EA-00-297 - Bayou Inspection Services, Inc.

April 2, 2001

EA-00-297

Mr. Willie Tezeno, President
Bayou Inspection Services, Inc.
P.O. Box 369
Amelia, Louisiana 70340-0396

SUBJECT:

NOTICE OF VIOLATION AND PROPOSED IMPOSITION OF CIVIL PENALTY – $5,500 (NRC Inspection Report No. 150-00017/00-02 & Investigation Report No. 4-2000-037)

Dear Mr. Tezeno:

This refers to the NRC inspection and investigation of Bayou Inspection Services, Inc. (Bayou) industrial radiography operations in offshore waters, i.e., areas in the Gulf of Mexico that fall within the NRC's jurisdiction. During a final telephonic exit briefing with you and your staff on January 18, 2001, the NRC informed you that four apparent violations had been identified and were being considered for escalated enforcement action. We also informed you that we were concerned that two of the apparent violations were committed willfully. The apparent violations were described in an inspection report issued January 25, 2001. On February 9, 2001, a closed, predecisional enforcement conference was conducted in the NRC's Arlington, Texas office with you and Bayou's radiation safety officer (RSO) to discuss the apparent violations, their significance, their root causes, and your corrective actions.

Based on the information developed during the inspection and investigation, and the information that you provided during the conference, the NRC has determined that four violations of NRC requirements occurred. These violations are cited in the enclosed Notice of Violation and Proposed Imposition of Civil Penalty (Notice), and include: (1) a willful failure to notify the NRC prior to conducting industrial radiography operations in offshore waters; (2) a willful failure to obtain an exemption from the NRC for the use of pipeliner radiography devices in offshore waters; (3) a failure to perform an exposure evaluation to assess the radiation dose to the extremities of radiographers using pipeliner radiography devices; and (4) a failure to perform an exposure evaluation to assess the radiation dose to individual members of the public from the use of these devices.

Our basis for characterizing the first two violations as willful was explained to you in the information provided with the inspection report. None of the information provided at the conference changed this. In summary, the NRC's investigation found that a former RSO for Bayou received a memorandum from the state of Louisiana in 1998 that described requirements for notifying the NRC of planned industrial radiography activities in NRC jurisdiction, and stated that certain pipeliner radiography devices did not meet NRC requirements and could not be used without obtaining an exemption from the NRC. The investigation found that the former RSO initiated steps in September 1998 to notify the NRC of Bayou's intent to conduct activities in NRC jurisdiction, but never completed them.

Since the two willful violations resulted from the same root cause, the NRC is treating these as a single "problem" for the purpose of assigning a severity level and considering a civil penalty. The NRC considered the following factors in assigning the severity level for this problem: the significance of not notifying the NRC of activities occurring in its jurisdiction; the significance of using radiographic exposure devices that did not comply with NRC requirements; the fact that Bayou had obtained an exemption from the state of Louisiana for the use of radiographic exposure devices that did not comply with the state's requirements; the fact that Bayou was using the devices in accordance with the exemption approved by the State of Louisiana; the fact that the violations were caused by careless disregard on the part of the former RSO in 1998; and the fact that no current Bayou employees were implicated in wrongdoing by the NRC's investigation. Thus, in consideration of all of the circumstances, the NRC has classified these violations as a Severity Level III problem in accordance with the "General Statement of Policy and Procedure for NRC Enforcement Actions" (Enforcement Policy), NUREG-1600, May 1, 2000.

In accordance with the Enforcement Policy, a civil penalty with a base value of $5,500 is considered for each Severity Level III problem. Because the violations involved in this problem were willful, we considered whether credit was warranted for Identification and Corrective Action in accordance with the civil penalty assessment process in Section VI.C.2 of the Enforcement Policy. No credit was warranted for identification, because the violations were identified by the NRC's inspection and investigation. However, credit was warranted for corrective action since you suspended pipeliner radiography operations in offshore waters on the day of the NRC inspection, filed an NRC Form 241 with the NRC a day later, and submitted an exemption request on August 28, 2000. This results in the assessment of a civil penalty at the base value of $5,500 for this Severity Level III problem.

To emphasize the importance of strict compliance with NRC requirements associated with radiography operations, and the significance that the NRC attaches to violations committed willfully, I have been authorized, after consultation with the Director, Office of Enforcement, to issue the enclosed Notice of Violation and Proposed Imposition of Civil Penalty (Notice) in the amount of $5,500 for the Severity Level III problem described above and in the Notice. In addition, issuance of this Notice constitutes escalated enforcement action which may subject you to increased inspection effort.

Bayou's failures to fully evaluate radiation exposures to radiography personnel and non-radiation workers on lay barges have been classified at Severity Level IV since neither posed a substantial potential for overexposures to occur. Severity Level IV violations are not considered for civil penalties.

You are required to respond to this letter and should follow the instructions specified in the enclosed Notice when preparing your response. The NRC will use your response, in part, to determine whether further enforcement action is necessary to ensure compliance with regulatory requirements.

In accordance with 10 CFR 2.790 of the NRC's "Rules of Practice," a copy of this letter, its enclosure, and 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.

		Sincerely,
		/RA/
		Ellis W. Merschoff Regional Administrator

Docket No. 150-00017
General License Pursuant to 10 CFR 150.20

Enclosure:   Notice of Violation and Proposed Imposition of Civil Penalty

cc w/Enclosure:  State of Louisiana

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NOTICE OF VIOLATION
AND
PROPOSED IMPOSITION OF CIVIL PENALTY

Bayou Inspection Services, Inc. Amelia, Louisiana

Docket No. 150-00017 General License, 10 CFR 150.20 EA-00-297

During an NRC inspection and investigation completed on January 18, 2001, 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 NRC proposes to impose a civil penalty pursuant to Section 234 of the Atomic Energy Act of 1954, as amended (Act), 42 U.S.C. 2282, and 10 CFR 2.205. The particular violations and associated civil penalty are set forth below:

A.	Violations Assessed a Civil Penalty
1.	10 CFR 150.20(a) provides in part that any person who holds a specific license from an Agreement State is granted an NRC general license to conduct the same activity in offshore waters, provided that the provisions of 10 CFR 150.20(b) have been met. 10 CFR 150.20(b)(1) requires, in part, that any person engaging in activities in offshore waters, shall, at least 3 days before engaging in each such activity, file an NRC Form 241, "Report of Proposed Activities in Non-Agreement States", and 4 copies of its Agreement State specific license with the Regional Administrator of the appropriate NRC regional office. Contrary to the above, between January 1998 and June 2000, Bayou Inspection Services, Inc., (Bayou or Licensee) a licensee of the state of Louisiana authorized to conduct industrial radiography, conducted industrial radiography using radiographic exposure devices containing iridium-192 in offshore Federal waters, without filing NRC Form 241 with the NRC.
2.	10 CFR 34.20 (a)(1) requires, in part, that equipment used in industrial radiographic operations, including each radiographic exposure device, source assembly or sealed source, and all associated equipment must meet the requirements specified in American National Standards Institute (ANSI), N432-1980 "Radiological Safety for the Design and Construction of Apparatus for Gamma Radiography," (published as NBS Handbook 136, January 1981). Contrary to the above, between January 1998 and June 2000, licensee radiographic personnel conducted industrial radiographic operations in offshore waters within the NRC's jurisdiction using pipeliner radiographic exposure devices that had not been demonstrated as meeting the requirements specified in ANSI N432-1980 "Radiological Safety for the Design and Construction of Apparatus for Gamma Radiography." Specifically, the devices the licensee used did not meet the following provisions of ANSI N432-1980: the shielding efficiency test requirements when loaded with the maximum rated activity of iridium-192; the vertical and horizontal shock test requirements; and the 30-foot drop test requirements.
These violations represent a Severity Level III problem (Supplement VI). Civil Penalty – $5,500
B.	Violations Not Assessed a Civil Penalty
1.	10 CFR 20.1501(a) requires that each licensee make or cause to be made surveys that may be necessary for the licensee to comply with the regulations in 10 CFR Part 20 and that are reasonable under the circumstances to evaluate the extent of radiation levels, concentrations or quantities of radioactive materials, and the potential radiological hazards that could be present. 10 CFR 20.1502(a)(1) requires, in part, that the licensee shall monitor exposures to radiation and radioactive material at levels sufficient to demonstrate compliance with occupational dose limits. As a minimum, licensees shall monitor occupational exposures and require the use of monitoring devices by adults likely to receive, in 1 year from sources external to the body, a dose in excess of 10 percent of the limits in 10 CFR 20.1201(a). Pursuant to 10 CFR 20.1003, survey means an evaluation of the radiological conditions and potential hazards incident to the production, use, transfer, release, disposal, or presence of radioactive material or other sources of radiation. Contrary to the above, as of June 19, 2000, for activities occurring in NRC jurisdiction, the licensee had not performed an evaluation to demonstrate that Bayou was not required to monitor radiation exposures to the extremities of Bayou radiography personnel using pipeliner radiographic exposure devices. This is a Severity Level IV violation (Supplement IV).
2.	10 CFR 20.1302 requires, in part, that each licensee make or cause to be made, as appropriate, surveys of radiation levels in unrestricted and controlled areas to demonstrate compliance with the dose limits for individual members of the public in 10 CFR 20.1301. 10 CFR 20.1301 specifies that the total effective dose equivalent (TEDE) to individual members of the public from licensed operations must not exceed 1 milliSievert (100 mrem) in a year. Pursuant to 10 CFR 20.1003, survey means an evaluation of the radiological conditions and potential hazards incident to the production, use, transfer, release, disposal, or presence of radioactive material or other sources of radiation. Contrary to the above, as of June 19, 2000, for activities occurring in NRC jurisdiction, the licensee had not performed an evaluation to demonstrate that the TEDE to individual members of the public in unrestricted and controlled areas did not exceed 1 milliSievert (100 mrem) in a year. Specifically, the licensee had not evaluated potential exposures to individual members of the public on lay barges where licensee personnel were using pipeliner radiographic exposure devices to perform industrial radiography. This is a Severity Level IV violation (Supplement IV).

Pursuant to the provisions of 10 CFR 2.201, Bayou is hereby required to submit a written statement or explanation to the Director, Office of Enforcement, U.S. Nuclear Regulatory Commission, within 30 days of the date of this Notice of Violation and Proposed Imposition of Civil Penalty (Notice). This reply should be clearly marked as a "Reply to a Notice of Violation" and should include for each alleged violation: (1) admission or denial of the alleged violation, (2) the reasons for the violation if admitted, and if denied, the reasons why, (3) the corrective steps that have been taken and the results achieved, (4) the corrective steps that will be taken to avoid further violations, and (5) the date when full compliance will be achieved. Your response may reference or include previous docketed correspondence, if the correspondence adequately addresses the required response. If an adequate reply is not received within the time specified in this Notice, an order or a Demand for Information may be issued as to why the license should not be modified, suspended, or revoked or why such other action as may be proper should not be taken. Consideration may be given to extending the response time for good cause shown. Under the authority of Section 182 of the Act, 42 U.S.C. 2232, this response shall be submitted under oath or affirmation.

Within the same time as provided for the response required above under 10 CFR 2.201, the Licensee may pay the civil penalty proposed above, in accordance with NUREG/BR-0254 and by submitting to the Director, Office of Enforcement, U.S. Nuclear Regulatory Commission, Washington, DC 20555, a statement indicating when and by what method payment was made, or may protest imposition of the civil penalty in whole or in part, by a written answer addressed to the Director, Office of Enforcement, U.S. Nuclear Regulatory Commission. Should the Licensee fail to answer within the time specified, an order imposing the civil penalty will be issued. Should the Licensee elect to file an answer in accordance with 10 CFR 2.205 protesting the civil penalty, in whole or in part, such answer should be clearly marked as an "Answer to a Notice of Violation" and may: (1) deny the violation(s) listed in this Notice, in whole or in part, (2) demonstrate extenuating circumstances, (3) show error in this Notice, or (4) show other reasons why the penalty should not be imposed. In addition to protesting the civil penalty, in whole or in part, such answer may request remission or mitigation of the penalty.

In requesting mitigation of the proposed penalty, the factors addressed in Section VI.C.2 of the Enforcement Policy should be addressed. Any written answer in accordance with 10 CFR 2.205 should be set forth separately from the statement or explanation in reply pursuant to 10 CFR 2.201, but may incorporate parts of the 10 CFR 2.201 reply by specific reference (e.g., citing page and paragraph numbers) to avoid repetition. The attention of the Licensee is directed to the other provisions of 10 CFR 2.205, regarding the procedure for imposing a civil penalty.

Upon failure to pay any civil penalty due which subsequently has been determined in accordance with the applicable provisions of 10 CFR 2.205, this matter may be referred to the Attorney General, and the penalty, unless compromised, remitted, or mitigated, may be collected by civil action pursuant to Section 234(c) of the Act, 42 U.S.C. 2282c.

The response noted above (Reply to Notice of Violation, statement as to payment of civil penalty, and Answer to a Notice of Violation) should be addressed to: Director, Office of Enforcement, U.S. Nuclear Regulatory Commission, One White Flint North, 11555 Rockville Pike, Rockville, MD 20852-2738, with a copy to the Regional Administrator, U.S. Nuclear Regulatory Commission, Region IV, 611 Ryan Plaza Drive, Suite 400, Arlington, TX 76011-8064.

Because 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), to the extent possible, it should not include any personal privacy, proprietary, or safeguards information so that it can be made available to the public without redaction. ADAMS is accessible from the NRC Web site at the Public NRC Library. If personal privacy or proprietary information is necessary to provide an acceptable response, then please provide a bracketed copy of your response that identifies the information that should be protected and a redacted copy of your response that deletes such information. If you request withholding of such material, you must specifically identify the portions of your response that you seek to have withheld and provide in detail the bases for your claim of withholding (e.g., explain why the disclosure of information will create an unwarranted invasion of personal privacy or provide the information required by 10 CFR 2.790(b) to support a request for withholding confidential commercial or financial information).

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

Dated this 2nd day of April 2001