[Federal Register Volume 61, Number 91 (Thursday, May 9, 1996)]
[Notices]
[Pages 21210-21212]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-11606]
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NUCLEAR REGULATORY COMMISSION
[Docket No. 70-1201; License No. SNM-1168; EAs 95-236 and 95-215]
B&W Fuel Company d/b/a Framatome Cogema Fuels; Order Imposing
Civil Monetary Penalty
I
B&W Fuel Company (Licensee) is the holder of Special Nuclear
Material License No. SNM-1168 issued by the Nuclear Regulatory
Commission (NRC or Commission) in September 1969. The license
authorizes the Licensee to possess and use special nuclear material in
accordance with the conditions specified therein. The license was last
renewed on September 24, 1990, and is due to expire on September 30,
2000.
II
Inspections of the Licensee's activities were conducted during the
period of June 12 through October 6, 1995. The results of these
inspections indicated that the Licensee had not conducted its
activities in full compliance with NRC requirements. A written Notice
of Violation and Proposed Imposition of Civil Penalty (Notice) was
served upon the Licensee by letter dated January 30, 1996. The Notice
states the nature of the violations, the provisions of the NRC's
requirements that the Licensee had violated, and the amount of the
civil penalty proposed for the violations.
The Licensee responded to the Notice in a letter dated February 23,
1996. In its response, the Licensee admitted Violations B, and C, and
questioned the regulatory basis for Violation A. In addition, the
Licensee requested the NRC to reconsider both the severity level of the
violations and the proposed civil penalty based on the stated minimal
safety significance of the violations and the Licensee's corrective
action.
III
After consideration of the Licensee's response and the statements
of fact, explanation, and argument for mitigation contained therein,
the NRC staff has determined, as set forth in the Appendix to this
Order, that the violations occurred as stated and that the penalty
proposed for the violations designated in the Notice should be imposed.
IV
In view of the foregoing and pursuant to Section 234 of the Atomic
Energy Act of 1954, as amended (Act), 42 U.S.C. 2282, and 10 CFR 2.205,
IT IS HEREBY ORDERED THAT:
The Licensee pay a civil penalty in the amount of $12,500 within 30
days of the date of this Order, by check, draft, money order, or
electronic transfer, payable to the Treasurer of the United States and
mailed to Mr. James Lieberman, Director, Office of Enforcement, U.S.
Nuclear Regulatory Commission, One White Flint North, 11555 Rockville
Pike, Rockville, MD 20852-2738.
V
The Licensee may request a hearing within 30 days of the date of
this Order. Where good cause is shown, consideration will be given to
extending the time to request a hearing. A request for extension of
time must be made in writing to the Director, Office of Enforcement,
U.S. Nuclear Regulatory Commission Washington, D.C. 20555, and include
a statement of good cause for the extension. A request for a hearing
should be clearly marked as a ``Request for an Enforcement Hearing''
and shall be addressed to the Director, Office of Enforcement, U.S.
Nuclear Regulatory Commission Washington, D.C. 20555, with a copy to
the Commission's Document Control Desk, Washington, D.C. 20555. Copies
also shall be sent to the Assistant General Counsel for Hearings and
Enforcement at the same address and to the Regional Administrator, NRC
Region II, 101 Marietta Street, N.W., Suite 2900, Atlanta, Georgia
30323.
If a hearing is requested, the Commission will issue an Order
designating the time and place of the hearing. If the Licensee fails to
request a hearing within 30 days of the date of this Order (or if
written approval of an extension of time in which to request a hearing
has not been granted), the provisions of this Order shall be effective
without further proceedings. If payment has not been made by that time,
the matter may be referred to the Attorney General for collection.
In the event the Licensee requests a hearing as provided above, the
issues to be considered at such hearing shall be:
[[Page 21211]]
(a) whether the Licensee was in violation of the Commission's
requirements as set forth in Violation A of the Notice referenced in
Section II above; and
(b) whether on the basis of Violation A, and the additional
violations admitted by the Licensee, this Order should be sustained.
Dated at Rockville, Maryland this 29th day of April 1996.
For the Nuclear Regulatory Commission.
James Lieberman,
Director, Office of Enforcement.
Appendix--Evaluations and Conclusion
On January 30, 1996, the NRC issued to B&W Fuel Company, aka
Framatome Cogema Fuels, (Licensee or B&W Fuel) a Notice of Violation
and Proposed Imposition of Civil Penalty (Notice) for three
violations identified during NRC inspections conducted during the
period of June 12 through October 6, 1995. In its response dated
February 23, 1996, the Licensee admitted Violations B and C, and
questioned the regulatory basis for Violation A. In addition, the
licensee requested the NRC to reconsider both the severity level of
the violations and the proposed civil penalty based on the stated
minimal safety significance of the violations and the Licensee's
corrective action. The NRC's evaluation and conclusion regarding the
Licensee's request are as follows:
Restatement of Violation A
10 CFR 71.12(c)(2) requires, in part, that the licensee comply
with the terms and conditions of the Certificate of Compliance and
the applicable requirements of Subparts A, G, and H of 10 CFR Part
71.1
\1\ During the period January 1, 1978 through September 6, 1983,
this requirement was contained in 10 CFR 71.12(b)(1)(ii) and
required compliance with applicable requirements in 10 CFR Part 71.
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Effective April 25, 1983, to September 11, 1992, Condition
5(a)(3) of Certificate of Compliance No. 6294 specifies that the
packaging is constructed in accordance with Babcock & Wilcox Company
Drawing Nos. MS-135E and MS-82B.
Effective September 11, 1992, through August 4, 1995, Condition
5(a)(3) of Certificate of Compliance No. 9251 specifies that the
packaging is constructed in accordance with B&W Fuel Company Drawing
Nos. 1215598B and 1215599E.
Contrary to the above:
1. From August 1983 through July 10, 1995, the licensee made
multiple shipments using UNC-2901 and/or BW-2901 shipping packages
which were not constructed by B&W Fuel in accordance with, and did
not conform to, Certificate of Compliance Nos. 6294 and 9251.
Specifically, the dimensions of the inner cavity exceeded the
dimensions on drawings Nos. MS-135E, MS-82B, 1215598B, and 1215599E.
2. From August 1983 through May 22, 1995, the licensee made
multiple shipments using UNC-2901 and/or BW-2901 shipping packages
which were not constructed by B&W Fuel in accordance with, and did
not conform to, Certificate of Compliance Nos. 6294 and 9251.
Specifically, the hole locations in the closure lids were outside
the specifications of drawings Nos. MS-135E, MS-82B, 1215598B, and
1215599E.
The Licensee's Challenge of the Basis of Violation A
The Licensee maintained that its Quality Assurance Plan (QAP)
for shipping containers allows and requires B&W Fuel to disposition
all deviations concerning container design. The Licensee stated that
``A full reading of 71.12(c)(2) (emphasis added for clarity) is as
follows: `The general license applies only to a licensee who: (2)
Complies with the terms and conditions of the license, certificate,
or other approval, as applicable and the applicable requirements of
Subparts A, G, and H of this part; and'.''
The Licensee added that the NRC's approval of the B&W Fuel's QAP
submitted under Subpart H indicates that B&W Fuel is authorized and
is expected to act as specified in the ``B&W Fuel Company
Radioactive Material Shipping Container Quality Assurance Plan''
which, the Licensee believes, constitutes the ``other approval as
applicable'' discussed in 10 CFR 71.12(c)(2). The Licensee noted
that B&W Fuel acted entirely in accordance with its approved QAP
which allows and requires B&W Fuel to disposition all deviations to
the container design basis. Therefore, the Licensee stated, the
Notice does not appear to recognize that there is another document,
submitted and approved by the NRC under Subpart H, which guided B&W
Fuel's actions in dispositioning BW-2901 shipping container defects.
B&W Fuel added that it has ``acted in good faith with the
understanding that the differences in interpretation of Part 71
between the NRC and the licensees would be addressed and resolved in
an industry forum.''
In addition, the Licensee argued that when ``the current Part 71
was invoked, most fissile material container users adopted quality
programs which mirror 10 CFR 50 requirements.'' The Licensee stated
that 10 CFR 71.131 clearly anticipates that deviations to the COC
[Certificate of Compliance] may be found during use, and it does not
require that the licensee cease to use the packaging. It does
require, under subpart H, that the safety significance be determined
prior to further use and that the conditions be reported to the NRC.
The Licensee stated that ``NRC's approval of our Quality Plan caused
FCF [Framatome Cogema Fuels, formerly B&W Fuel] to handle shipping
containers in the same manner that we handle design deviations under
our Part 50 Program.''
NRC Evaluation
10 CFR 71.12(a) states that ``a general license is hereby issued
to any licensee of the Commission to transport, or to deliver to a
carrier for transport, licensed material in a package for which a
license, certificate of compliance, or other approval has been
issued by the NRC.'' As a condition of satisfying 10 CFR 71.12(a),
10 CFR 71.12(c)(2) provides that the general license applies only to
a licensee who ``complies with the terms and conditions of the
license, certificate, or other approval, as applicable, and the
applicable requirements of Subparts A, G, and H of this part.''
The ``other approval'' cited in both 10 CFR 71.12(a) and 10 CFR
71.12(c)(2) does not refer to Quality Assurance Program approval;
rather, the words ``other approval'' refer to forms of package
approvals other than Certificates of Compliance. Examples of ``other
approval'' would be letter amendments, amendments to facility
licenses, and specific licenses for transportation. Furthermore, the
regulations pertaining to quality control, set forth in Subpart H of
Part 71, do not permit Licensees to use packages which do not comply
with the conditions of the Certificate of Compliance. Section 71.105
specifically provides that Licensees must implement quality control
which ``assures conformance to the approved design of each
individual package used for the shipment of radioactive material.''
The regulations in Subpart H of Part 71 do not sanction the use of
containers which do not comply with the regulatory requirements.
Therefore, B&W Fuel, aka Framatome Cogema Fuels, has incorrectly
interpreted the meaning of ``other approval'' as used in 10 CFR
71.12.
With regard to the Licensee's argument regarding 10 CFR Part 50
requirements, the NRC notes that such argument is irrelevant because
the requirements in 10 CFR Part 50 differ from those in 10 CFR Part
71. The Licensee's handling of shipping containers in the same
manner that it handles design deviations under Part 50 is not
authorized under 10 CFR 71.
The NRC concludes that Violation A occurred as stated.
Summary of Licensee's Request for Mitigation and Reconsideration of
Severity Level
The Licensee offered several arguments in support of its request
for mitigation of the proposed penalty. Below is a summary listing
of the Licensee's arguments that are related to its request for
mitigation, some of which have been consolidated. The NRC's
evaluation follows each argument.
1. The Licensee disagreed with the NRC's characterization of the
violations. Specifically, B&W Fuel stated that it believes that,
taken by themselves, none of the violations would constitute a
Severity Level III violation; therefore, taken together B&W Fuel
cannot tell what part of the civil penalty is applicable to each
part.
NRC Evaluation
The purpose of aggregating violations as stated in Section IV.A
of the Enforcement Policy (NUREG-1600) is to focus the Licensee's
attention on the fundamental underlying causes and to reflect that
several violations with a common cause may be more significant
collectively than individually and may, therefore, warrant a more
substantial enforcement action. As stated in the Enforcement Manual,
NUREG/BR-0195 at Section 3.5.2, a group of Severity Level IV
violations may be evaluated in the aggregate and assigned a single,
increased severity
[[Page 21212]]
level, thereby representing a Severity Level III problem, if the
violations reflect the same underlying cause or programmatic
deficiency, or the violations contributed to or were unavoidable
consequences of the underlying problem. In this case, the violations
are related, and the lack of attention and carelessness toward
licensed activities were the underlying causes of the three
violations. Therefore, in accordance with the Enforcement Policy,
the NRC aggregated the violations into a Severity Level III problem
for which a $12,500 civil penalty was assessed.
As to the apportionment of the civil penalty, the violations
individually would be characterized at Severity Level IV and,
therefore, would not be subject to individual penalties. The
regulatory significance of this Severity Level III problem is the
collectiveness of the problem. Therefore, the penalty has not been
allocated for each violation. Consequently, the civil penalty
applies to the problem as a whole.
2. The Licensee argued that none of the violations ``has real
safety significance.'' B&W Fuel stated that its safety analysis of
the BW-2901 package, which was performed after deviations were found
and prior to further use, was more than adequate. B&W Fuel added
that the NRC does not have a basis in the regulations for requiring
the use of incredible assumptions, such as an optimized volume
fraction, in post accident assumptions.
The Licensee contended that the NRC staff's new assumptions
imposed during the review of B&W Fuel's submittal under 10 CFR 71.95
make the analysis appear inadequate and that this is not the case.
The Licensee stated that it considers some of the required
assumptions to be not credible and therefore beyond the requirement
of 10 CFR 71.55(b)(1) and (2), and that the NRC ultimately agreed
with B&W Fuel's analysis and authorized it to use the containers
with the deviations present.
NRC Evaluation
Safety significance, from an enforcement prospective, involves
consideration of: (1) actual safety consequence; (2) potential
safety consequence; and (3) regulatory significance. Violation A is
of concern because of the potential criticality consequence of B&W
Fuel's use of shipping packages that were not constructed as
required and for which an adequate safety evaluation had not been
performed. Violation B is of concern because the violation continued
for over two years which demonstrates a lack of management oversight
(i.e., B&W Fuel failed to identify the violation, although the
cylinders were readily visible during that time). Violation C is of
concern because, in each example of the violation, the NRC relied
upon inaccurate information submitted by the Licensee to make a
regulatory decision.
While the actual safety consequences of the violations
fortunately turned out to be minimal in this case, the regulatory
concerns are significant due to B&W Fuel's lack of attention to
licensed activities. Specifically, the lack of attention to
regulated activities was not isolated, but spanned several areas
including licensing, transportation, quality assurance, and material
control and accountability, and directly resulted in the three
violations described in the Notice. Therefore, the NRC concludes
that, taken collectively, the violations represent a significant
regulatory concern.
The NRC disagrees with the Licensee's statements regarding the
adequacy of its safety analysis. When B&W Fuel evaluated the safety
significance of the larger containment vessel, the Licensee
incorrectly considered the wooden boards (i.e., box) to be
structural components that would confine the fissile material under
accident conditions. This is not consistent with the safety basis of
the package or previous B&W Fuel analyses. The NRC did not, and does
not, agree with B&W Fuel's safety assessment dated July 7, 1995.
Furthermore, the NRC did not authorize the Licensee to use the BW-
2901 shipping packages with the deviations present unless certain
conditions were met; specifically, installation of borated aluminum
poison plates, or restricting shipments to large size pellets with a
stainless steel separator plate. In view of the above, the NRC
concludes that the Licensee's safety analysis of the BW-2901
shipping package was inadequate.
3. The Licensee stated that it does not understand why the NRC
did not give B&W Fuel credit for its corrective actions or the cost
of meeting the requirements imposed by the NRC assumptions in the
analysis for the BW-2901 shipping containers. The Licensee argues
that it has been very proactive in this case and took action which
prevented any reduction in the protection of the public's health and
safety. Specifically, when NRC management indicated that it
considered that B&W Fuel's action was outside the NRC's
interpretation of Part 71, B&W Fuel immediately stopped using the
containers and submitted a request for modification of the COC.
The Licensee claimed that, despite its belief it acted entirely
in accordance with its approved QAP, B&W Fuel agreed to comply with
the NRC position on 10 CFR 71.12(c)(2) and did so voluntarily on
July 20, 1995. B&W Fuel stated that it has operated in accordance
with NRC's wishes and is not using the provisions of its QAP, which
allows the Licensee to use containers with deviations that are shown
by analysis to have no safety significance. The Licensee asserted
that corrective action was taken to prevent recurrence in 1990 with
a re-design of the procedures which govern shipping container
manufacture and use, and that these procedures were demonstrated to
be effective during the procurement of new Model 51032 containers in
1993. The Licensee, therefore, disagreed with the NRC's statement in
the Notice that ``absent NRC action, FCF would have continued to use
nonconforming packages without NRC approval and without performing
an adequate safety analysis.''
NRC Evaluation
NRC did not give B&W Fuel credit for corrective actions because
the NRC had to take action to focus the Licensee's evaluative and
corrective process to obtain comprehensive corrective action.
Specifically, for Violation A: (1) as noted in Section 2 of this
Appendix, B&W Fuel's safety analysis of the BW-2901 shipping package
was inadequate; and (2) the Licensee continued to use nonconforming
packages after performing its analysis until the NRC staff informed
B&W Fuel staff that it was not authorized to do so.
B&W Fuel was initially informed by the NRC staff via telephone
on May 24, 1995, as a result of identification of the bolt hole
discrepancies, that it was not authorized to use packaging that does
not meet the drawings listed in the COC. In the telephone
conversation, B&W Fuel was requested to submit revised pages to the
safety analysis report to clarify that packages must conform to the
drawings specified in the Certificate of Compliance.
By letter dated May 24, 1995, B&W Fuel submitted revised pages
for the BW-2901 safety analysis report. The revised acceptance tests
included the following statements: ``Containers will be fabricated
only in accordance with the designed drawings referenced in the
Certificate of Compliance. The approved Quality Assurance Manual
will be used to ensure compliance. Any changes in the drawings shall
be submitted to NRC for approval.'' Based on this, NRC staff
understood that B&W Fuel would not use packaging that deviated from
the drawings referenced in the Certificate of Compliance, without
prior NRC approval.
Contrary to the communications, and based on its erroneous
interpretation of the use of its QAP, B&W Fuel used the BW-2901
packaging that did not conform to the drawings following
identification of the inner dimensional discrepancies until July 20,
1995, when the NRC staff reiterated the regulatory requirements to
the Licensee. While the NRC acknowledges that B&W Fuel ultimately
agreed to stop using the BW-2901 shipping package, the Licensee,
absent NRC involvement, would have continued to use the
nonconforming packages. Therefore, the NRC concludes that its
statement in the Notice was appropriate.
With regard to Violations B, the Licensee did not provide
additional corrective actions which were not already considered
after the November 21, 1995 predecisional enforcement conference. As
stated in the Notice, although the initial corrective actions for
Violation B were appropriate, the adequacy of the long term
corrective action is yet to be demonstrated. The corrective actions
for violation C were adequate.
Therefore, the NRC concludes that, in accordance with Section
VI.B.2 of the Enforcement Policy, credit for the Licensee's
corrective action is not warranted.
NRC Conclusion
The NRC has concluded that the violations in the Notice were
correctly categorized as a Severity Level III problem, and that the
Licensee did not provide an adequate basis for mitigation of the
civil penalty. Consequently, the proposed civil penalty in the
amount of $12,500 should be imposed.
[FR Doc. 96-11606 Filed 5-8-96; 8:45 am]
BILLING CODE 7590-01-P
