United States Nuclear Regulatory Commission - Protecting People and the Environment

ACCESSION #:  9607240138

Quanex Corporation
Gulf States Tube Division               Quanex    Gulf States Tube
P.O.  Box 952                                     Division
Rosenberg, Texas 77471
(713) 342-6401 Phone
(713) 342-9851 Fax

Document Control Desk
U.S.  Nuclear Regulatory Commission
Washington, D.C.  20555

Re: Interim report of deviation evaluation:

This letter is an interim report documenting the evaluation of an ongoing
investigation involving 3/4" Schedule 80 pipe furnished to Consolidated
Power Supply.  Quanex, Gulf States Tube Division manufactured 3/4"
Schedule 80 ASME SA 106 Grade B pipe on Mill Order 74229 which was
furnished to Consolidated Power Supply against PO S65-46324. During
routine testing, Consolidated found that one tube marked as SA106 Grade B
was actually A335 P22. This was subsequently verified by Gulf States Tube
Division on a sample provided by Consolidated.

Quanex investigation revealed that only one nuclear customer was involved
in the sale of this material and that was Consolidated Power Supply.
They were notified 61/14/96 to return the material from this order.

The attached documentation from Consolidated Power Supply summarizes the
status of their investigation and notification of possible affected
users.  Since some of the Issues have not been resolved, this interim
report is being issued per the requirements of Part 21 - Notification.

As of this date, no licensee has reported installing any product with the
suspect deviation.

Sincerely yours

Donald L.  Murray
Manager of Quality Control

CC:  Steven Andrews - Quality Assurance Manager, Consolidated Power
     Supply
     L.  Whitver - General Manager, Quanex, Gulf States Tube Division
     J.  Hill - President Tube Group, Quanex Corporation

Consolidated
Power Supply

July 22, 1996

Quanex Corporation                                           Page 1 of 5
Gulf States Tube Division
Highway 59 at Scott Road
Rosenberg, TX 77471

Attn:     Mr.  Don Murray
          Manager Of Quality Control

Subject:  Evaluation/Status Update for Heat #16205, SA-106 Grade B, 3/4"
          sch.  80 Pipe

Reference 1:   Consolidated Power Supply Letter noted June 18, 1996

Reference 2:   Consolidated Power Supply Letter Dated June 21, 1996

Dear Mr.  Murray:

As previously discussed, Consolidated Power Supply (CPS) has been working
on the evaluation for the subject heat of material.  As the 60 day
requirement for providing the United States Nuclear Regulatory Commission
(NRC) an Interim Report is noted as July 22, 1996, CPS is providing this
correspondence which reflects the current status as of July 22, 1996.

As identified in Reference 1, Quanex Corporation - Gulf States Tube
Division (Quanex) was unable to determine that the deficiency with a mix
in material specifications  (SA-106 Graft B versus A-335 P22) was an
isolated case relative to the one shipment to CPS in November 1994.  It
was conveyed by Quanex that CPS is the only customer affected at this
time.  Included with Reference 2 were copies of the correspondence
provided by CPS to all affected customers who were supplied the subject
heat and size of material.  CPS has verified through review of FedEx
receipts that written notification to these customers was received by
each one on June 21, 1996.  As anticipated, not all recipients have
responded at this time.  A break down of each customer notified and the
current status is provided as follows:

1)   Capitol Manufacturing, Crowley, LA - both lengths of pipe have been
accounted for that were initially supplied by CPS.  Pipe nipples were
made for two seperate CPS customers, with one length being used for a
Baltimore Gas & Electric; (BGE) order and the other length being used for
a New York Power Authority (NYPA) order.  On the first length, Capitol
returned one 6' piece to CPS from an initial length of 20.6' supplied,
made nipples for CPS in which 10 each

   3556 Mary Taylor Road o Birmingham, Alabama 35235 o (205) 655-5516

   A Division of Consolidated Pipe & Supply Co., Inc., Birmingham, AL

Consolidated
Power Supply

                     Letter to Quanex, Dated 7/22/96

                                                              Page 2 of 5
were supplied to BGE, with Capitol scrapping the balance of the initial
length.  The other length consisted of nipples being made for CPS
(nipples sold to NYPA), with the balance of the initial length being
scrapped by Capitol.  No concern relative, to Capitol exists based on CPS
being the only recipient of the pipe and nipples produced, with all
remaining material either being scrapped by Capitol returned to CPS.  In
addition, testing performed by CPS has confirmed that both pieces of the
subject pipe provided to Capitol are in compliance with SA-106 Grade
B.  (See BGE and NYPA status information below)

2)   New York Power Authority, Indian Point #3, Buchanan, NY - A total of
28 pipe nipples were supplied in January 1995 and certified to as meeting
the requirements of 10CFR50 Appendix B by CPS.  The pipe nipples were
produced by Capitol Manufacturing as stated in #1 above, which reflected
a heat code of 0R04 which traces the nipple to Quanex heat #16205.  An
evaluation has been received from NYPA's Engineering Department stating
that three of nipples bad been installed.  The balance of 25 were
returned to CPS, in which one nipple was chemically tested.  The test
results indicate that the material meets the chemical requirements
of SA-106 Grade B and not A-335 P22.  Based on the testing and the fact
that all 28 nipples were produced from one starting piece of pipe, no
concern exists.  In addition, NYPA's evaluation concluded that even if
the was A-335 P22 it would not be a concern relative to the installed
application.

3)   Tennessee Valley Authority, Sequoyah Nuclear Plant, Soddy Daisy, TN
TVA was supplied 5 lengths of the subject pipe in August 1995
representing a total of approximately 117'.  No contact with TVA
personnel has been made at this time.  The status of the material is
indeterminate.  The material was certified to as ASME Code Class 2 by
CPS.

4)   Valcor Engineering, Springfield, NJ - Valcor was supplied with two
10' lengths of the subject pipe in November 1995 representing a total of
approximately 20'.  Valcor card CPS on July 18, 1996 and requested a copy
of A-335.  A telecopy was provided to Valcor at that time.  No further
contact with Valcor personnel has occurred.  The status of the material
is indeterminate.  The material was certified to as ASME Code Class 3 by
CPS.

5) S Y Trading Co., Torrence, CA - One length of the subject pipe
representing a total of approximately 22' was supplied to S Y Trading in
March 1995.  S Y Trading appears to be an agent for Hyndai Heavy
Industries Co., LTD., located in South Korea.  The material was certified
to as ASME Code Class 3 by CPS.  No contact with S Y Trading has occurred
to date leaving the status of the material as indeterminate.

Consolidated
Power Supply

                     Letter to Quanex, Dated 7/22/96

                                                             Page 3 of 5

6)   Baltimore Gas & Electric (BGE), Calvert Cliffs Nuclear Plant, Lusby,
MD - BGE was supplied with 10 pipe nipples in May 1995 made from the
subject pipe.  No conservations with BGE personnel have occurred to date;
however, these nipples have been cleared of any concern based upon
testing by CPS.  In item #1, Capitol Manufacturing returned approximately
6' of pipe which is the only piece used to produce the nipples supplied
to BGE.  The test results indicate that the material meets the
requirements of SA-106 Grade B and is not A-335 P22.  The nipples were
certified to as meeting ASME Code Class 2 by CPS as the starting pipe
used was ASME Code.  Capitol applied heat code #0R04 to the nipples
that reflects traceability to Quanex heat #16205.

7)   Duquesne Light Company, Beaver Valley Power Station, Shippingport,
PA - Duquesne was supplied with one length of the subject pipe in
February 1995 representing a total approximately 23'.  No contact has
been made with any Duquesne personnel to date.  The pipe was certified to
by CPS as meeting the requirements of 10CFR50 Appendix B.  The status of
the pipe is indeterminate.

8)   Toledo Edison Company (Center Energy), Davis-Besse Power Station,
Oak Harbor, OH-Toledo Edison supplied with one length of the subject pipe
in August 1995 representing a total of approximately 23.7'.  On 7/22/96,
Toledo Edison contacted CPS stating that the one piece has been installed
in various applications.  The impact, if any, is currently being
evaluated by Toledo Edison Engineering personnel and remains
indeterminate.  The pipe was certified to as ASME Code Class 2 by CPS.

9)   TU Electric, Comanche Peak Operating Station, Glen Rose, TX - TU
Electric was supplied with two lengths of the subject pipe in May 1995
representing a total of approximately 48'.  TU Electric contacted CPS on
7/8/96 and stated that one pipe was still in the ware house and had not
been used.  The pipe was subjected to a chemical over check by TU
personnel and appears to be SA-106 Grade B.  The other length has been
installed, possibly in multiple applications.  As of 7/8/96 all pipe
installed was determined to be in non-safety related/non-ASME Code
applications by TU Electric personnel.  No material has been returned to
CPS to date.  The status is considered indeterminate based on no written
correspondence being received at this time.  The pipe was certified to as
ASME Code Class 2 by CPS.

10)  Wisconsin Public Service Corp., Kewaunee Nuclear Plant, Kewaunee, WI
- Wisconsin was supplied with 5 lengths of the subject pipe in May 1995
representing a total of approximately 119'.  Wisconsin personnel
contacted CPS on 6/28/96 and stated that one piece

Consolidated
Power Supply

                     Letter to Quanex, Dated 7/22/96

                                                              Page 4 of 5

was used in a non-safety related/non-ASME Code application.  The other
four pieces were still in the warehouse and had not been used.  The piece
installed should not be a concern; however, no written confirmation has
been received by CPS at this time.  The other four pieces have not been
received by CPS in order to perform the necessary testing.  The pipe
supplied to Wisconsin remains indeterminate pending written
correspondence of the piece installed and return of the four not used.
The pipe was certified to by CPS as meeting the requirements of 10CFR50
Appendix B.

11)  Bechtel Power Corp., working as agent for Rochester Gas & Electric,
Ginna Power Station, Ontario, NY - Bechtel was supplied with 1 length of
the subject pipe in February 1995 representing a total of approximately
20'.  As the assignment at Ginna Station was completed, Bechtel returned
the 2 lengths originally supplied, only one being heat #16205.  Upon
return, both pieces were chemically tested by CPS and found to reflect
compliance with SA-106 Grade B and is no A-335 P22.  The material was
certified to as ASME Code Class 2 by CPS.  Based upon the return and
subsequent testing no concern exists on the pipe supplied to Bechtel.

12)  Edward Valves, Raleigh, NC - Edward was supplied with one short
piece of the subject pipe in May 1995 representing a total of
approximately 9.6'.  Edwards had used approximately one foot of the piece
on a commercial application, which has been substantiated in writing by
Edward Valves Quality Department Personnel.  The balance of approximately
8.4' was returned to CPS for chemical testing by CPS.  Results of the
test concludes that the pipe meets the requirements of SA-106 Grade B and
is not A-335 P22.  The material was certified to by CPS as meeting the
requirements of 10CFR50 Appendix B.  No concern exists based on the
return of the material and subsequent testing performed by CPS.

13)  Entergy Operations, River Bend Station, Saint Francisville, LA -
River Bend was supplied with 30 lengths of the subject pipe in December
1994 representing a total of approximately 705'.  The material was
certified to as ASME Code Class 2 by CPS.  Based on conversations with
multiple Entergy Operations personnel some of the pipe has been
installed.  Entergy has performed chemical over checks of all pipe
installed and has concluded that each piece reflects compliance with SA-
106 Grade B. In addition, chemical over checks were performed on the
pieces remaining in the River Bend warehouse.  At least two pieces in
their warehouse indicate that the material is not SA-106 Grade B and
could be A-335 P22.  It is was not conveyed to CPS how many pieces of the
30 originally supplied were installed and how many pieces are still in
the River Bend warehouse on hold.  As this information was conveyed to
CPS on 7/22/96, CPS is now in process of issuing a return authorization
for all pieces remaining in the River Bend

Consolidated
Power Supply

                     Letter to Quanex, Dated 7/22/96

                                                              Page 5 of 5

warehouse.  Based on the above information, the status of all 705'
remains indeterminate at this time.  There does not appear to be a
concern based on comments received from Entergy Operations Engineering
personnel.

The above information accounts for all pieces of Quanex 3/4" schedule 80
pipe supplied to CPS customers as ASME Code and/or safety related.  At
this time, no CPS customers have identified anything other than SA-106
Grade B material being installed.  Several commercial shipments were made
by CPS, including at least one to a commercial nuclear licensee.
Customers that were supplied with the subject pipe not certified to
either ASME Code or safety related were not notified of the potential mix
in the grades of the pipe.

The material returned to CPS from customers will remain in the
Nonconforming material cage pending completion of the evaluation.  Once
completed, all material will be dispositioned as agreed upon between CPS
and Quanex.  On July 22, 1996, CPS will begin making additional efforts
with the above customers that have not provided sufficient information to
enable closure of the concern.  As information is obtained, CPS will
contact Quanex at that time.

Based on the 60 day Interim Reporting requirement identified in 10CFR
Part 21, CPS will verify that the NRC has been notified by Quanex of the
status of the deviation no later than July 22, 1996.  As soon as Quanex
has provided such notification as required by the regulation please
contact the undersigned in order for CPS to confirm that the proper
notification to the NRC has been completed.  If there are any questions
please contact me at your convenience.

Sincerely,

Steven W. Andrews
Quality Assurance Manager

cc:  H. Kerr - President, CPS
     M. Mathias - Gen. Mgr., CPS
     CAR I96-9

GENERAL INFORMATION or OTHER            EVENT NUMBER: 30774

LICENSEE: QUANEX CORPORATION            NOTIFICATION DATE: 07/22/96
  CITY: ROSENBERG        REGION: 4      NOTIFICATION TIME: 18:45 [ET]
COUNTY:                  STATE: TX      EVENT DATE:        05/24/96
LICENSE#:            AGREEMENT: Y       EVENT TIME:        00:00[CDT]
  DOCKET:                               LAST UPDATE DATE:  07/22/96

                                                  NOTIFICATIONS

NRC NOTIFIED BY: DONALD L.  MURRAY      VERN HODGE, NRR     PCEB
HQ OPS OFFICER: LEIGH TROCINE

EMERGENCY CLASS: NOT APPLICABLE
10 CFR SECTION:
CDEG 21.21(c)(3)(i)      DEFECTS/NONCOMPLIANCE

                               EVENT TEXT

QUANEX CORPORATION INTERIM 10 CFR PART 21 REPORT OF A DEVIATION
EVALUATION INVOLVING A MIX IN MATERIAL SPECIFICATIONS (SA-106 GRADE B
VERSUS A-333 P22)

QUANEX CORPORATION GULF STATES TUBE DIVISION SUBMITTED AN INTERIM
REPORT
TO DOCUMENT THE EVALUATION OF AN ONGOING INVESTIGATION INVOLVING
3/4-
INCH, SCHEDULE-80, ASME, SA-106, GRADE-B PIPE ON MILL ORDER #74229 WHICH
WAS FURNISHED TO CONSOLIDATED POWER SUPPLY (CPS) AGAINST PO
S65-46324.
DURING ROUTINE TESTING, CPS FOUND THAT ONE TUBE WAS MARKED AS SA-106
GRADE B, AND IT WAS ACTUALLY A335 P22.  THIS WAS SUBSEQUENTLY VERIFIED
BY
THE QUANEX GULF STATES TUBE DIVISION ON A SAMPLE PROVIDED BY CPS.

THE QUANEX INVESTIGATION REVEALED THAT CPS WAS THE ONLY NUCLEAR
CUSTOMER
THAT WAS INVOLVED IN THE SALE OF THIS MATERIAL.  CPS WAS NOTIFIED ON
JUNE
14, 1996, TO RETURN THE MATERIAL FROM THIS ORDER.  HOWEVER, QUANEX
WAS
UNABLE TO DETERMINE THAT THE DEFICIENCY WITH A MIX IN MATERIAL
SPECIFICATIONS (SA-106 GRADE B VERSUS A-333 P22) WAS AN ISOLATED CASE
RELATIVE TO THE ONE SHIPMENT TO CPS IN NOVEMBER 1994.  CPS PROVIDED
CORRESPONDENCE TO ALL AFFECTED CUSTOMERS WHO WERE SUPPLIED THE
SUBJECT
MATERIAL AS ASME CODE AND/OR SAFETY RELATED, AND CPS VERIFIED
RECEIPT OF
THIS CORRESPONDENCE ON JUNE 21, 1996.  CPS NOTIFICATIONS WERE SENT TO
THE
FOLLOWING CUSTOMERS: CAPITAL MANUFACTURING, INDIAN POINT 3,
SEQUOYAH,
VALCOR ENGINEERING, S. Y. TRADING COMPANY, CALVERT CLIFFS, BEAVER
VALLEY,
DAVIS BESSE, COMANCHE PEAK, KEWAUNEE, BECHTEL (AS AGENT FOR GINNA),
EDWARD VALVES, AND RIVER BEND.  NOT ALL RECIPIENTS HAVE RESPONDED
AT THIS
TIME.  IN ADDITION, NO CPS CUSTOMERS HAVE IDENTIFIED ANYTHING OTHER
THAN
SA-106 GRADE-B MATERIAL BEING INSTALLED.

*** END OF DOCUMENT ***

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