000, telephone conversation, the Hematite facility identified additional improper shipments of material.

In the letter transmitting the inspection report, we provided you the opportunity to address the apparent violations identified in the report by either attending a predecisional enforcement conference or by providing a written response before we made our final enforcement decision. In a letter dated October 6, 2000, you provided a response to the apparent violations. In this response you provided the root cause of the violations, the immediate and long term corrective actions taken, and the date when full compliance will be achieved.

Based on the information developed during the inspection, information provided during the September 28, 2000, telephone conversation, and the information that you provided in your October 6, 2000, response to the inspection report, the NRC has determined that violations of NRC requirements occurred. These violations are cited in the enclosed Notice of Violation (Notice) and the circumstances surrounding them are described below and in detail in the subject inspection report. The violations involve the failure to: (1) transport radioactive material in accordance with the NRC and Department of Transportation requirements; and (2) complete a Nuclear Material Transaction Report no later than close of business the next working day following the export of greater than 1.0 kilogram of uranium.

On May 22, 2000, the Hematite facility shipped what it believed to be an empty ABB-2901 package to a sister company in Sweden. However, on June 15, 2000, the Hematite facility was notified by its sister company that the package contained 37.4 kilograms of natural uranium/gadolinium pellets in "shoeboxes"⁽¹⁾ inside the ABB-2901 package. Therefore, on May 22, 2000, the Hematite facility inadvertently shipped 37.4 kilograms of natural uranium/gadolinium pellets and shipping papers were not prepared; the shipping container (ABB-2901) was not properly marked, labeled, or classified; the licensee did not perform surveys to determine the external radiation levels of the package; and the Nuclear Material Transaction Report was not completed by close of business the next working day following the shipment. The report was completed on August 9, 2000.

During the September 28, 2000, telephone conversation, the Hematite facility informed NRC of additional improper shipments of radioactive material. Specifically, on August 14, 2000, the Hematite facility shipped what it believed to be empty ABB-2901 packages to its sister company in Sweden. However, on September 25, 2000, the Hematite facility was notified by its sister company that a single enriched pellet (less than 1 gram uranium-235 per pellet) was found in each of two ABB-2901 containers sent to Sweden. These containers were not properly marked, the licensee did not certify the packages as being acceptable for transportation, and the licensee did not perform surveys to determine the external radiation levels of the packages.

On two separate occasions the Hematite facility shipped packages to Sweden without being properly prepared for transport. This failure is significant since the information about packages containing hazardous materials is essential for safe handling by individuals transporting and receiving the material and for individuals responding to accidents involving the packages. In addition, the quantity of material in the May shipment was sufficient to require a Nuclear Material Transaction Report, which was not completed until August 9, 2000 (79 days after the shipment). Therefore, in accordance with the "General Statement of Policy and Procedure for NRC Enforcement Actions" (Enforcement Policy) NUREG 1600, May 1, 2000, these violations are categorized collectively as a Severity Level III problem.

In accordance with the Enforcement Policy, a base civil penalty in the amount of $13,750 is considered for a Severity Level III problem. Because your facility has not been the subject of escalated enforcement actions within the last two years, the NRC considered whether credit was warranted for Corrective Action in accordance with the civil penalty assessment process in Section VI.C.2 of the Enforcement Policy. Credit was given for the corrective actions that included: (1) modifying the procedure for handling the drums involved; and (2) conducting training sessions with plant staff to emphasize procedural compliance, management's responsibility in ensuring compliance with procedures, and consequences for failing to comply with procedures. Additional corrective actions as a result of the second incident included: (1) development of an enhanced traveler system to guide and document the preparation of empty ABB-2901 shipping containers; (2) reopening all drums that were processed with the revised procedure; and (3) improving the inspection process for empty drums by requiring the complete removal of corrugated trays from "shoeboxes" prior to declaring the drum empty.

Therefore, to encourage comprehensive correction of violations, and in recognition of the absence of previous escalated enforcement action, I have been authorized, after consultation with the Director, Office of Enforcement, not to propose a civil penalty in this case. However, significant violations in the future could result in a civil penalty. In addition, issuance of this Severity Level III problem constitutes escalated enforcement action, that may subject you to increased inspection effort.

In accordance with 10 CFR 2.790 of the NRC's "Rules of Practice," a copy of this letter, its enclosure, and your response, if you choose to provide one, will be made available electronically for public inspection in the NRC Public Document Room or from the Publicly Available Records (PARS) component of NRC's document system (ADAMS). ADAMS is accessible from the NRC Web site at the Public NRC Library.

		Sincerely,
		/RA/
		J. E. Dyer Regional Administrator

Docket No. 070-00036
License No. SNM-33

Enclosure: Notice of Violation

NOTICE OF VIOLATION
CE Nuclear Power LLC Festus, Missouri		Docket No. 070-00036 License No. SNM-33 EA-00-200

During an NRC inspection completed on August 23, 2000, and the September 28, 2000, telephone conversation between CE Nuclear Power and the NRC, violations of NRC requirements were identified. In accordance with the "General Statement of Policy and Procedure for NRC Enforcement Actions," NUREG-1600, May 1, 2000, the violations are listed below:

1.	10 CFR 71.5(a) requires that a licensee who transports licensed material outside the site of usage, as specified in the NRC license, or where transport is on public highways, or who delivers licensed material to a carrier for transport, comply with the applicable requirements of the Department of Transportation (DOT) regulations appropriate to the mode of transport contained in 49 CFR parts 170 through 189. Pursuant to 49 CFR 172.101, radioactive material is classified as hazardous material. 49 CFR 171.2(a) prohibits any person from offering hazardous material for transportation unless, among other requirements, the hazardous material is properly classified, described, marked, and labeled as required or authorized under the Hazardous Material Regulations (49 CFR parts 171-177). This includes: describing the hazardous material on the shipping paper; marking the package with the proper shipping name and identification number; appropriately labeling the package; marking the package as "Radioactive"; certifying the package as being acceptable for transportation by having a notice enclosed in or on the package, included with the packing list, or otherwise forwarded with the package; and insuring by examination or appropriate tests that the external radiation levels are within the allowable limits. Contrary to the above, on May 22 and August 14, 2000, the licensee shipped uranium/gadolinium pellets and enriched uranium pellets, respectively, to a location in Barseback Kraft, Sweden and failed to properly classify, describe, mark, and label packages containing radioactive material as follows:
	a.	On May 22, 2000, the licensee offered to a carrier for transport 37.4 kilograms of natural uranium/gadolinium pellets, a hazardous material, and the licensee failed to: (1) describe the hazardous material on the shipping paper that accompanied the shipment; (2) mark the package with the proper shipping name and identification number; (3) label the package with Radioactive Yellow-II labels; and (4) perform surveys to determine the external radiation levels of the package.
	b.	On August 14, 2000, the licensee offered to a carrier for transport two packages, each containing an enriched uranium pellet (less than 1 gram uranium-235 per pellet), a hazardous material, and the licensee failed to: mark the outside of the inner packaging or the outside of the packaging itself with the marking "Radioactive"; certify the package as being acceptable for transportation by having a notice enclosed in or on the package, included with the packing list, or otherwise forwarded with the package; and, perform surveys to determine the external radiation levels of the packages.
2.	10 CFR 40.64(a) requires each specific licensee who transfers, receives, or adjusts the inventory, in any manner, of uranium or thorium source material of foreign origin by 1.0 kilogram or more, or who imports or exports 1.0 kilogram of uranium or thorium source material of any origin complete a Nuclear Material Transaction Report in accordance with the instructions in NUREG/BR-0006 and Nuclear Materials Safety and Safeguards (NMSS) Report D-24 "Personal computer Data Input for NRC Licensees," no later than the close of business the next working day. Contrary to the above, on May 22, 2000, the licensee exported 37.4 kilograms of natural uranium pellets to Sweden and failed to complete a Nuclear Material Transaction Report until August 9, 2000. (01023)

This is a Severity Level III problem (Supplements V and VI).

The NRC has concluded that information regarding the reason for the violations, the corrective actions taken and planned to correct the violations and prevent recurrence, and the date when full compliance will be achieved, is already adequately addressed on the docket in your October 6, 2000, letter. However, you are required to submit a written statement or explanation pursuant to 10 CFR 2.201 if the description therein does not accurately reflect your corrective actions or your position. In that case, or if you choose to respond, clearly mark your response as a "Reply to a Notice of Violation," and send it to the U.S. Nuclear Regulatory Commission, ATTN: Document Control Desk, Washington, DC 20555-0001 with a copy to the Regional Administrator, Region III, 801 Warrenville Road, Lisle, Illinois 60532-4351 within 30 days of the date of the letter transmitting this Notice of Violation (Notice).

If you contest this enforcement action, you should also provide a copy of your response, with the basis for your denial, to the Director, Office of Enforcement, United States Nuclear Regulatory Commission, Washington, DC 20555-0001.

If you choose to respond, your response will be made available electronically for public inspection in the NRC Public Document Room or from the Publicly Available Records (PARS) component of NRC's document system (ADAMS). ADAMS is accessible from the NRC Web site at the Public NRC Library. Therefore, to the extent possible, the response should not include any personal privacy, proprietary, or safeguards information so that it can be made available to the Public without redaction.

In accordance with 10 CFR 19.11, you may be required to post this Notice within two working days.

Dated this 8^th day of December 2000.

¹ Steel boxes containing steel corrugated trays.

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