IA-97-311, Submits Physical Security Info for Export of Unirradiated Fort St Vrain Fuel Containing high-enriched U Mixed W/Th to France for recovery,down-blending & Subsequent Use as Fuel in Research & Test Reactors.Supporting Documentation Encl

Submits Physical Security Info for Export of Unirradiated Fort St Vrain Fuel Containing high-enriched U Mixed W/Th to France for recovery,down-blending & Subsequent Use as Fuel in Research & Test Reactors.Supporting Documentation Encl

ML20198H575
Person / Time
Site:	Fort Saint Vrain
Issue date:	11/18/1993
From:	Sherr T NRC OFFICE OF NUCLEAR MATERIAL SAFETY & SAFEGUARDS (NMSS)
To:	Hauber R NRC OFFICE OF INTERNATIONAL PROGRAMS (OIP)
Shared Package
ML20198H564	List: IA-97-311, Submits Physical Security Info for Export of Unirradiated Fort St Vrain Fuel Containing high-enriched U Mixed W/Th to France for recovery,down-blending & Subsequent Use as Fuel in Research & Test Reactors.Supporting Documentation Encl ML20198H560 ML20198H575
References
FOIA-97-311 NUDOCS 9709190097
Download: ML20198H575 (15)

Text

_

uutt:3 stAvas f NUCLEAR REGULATORY COMMIS810N a smaawweevon,s.c.seems

\***** . Noves6er 18, 1993 MEMDRANDUM FOR: Ronald Hauber, Assistant Director Exports, Security and Safety Cooperation office of International Programs FROM: Theodore S. Sherr, Chief Regulatory and International Safeguards Branch Division of Fuel Cycle Safety and Safeguards Office of Nuclear Material Safety and Safeguards .

SUBJECT:

XSNM-2748. EXPORT OF UNIRRADIATED FORT ST. VRAIN FUEL CONTAINING HIGH-ENRICHED URANIUM MIXED WITH THORIUH TO FRANCE FOR REC 0VERY, DOWN-BLENDING AND SUBSEQUENT USE AS FUEL IN RESEARCH AND TEST REACTORS (C0GEMA)

The following physical security information is being provided for the subject export application for the export of high-enriched uranium (HEU) for the purpose of recovery, down-blending, and subsequent use as fuel in research and test reactors. This examination of the application addresses the Category I physical security for the domestic transport portion of the pending application.

MMS $ was informed on November 3,1993, by Transnuclear, Inc., the lic.nse applicant, that the shipment of material under this license will move as a s series of Category I shipments. Transnuclear again plans to petition the Department of Energy (D0E) to transport and protect the HEU on the domestic leg of the shipment from its present storage location plant to the Aerial Port of Embarkation. The French Air Force will fly the material from the Aerial Port of Embarkation directly to France.

In a letter to NRC dated October 24, 1986, confiming that DOE would provide transport on the domestic leg of an earlier shipment DOE stated that "the domestic portion ...will be made in accordance with DOE directives...' DOE also stated that they plan to teminate use of the SST system for commercial purposes at the earliest possible time. In view of this, DOE may decline to make this shipment if a suitable commercial carrier can be found.

At this point in time, there are no approved commercial carriers for transporting Category I material domestically. NRC requirements for such shipments have yet to be upgraded consistent with the results of the most recent NRC/D0E physical security transportation comparability review.w@R?.QS.]:-

commercial carrier were to come forward to transport Category I material; Jts 1M physical security plan would need to be reviewed on a case-specific basis against interia licensing criteria pending codification of upgrades regulations. F- in g g g

. 3. '

9709190097 970916 DS -311 PDR

. O O

-t-We have reviewed the proposed export application and have determined that the following physical protection condition should be made part of the license.

'The asterial to be exported under this license shall either be protected in transit, while within U.S. jurisdiction in accordance with NRC-approved licensing criteria or shall be protected in transit, while within U.S. jurisdict'on, by the Department of Energy (00E) Safe secure Transport (SST) system in accordance with the 00E requirements and directives for the transport of such material.'

[ }dTheodore L J. S. Sherr, Chief Regulatory and Internatior.a1 Safeguards Branch Division of Fuel Cycle Safety and Safeguards ,

Office of Nuclear Material Safety ,

and Safeguards C

O O

UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION COMMISSIONERS Ivan Salin, Chairman Xenneth C. Rogers Forrest J. Remick Z. Gail de Planque In the Matter of )

)

TRANSNUCLEAR, INC. ) Docket No. 11004649

)

(Export of 93.15% Enriched Uranium)) License No. XSNM 02748

)

usuonAunou amo canza CLI .

I. INTRODUCTION The Nuclear Control Institute ("NCI") filed a Petition for Leave to Intervene and Request for Hearing on an application from Transnuclear, Inc. ("Transnuclear") for a license to export 280 kilograms of high-enriched uranium ("HEU") in the form of mixed uranium and thorium carbide, as unirrad$ated fuel fabricated for the Fort St. Vrain reactor, to COGENA in France to be processed for recovery of the uranium and thorium. For the reasons stated in this Namorandum and Order, we deny the Petition for Leave to Intervene and Request for Hearing.

II. BACKGROUND Transnuclear filed an application, dated May 5, 1993, for a i license to export 280 kilograms of HEU containing 260.9 kilograms i .of uranium-235 (93.15% enriched) and 2481 kilograms of thorium,

! in the form of mixed uranium and thorium carbide, as unirradiated fuel fabricated for the Fort St. Vrain reactor,1 to COGEMA in

France to be processed for recovery of the uranium and thorium.8

on June 24, 1993, NCI filed a Petition for Leave to Intervene and Request for Hearing on the Transnuclear license application. NCI l asserts that it is a nonprofit, educational corporation based in the District of Columbia, and engages in disseminating i information to the public concerning the risks associated with .

l the use of nuclear materials and technology. Petition at 1-2.

NCI seeks intervention to argue that (1) the proposed j export, if authorized, would be inimical to the common defense t~

and security of the United States, (2) approval of the proposed i

! export would be contrary to Section 134 of the Atomic Energy Act l of 1954, as amended, 42 U.S.C. $ 2160d (the "Schumer Amendment")8, and (3) the license application is deficient in 1

3The fabricated fuel is from the now-decommissioned Fort St.

1 Vrain Power Station, a high temperature gas-cooled thorium fuel

' - cycle prototype reactor located at Platteville, Colorado and owned by the Public Service Company of Colorado. The material is currently owned by Nuclear Fuel Services (NFS) and stored at the Erwin, Tennessee facility of NFS.

aNotice of receipt of the application was published in the Federal Register on May 26, 1993 (58 Fed. Reg. 30187).

*The Energy Policy Act of 1992, Public Law 102-486, signed into law on October 24, 1992, among other things, added new (continued...)

O O meeting the information requirements of NRC regulations in that it does not sufficiently describe the ultimate intended and use of the material to be exported. Petition at 10-11.

NCI requests that the commission (1) grant NCI's Petition for Leave to Intervene, (2) order a full and open public hearing

• at which interested parties may present oral and written testimony and conduct discovery and cross-examination of witnesses, and (3) act to ensure that all pertinent information regarding the issues addressed by NCI is made available for public inspection at the earliest possible date. Petition at 1-2, 18.

Transnuclear filed an Opposition in Response to Petition to Intervene (" Response") on July 27, 1993. Before responding to the petition, Tranunuclear amendad its application on July 16, 1993, to require that the exported material be blended down and used as low enriched uranium (" LEU") for research or test reactors. In its Response, Transnuclear argues that the NRC is a(... continued) restrictions on the export of uranium, in a new Section 134 of the Atomic Energy Act (the "Schumer Amendment") . The Schumer Amendment permits the issuance of a license for export of uranium enriched to 20 per cent or more in the isotope-235 to be used as a fuel or target in a.anclear research or test reactor only if, in addition to other requirements of the Atomic Energy Act, the NRC determines that 1) there is no alternative nuclear reactor fuel or target enriched in the isotope 235 to a lesser percent than the proposed export, that can be used in that reactor; 2) the proposed recipient of that uranium han provided assurances that, whenever an alternative nuclear reactor fuel or target can be used in that reactor, it will use that alternative in lieu of highly enriched uranium; and 3) the United States Government is actively developing an alternative nuclear reactor fuel or target that can be used in that reactor. The applicability of the Schumer Amendment to.the instant application is discussed Infra.

O O not statutorily required to provide an adjudicatory hearing on export licenses and that in any case, PCI is not entitled to a l

hearing as a matter of right because NCI lacks standing.

Response at 2-4. Transnuclear further argur4 that a discretionary hearing would not be in the public interest or assist the Commission in making its statutory determination because Transnuclear's amended license application makes clear that the uranium recovered from the exported material will be blended down to LEU thus resoving the relevance of the contentions proffered by NCI. Response at 8-10.

NCI filed a timely Reply to Applicant's opposition to the Petition for Leave to Intervene and Request for Hearing (" Reply")

on August 16, 1993. In its Reply, NCI argues that a hearing of right is available in export licensing cases. Reply at 2-4. NCI concedes that Commission case law has denied standing, as a matter of right, to organizations with interests substantially similar to NCI in proceedings substantially sitilar to the instant one, but argues that the commission should expand its approach to standing in export licensing proceedings to meet congressional expectations regarding public participation in such proceedings 9taply at 5-7. NCI further argues that,

~

notwiths Transnuclear's, stated intention to blend down the material after it is exported, mci's contentions remain valid because granting the license will increase the amount of REU in international transport and commerce, and the expressed intention to down bland is unacceptably vague. Reply at 7-14.

subsequent to NCI's Reply, COGENA submitted a letter dated September 8, 1993, confirming that COGENA will notify the NRC, in writing, within 30 days after all the exported material has been blended down to 120. In a letter dated September 24, 1993, COGENA again confirmed the earlier notification commitment and further contirmed that commercial arrangements regarding the material require that all the exported material be blended down with no substitutions or sale of NEU allowed, and that COGENA will retain title to the material until it has been blended down to LEU.

III. THE PETITIONER'S STANDING A. NCI Does Not have Standing To Intervene As A Matter of Right Section 189a of the Atomic Energy Act of 1954, as amended, provides, among other things, that the Commission grant a hearing, as a matter of right, to any person "whose interest may be affected by" a proceeding under the Act for the granting of any liceagg. 42 U.S.C. $ 2239(a) (1) .* To determine if a

• The commission's regulations at 10 C.F.R. $ 110.84 list the factors to be considered in taking action on a hearing request or intervention petition in a licensang proceeding for the export of nuclear materials. Section 110.84(b) addresses considerations to determine whether - a petitioner has standing to intervene as a matter of right and provides that:

(continued...)

O o

-g.

petitioner has sufficient interest in a procesding to be entitled to intervene as a matter of right under section 189a, "the Commission has-long applied contemporaneous judicial concepts of standing.* cleveland Electric 111uninating company, et al.

(Perry Nuclear Power Plant, Unit 1), CLI-93-21, 38 NRC 87, 92 (1993), citing Sacramento Municipal Utility District (Rancho seco Nuclear Generating Station), CLI-92-2, 35 NRC 47, 56 (1992),

aft'd, Environmental & Jtesources conservation Org. v. NRC, No.

92-70202 (9th Cir. June 30, 1992); Netropolitan Edison Co.

(Three Mile Island Nuclear station, Unit 1), CLI-83-25, 18 NRC 327, 332 (1983). To satisfy the judicial concept of standing, a petitioner must demonstrate "a concrete and particularised injury that is fairly traceable to the challenged action." Zd.

(citations omitted).

NCI asserts a claim of interest for standing based on its institutional interests in the dissemination of information concerning nuclear weapons and proliferation in gerieral and the use of REU in particular. Petition at 3. The Commission has

• (... continued)

(b) If, a hearing request or intervention petition asserts an interest which may be affected, the cessaission will considers (21 The nature of the alleged interest; (2) How the interest relates to issuance or denial; and (3) The possible effect of any order on that interest, including whether the relief requested is within the commission's authority, and, if so, whether granting relief wod1d redress the alleged injury.

10 C.F.R. $ 110.84(b).

long hetd that institutional interest in providing information to the pub. tic and the generalized inturest of their memberships in minimis:.ng danger from proliferation are insufficient for standing under section 189a. See, e.g., 2dlow International Co.

(Agent ior the Government of India on Application to Export special ' Nuclear Material) , CLI-76-6, 3 NRC 563,572-78 (1976);

Ezron Nu= lear Company, Inc., et al. (Ten Applications For Low Enriched Uranium Exports To EURATON Nember Nations) CLI-77-24, 6 NRC 52!i, 529-32 (1977); Westinghouse Kloctric Corp. (Export to South Kol'ea) CLI-80-30, 12 NRC 253, 257-60 (1980); General Electric Company (Exports to Taiwan) CLI-81-2, 13 NRC 67, 70 (1981). See also Srcramento Municipal- Utility District (Rancho Seco Nuclmar Generating Station) CLI-92-02, 35 NRC 47, (1992)

(rejectica of " informational interaces" as grounds for standing in other than an export licensing case).

NCI Oconcede[s] that there is a line of Commission cases, starting with the pre-NNPA (Nuclear Non-Proliferation Act) decision in Edlow International Co., CLI-76-6, 2 NRC 563 (1976),

denying standing to organizations with interests substantially similar to Petitioner in proceedings substantially similar to the present cem." Reply at 5. NCI argues, however, that the Commission 8e approach to standing should be expanded to realize the Congressional intention to increase public participation in export licensing through enactment of section 304 of the Nuclear Non-Proliferation Act of 1978, 42 U.S.C. $ 2155a ("NNPA"). Reply at 5-7.

O O The mechanism for increased public participation NCI urges already is provided for in the commission's regulations, section 304 (b) (2) of the NNPA mandated that the Commission promulgate regulations establishing procedures "for public participaticn in nucloar export licensing proceedings when the commission finds that such participation will be in the public interest and will assist the commission in making the statutory determinations required by the 1954 Act." 42 U.S.C. $ 2155a(b) (2) . The commission amended its regulations in 1978 expressly to accommodate this mandate by adding the criteria set out in 10 C.F.R. $ 110.84(a) for granting a hearing as a matter of discretion.s See statement of Considerations, 43 Fed. Reg. 21641, 21642-43 (1978). The regulation specifically sets forth the commission policy to hold a hearing or otherwise permit public participation if the commission finds that such a hearing or participation would be in the public interest and would assist the commission in making the required statutory determinations.

8Section 110.84(a) of Title 10 of the Code of Federal Regulations provides that:

(a) In an export licensing proceeding, or in an import licensing proceeding in which a hearing request or intervention petition does not assert or establish an interest which may be affacted, the commission will consider:

(1) Whether a hearing would be in the public interest; and (2) Whether a hearing would assist the commission in making the statutory determina-tions required by the Atomic I:nergy Act.

10 C.F.R. 5 110.84(a).

O O Thus, even though NCI has not established a basis on which it is entitled to intervene as a matter of right, the Commission could hold a hearing under 10 C.F.R. $ 110.84 (a) (1) and (2) if such hearing would be in the public interest and assist the Comaiasion. See Braunkohle Transporta USA (Iaport of 5outh African Uranium Ore Concentrata), CLI-87-6, 25 NRC 891, 893 (1987).

B. A Discretionary Hearing Would Not Assist The Commission And Be In The Public Interest The issues :L'.. sed by NCI - (1) the common defense and security of the United states, (2) compliance with the Schumer Amendment, and (3) assurance of the ultimate intended and use of the unterial - do concern matters which the Commission considers in making an export license decision. There is no indication in NCI's pleading, however, that it possesses special knowledge regarding these issues or that it will present information not already available to and considered by the commission.

The Executive Branch and the Commission staff have addressed the issues sufficiently in their respective reviews of the Application. The transportation, international safeguards, and foreign physical security concerns associated witP the issue of the common defense and security were addressed by te.e Executive Branch and the Commission staff in their consideration of the Application. The Commission has reviewed the Executive Branch's and Commission staff's evaluation of the ultimate end use of the

O O

(- -

material and the effect of the COGEMA september 8 and 24, 1993, letters regarding that end use. NCI offers no reason for the commission to differ with the views expressed by the Executive Branch and the commission staff on these matters.

The only remaining issue raised by NCI is compliance with Section 134 of the Atomic Energy Act of 1954, as amended, (the schumer Amendment) 42 U.S.C. 5 2160d. NCI contends that, notwithstanding that the HEU is to be blended down for use as LEU reactor fuel, the Schumer Amendment issue " remains alive" because of the terac of the Amendment. Reply at 13-14. A fair reading of the entire amendment, however, shows that, while Congress may have been concerned about the transportation of HEU, the focus of the statute is on discouraging the continued use of HEU as reactor fuel and not on prohibiting tha exportation, per se, of HEU. Any other reading would be inconsistent with the plain meaning of the legislation since it allows for the exportation of HEU fuel for use in a reactor provided that certain provisions are in place to ultimately convert the reacter to use LEU. See b

42 U.S.C. $ 2160d(a) (2) and (3) . Further, assuming arguendo that the terms of the Schumer Amendment are ambiguous,' a review of

'The Schumer Amendment states, in parts

a. The commission may issue a license for the export of highly enriched uranium to be used as a fuel or target in a nuclear research or test reactor only if, in addition to any other requirement of this (Act), the commission determines that-(1) there is no alternative nuclear fuel or target enriched in the isotope 235 to a lesser percent than the proposed export, that can be (continued...)

O O its legislative history risarly shows that the intent of the amendment is to "put into law what was, from 1978 to 1990, the policy of both Democratic and Republican administrations--

i prohibiting the NRC from licensing the exports of bomb-grade uranium fuel... .

138 Cong. Rec. H. 11440 (daily ed. October 5, 1992) (remarke of Representative Schumer) (amphasis added). The NRC staff adviaes that the material the Applicant seeks to export, although fabricated as HEU fuel for the now defunct Fort St. Vrain reactor, is not in a form that can be used as HEU fuel or target material in a research or test reactor without first processing the material to recovery its uranium content.

Exporting the material for processing, blending down, and subsequent fabrication into LEU fuel or target material for test and research reactors may aid in discouraging the continued use of HEU as fuel in reactors by increasing the availability of LEU fuel. The action, if nothing else, meets one of the goals of the Schumer Amendment, in that it will remove 280 kilograms of HEU from the world inventory and, thereby, help encourage " developing alternative fuels that will enable an and to the bomb-grade exports." Id.

• (... continued) used in that reactor; 42 U.S.C. 5 2160d. The meaning of the phrase "to be used as a fuel" in the first sentence, in the context of the whole provision, clearly means "to be used as a HFU fuel." The NCI argument depends on reading the word "fuela in th= lirst sentence as meaning either "HEU fuel" or " LEU fuel."

O o In summary, nothing in the NCI Petition and Reply indicates that a hearing would generate significant new insights for the Commission regarding the instant application. To the contrary, conducting a public hearing on issues concerning matters about which the Commission already has abundant information and analyses would be contrary to one of the purposes of the NNPA, namely,."that United States government agencies act in a manner which will-enhance this nation's reputation as a reliable supplier of nuclear materials to nations which adhere to our non-proliferation standards by acting upon export license applications in a timely fashion." Westinghouse CLI-80-30, 12 NRC 253, 261 (1980) (citation omitted). For these reasons, NCI's petition and request for a public hearing should be denied as not in the public interest and not necessary to assist the commission in making its statutory determinations.

IV. CONCLUSION AND ORDER For the reasons stated in this decision, NCI has not established a basis on which it is entitled to intervene as a matter of-right under the Atomic Energy Act. Further, a hearing, as a matter of discretion pursuant to 10 C.F.R. $ 110.84(a),

would not be in the public interest and is not needed to assist the Commission in making the determinations required for issuance i

g...,......... .. ..

. O O of the export license to Transnuclear. The Petition for Leave to Intervene and Request for Hearing is denied.

It is so ORDERED.

For the Commission SAMUEL J. CHILK secretary of the Dated at Washington, D.C.

this day of , 199 .

c

D

1. • • W)I.. c stij y,f a .'T a y 3 j, ) ce a 7S D ...or. th.

UNITED STATES NUCLEAR REGULATORY COMNISSION h7 y,

.)/jj Washington, D.C. 20555 2n the Matter of )

)

TRANSNUCLEAR, INC. ) Docket No. 11004649

)

(Export of 93.15% Enriched Uranium) ) License No. XSNN 02748

)

)

3302729.

PETITION OF THE NUCI2AR CONTROL INSTITUTE FOR LEAVE ,

TO INTERVENE AND REQUEST FOR HEARING Pursuant to Section 189a. of the Atomic Energy Act of 1954, as amended, 42 U.S.C. 5 2239a. , and Section 304(b) of the Nuclear Non-Proliferation Act of 1978, 42 U.S.C. $ 2155a. 3the "NNPA"),

and the applicable rules and regulations of the United States Nuclear Regulatory Commission (the " Commission"), including 10 C.F.R. Part 110, Subpart I, the Nuclear control Institute ("NCI" or " Petitioner") hereby respectfully petitions the Commission for leave to intervene as a party in opposition to the application o, Transnuclear, Inc. (" Applicant"), dated May 5, 1993, for a

. license to export 280 kilorgrams of 93.15% enriched uranium for processing in France, as published in the Federal Ranister on May 26, 1993 (58 Zad. 333 30187).

In addition, Petitioner requests that the Commission order a full and open public hearing at which interested parties may present oral and written testimony and conduct any discovery and 0 D YOlb/O Y cD/s p.

O O i

, cross-examination necessary to resolve the factual and legal issues relevant to the commission's determinations with respect to the pending license application. Such a hearing would be in the public interest and assist the commission in making its statutory determinations under the Atomic Energy Act, as provided for by Section 304 (b) of the NNPA, 42 U.S.C. $ 2155a., and 10 C.F.R. 5 110.84.

2. Petitlener's Interests Petitioner is a nonprofit, educational corporation, organized and existing under the laws of the District of columbia, whose principal place of business is also in the District of columbia. Its address and telephone numbe,r are: 1000 connecticut Avenue, N.W., suite 704, Washington, D.C. 20036; (202) 822-8444. It is actively engaged in disseminating information to the public concerning the proliferation, safety and' environmental risks attendant upon the use of sensitive nuclear materials, equipner.t, and technology. It develops strategies for halting the further spread of nuclear weapons and is deeply concerned with the inadequacies of present national and internati systems for the safeguarding of nuclear satorials against , diversion and other unauthorized uses.

mci has undertaken special efforts to educate the public i

0 D about the feasibility and desirability of eliminating bomb-grade (or " highly enriched") uranium ("HEU") from commerce in general and research reactors in particular and has strongly advocated the completion and full implementation of the Reduced Enrichment for Research and Test Reactors ("RERTR") program. Examples of its publications in the area include the January, 1991, Issue Paper, " Eliminating Bomb-Grade Uranium From Research Reactors,"

and its June 23, 1991, M inuten Pest " Outpost" artirele,

" Politicians in the Lab . . . and Scuttling an Easy Way to Stop Nuclear Proliferation". It has been active in prior procesdings before the commission relating to the export of HEU, specifically the proposed export of HEU to the MTR/Petten Reactor in The Netherlands (Dkt. No. 11004440, Lic. No. XSNM 02611).

Petitioner has important institutional interests which would be dirsetly affected by the outcome of this proceeding. As noted above, it is actively involved in public information and education programs concerning arms control, the spread of nuclear weapons, and the risks of proliferation and nuclear terrorism in general and the use of HEU in particular. Its interest and ability to carry out these functions would be significantly and adversely impaired by the absence of a full, open and independent review by the commission of the issues raised under the Atomic Energy Act and the NNPA by the pending license application.

. O Q Petitioner has no other means to protect its interests in this proceeding, and those interests are not now represented by the existing parties. This Petition, moreover, is not interposed for delay or to broaden the proper scope of the proceedings. It is timely flied, within 30 days of the publication of the license application in the Federal Racistar, as required by 10 c.F.R. 5 110.s2 (c) (1) . Finally, Petitioner's contentions raise important questions concert.ing the appropriateness of continued commerce in and use of HEU, which is directly useable in nuclear bombs, and Petitioner submits that its participation will assist the commission in developing a sound record.

II. Raekaround For many years, HEU has been used in the civil sector primarily to fuel research and test reactors around the world.

However, its risks have likewise long been recognized, and there have therefore been substantial efforts to curtail its use.

The risks associated with the circulation of HEU in commerce are self-evident. MEU was the material used in the Hiroshima

~

bomb (Little, Boy). According to .7. carson Mark, former head of weapons design at 14s Alamos National Laboratory, a "first generation" implosion weapon requires no more than about twelve 4-

kilograms of this material.8 consequently, HEU is an attractive target for national diversion or seizure by terrorists. Indeed, the Manhattan Project physicist Luis Alvares has noted, *[W)ith modern weapons-grade uranium ... terrorists, if they had such materials, would have a good chance of setting off a high-yield explosion, simply by drooping one-half of the material on the other half."3 Furthermore, the possession of this material in the hands of a saddam Hussein or in a country such as Romania or the former Yugoslavia during a breakdown of civil order, or by terrorists who steal such material, would present a grave international threat. Unless quantities of HEU in commerce are substantially reduced, or eliminated, such riske are only likely to grow. ,

In recognition of the problems associated with continued reliance on HEU in research reactors, the United States instituted the RERTR program in 1978. Under the leadership of Argonne National Laboratory, this program has been developing high density, low-enriched uranium (" LEU") fuels -- fuels not suitable for fabrication into weapons but, suitable for use in researett reactors - thereby allowing conversion to IEU and much Mark, "Some RenatXs on Iraq's Possible Nuclear Weapon capability In Light of Some Known Facts concerning Nuclear Weapons" (Nuclear control Institute, May 16, 1991), at 2.

Alvarez, Adventures of a Physicist 125 (Basic Books 1987).

. . O O reducing the amount of EEU in commerce. Its results have been

impressive the RERTR program has developed, tested, and qualified four types of LEU fuel "which make it technically possible to convert to LEU use some 95 percent of the 118 research reactors in 34 countries (36 in the United states and 82 in other countries).*8 U.S. policy has also been strongly in favor of reducing use of HEU. Thus, the commission itself for more than ten years has sought to " reduc (e), to the maximum extent possible, the use of HEU in ... foreign research reactors." 133 47 Zad. 182 37007 (August 24, 1 '

. The same Policy statement affirms that "any reduction in the potential for access to these (HEU) inventories would constitute a reduction in the proliferation risk."

Moreover, domestically, the commission has since 1986 been requiring all licensed research reactors to convert to LEU. 131 51 Ind. Egg. 6514 (February 25, 1986). In taking this action, the commission asserted that the " domestic conversions are intended to be put on solid footing by setting a strong, resolute and sensible example, consistent with U.S. national policy, to encourage foreign operators of non-power reactors to convert to e

8 ERC Environmental and Energy Services Co. , Review cf the RERTR Program (Report submitted to the U.S. Department of Energy, May 15, 1990), at 3-3.

O O

-the use of LEU fuel." 2A. at 6816.*

In 1986, congress, too, acted. It passed the omnibus Diplomatic security and Anti-Terrorism Act, calling upon the President "to take, in concert with United states allies and other countries, such steps as necessary to keep to a miniaua the amount of weapons-grade nuclear material in. international transit." gaa Omnibus Diplomatic security and Anti-Terrorism Act of 1986, Pub. L. No.99-399, sec. 601(a) (3) (A) (August 27, 19 s s) .s Under this legislation, MEU experts have been limited only to those countries "... which have cooperated closely with the U.S. in the Reduced Enrichment for Research and Test Reactors (RERTR) Program. Exports are further limited to supply of only

~

those research reactors which either cannot be converted at present to LEU fuel or which need additional HEU fuel while in process of conversion to LEU." 1991 Annual Report Under section sol of the NNPA, 22 U.S.C. $ 3281 (July 2, 1992), at 77.

• commission policy, it should be noted, has reflected the consistant views of the Executive Branch that it is important to U.S. non-proliferation policy to minimize the amount of HEU in inter ional commerce. 183 Presidential Non-Proliferation Policy stat of April 7, 1977, 13 Weekly comp. Pres. Doc. 507 (Apr,1 11, f U.S. Nuclear Non-Proliferation and Cooperation Policy (July .1981), 17 Weekly comp. Pres. Doc. 749 (July 20, 1981);

1991 1 Report under section sol of the NNPA, 22 U.s.c.

$ 32s1 (July 2, 1992), at 77.

s congress had previously passed resolutions supportive of Executive Branch efforts to reduce HEU use. Eat S.J. Res. 179, 97th cong. , let sess. (July 27, 1981); 3. con. Rev 96, 97th cong.,

2d sess. (May 27, 1982).

• O O Finally, Section 603 of the 1986 law added a new section 133 to the Atomic Energy Act, 42 U.S.C. $ 2160c., specifically requiring Commission consultation with the secretary of Defense concerning the adequacy of physical security in connection with any proposed erport or transfer of HEU.

Most recently, congress dealt with commerce in HEU in Title 2X, section 903, of the comprehensive National Energy Policy Act, Pub. L. No. 102-486, los stat. 2944, enacted October 24, 1992 (the "schumer Amendment"). The schumer Amendment adds a new section 134 to the Atomic Energy Act, 42 U.S.C. $ 2160d., which 31mits the circumstances in which any HEU can be exported for use as a fuel or target in a research or test reactor. As its principal author stated, "[T]his bill codifies once and for all that bomb grade uranium is simply too dangerous to continue indefinitely shipping it overseas for non-military purposes".

138 gang.llag. H. 11440 (daily ed., oct. 5, 1992). Under the schumer Amendment, no HEU exports are permitted for use in a research or test reactor unless three conditions are mets (1) there is no alternative nuclear reactor fuel er target enriched in the isotope 235 to a lesser parcent than the proposed orport, that can be used in that reactor; (2) the proposed recipient of that uranium has provided assurances that, whenever an alternative nuclear reactor fuel or target can be used in that reactor, it will use that alternative in lieu of highly enriched

. uranium; and

=-*+emeam.u .3--

em. ..e es "

O O s

l (3) the United statsu covernment is actively developing an alternative nuclear reactor fuel or target that can be used in that reactor.

42 U.s.C. 5 21 sod. (a) (1).(:,) . .it was expected that, under the schumer Amendment, all MrU exports could be phased out "within 5 years," assuming the RERTR fuel development program were restarted. In the absence of continued funding for the RERTR program, the only option would be to a cut off the bomb-grade exporta immediately." Sta 138 gang. Rag. at M. 11440 (statement af Rep. schumer).

It is uncertain just what the end use of the MEU under the Pending application is likely to be. The and use statement in the license application (paragraph 11) merely staters that

" recovered uranium ... are [ sic) to be returned to Mrs in the USA". The application tions not state to what use the HEU will be put after its return. However, it would be logical to presume that the recovered HEU is ultimately intended for use in a research or test reactor, either domestically or abroad, since there appear to be few, if any, other civil uses for the material.' such use would directly implicate the laws and polici discussed above and should not be furthered by the

• Conceivably the HEU could also be used as start-up material in a breeder reactor. Obviously, however, such use would have equally, if not more, serious non-proliferation and terrorism implications.

.p.

o

. e commission through appr6 val of the pending license application.

In any event, because a substantial amount of material -- 280 kilograms or enough to fabricate more than 20 bombs -- is involved in this proposed export, no potential use of this material is justified, unless it can be persuasively demonstrated that there.are no presently available, viable alternatives (e.g.,

blending down the uranium) involving lesser proliferation and terrorism risks. This is a heavy burden which Applicant has not sought in any way to meet. e III. Petitlener's Contantiens In accordance with Section 33 of the Atomic Energy Act of 1954, as amended, 42 U.K.c. $ 2073, and 110 C.F.R. ,

55 110.42 (a) (s) and 110.44 (a)(1) (ii), the commission may not issue a license for the export of special nuclear material, such as the HEU at issue'in this proceeding, unless it determines that

"[t]he proposed export would not be inimical to the common defense and security." For the reasons set forth in paragraph (a) below, Petitioner submits that this requirement cannot be met by the pending licanse application. In addition, as set forth in paragraph (h) below, to the artent the ultimate end use of the material weeld be in a research or test reactor, approval of the proposed export would be contrary to the requirements of the schumer Amendment, section 134 of the Atomic Energy Act of 1954,

~ - -

. O O

, as amended, 42 U.S.C. $ 21404. Finally, as set forth in paragraph (c) below, because Applicant has not sufficiently described the ultimate intended and use of the export, the pending application does not meet the information requirements set forth in 10 C.F.R. $ 110.31(f)(5).

(a) The Presenad Ernart Mauld Ra Iniminal ,

to the commen Dafanaa and Baeuritv.

• The proposed export would be inimical to the U.S. common defense and security in at least three respects. First, to the extent positive commission licensing action could imply U.S.

government approval of either domestic or foreign use of en additional 280 kilograms of HEU in research or test reactors, this would fundamentally undercut the RERTR program, exacerbating the risk that operators who have not yet converted their reactors would refuse to do so and that operators who have converted would revert to HEU use, contrary to the United states' non-proliferation interests, second, approval of the pending application would lead to increased international transport of weapons-useable material, aggravating the risk of interception by

. rogue states, criminals or terrorists, even though it is by no means clear that (i) fuel processing, if truly necessary, could not be performed in the United states, or (ii) other supplies of MEU (again, if truly necessary) might not be available from sources other than the Fort St. Vrain fuel, or (iii) alternatives O O such as blending down the fuel for use in a converted research reactor signt not be viable.' Third, since there is no stated justification for NEU processing in the application, the nuclear proliferation and terrorism risks associated with increasing amounts of HEU in international commerce necessarily outweigh any hypothetical benefits to Applicant or others from the export. In a world in which major efforts are underway to eliminate HEU surpluses, it makes little sense to process more.' In light of such considerations, the grant of the pending license application cannot be squared with U.S. common defense and security interests.

(b) To the Ertant the Ultimate End Una of the Material Is in a Ramsarch er Tant Reactor, the Premenad Ernert Would an Inconsistant with the schumar Amendment.

The proposed export would be inconsistent with the schumer Amendment in at least two possible respects.

'It should be noted that Nuclear Fuel services, Inc. ("NTS"),

the present owner of the fuel, is now licensed to carry out blanding down operations at its facility (NRC Dkt. No.70-143 stos). .

'The ted States has already undertaken, at an estimated cost of severa e, 111on dollars, to purchase 500 tons of Russian HEU, all of which is to be blended down to LEU to remove the bomb-grade material from international commerce and eliminate any risk of diversion to weapons. An interim agreement was signed in May 1993 by Lynn Davis, U.S. Undersecretarv of state, and Viktor Mikhailov, head of Russia's Atomic Energy Manistry, to this end. Approving the proposed export would be at cross purposes with this major U.S.

post cold War initiative.

__. _= . _ _

9'Pt" 4 WW b

. O o First, while the end use in a specific reactor is not indicated in the license application, there is plainly a risk that, ones the NEU is in Europe and has been processed, Applicant would seek e license amendment permitting the fuel to be transferred for use at a foreign research or test reactor. Given the absu ct n? other civil uses, this is a highly plausible scenario. h tact, NFs, the current owner of the NEU, is actively engaged in discussions with the Commission to lower security requirements at its facility (NRC Dkt. No.70-143 W503).

such an outcome is possible only if NFs reduces its inventory of HEU below the category I threshold (five kilograms). NFS, in other words, has every incentive nas to have the fuel returned but instead ut111:ed abroad.' Furthermore, even if the fuel is returned to the United states as planned, there might be subsequent efforts to reexport it for research or test reactor use.

Indeed, Petitioner understands that the originally intended and use for this fuel was France's RHF Grenoble reactor, and another option.under consideration has been shipment to Canada for use as targets in the NRU reactor and the yet-to-be-completed

'It alternativeshould be noted available that export to NFs to get of the MEU is not the only the fuel off-site for the purpose of lowering security requirements. NFS could transfer the fuel to a Department of Energy (" DOE") facility where category I level security is in place, e.g., Oak Ridge or savannah River. NFs could possibly transfer ownership to DOE as well, since petitioner understands that it originally obtained the fuel without charge from the Fort St. Vrain reactor.

A4

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Maple X10 reactor." once costs are sunk in fusi processing, it would be all the more difficult for the commission to turn down a request for use of the HEU in a foreign research or test reactor.

Finally, Applicant might attempt a substitution arrangement whereby the NEU would remain in Europe in exchange for LEU containing an equivalent quantity of U-235. If such an arrangement were permitted, and the HEU were ultimately used in a foreign research or test reactor, the schumer Amendment would be evaded." To avoid such scenarios, the commission should now decide that any such use would be contrary to the Schumer Amendment and, more specifically, that the three criteria set forth in section 134 of the Atomic Energy Act cannot be satisfied.

necond, if Applicant affirms that the ultimate and use of

• In the RHF reactor the HEU would be used as fuel, while it would be used as target material for production of radioisotopes in the NRU and Haple X10 reactors. SLnce the RERTR program is not actively developing LEU fuels, the schumer Amendment would bar export of HEU for the RMF reactor. Since the RERTR prgeram in developing LEU targets, the Schumer Amendment might permit exports of HEU to Canada until LEU targets are successfully developed --

estimated at five years. However, in light of existing HEU stocks in canada, Petitioner understands that canada's maximum HEU import requirassage over this period will be no more than 40-60 kilograms, or just a stastion of the total HEU to be procesced in the proposed export. Tttue , these reactors do not represent a legal export market for the bulk of the HEU at issue in this proceeding.

" Applicant might find substitution financially attractive.

Since there is currently a premium on HEU in Europe, Applicant might receive a larger quantity of U-235 in i.EU than was contained

, in the HEU.

1

.ii _ . . _ -.

the fuel would be in a research or test reactor in the United states, the schumer Amendment would still apply. By its terms, it uneguivocally bars the commission from allowing any export at all of MEU ato be used as a fuel or target in a nuclear research or test reactor", unless its three statutory conditions are satisfied, without regard to whether the ultimate end use is in a foreign or domestic reactor.

In sun, given the provisions of the schumer Amendment, absent a demonstration by Applicant either that the fuel is ultimately intended for some and use other than in a research or test reactor or that the Schumer Amendment's conditions are satisfied for the ultimate and use, the pending license application should not be apt. roved. *

(c) The Pandina Annlication Dean Net Meat The Information Ranuirements of the Comminaien's Raoulations.

As noted above, the pending application does not describe the ultimate end use of the HEU to be processed. However, under the couaission's regulations, a license application must contain:

A) description of and use by all consigness an sufficient detail to permit accurate evaluation of the justification for the proposed export ..., including the need for shipment by the dates specified.

O O 10 c.F.R. $ 110.31(f)(5). It is readily apparent that, until the commission knows the use to which the processed MrU will be put, it lacks sufficient information to make an " accurate evaluation of the justification for the proposed export", and, therefore, the pending application must be denied.

IV. The Naad for a Pull Oral Hamrine A full oral hearing to examine Petitioner's contentions is essential both to serve the public interest and to assist the commission in making its statutory determinations. Such a hearing would fulfill the commission's mandate to explore fully the facts and issues raised by export license applications, where appropriate through full and open public hearings in which (a) all pertinent information and data are made available for public inspection and analysis and (b) the public is afforded a-reasonable opportunity to present oral and written testimony on these questions to the commission. 121 42 U.S.C. $ 2155a. and 10 c.F.R. 5 5 110. 4 0 (c) , 110.44(a), (b), 110.so-110.si, 110.100."

There is substantial controversy surrounding any continued use of bomb-grade uranium. Indeed, the questionable wisdom of "The commission's regulations, it should be noted, include specific recognition that public participation and input are encouraged. 10 c.F.R. $ 110.81(a).

2 O O permitting commerce in HEU has been sharply illustrated by the actions of the United States, its allies and the International Atomic Energy Agency to remove the HEU in the possession of Iraq after the conclusion of the Persian Gulf War. similarly, after the fall of Romania's Communist government, the U.S. sought and won in 1991 permission to convert all unirradiated HEU fuel elements owned by the Romanian government to LEU. Only a public hearing in which issues related to the continued appropriateness of erporting HEU are fully aired and subjected to public scrutiny will serve to resolve legitimate public questions concerning both the need for granting this license application and the risks associated with such action. Certainly, the unchallenged assertions of Applicant and/or ths Executive Branch are not enough to satisfy the public interest in the case.-

Petitioner includes among its directors, staff and supporters individuals with broad experience and expertise in technical and policy matters directly relevant to the risks and implications of the proposed export. Additionally, it has expert consultants fully familiar with all aspects of the RERTR program.

These in.dividuals would bring to the instant proceeding perspec4Waswhicharepresentlylackingandarepivotaltoan understaInding and resolution of the factual and legal issues raised by the pending 'ticense

. application.

o O V. halief Reeruanted For the reasons set forth above, Petitioner respectfully requests that the commission 1.

Grant this Petition for Leave to Intervene; 2.

order that an oral hearing be held in connection with the pending license application; and 3.

Act to ensure that all pertinent data and information regarding the issues addressed by Petitioner be made available for public inspection at the earliest possible date.

(

Respectfully submitted,

/

Eldon V.C. Gr'oenberg GARVEY, SCHUBERT &

1000 Potomac 3 , N.W.

suite 500 Washington, D.C.' 20007 (202) 965-7800 .

r Attornav for Datitionar Dated: June 24, 1993 Washington, D.C.

18

O O i

KFFfftMATION I affirm that I an duly authorized counsel for Petitioner in this proceeding, that I have consulted with Petitioner concerning the statements contained in the Petition, and that such statements sre true and correct to the best of my personal knowledge and belief.

k}

Idon V.C. Greenberg subscribed and sworn to before me this 24th day of June, 1993.

&_hk-Notary Public PhyUls landau Notary Pubuc Distrier af Cahunk My Commission Empires May 14.1998

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~

crkTIFICATE OF BERVICE 2 hereby certify that I caused the foregoing Petition of the Nuclear control Institute for Leave to Intervene, together with counsel's Notice of Appearance, to be served by having soples thereof sailed, first class, postage prepaid, on the 24th day of June, 1993, to the following -

Joan McLaughlin Executive secretary Traffic coordinator U.S. Department of state Trane.7uclear, Inc. Washington, D.C. 20520 Two skyline Drive Hawthorne, New York 10532-2120 and by having copies thereof hand-delivered on such date to the following:

Docketing and service tranch General Counsel office of the secretary U.S. Nuclear Regulatory U.S. Nuclear Regulatory commission commission one White Flint North one White Flint North 11555 Rockville Pike 11555 Rockville Pike Rockville, Maryland 20852 Rockville, Maryland 20852 (3 copies) 4 Av T, don V.C. Greenber Dated:- June 24, 1993

. Washington, D.C. -

O O

Before the UNITED STATE 5 NUCLEAR REGULATORY CONNIs5 ION Washington, D.C. 20585 2n the Matter of )

)

TRANSNUCLEAR, INC.

) Docket No. 1100649

)

(Export of 93.15% Enriched Uranium ) License No. X5NH 02748

)

) .

NOTICE DI' APPEARANCE Notice is hereby given that the undersigned attorney herewith enters an appearance in the above-captioned matter. In accordance with 5 2.713(a), 10 C.F.R. Part 2, the following information is provised:

• Names Eldon V.C. Greenberg Address: GARVEY, SCHUBERT & SARER 1000 potomac Street, N.W.

Suite 500 Washington, D.C. 20007 Telephones (202) 965-7880 Admission: Member of D.C. and New York Bars name of Party: Nuclear Control Institute

--6

' Av I don V.C. Greenberg Attornav for pgi ner Dated: June 24, 1993 Washington, D.C.

..' . U O

=== SmenS or ansarca WDCLEAR RS5MA'f01Y 03AE18815

. . . , ,. s. .. .

)

In the Matte of )

)

TBMtSNUCLEp., INC., ) Doeket No. 11004849 et behalf of, )

COGath, INC., ) Lisease No. Emet =3748

)

(Supert of Rairradiated )

Fual for hifabriention) )

)

TRANSWDCLEAR'S OPPOSITION .

III E22POMsI TO PETITICIf TC IIfTIETEEE Trazanuclear, Inc. ('Transnuclear'), on behalf of CoGDR, Inc., .L/ files this opposition in response to the

' Petition of the Nuclear control Institute For Leave to Intervene and Request For Esaring' (' Petition') submitted en June 24, 1993.

Noclear control Institute (*NCI') soaks leave to intervene as a party in opposition to Transnucisar's May 5, 1993 application (amended on July 16, 1993) for a license to emport unirradiated fuel for defabrication in France.

The liuanse would permit the export of fuel fabricated for the Fort St. Train-high temperature gas reactor and scrap and excess material resulting from production of such material that is cur m tly owned by Nuclear Fuel Services (NFS) and s'tored at NFS' Erwin, Tennessee facility. Fursuant to the proposed 1/ coGDR, Inc. f.s a U.S. corporation and is a wholly owned subsidiary of Ltspaynie Odadrale des MatJ&res Nuc2daires

('CCGDE'), a French corporation.

$$Oona ig;h,,.

I

(o .o

-3 application, as amended, the fuel and ancisar antarial will be exported to France, where it will be defabricated at 00GENh's facility leented at Pierrelatte, Franoe, and where all of the reewared uranium will be blended with natural and/or low-enriched uranium so that the resulting product is enriched to less than 20 percent time (low eariched uranium or 'L308) for ultimate use as fuel for research and test reactors.

Although it has long been established statutorily and judicially that the NRC seed not prwide an adjudicatory hearing on export licenses, U NCI requests a ' full and open hearing

• pursuant to 10 CFR I 110.04 (1993), with an opportunity to present oral and written testimony and to conduct cross-examination and discwory. M NCI establishes no basis for such extraordinary procedures. Indeed, it fails to articulate any

' cognizable interest which will be affected by this proceeding and thus fails to establish its organisational sta d4=g.

In support of its request, WCI presents three -

contentions which presuppose that the exported unterial either could or would ultimately be used as high enriched ursaium

(*IEU'). Da July 16, 1993 Transnuclear amended its applicetion to require that the exported antarial be blended down and used as f

U Macura2 Jtesources Defense council v. MC, 580 F.2d 598, 599 (D.C. Cir. 1978).

U The exi.raordinary procedures of cross awa=4mation and discwory requested by NCI are not Itwided in 10 CFR Part 110, subpart J, which contemplates legislative type

• man-adjudicatory hearings. 10 CFR II 110.100 113 (19H).

_._ m _

O O

. . 3

[ 2m for research er test reactors. Stmas, name of WC1's esotentions has any relevance to the current application.

For these reasons, and th reasons more fully stated below, Transnuclear respectfully reposts that the comedesion deny the petition to intervene and deny the ropest for a hearing.

M

z. per nas no trent to a anmaran Unlike Intc's consideration of other licenses, its

~

zwiew of an export license application does not trigger the hearing rights afforded by section 189 of the Atomic Energy Act of 1954, as amended (42 U.S.C. 5 2239 (1988)) . Section 304(b) of the Nuclear Non Proliferation Act of 1978 (*IntPA*) prwides that the ccesr.ission shall prwide for public participation in export licensing proceedings when it ' finds that such participation will,,

be in the public interest and will assist the Comniission in asking the statutory determinations regired by [the Act).' 42 U.S.C. 2155a (b) (1988). Section 304(c) of the IntPA directs that the criteria of Section 304(b) 'shall constitute the exclusive basis ior hearings in nuclear export licensing proceedings

• and

'shall act repire the Comunission to grant any person an on the -

record hearing ia such a proceeding.' 42 U.S.C. I 2155a(c) .

This latter subsection 'thus directs La unepivocal language that the 3Dic need not afford any person an adjudicatory hearing in a nuclear export licensing proceeding.* 3Ratural Resources Defense Counell v. JIRC, 580 F.2d 698, 699 (D.C. Cir.1978) . '

mi ei sa e i q ui i

- Despite the dictates of the 3DIPA, WC2 seeks a hearing and rights such as disewery and cross examination which would effectively create a full blown adjudioatory proceeding. Such procedures, however, 'are not prwided for la the Commission's regulations set forth*La 10 Crm part 110.* arounkohle Fransport (Esport of south African Draaium Ore concentrate), CLI 87 5, 25 ERC 091, 893 (1987) . A/ In accordance with section 304(b) of the IOf7A, the NRC's regulations establish procedures for the public to participate la export licensing proceedings by ,

prwiding their written views. As such, these regulations prwide the 'only basis for determining the hearing rights of groups such as (NCI) .* See 30tDC, 300 P.3d at 700. Stey do not include a heari*ng as of right, or any of the other astraordinary procedures requested by NCI. .

According to the Commission in arounkohle, Part 110 does not prwide for adjudicatory procedures because they would be inappropriate in export and import license proceedings which -

' frequently involve sensitive foreign poli and national defense considentions. ' CL2 87-5, 25 NRC . Consistent with this rationale, such procedures would be inappropriate and serve no useful purpose in considering the instant export license application. .

A/ In ars=*ahte the Commission did not rule on the Petitioners' roguest that a hearing be granted as a matter of right. CL2 s7 5, 25 NRC at 893. Instead, the Commission ranted a discretionary written hearing because it was taterested in certain legal issues relating to interpretation of the Comprehensive Anti Apartheid Act of 1986. 2d. at 894.

I

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• g-

22. MC1_Baa RAILED TO RSTABLYER TER REDEr1AITE ETARDIMI hasuming aryueado that a petitioner could assert a right to same sort of hearing before the CosmLission, ItCI has not demonstrated here that it has standing or a sufficient interest to assert such a right in this proceeding. NCI has failed to demonstrate any cognisable interest which will be affected by this proceeding.

In order to meet the requirements for standing, 4.e. an affected intierest, 'an organisation satst show injury, either to its organisational interests or to the interests of members who have authorised it to act for them.' Phi 2sde2phis 22ec. co.

(Linarick Generating Station, IInits 1 and 2), LBP 82 43A,15 ItRC 1423, 1437 (1982). NCI apparently seeks to establish its staruting or interest on the basis of an alleged generalised

' injury to its organisational interests, rather than to assert the interests of any members who have authorised it to act for them. 1/ NCI baldly asserts that it 'has important institutional interests which would be directly affected by the outcome of this proceeding.' (Petition at 3). The only interests asserted, however, are NCI's generalised interest in publie ,ormation and education regarding its ecocerns about non- tion. Stis type of general grievance does not 1/ When an organisation undertakes to intervene on behalf of its members, it saast demonstrate that at least one member with the requisite interest has authorised the organisation to represent her in the proceeding. Limerick, LBP.82 43A, 15 NRC at 1437; Nouston Myhtiaf a Power Co. (South Texas Project,1 Faits 1 and 2), LhP 7910, 9 MRC 439, 444 (1979) .

o

.o

-6

, demonstrate the repleite 'Lajury in fact

• to confer standtag impon NCI.

It has long been established and consistently reaffirmed that sa 'organisation seeking relief met allope that it will suffer some threatened or actual injury resulting from the agency action.' k'estinghouse 22ec. Corp. (Ruport to south Eorea), CLI 80 20,12 3RC 253, alt *,1980) (citing cases). 2a reviewing a ropest for intervention and a hearing on an export license application in Mestlayhouse, the Coundesion relied vpon

judicial precedents and concepts of standing which *made clear that *an organisation's abstract concern with a subject that could be affected by an adjudication does not substitute for concrete injury.** 2d. (p oting #1mos v. Eastern Kentucky

~

We2 fare Rist*:s OrganisatJam, 426 U.S. 25, 40 (1976)); .see also

'Elerra C2ub v. Norton, 405 U.S. 721, 739 40 (1972) . Likewise, the comissice has also held that under the ' injury in fact' test

'a clain,will not normally be entertained if the ' asserted harm is a *generalised grievance' shared in substantially e gal measure by all or a large class of citisens. 2'ransnuclear,

.Zac. (Ten ;.pplications for M ts to EURA'!CN Member Nations),

CLI 77 24, 6 BC 525, 531 (1977) (poting Marth v. soldia, 422 D.E. 490, 499 (1973)) .

NCI states that it is actively Lavolved la public istornation and education programs ocacerning issues such as nuclear proliferation. (Petition at 3). NCI then coattada, without providing any basis er support, that *[ilts interest and

O.

l ...

O

. 7

- ahuit. t. - -t ae.e g.neti.as wood be signini.anu, and adversely tagmired by the abeemos of a full, open and independent zwiew by the cossaission of the tesues raised under the Atomic anergy Act and the serPA by the pending liosase application.'

(Petition at 3). ' Ants, EICI appears to asyue that it should be granted standing to intervene in thist proceeding because it would like to intora the public concerning issues that might be raised by the panding export license application. If trie were the applicable standard, any newspaper, newsletter or other

arganisation providing information to the public would have standing to intervene in any stRC proceeding. Such a result is sentrary to established actions of standing.

In order to establish standing 'the injury amist be sairly traceable to the challenged action. 'or put otherwise, ,

t. hat the exercise of the Court's (or 3rRC's] respdial powers Wuld redress the claimed injuries. Westingbouse, CLI 80 30,12 NRC at 259 (queting Suke Power Co. v. Chro2ina Environmental study aroqp.- 438 U.S. 59, 74 (1978)) . Eowever, IICI has failed to suggest that it will be injured in any way that the commission sould remedy in connection with its review of this export license application.

-- The stCI petition clearly 2 ails to identity any sogni injury to its interests. In sum, NCI has failed to establish any interest in this proceeding.

O

• 221. & DISCRET20M&RT BEARING 18 WOT IN TER PUBLIC INTEREST &atD WOULD NOT ASSIST TER C000t18820N IN MhEING ITS STATUTORT n- ,->--Presen section 304(b) of the 30tPA provides for public participation in export licensing proceedings 'when the ccommission finds that such participation will be in the public interest and will assist the comunission.' 42 U.S.C. 2155a(b) see also 10 CFR II 110.84 (a) (1). (3) . Thus, no hearing should be ordered where the Causaission is unable to affirmatively make such findings. See, e.g., General Electric Co. (Exports to Taiwan),

CLI.81 2,13 NRC 67, 72 (19 B1) : Babcock & Wi2 cow (Application ior Consideration of Facility Export License), CL17718, 5 NRC 1332, 1349 (1977).

NCI has failed to make the showing required to justify a finding that a hearing will be in the public interes,t or assist the Coemission. 1/ NCI has raised three contentions, all of ,.

which presuppose that the ultimate end use of the esported material would involve utilisatiam as EEU. Bowever, Transnuclear has amended its application to make clear that the fuel will be defabricated and 'the recovered uranium will be blanded down at Pierrelatte to less than 20 percent U 235 (low enriched uranium is warranted. Bowever, if tNs Cound cAltal

~

1/ No '-

that f"arther inquiry were resired, a written date hearing should be sufficient to develop an adequate record on the issues that the Commission deems relevant. See, e.g., Ed2cw Int'2 co. (Agent for the Government of India),

CL1-19 2, 9 NRC 2, 3 (1979) (*(W)e do not believe that oral presentations before the Comunission would substantially assist the Commission in its analysis of this license application.'). An oral hearing could only serve to unnecessarily delay this proceeding without any significant benafit to the Cenission in reviewing the application.

o.

o for ultimate use as fuel for researsh and test reacters.*

(Ammaded Applicaties, Bleek 11). Etus, the sententions progiered by sci have ao relevance to the current application.

In its 2irst contention, WCI argues that appre M of this export would tuply U.S. governmental approval for use of M and that U.S. comuco defense and security interests would not be served by increasing the amount of M is laternational transport and commerce. In light of Transnuclear's amended applioation, it is clear that this export will not result in increase 6 use and proliferation of M. To the contrary, the defabriciation of this m and blending down to LEU will reduce the world inventory of M. Moreover, it will eliminate the possibility that the m in this fuel will be utilised in a high enriched for?a at some future tims. Finally, since the m contained in the esported material

.will be blended down to LEU and fabricated into_ fuel for research and test reactors, the expert directly supports the longstanding U.S. objective .. expressed in the Reduced Enrichment Research and Test Reactor program and other U.S. initiatives .. to eliminate the use of M fuel in research and test reactors.

NCI's second ocetention is that the proposed export would be inconsistant with the Schumer Amendmant, 2/ which prohibits export of m for use in research and test reactore unless certain conditions are met. Under the amended application, the exported material will be' blended down and used 2/ Section 903 of the Energy policy Act of 1992 (known as the

'Schumer Amendment') added section 134 to the Atomic Energy Act of 1954. 42 U.S.C. I 21604.

___m___

. 'o O 10 to fabricate LED fuel. Herefore, the Schumor manament is 4=311 cable to this export. In inet, the proposed export would promote the underlying goals of the schumor n=aaamant, by providing through haanding a source of 19.75 percent enriched uranium to be used in fabricating LED fuel for foreign research or test reactore.

Finally, 3tCI's third contention argues that Transnuelaar failed to adequately describe the proposed and.use in its application and thereby did not meet the information requirements of 10 CFR 5110.31(f) (5) . his argument is now moot, in light of Transnuclear's amended application which makas clear that the blended down LED will be used as fuel in research and test reactors.

MCI has iailed to raise any contentice which.will assist the Coenission in making the determinations required by statute, and thus, the Petition fails to satisfy the criteria of 10 CFR 5 110. 84 (a) (2) . Further inquiry will not assist the -

commission.

w-

o. o

.it.

. eesprmarest For the foregoing reasons, Transnuclear, Zac. en behalf of cogena, Inc., respectfully requests that the Petition of 3ruc3aar control Institute be denied in its entirety.

Respectfully Suhaitted,

"; O'

. .. . .s, ,

John E. Matthews Newman & Roltsinger, P.C. .

1615 L Street, N.W., Suite 1000 Washington, D.C. 20036 , ,

(202) 955 6600 AT2VRNEYS FOR TRANSNDCLEAR, 2NC.

July 27,1993 ass e e

'4 9

O o M SNatts OF AMER 3Ch N RSWIm&5' ORT 038E1883m REFoma Tus eenatraar m

)

zu the asatter of )

)

TRANSNUCLE&1, INC., ) DDeket No. 11064649 en behalf et, ) -

COGash, INC., ) Lisease No. 28 W 2748

)

(Empert of Dairratiated )

Puel ier Defabriosties) )

)

pgTTCE OF APPEARANCE OF ComtBEb Notice is hereby given that James A. Glasgow enters an appearance as counsel for Transnuclear, Inc., en behalf of COGENA, Jac., in the above captioned proceeding.

3 tame: James A. Glasgow

, Addresa: Newman & Roltsinger, P.C. I 1615 L Street, N.W., Suite 1000 ,

Washington, D.C. 20036 Telephone: (202) 955 6766 Admissions: United States Court-of 1s-for the District of Col in Circuit Name of Party: *1ransouclear, Inc.

Two Skyline Drive -

New York 10532 2120 Nawthorne, m Oe h 2 3n ~

James A. Glasgow" Newman & Noltsinger, P.C.

1615 L Street, N.W., Suite 1000 Washington, D.C. 20036 Date: July 27, 1993

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l .** NUCLEAR RSSUL&fcEY Octat18810N i .

i REPQ1E TER IMBAt1221dB l

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2a the matter of )

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TRANSNUCLEAR, INC., ) Seeket Be. 11004649 i en behalf of, )

] COGEMA, INC., ) 3.ieanse Be. 33101 2748

)

I l (Expert of Wairradiated )

{ Puel for Defabricaties) )

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s.a * - > . . s~ > s .,es.

Notice is hereby given that John 5. Matthews enters an appearance l as counsel for Transnuclear, Zac., on bshalf of COGENA, Inc., in the above captioned proceeding.

i l Name: John E. 90stthews 1

4 Address: Newman & Roltsinger, P.C.

• 2 -

1615 L Street, N.N. -

Suite 1000 Washington, D.C. 20036

Telephone

(202) 955 5806 j Admissions: United States Court of Appeals

]

for the District of Columbia circuit t

l Name o* Party Trans Inc.

]

Two ive York 10532 2120 1

N innsemartneve Newsan & Roltsinger, P.C.

1615 L Street, N.W., Duite 1000 washington, D.C. 20036 Date: July 27, 1993

. U O 2 hereby certify that en July 27, 1983, copies of

• 'Transnuclear's opposition in Response to Petition to Intervene two Notices of Appearance of Counsel, a certificate of service,,*

and a letter to the Secretary of the cometission, in the above-captioned proceeding were served by hand on the f allowing:

Chairman Ivan salin U.S. Nuclear Regulatory Commission One White Flint North 11555 Rockville Pike Rockville, Maryland 20852 ccomissioner Renneth C. Rogers U.S. Nuclear Regulatory Comattssion one White Flint North 11555 Rockville Pike Rockville, Maryland 20852 -

Coenissioner Forrest J. Remick '

U.S. Nuclear Regulatory Comunission one White Flint North 11555 Rockville Pike Rockville, Maryland 20852 Coenissioner Gail de 71anque U.S. Nuclear Regulatory Commission one White Flint North

• 11555 Rockville Pike .

Rockville, Maryland 20852 Office of the secretary U.S. Nuclear Regulatory Comunission r one White Flint North 11555 Rockville Pike Rockville, Maryland 20852 Attention: Chief Docketing and service section (Original plus two copies)

Office of the General Counsal U.S. Nuclear Regulatory Commission One White Flint North 11555 Rockv12.le Pike Rockville, Maryland 20852 .

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• l 316am V.C. Greenbe GMtVEY. SCNUBERT &

1000 Potomac Street, N.W, Suite 500 Mashington, D.C. 20007 0

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gJamesA. Glasgow /

2nly 27,1933 t

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Woul#S,ek. D.C. 3D088 8810 TELtemewti tses) e s s. sees naser aan scssas caen ess.am m mee = = enel ) 7, [f g July 27, 1993 1T EAMD DELTTERY Samuel J. Chilk Secretary of the Cosetission U.S. Nuclear Regulatory Comunission Washington, D.C. 20555 Attn Chief, Docketing and Services tranch Re: Transnuclesto Enc., on behsit of COGENAo Enc.

(Export of Unirradiated Fuel For Defabrication)

Dkt. No. 11004849. License Me. TENtf.274R Dear Mr. Chilk Enclosed are the original and two copies of

'Transnuclear's opposition in Response to Petition to Intervene,"

.together with two Notices of Appearance of Counsel and a certificate of Service. All are for filing in tonnection with the above-referenced application for an export license.

Service on Transnuclear, Inc. in the above-referenced proceeding should be made to James A. Glasgow, Newman &

Moltsinger, P.C., 1615 L Street, N.W., Suite 1000, Washington, D.C. 20036.

Sincerely, A , _ f. -

e.

/ ~~ ~ '

James A. Glasgow ' 'f .

JAG /1gv Enclosures 9303263 o

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Before the UNITED STATE 8 NUCLEAR REGUIATORY CONKISSION Nashington, D.C. 20555 In the Natter of )

)

TRANSNUCLEAR, INC. ) Docket No. 11004649

)

(Export of 93.159 Enriched Uranium) ) License No. X5MN 02748

.)

REPLY OF PETITIONER NUCLEAR CONTROL INSTITUTE TO APPLICANT'S OPPOSITION TO THE PETITION FOR LEAVE TO INTERVENE AND REQUEST FOR MEARING Petitionar, Nuclear control Institute (" Petitioner"), .

submits this reply memorandum in support of its Petition For Leave to Intervana and Request for Hearing (the ' Petition"), and in response to the views of Applicant, Transnuclear, Inc.

("Transnuclear" or

• Applicant"), as expressed in Transnuclear's opposition of July 27,1993 (hereinaf ter cited as " App. Opp.") .2 As set forth belcw, Petitioner sidaits that it has a sufficiant interest to warrant intervention under Section 189a. of the Atomic Energy Act of 1954, as amended, 42 U.S.C. $ 22394. (the

'It is Petitionar's understanding that the Commission Staff is not filing an Ansvar in this mattar, and no other Ansvars are expected.

3303559 e

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• Act"); that a hearing would assist the r===iasion in making its statutorily-reguired determinations and would be in the public interest; and that a full oral, adjudioatory hearing, including cross-examination and discovery, is appropriata.

2. PmTIONER BAE A SITFFIcIM INTMST TO MARRAMTl unmiwa as or mient uwnrm arction inen or enz Atowie rurmcy Act Awn in c.r.m. < iin.aa.

Applicant contends that there is no right to a hearing on an export license under section 189a. of the Atomic EnerWY Act and that, in any case, Petitionar has no standing to assert such a right in this proceeding. App. opp. at 3-7. Petitionar recognizes that the Camaission has addressed these issues extensively in prior export licensings; it does not intend to reiterate the arguments with which the commission is fully familiar. It does wish te make two points, however, with respect to (1) the relationship between section 189a. of the Atomic ..

Energy Act and Sections 304(b) and (c) of the Nuclear Non-Proliferation Act of 1978, 42 U.S.C. $ 2155a. (the *NNPA"); and (2) the appropriataness of the commission's general approach to standing in export licensing cases.

A, A Hearing Am of miaht Tm Avm11mble Yn twnert

... Licansinas.

The argument that section 304(c) of the NNPA eliminates any 4

right to a hearing in a nuclear export licensing proceeding under e

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O

.. .. O

,. Section 1893. Cf the Atemio Enaryy Act mi0 understands both the

, NNPA and the Commission's own prior practios.: ,

Section 304(c) of the NNPA does not ovarrida Section 189a.

of the NNPA in the export licensing centext. She form of a bearing, which is the subject of Section 304(c), must not be confused with the right to a hearing, which is provided for in

. Section 189a. and not dealt with in Section 304(s).

In section 304(c), Congress merely determined that standing under section 189a. does not antitle an individual to an *on-the-record" hearing and that, instead, section 304(b) would be the

'axelusive basis for hearings." Whether a particular individual would have a right to a hearing under Section 304(b) is a differant question. The Rouse Report on the NNPA is explicit in stating that, other than eliminating any requirement for an 'on-the-record hearing, "[I)t is not the intent of the Committee to limit public participation in the export licensing process in ar.y other respect." 5.R. Rep. No. 887, 95th' Cong. ,1st Sess. 32 (1977). 131 1152 s. Rep. No. 457, 95th Cong., 1st Sess. 15 8section 304(c) of the NNPA states 'The proceduras to be established pursuant to subsection (b) (of Section 304) shall constitute the exclusive basis for hearings in nuclear export licensing proceedings before the Commission, and notwithstanding section 189a. of the 1954 Act, shall not require the commission to grant any person an on-the-record hearing in such a proceeding."

(

o o

.. (1977). In other words, section assa., azoopt cc expreocly

, _ modified by section 304(o), is not affected by the NNPA.s Also unavailing to Applicant's position is the opinion of the District of Columbia circuit Court of Appeals in Matagal Rameurces befanma counell. Tne. v. Nuelaar Rasulaterv emeniamien, 580 F.2d 898 (D.C. Cir. 1978). What case merely held that, in view of the enactment of section 304(c), the question of need for an adjudicatory hearing under section 189a. was overtaken by Congressional action. Since the petitioners in that case had been afforded a legislative-type hearing by the Commission, it was not necessary for the Court to address questions of antitlament or standing. The Court, nonetheless, specifically stated that, if a petitioner sought to intervene and were denied intervention, it would be prepared to review the commission's ruling. 580 F.2d at 700. -

Lastly, the Commission's own practice has consistently been to consider the right to intervention in terms of standing under section 189a. Not only does 10 C.F.R. 5 110.s4 refer to tLe establishment of "an inturest that any be affected," the very language of section 189a., but, in each export licensing case since enactment of the NNPA in March of 1978, the Commission has nThis conclusion is reinforced by the ' cardinal principle" of statutory construction that, absent irreconcilable conflict, repeals by implication are not favored. h , Marten v. Naneari, 417 V.s. 535, 549-551 (1974).

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leaked to Scotion 189a. procedent as a basis for determining the, right te intervene. h, Wantinerheuna timetrie earn. , CLI 30, 12 ERC 253 (1980); canarmi timetrie ca., CLI-81-2, 13 NRC 67 (1981).

3. Petitlener's Tntarant fa suffleinnt Te Warrant A Naarine In Thia Preenedine.

Petitionar must necessarily concede that there is a line of Commission oases, starting with the pre-NNPA decision in Edinv internationni ca., CLI-76-4, 3 NRC 563 (1976), denying standing to organizations with interests substantially similair to Petitioner in proceedings substantially similar to the present ans. h, Edlow International ca. , ggggg; Trananuelaar. Tne.,

CLI-77-24, 4 NRC 525 (1977); wantinehouma timetrie cern., CLI 30,12 NRC 253 (1980); canarmi timetrie ca., CLI-81-2, 13 NRC 67 (1981).* Bowever, petitioner submits that a more equitable

' Contrary to the commission's approach, petitioner believes that there is an " institutional" basis for determining that it has standing to intervene, that the commission's determination that standing must be established *in terms of the final result of the proceedings" and that informational interests do not suffice to do so, udiew Intern.tional en., aunra, 3 NRC at 572-574, is erroneous, and that the United States court of Appeals for the 31 strict of Columbia circuit has recognised an institut$emal basis for standing assentially identical to that asserte( Sa these proceedings. 333 seientists' Ynatituta fer Publie TWfermation. Yne. v. Atomie Enarav commiamien, 431 F.2d 1079 (D.C. Cir. 1973); National Wildlife Federation v. Medal, 339 F.2d 494, 712 (D.C. Cir. 1988); comeatitive Entarnrian institute

v. National Michway Traffic safety Administration, 901 F.2d 107, 123 (D.C. Cir. 1990). But see Foundation en tennemie Trenda v.

Mg1 king, 794 F. Supp. 395 (D.D.C. 1992).

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o

, approach to standing in export lioensing proceedings is required than has been applied in the past.

The effect of the Commission's standing rulings just cited is essantially to preclude mandatory review of arport licensing action by all but equipment suppliers and foreign importars of nuclear materials, h , those with financial intarasts in the transaction, while the persons whom the process is designed to protect are excluded from participation. Comment, .

Environwantalista Attack NRc's Pual twnert Lieansina, 6 E.L.R.

10190 (sept. 1976'). This result is unwarranted.

At the time of the Zillag decision, there was nothing in the Atoalc Enargy Act to indicate that Congress contemplated public participation in the export licensing process. Edinv International cm. , AMEZA, 3 NRC at 570-572. Since 3dlag was.

decided, the NNPA has been anacted, reflecting the judgment of Congress that public participation in the arport licensing process is

• crucial.* waturni maneurena nafensa council. Tne. v.

Wuelaar Raoulatery comminaien, 447 F.2d 1345, 1368, 1375 (D.C.

Cir. 1981) (Robinson,.7., concurring). Indeed, the Mouse Report on the NNPA states, attithm intent of the committaa timi to cuarantaa ta eltitana and nublic interant arouns their rinht to saaka their vlava knmm durine the ernert licensine necessa.*

M.R. Rep. No. 537, 95th Cong. ,1st Sess. 22 (1977) (emphasis 6-e e

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, added). 333 4133 124 g m . 333 3. 1438 (daily ed. February 7, 1978) -(remarks of Senator Glenn).

Given this history, since Article 222 of the constitution does not dictate the results to be reached under Section 189a. of the Atomic Energy Act, as it does in federal ocurt actions, there is svary reason to expand the Commission's approach to standing in proceedings such as this one. If such action were taken, Petitioner believes that there would be few *public interest groups" deemed more qualified than itself to invoke the hearing procedures as of right under 10 C.F.R. Part 110.s II. A FUT1 AND OPEN MEARING W0tfLD ARETET TNT COMMTRETON TN MAXING ITE ETATUTORILY-REOUIRED DETERMINATIONE AND woute af IN TNE PUntic INTEmreT.

~

Applicant argues against a public hearing on the ground

t. hat, by virtue of the .7uly 16, 1993 amendment to its initial application,8 Petitioner's contentions, "which presuppose that 8

It' deserves note that in a prior licensing also involving the proposed export of highly enriched uranium -(*REU"), that for the HTR Petten Reactor (Dkt. No. 11004440, Lic. No. XSNM 02611),

the commission staff itself, while opposing intervention as of right, acknowledged that Petitioner

• sight possess knowledge and information that would be helpful to the Commission" and supported permissive intervention. Commission statf Answer, dated August 2, 1991, at 12. Should the Commission deem it appropriate, Petitioner stands ready to submit by supplemental affidavit more detailed ir. formation concerning its informational activities as they relate to EEU and the background and expertise of its directors, staff and consultants with respect to the uses and control of REU. .

• This amendment was noted in the Federal Recrister on August 12, 1993 (58 Zad. Rag. 42991). Consistent with the terms of the Faderal Recristar notice, Petitioner reserves its right to file

)

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o to

, t '

th3 ultimata and-use of the suported antarial would involve stilisaties as EED . . ., have no relevanoe to the surrent t

application." App. Opp. at 8-9. Petitionar readily concedes j that Applionat's newly-announced intention to bland down the EEU to Isss than 30% D-235 is a velocae developeant and removes 3g33 or petitioner's concerns about the proposed export. Bowever, it l does not resolve All Petitioner's conoarna, and, contrary to Applicant's views, Petitioner sukumits that its participation, l with respect to the amended application, *will be in the public i

interest and will assist the commission in making the statutory ,

determinations required" by the Atomic Energy Act, within the l meaning of section 304(b) of the NNFA and the commission's own regulations, 10 c.F.R. 5 110.s4 (a) .

)

i

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( A. Petitioner's commen Befanan and Emeurity contantions i Ramain Valid. -

l Petitioner's common defense and security contentions remain j valid because, despite Applicant's assertions, the risks l

j associated with increased transport of and commerce in EEU are r

not completely eliminated by Applicant's stated intention to blend down the fuel at issue in this proceeding at COGENA's 71errelatte facility in France. This is so for essentially four reasons.

l

! amended contentions within thirty days of such notice.

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... First, while Applicant oorrectly notas Petitioner's position

• that U.S. conson deranse and security interests would not be sarved by increasing the amount of m in international transport and commeroe," app. Opp. at 9, the conclusion does not follow that the amended license app,ination eliminates the problem of increasing international transport of and commerce in m . To the contrary, obviously such increase would in fact occur if the proposed export ware approved, sinoa m would be shipped from the United States to France. Ebe goal of U.S. non-proliferation 2aw and policy, as set forth in Section 501(a)(3)(A) of the ,

omnibus Diplomatic security and Anti-Terrorian Act of 1985, Pub.

L. No.99-399, is to " keep to a minimum the amount of weapons-grade nuclear material in international transit." petitionar continues to maintain that, unless and until Applicant demonstrates that processing and blanding down oculd not be accomplished in the United States, the proposed export would.. -

. still run afoul of this goal and so should not be approved by the canaission. In fact, it is doubtful that such a showing can be made, since Nuclear Fuel Services, Inc.l the owner of the fuel in question, has recently obtained amendments to its license (Dkt.

No.70-143, Lic. No. SNN-134, Amendments Nos. 3 and 8, dated May 7,1993 and August 4,1993, respectively) authorizing both the processing of the fuel to recover m and enrichment down blanding at its Erwin, Tannessee facility. Since it appears that processing and blanding down of the bomb-grade material now can e

be done Comestleally, the semesa defense and security rationalo against the proposed export is more sempelling than ever.'

second, despite the expressed intention to defabricate and bland down the fuel which is the subject of this licensing, actual physical alteration of the material proposed to be exported is not assured. Applicant has nowhere avarred that sale, substitution or swap of the material would not take place once the material is in Framos, within the Europeaa Atomic; Energy Community ("EURATCH"), but prior to any actual defabrication or bland down. Nor has Applicant avarred that the material would not otherwise be retransferred within EURATON, prior to defabrication or bland down, to an and use different than that specified. Under the taras of the U.S.-EURATOM egreements for nuclear cooperation,8 such eventualities could occur, without V.s. consent or knowledge, thereby permitting t'he material -

7 It might also be questioned whether the proposed export can be considered to meet the " minimum transit" goal of pub. L.

No.99-399, unless Applicant could demonstrate that there is no way to produce 19.75% enriched uranium and satisfy the demand for the use of such material in research and test reactors othar than by arporting REU for blanding down in foreign facilities.

'Aga Agreement for Cooperation between the Government of t a United States and the European Atomic Energy Community (EURATOM)

Concerning Peaceful Uses of Atomic Energy, done at Brussels, Novaaber s. 58, entered into force February 15, 1959, as amended by t done May 21 a 22, 1962, TIAs Nos. 4173, 5103; Addi 1 Agreement for Cooperation between the United States and the European Atomic Energy Community (EURATOM)

Concerning peaceful Uses of Atomic Energy, done at Washington and New York, .7une 11,1960, entered into force .7uly 25, 1960, as amended by Agreements done May 21 & 22, 1962, August 22 & 27, 1963, and September 20, 1972, TIA5 Nos. 4650, $104, 5444 and 7566 (colleetively, t.he "U.s.-EURATON Agreements").

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ultimately to be used as EEU in research remoters or for other purposas in the Community, regardless of the and use specified in the lioanse application and authorised by the Commission.' 2n fact, the W.B.-EURATON Agreements in no way har suob actions, and there is both precedent for them" and an economic inoentive which makes then plausible.88 For these reasons, a commitment by Applicant to rendering this specific antarial into a form below 20% anrichment and therefore unsuitable for weapons use must be

'Ang 3. Rep. No. 467, 95th Cong. ,1st Sass.17 1977). As stated in a letter dated April 6,1992, from Acting ,(Commission Chairman Rogers to Congressaan Charles E. Schumer regarding previous HEU exports, " EURATOM is not required to seek U.S.

approval for transfera within the Commun:,ty....(N)ovaments of nuclear materials within the community are not reported to the United States....(P)rior U.S. consent is agt required if the material is transferred to diffarant and-uses w;, thin the EURATOM connunitya (amphasis in original).

"For example, EEU fuel originally exported for*end use in Germany's now closed TNTR-300 reactor is at this time, without there apparently even having been consultation'with the United states, being marketed elsewhere in Europe, including for and use in reactors, such as the EFR Petten Reactor in the N:,therlands, whi.h U.S. law would andnot be eligible to receive such fuel undar current policy.

8$

There is an economic incentive to ' utilise EEU ggh EEU because there is a premium in Europe on such fuel due to its reistive scarcity compared with less than act enriched fuel, including abundant supplies of 19.75% enriched uranium. In addition, prior to blend down, the material would have an extra pranium over and above that of even European-origin EEU, because the United States is committed under the Department of Energy's off-Site Fools policy to accept its return as spent fuel after use levelinwasteforeienla research reactors and retain all residual high this country. Aan letter, dated .7uly 13, 1993, from secretary Warren of Energy Basel O' Leary to Secretary of State Christoper.

l By contrast, European processors require reactor operators to accept the return of residual high level waste recovered in the processing of their spent fuel.

Petitionar understands that some operators may not be licensed to ractsive such wasta. -

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-T tO O concepanied by o semaitment ta writing by samaron that, mothwithstanding any provision er interpretation of the U.S.-

EURATOM Agreements, bland down operations will be oompleted, and, after such osapletion, appropriate omrtification and . h .drq will be provided to this affect. Otherwise, achievement of U.S.

men-proliferation objectives cannet be assured.

Third, because the material will be in EURATON, where under the U.S.-EURATOM Agreements the U.S. does not possess consent rights over the subsequent alteration of the material, .

Applicant's assertion that its proposal will " eliminate the possibility that the EEU in this fuel will be utilised in a high-anriched fora at some future time," App. Opp. at 9, cannot be taken at face value, even if defabrication and bland down operations are initially carried out. In fact, reenri'chment of the materini after bland down must be considardd a real -

, possibility, both because there is nothing in the license application as amended or the underlying U.S.-EURA'tCH Agreements that affirmatively rules it out and because of the noenomic attractiveness of U.S.-origin EEU in Europe. In such circumstances, since 19.75% enriched uranium is auch easier to reanrich than 3-54 antarial, Petitioner believes that, to reduce the prospect of reenrichment to a miniana, Applicant should be required to identify a specific demand for 19.75% enriched uranium that eannot be satisfied by existing international supplies. Otherwise, no export should be approved, unless there 3.2 -

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,, As a sommitment to bland down the material to less than 5%

enrichment, for which there plainly is a market.

Fourth, the amended application leaves open questions related to the timing of defahrloation and bland down operations.

Plainly, the longer the material remains unprocessed, the greater the risk. No export abon14 he approved without a specific requirement that defabrication and bland down eoour within a limited time period, i.e... six months from transport, to reduce risks of misuse to a miniana. If defabrication and, bland down do not occur within the specil'ied period, then, absent demonstration of reasonable cause for delty, the material should be required to be returned to the United States.

7, Datitionar's Echummy amanAmmMt Cententions*Rammin Valid.

Applicant contends that, in light of its July is amendment, the Schumer Amendment, 42 U.S.C. $ 2180d., is now

• inapplicable to this , export." App. Opp. at 10. Again, the effect of the -

license application amendment.in not so' simple. Until the questions noted above with respect to the prospects for sale, swap, substitution, retransfer and reenrichment are resolved satisfacterily - and any prospect for the use of the material subject to this licensing as EED in a'research or test reactor abroad thus definitively eliminated - the schumer Amendment issues raised by Petitioner remain , alive. 2n any event, by its terms, the schumer Amendment allows the commission to issue "a

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(O O lioensa for the export cf highly enriebed uranium to be need as o

• fuel or tarTet in a nuclear research or test reactor only if...thare is no alternative nuclear reactor fuel se target enriched in the isotope 235 to a lassar paroent than the proposed export, that can be used in that reactor." 42 U.S.C.

5 21 sod. (a) (1) . Applicant affirms that the material at issue bare - EEU - will ultimately be used in a research or test reactor, albeit ih altered form. Consequently, in order to comply with the Schumer amendment, the burden remains on ,

Applicant to demonstrata that a demand for this matarial cannot be satisfied by existing international supplies of less than 20%

enriched fuel. Absent such a demonstration, the license application must be denied.

C. Petitioner's Informational contantions Rammiri valid.

Applicant suggests that Petitioner's inforisational -

contantions under 10 C.F.R. $ 110.31(f) (5) are now *noot". App.

Opp. at 10. However, while Applicant statas that the ultimate and use of the matarial will be *as fuel in research or' test reactors", id., this statament is still unacceptably vague.

Applicant has not specified in which particular rossarch or test reactor the fuel might be used, the country where such reactor might be located, the sateguards and physical security conditions applicable to its eventual use and the like. The ultimate end use thus remains speculative, and more information needs.to be prc tidad to satisfy the Commission's informational requirements,

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• • 311. A FtfLt. Stif AMtfBf e1TomY WtitTMS. Tuef_ttnTMc enema.

'YavfMATION AND DInc0VERY. Ya APPROPRfATE TM TNTEF pmoctreimas.

Applicant argues that a full oral adjudioatory hearing is not provided for under the commission's regulations for export licensing and would be ' inappropriate.' App. Opp. at 4.

petitioner submits that a full oral adjudicatory hearing is both available and desirable in these proceedings.

There is no question that a full-scale adjudicatory hearing is available in the export licensing process. The NNPA in Section 304 does not specify what type of hearing the commission must provide in an export licensing. While it states that adjudicatory hearings are not racptirad, in no way does it prohibit the granting of an adjudicatory hearing. Rather, the NNPA simply leaves discretion with the commission to establish appropriate hearing procedures. ~

Petitioner recognises that the Commission's regulations, 10 C.F.R. Part 110, Subpart .7, basically co'ntemplate legislative-type hearings. Nonetheless, the Ccamission hem a wids range of choices legally available to it in structuring its hearing processes.. The agency has authority ta modify its procedural rules the ends of justice require it", American hru Linas L Black Ball Freight Service. 397 U.S. 537 (1970)n and min varment Yankaa Nuelaar Power cern. v. Natural Resouream Defanna council. Yne., 435 U.S. 819, 524 (1978), Justice Rehnquist similarly noted that, under the Administrative

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. 21ezihi11ty under subpart a to se . ama, a m , to C.F.m.

5 110.113 (e) (4) .

While Applicant vaguely refers to

• sensitive foreign policy and national defense considerations" militating against adjudicatory procedures, citing Braunkohle Transnart usa. CLI 5, 25 NRC 591 (1987), these consideratio'is are unspecified, and mene is okwious in this particular proceeding. vague assertions '

of foreign policy sensitivity should not he allowed to defeat full and open public processes. As the Court of Appeals for the D.C. Circuit stated a number of years ago: "The time has long passed when the words ' foreign policy' uttered in hushed tones, can evoke a reverential silena from either a court or the man in the streets.* Zweihon m.Mitchall. 515 F.2d 594, 657 a.207 (D.C.

Cir.1975), sagt. daning, 435 U.S. 944 (1976), quoting Dillai v.

~

civil Aarenauties neard, 485 F.2d 1018, 1031 n.34 (D.C. Cir.'

1973).

Nor is this casa properly comparshl's to Braunkohle Transeert. DEA, CLI-87-5, 25 IDtc 891 (1987), where the CoenLission felt a

• paper hearing" sufficient because the matters at issue were considered to be primarily ones of law and policy. In Braunkohle, the primary question was whether the Anti-Apartheid Procedure Act, "Agencias are free to grant additional i,s h ural rights in the exercise of their discretion.* ,

W O e

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_,, Act hanned the importation of uranium hasafluoride from south

, Afrios. The commission thus emphasised:

Use of formal adjudioatory procedures is particularly inappropriate bare because the major issues facing the ceanission are legal cuestions regarding what is the scope of the uranium import har contained in the Anti-Apartheid Act. Legal issues traditionally are resolved through written pleadings, not through use of formal adjudicatory procedures such as cross-awamination.

25 30tc at 894. by contrast, in this proceeding, petitioner's sentantions are not ones of statutory construction but are rather focused on the facts and sirouastances of a particular fuel

• esport.

There are, Petitioner submits, numerous factual issues with respect to this proceeding. Factual issues that need to be probed are, for example, (a) the feasibility of defabricating and blanding down the material in domestic U.S. facilities; (b) the possibility that all currant demands for 19.754~anriebed uranium in research and test reactors can be satisified by existing international supplies; (c) the economic attractiveness of sway, substitution, sale and retransfer schema's which could result in the continued circulation of the material in international conserce; (4) the conditions, if any, under which reenrichment in EURATott might make economic sense, thereby undermiaia; Applicant's representations; and (e) the timeframe for completing defabrication and bland down operations at pierrelatta.

The list of issues could readily he expanded. The point, -

however, is that only an oral adjudicatory hearing can provida e

>O O the heightened adversarial contant neoessary to elicit proper a

answers to such factual questions.

Disoevery privileges, furthermore, are needed to ensure that all relevant information is made available to the parties, the .

Staff and the constission. Absent such procedures, there is no assurance that a tall picture of the facts relating to this expart and its future laplications will be developed by the '

parties and presented to the commission. Rather, all the..

commission will have is information the Commission Staff has requested from or which has been volunteered by Applicant.

In sua, in this case, unless the full panoply of adjudicatory procedures is available, there is a real prospect that the record will not be fully developed and that the

~

substantial risks associated with this proposed export will not be completely and comprehensively explored. Consequently, there is every reason to order a full adjudicatory hearing and so best ensure that the Commission " develop [s] a' record that will contribute to informed decisionmaking." 10 C.F.R. $

110.105 (a) ."

1. Even if an adjudicatory hearing is not hearing is for preferable to the mere " paper" hearing by Applicant.

ordered, a full oral suggested 333 App. Opp. at 8, m.6. An oral hearing would provide' requiredauch greater statutory assistance to the Commission in making the determinations. Only an oral hearing would permit the sukaission of " oral statements, questions, responses, and rebuttal testimony," 10 C.F.R. $ 110.106(b), as well as an opportunity for oral questioning by the presiding officer, 10 C.F.R. 55 110.105 (a) (3) , 110.107 (f) . The commission itself has

= 18 -

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.:2

o. O enmermarou For all the reasons set forth in this Reply and in the Petition, Petitioner respectfully submits that the commission should grant the Petition; order a full, eral adjudicatory hearing in connection with the pending lioense application; and act to ensure that all pertinent data regarding the issues addressed by Petitionar be made available for public inspection at the earliest possible date.

Respeettully submitted,.

ND }

Eldon V. C. Greenberg Linette G. Tobin GARVEY, SCHUBERT &

1000 Potomac Stree .W.

Suite 500 Washington, D.C. 20007 (303) 965-7880 -

Attornava for Datitlenar Dated:

• August 15, 1993 Washington, D.C.

recognized that such public hearings "can be conducted without prejudicing the important national interests on which export licensing determinations are made." ulov international ca.,

CLI-76-4, 3=NRC 563, 590 (1976).

e

LO -

O i .'

CERTIFTCATE.OF EERY 1CE 2 hereby certify that I caused the foregoing Reply of Petitioner to be served by having copias thereof mailed, first class, postage prepaid, on the 16th day of August, 1993, to the following:

Executive Secretary D. 5. Department of State ,.

Washington, D.C. 20520 and by having copies thereof hand-delivered on such date to the following:

Office of the General Counsel U.S. Nuclear Regulatory Commission One White Flint North -

"~~~

11555 Rockville Pike Rockville, Maryland 20852 Docketing and service Branch James A. Glasgow Office of the Secretary Newman & Roltsingar U.S. Nuclear Regulatory 1815 L Street, N.W.

Commission Washington, D.C. 20036 One White Flint North 11555 Rockville Pike Rockville, Maryland 20852 (3 copies)

,.- b Eldon V.C. Greenberg Dated: August 16, 1993 Washington, D.C.

e e

O O O

G ATTACMENT 6

Attachnent 2 7CMETED

. ..NHC UNITED STATES OF AMERICA M M6 NUCLEAR REGUIATORY COMMISSION , , , ,

COMMISSIONERS:

Ivan Selin, Chairman Kenneth C. Rogers Forrest J. Remick E. Gail de Planque

, SE M1$ N k

In the Matter of )

)

TRANSNUCLEAR, INC. ) Docket No. 11004649

)

(Export of 93.15% Enriched Uranium)) License No. XSNM02748

)

xxxOmannou ame omnum CLI-9 4- 01 F I. INTRODUCTION The Nuclear Control Institute ("NCI") filed a Petition for Le&ve to Intervene and Request for Hearing on an application from Transnuclear, Inc. ("Transnuclear") for a license to export 280 kilograms of high-enriched uranium ("HEU") in the form of mixed uranium and thorium carbide, se unirradiated fuel fabricated for the Fort St. Vrain reactor, to COGEMA in France to be processed for recovezy of the uranium and thorium. For the reasons stated in this Memorandum and order, we deny the Petition for Leave to Intervene and Request for Hearing.

W^:T? c', '??  ; ] ,z

II. BACKGROUND Transnuclear filed an application, dated May 5, 1993, for a license to export 280 kilograms of HEU containing 260.9 kilograms of uranium-235 (93.15% enriched) and 2481 kilograms of thorium, in the form of mixed uranium and thorium carbide, as unirradiated fuel fabricated for the Fort St. Vrain reactor,1 to COGEMA in France to be processed for recovery of the uranium and thorium.2 on June 24, 1993, NCI filed a Petition for Leave to Intervene and Request for Hearing on the Transnuclear license application. NCI asserts that it is a nonprofit, educational corporation based in the District of Columbia, and engages in disseminating information to the public concerning the risks associated with the use of nuclear materials and technology. Petition at 1-2.

NCI seeks intervention to argue that (1) the proposed export, if authorized, would be inimical to the common defense and security of the United States, (2) approval of the proposed export would be contrary to Section 134 of the Atomic Energy Act of 1954, as amended, 42 U.S.C. I 2160d (the "Schumer

) Amendment")3, and (3) the license application is deficient in

'The fabricated fuel is from tho'now-decommissioned Fort St.

Vrain Power Station, a high temperature-gas-cooled thorium fuel cycle prototype reactor located at Platteville, Colorado and owned-The materia,1 is by the Public Service Company of Colorado.

currently owned by Nuclear Fuel Services (NFS) and stored at the Erwin, Tennessee f acility of NFS.

2 Notice of receipt of the application was published in the Federal Recister on May 26, 1993 (58 Fed. Reg. 30187).

I The Energy Policy Act of 1992, Public Law 102-486, signed into law on October 24, 1992, among other things, added new (continued...)

meeting the information requirements of NRC regulations in that it does not sufficiently describe the ultimate intended and use of the material-to be exported. Petition at 10-11.

NCI requests that the Commission (1) grant NCI's Petition for laave to Intervene, (2) order a full and open public hearing at which interested parties may present oral and written testi:nony and conduct discovery and cross-examination of witnesses, and (3) act to ensure that all pertinent information regarding the issues addressed by NCI is made available for s

public inspection at the earliest possible date. Petition at 1-2, 18.

Transnuclear filed an Opposition in Response to Petition to Intervene (" Response") on July 27, 1993. Before responding to the petition, Transnuclear amended its application on July 16, 1993, to require that the exported material be blended down and used as low enriched uranium (" LEU") for research or test reactors. In its Response, Transnuclear argues that the NRC is 3(... continued) restrictions on the export of uranium, in a new Section 134 of the Atomic Energy Act (the "Schumer amendment") . The Schumer Amendment permits the assuance of a license for export of uranium enriched to 20 per ce4 or more in the isotope-235 to be used as a fuel or target i nuclear research or test reactor only if, in addition

-to other irements of the Atomic Energy Act, the NRC determines that 1) re is no alternative nuclear reactor fuel or target enriched in the isotope 235 to a lesser percent than the proposed export, that can be used in that reactor; 2) the proposed recipient of that uranium has provided assurances that, whenever an alternative nuclear reactor fuel or target can be used in that reactor, it will use that alternative in lieu of highly enriched uranium: and 3) the United States Government is actively developing an alternative nuclear reactor fuel or target that can be used in that reactor. The applicability of the Schumer Amendment to the instant application is discussed infIA.

• -o not statutorily required to provide an adjudicatory hearing on export licenses and that in any case, NCI is not entitled to a hearing as a matter of right because NCI lacks standing.

Response at 2-4. Transnuclear further argued that a discretionary hearing would not be in the public interest or assist the commission in making its statutory determination because Transnuclear's amended license application makes clear that the uranium recovered from the ex c .can material will be blended down to LEU thus removing the relevance of the contentions proffered by NCI. Response at 8-10.

NCI filed a timely Reply to Applicant's opposition to the Petition for Leave to Intervene and Request - for Hearing (" Reply")

on August 16, 1993. In its Reply, NCI argues that a h, earing of right is available in export licensing cases. Reply at 2-4. NCI concedes that Commission case law has denied standing, as a matter of right, to organizations with interests substantially similar to NCI in proceedings substantially similar to the instant one, but argues that the commission should expand its approach to standing in export licensing proceedings to meet Congressional expectations regarding public participation in such proceedings. Reply at 5-7. NCI further argues that, notwithstanding Transnuclear's stated intention to bland down the material after it is exported, NCI's contentions remain valid because granting the license will increase the amount of REU in international transport and commerce, and the expressed intention to down blend is unacceptably vague. Reply at 7-14.

l

a Subsequent to NCI's Reply, COGEMA submitted a letter dated September 8, -1993, confirming that CoGEMA vill notify the NRC, in writing, within 30 days after all the exported material has been blended down to Izu. In a letter dated september 24, 1993, COGEMA again confirmed the earlier notification commitment and further confirmed that commercial arrangements regarding the material require that all the exported material ha blended down with no substitutions or sale of HEU allowed, and that COGEMA will retain title to the material until it has been blended down to LEU.

III. TME PETITIONER'S STANDING e

A. NCI Does Not Have Standing To Intervene As A Matter Of Right Section 189a of the Atomic Energy Act of 1954, as amended, provides,'among other things, that the Commission grant a hearing, as a matter of right, to any person "whose interest may.

be affected by" a proceeding under the Act for the granting of any licandb. 42 U.S.C. I 2239(a) (1) .' To determine if a

'The Commission's regulations at 10 C.F.R. I 110.84 list the factors to be considered in taking action on a hearing request or intervention petition in a licensing proceeding for the export of nuclear materials. Section 110.84(b) addresses considerations to determine whether a petitioner has standing to intervene as a matter of right and provides that:

(continued...)

4

-6=

petitioner has sufficient interest in a proceeding to be entitled to intervene as a matter of right under section 189a, "the commission has long applied contemporaneous judicial concepts of standing.* clavaland timetric T11uminatina emananv. at al. ,

(Perry Nuclear Power Plant, Unit 1), CLI-93-21, 38 NRC 87, 92 (1991), 2111Ag sacramanta Municinal utility nistrict (Rancho seco Nuclear Generating Station), CLI-92-2, 35 NRC 47, 56 (1992),

gli'd, Enyironmental & Ramources conmarvation Ora, v. NRC,' No.

92-70202 (9th Cir. June 30, 1992): Metrono11 tan Edison co.

(Three Mile Island Nuclear Station, Unit 1), CLI-83-25, 18 HRC 327, 332 (1983). To satisfy the judicial concept of standing, a petitioner must demonstrate a a concrete and particularized injury that is fairly traceable to the challenged action." CLI-93-21, 38 NRC at 92 (1993).

NCI asserts a claim of interest for standing based on its institutional interests in the dissemination of information concerning nuclear weapons and proliferation in general and the use of HEU in particular. Petition at 3. The Commission has

'(... continued)

(b) 72 a -hearing request or intervention petition speerts an interest which may be affected, the commission will considert

, (1) The nature of the alleged interests (2) How the interest relates to issuance or denialt and (3) The possible effect of any order on that interest, including whether the relief requested is within the Commission's authority, and, if so, whether granting relief would redress the alleged injury.

10 C.T.R. I 110.84(b).

=

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, long held that institutional interest in providing information to the public and the generalized intarost of their membershipi in minimizing danger ceum pro 11te'.3tien are insufficient for standing under section 189a. maa. a.a... Ediov internationni ce.

(Agent for the Government of India on Application to Export Special Nuclear Material), CLI-76-4, 3 NRC 543,572-78 (1976);

rwwen Nuelaar cannany. Inc.. at al. (Ten Applications For Low Enriched Uranium Exports To EURATOM Member Nations) C LI-7 7 -2 4 ,

6 NRC 525, 529-32 (1977) Wantinehouma Elmetric corn. (Export to South Korea) C LI-8 0-3 0, 12 NRC 253, 257-60 (1980)r C&naral giggerie cemenny (Exports to Taiwan) CLI-81-2, 13 NRC 67, 70 (1981). Saa also sacramento Munir.Inal Utility Diatrict (Rancho Seco Nuclear Generating Station) CLI-92-02, 35 NRC 47, 59-61 (1992) (rejection of " informational interests" as grounds for standing in reactor licensing case).

NCI " concede (s) that there is a line of Commission cassa, starting with the pre-NNPA (Nuclear Non-Proliferation Act) decision in Edlow International ca. , C LI-7 6-4, 3 NRC 563 (1976),

denying standing to organizations with interests substantially similar to petitioner in proceedings substantially similar to the present one." Reply at 5. NCI argues, however, that the Commission's approach to standing should be expanded to realize the Congressional intention to increase public participation in export licensing through enactment of section 304 of the Nuclear Non-Proliferation Act of 1978, 42 U.S.C. I 2155a f"NNPA"). Reply at 5-7.

-d

4 The mechanism for increased public participation NCI urges already is provided for in the commission's regulatior,s. section 304(b)(2) of the NNPA sandated that the Commission promulgate regulations establishing procedures "for public participation in nuclear export licensing proceedings when the Commission finds that such participation will be in the public interest and will assist the commission in making the statutory determinations required by the 1954 Act." 42 U.s.C. I 2155a (b) (2) . The Commission amended its regulations in 1978 expressly to accommodate this mandate by adding the criteria set out in 10 C.T.R. I 110.84(a) for granting a hearing as a matter of discretion.' Esa Statement of Considerations, 43 Fed. Reg. 21641, 21642-43 (1978). The regulation specifically s,ets forth the commission policy to hold _a hearing or otherwise permit public participation if the commission finds that such a hearing or participation would be in the public interest and would assist the Commission in making the required statutory determinations.

3Section 110.84(a) of Title 10 of the Code of Federal Regulations provides thatt Ih (a) In an export licensing proceeding, or in en import licensing proceeding'in which a hearing request or intervention petition does not assert or establish an interest which may be affected, the Commission will considers (1) Whether a hearing would be in the public interests and (2) Whether a hearing would assist the Commission in making the statutory determina-tions required by the Atomic Energy Act.

10 C.T.R. I 110.84(a).

_ ==____: ___: = . _ _ _ _ .

= = _ _

.g.

l Thus, even though NCI has not established a basis on which it ir entitled to intervene as a matter of right, the Commission could hold a hearing under 10 C.F.R. I 110.84(a)(1) and (2) if such hearing would be in the public interest and assist the Commission. Egg Braunkohle Trananort. USA (Import of South African Uranium ore Concentrate), CLI-87-6, 25 NRC 891, 893 (1987).

B. A Discretionary Hearing Would Not Assist The commission And Be In The Public Interest The issues raised by NCI - (1) the common defense and security of the United States, (2) compliance with the schumer Amendment, and (3) assurance of the ultimate intended and use of the material - do concern matters which the Commission considers in making an export license decision. There is no indication in NCI's pleading, however, that it possessoa special knowledge regarding these issues or that it will present information not already available to and considered by the Commission.

The Executive Branch and the Commission staff have addressed the issues sufficiently in their respective reviews of the Applicatimp. The transportation, international safeguards, and foreign physical security concerns associated with the issue of the common defense and security were addressed by the Executive Branch and the Commission staff in their consideration of the Application. The Commission has reviewed the Executive Branch's and commission staff's evaluation of the ultimate end use of the

material and the effect of the COGEMA September 8 and 24,1993, letters regarding that and use. NCI offers no reason for the Commission to differ with the views expressed by the Executive Branch and the Commission staff on these matters.

The only remaining issue raised by NCI is compliance with section 134 of the Atomic EnerTy Act of 1954, as amended, (the schumer Amendment) 42 U.s.C. I 21 sod. NCI contends that, notwithstanding that the NEU is to be blended down for use as LEU reactor fuel, the schumer Amendment issue arersins alive" because of the terms of the Amendment. Reply at 13-14. A fair reading of the entire amendsent, however, shows that, while Congress may have been concerned about the transportation of HEU, the focus of the statute is on discouraging the continued use of H,EU as reactor fuel and not on prohibiting the orportation, per se, of HEU. Any other reading would be inconsistent with the plain meaning of the legislation since it allows for the exportation of MEU fuel for use in a reactor provided that certain provisions are in place to ultimately convert the reactor to use LEU. 13a 42 U.S.C. I 2160d(a) (2) and (3) . Further, assuming arnuendo that the terms y the schumer Amendment are ambiguous,' a review of

'The schumer Amendment states, in parts

a. The Commission may issue a license for the export of highly enriched uranium to be used as a fuel or target in a nuclear research or test reactor only if, in addition to any other requirement of this (Act), the Commission determines that- 4 (1) there is no alternative nuclear fuel or target enriched in the isotope 235 to a lesser

. percent than the proposed erport, that can be (continued...)

its legislative history clearly shows that the intent of the amendment is te "put into law what was, from 197s to 1990, the policy of both Democratic and Republican administrations--

prohibiting the NRC from licensing the exports of bomb-arade uranium fuel... .

" 13 3 cener . Rec. H. 11440 (daily ed. October 5, 1992) (remarks of Representative Schumer) (emphasis added). The NRC staff advises that the material the Applicant seeks to export, although fabricated as HEU fuel for the now defun6t Fort St. Vrain reactor, is not in a form that can be used as HEU fuel or target material in a research er test reactor without first processing the material to recovery its uranium content.

Exporting the material for processing, blending down, and subsequent fabrication into LED fuel or target material for test and research reactors may aid in discouraging the continued use of HEU as fuel in reactors by increasing the availability of LEU fuel. The action, if nothing else, meets one of the goals of the Schumer Amendment, in that it will remove 2 0 kilograss of HEU from the world inventory and, thereby, help encourage " developing alternative fuels that will enable an and to the bomb-grade exports." Id.

• (... continued) used in that reactort 42 U.S.C. I 21606. The meaning of the phrase "to be used as a fuel" in the first sentence, in the context of the whole provision, clearly means "to be used as a HEU fuel." The NCI argument depends on reading the word " fuel" in the first sentence as meaning either "HEU fuel" or " LEU fuel. "

l . .

In summary, nothing in the NCI Petition and Reply indicates that a hearing would generate significant new insights for the j commission regarding the instant application. To the contrary, conducting a public hearing on issues concerning matters about which the Commission already has abundant information and analyses would be contrary to one of the purposes of the NNPA, namely, "that United states government agencies act in a manner which will-enhance this nation's reputation as a reliable supplier of nuclear materials to nations which adhere to our non-proliferation standards by acting upon export license applications in a timely fashion." Nestinghouse CLI-80-30, 12 KRC 253, 261 (1980) (citation omitted). For these reasons, NCI's petition and request for a public hearing should be de,nied as not in the public interest and not necessary to assist the commission in making its statutory deteruinations.

IV. CONCLUSION AND ORDER For th.e reasons stated in this decision, NCI has not

-establis a basis on which it is entitled to intervene asi a matter of right under the Atomic Energy Act. Further, a hearing, as a matter of discretion pursuant to 10 C.F.R. I 110.84(a),

would not be in the public interest and is not nseded to assist the commission in making the determinations required for issuance

_ _ = _ _

. _ ~

l

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1 .

of the export license to Transnuclear. The Petition for Leave to Intervent and Request for Hearing is denied.

It is sc ORDERED.

N, A

g For the Commission?

\9****# MA.-

MN C. H0YLE Ass tant secretary of the commission Dated at Washington, D.C.

this ffdday of January, 1994.

T w

Tcommissioner de Planque was not present for the affirmation of this order; if she had been present she would have approved it.

~ . .. -. . - .

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• • • assel.P. 16 4 Newthorne, NY 10532 26700 Pierrelatte, Frange s -

Attnt Joan McLaughlin s

(For recovery of uranium and thorium and down-blending of HEU to LEU for ultimate use as LEU fuel in research reactors) letTankstelATE SSNDISNS81N PeaEWN etWarTRY STMSRPanTlW T9BRPORT maass NONE Nuclear Fuel' Services, Inc.

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- 2,441.0 Thortus mixed uranium and thorium carbides as i .

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/ 6 8 and 9 on page two of this license appl to thi' export.

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REPORT IJCENSE Conditions usense NumberOAa .

Cond6 Hen 1 - Licenses shell his with th Customs Officer er the Postmentw two copies,in eddi.

tien to these seerwin required, of de Shippw's Import Desierstlen wvering each emport end merk are of such espin for transmittel to the U.S. Nucieer Reev.

lotory Commission, Washington, D.C. 20$55, h following declerotion shevid oc-esmpany or be pleeed on the Shipper's Esport Declarations for auch esports.

"This shipment is being mede pursuerd to speelfic lisense number (spesins teense noenber) f led et (losenen of Cootems efflee whom lleones le filed),

an ldete lisense was fuod). This limnw empires en (capiroNon date of Ileense), end the unshipped benence remaining en this licean is sufficient to eeww the shipment de.oribed en this desierstion."

Condition 3 - taperts eveerland in any country or destination, encept Country Groupt Q, 5, W, X, Y, and Z In Port 370, Supplement No.1, of the Cwnprehensive Empwt 5ckelule of the U.S. Depertment of Commwee.

Cond6 tion 3 - This licenu eevws only dw nucleer content sf the metriel.

CondiWen 4 - N mekriel to be empated undw this liconee shell be shipped in esserdence with the physical prometwn requirements for special nucleer meteriet in 10 CFR 73,

/ .

Condiden 8 - Speciel nucleer mo6clel evderland for esport vnsler IWs licenw shell not be transported evtside th United $tetos in poseenger corrying aircestt in shipments neeeding (1) 20 grama er 20 curim, whichwer is less, of plutonium m vrenlum 233, w (2) 350 groms of wrenium 235. ,

Conditlen 6- This license evtherises nport only end does not eveerine the receipt, physical peanesslen, or ww of the nuclear metwwl.

Canditlen F = h lir,ensee shell complete end submit on NaC Form 741 for each shipment of secree metriel emported undw this liennes.

Conditlen 8 - h lecensee shell odvise the NRC in the went there is any change in dw designe-tien of ik company who will pockege the nuclear motwist to be emperted undw this license, er any change in the location of Hw pocieging operation, et loost three weeks prior to the scheduled dote of emport.

Condition 9 . 'The asterial to be exported under this license shall either be

' protected in transit, while within U.S. Durisdiction, in accordance with NRC4pproved licensing criteria or shall be tacted in of transit,(while Energy within U.S. jurisdiction, by )the00E) Safe Secure in accordance with the DOE requirements and directives for the transport of such material."

l 4

i 4

. O O ATTAC E NT 7

00 00

.. COGEMA,INC.

[."dM kMM$ce:w September 8,1993 Mr. Ronald D. Hauber Assistant Director, Export, Security and Safety Cooperation Office of International Programs Nuclear Regulatory Commission One White Flint North Building 11555 Rockville Pike Rockville, MD 20852

Subject:

Docket Number 11004649 Ucense Number XSNM 02748

Dear Mr. Hauber:

COGEMA, Inc. is pleased to confirm that it will notify the Nuclear Regulatory Commission when the uranium material that is the subject of the above mentioned Export Ucense Application is blended down to less than 20% U235. Such notice will be provided by COGEMA, Inc., in writing within 30 days of completion of all blending operations.

Please feel free to contact me at 301986 8585 if there are any questions.

Very truly yours, Qr Frank A. Shallo ac: Mr. Robin DelaBarre Acting Director Office of Export and Import Control Bureau of Politico Military Affr. irs I: P'nD3.4YS 7.1111 Department of State " !F?iX3 Washington. D.C. 20520 9Z: 0W Ct W C6.

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GD . GD COGEMA,INC, 1

MICHAEL A. McMURPHY PLE& tdt A160 CEO September 24,1993 Mr. Ronald D. Hauber Assistant Director, Exports, Security, and Safety Cooperation Office of International Programs Nuclear Regulatory Commissic,n One White Flint North Building 11555 Rockville Pike Rockville, MD 20852 Er, g rc c= w vG. sa -c

>  % .=

Re: IJeense No. XSNM 02748 4:, y ~-

Docket No. 11004649 c' -

F' - e

_ w

Dear Mr. Hauber:

=- g Concerning the above-referenced export license application by Transnuclear, Inc., on behalf of COGEMA, Inc.,I am pleased to provide the following confirmation:

1. The terms of COGEMA, Inc.'s arrangements with its French parent company, Compagnie G&nerale des Matitres Nucleaires, for the processing of the unirradiated high temperature gas reactor (HTGR) fuel that COGEMA, Inc. seeks to export to France, will provide that all of the highly enriched uranium (HEU) contained in that fuel wiD be blended down to low enriched uranium (LEU).

2. The above-mentioned commerciel arrangements between COGEMA, Inc. and Compagnie Generale des Mati6tes Nucl6aires will not allow any substitution of the HEU contained in the fuel for other isotopically equivalent quantities of uranium and the above mentioned blending down to LEU is to be performed at COGEMA's Pierrelatte facility in France on the HEU that is separated at Pierrelatte from the thorium and graphite contents of the HTOR fuel.

_$3 m u $ Q ' " **^ " N " N * **

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4 oo oO o Mr. Ronald D. Hauber

, September 24,1993

] Fase 2 J. The above mentioned comme cial arrangements between COOEMA, Inc. and Cosapagnie Generale des Mati6res Nucleair s will not allow the sale of the HEU separated from the HTOR fuel, and COGEMA, Inc. will retain title to such HEU l

until the HEU has been blended down to 20.

I.

i

4. As previously noted is a letter to the Nuclear Regulatory Commission from Frank .

Shallo, Vice President, Market Development of COGEMA, Inc., NRC will be notified by COGEMA, Inc. prompdy upon completion of this blending down of the HEU contained in the HTOR fuel to EU.

i Please let me know if you have any questions regarding the commitments specified in this

letter.

Sincerely, l / b / h chael A. McMu

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President and CEO' y i COGEMA, hec.

, cc: Mr. Robin De la Barre Department of State E

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we atuact l The Honera:le van Selin Chairman i Nuclear Regulatory Commission Washingten, DC 20555 Ret Export License No. XsNH 02748

Dear Chairman salin,

! I write out of concern that the above cited export license i

application may be used to evade a provision of last year's energy

bill (P.L. 102-486) which is intended to restrict exports of bomb-

, grade uranium.

I i The new law specifically prohibits exports of highly enriched i

uranium (MEU) for use in research and test reactors unless these three conditions are met: 1) there is no alternative reactor fuel

. or target, 2) the reactor operator has committed to using an

alternative fuel once it is developed, and 3) the United States is actively developing an alternative fuel, since the Administration has requested no funds for alternative fuel development, the statute effectively bars exports of MEU fuel to research and test reactors.

l In this case, the applicant requests a license to export 280 i kilograms of HEU for processing in France, claiming the material l will then be returned for an unstated end-use in the U.S. If the Commission approves the export of this EEU, it is very possible that onca the material is overseas the applicant may seek to sell it for use in a foreign reactor. That is because the applicant could claim that the statute does not apply once the EEU is out of the country.

In fact, the Commission confirmed -- in a letter to Members of Congress dated April 6, 1992 -- that af ter HEU is exported to Europe f or a specified end-use, the United States cannot prevent (indeed we need not even be informed of) a change in the end use so long as the material remains in the EURATOM community.

According to the Commission's letter, "the United states has no direct control over future disposition of EURATOM retransf era solely within the EURATOM Community. . . . Movements of nuclear materials within the Community are not reported to the United States. . ..

Prior U.S. consent is ngt required if the material is transferred to dif f erant and-uses within the EURATOM community . . . . We do not have information on the quantities and enrichment levels of the still-unirradiated, U.S.-origin uranium exported for use in 1

(European) facilities."

In addition. I have three other concerns with the application:

1) The applicant's original draf t reportedly identified the MEU's end-use as REU fuel for France's Grenoble research reactor.

When informed by Commission staf f chat this would be denied under

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. 00 00 P.L. 102 486, the applicant changed the declared end use claiming the material would be returned to the U.S. When Administration of ficials reportedly informed the applicant that this end use would still not be approved, they filed an amendment changing the end use once again, this time claiming the material will be blended down to LEU. It seems to me that the applicant is shopping for an end use Just to satisfy application re confident that the stated end quirements, use on the and this makes application and me theless actual and use will be the same.

2) There is a glut of 19.9benriched uranium in Europe, whereas there is a scarcity of REU. Thus, blanding down the material would greatly reduce its value. From an economic standpoint, the applicant would have a strong motivation not to blend down the material once in Europe, regardless of its stated end use.

3) If the Administration goes forward with plans to renew its of f Site Fuels policy, the applicant would have an even stronger motivation not to blend down the material. That is because as U.S.-

origin HEU, the material would have extra value since the United -

States would be obligated to accept its return as spent fuel af ter i use in a foreign research reactor. For this reason, the material in question would have greater value as KEU than even identical, European-origin HEU.

The United states has had a policy of minimizing exports of bomb-grade uranium since the mid-1970s, institutionalized in 1978 by the creation of the REATR program and codified last year with the enactment of my amendment to the Energy Bill. Indeed, as early as 1986, P.L.99-399 directed the President "to keep to a minimum the amount of weapons grade nuclear material in international transit. "

l 280 kilograms of MEU is far from minimal and could supply the fuel for a dozen nuclear weapons if it fell into the wrong hands.

In light of these statutes and the inherent dangers of civilian commerce in bomb-grade uranium, I urge you to reject the proposed application unless the applicant can verify that:  !

1) the HEU will be blended down to LEU, not merely swapped for existing LEUs 21 the material will not be re-enriched to MEUs

3) the EED will be returned to the United states if the blending down does not occur within a reasonable, specified time periodi

4) there is a market for 19.9%-enriched LEU; and

5) the blending down cannot be accomplished domesticL11y.

On this final point, the owner of this material has now received authorization from the Coaunission to de-f abricate and bland down the MEU which further undermines any rationale for exporting this weapons-usable material.

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Thank you for your attention to this matter, and p.' ease do not hesitate to contact me af I can be cf additional assistance.

Sine rely.

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. May 20. 1994 CHAlRMAN

/TheHonorableCharlesE.SchumerChTtaid States House of Representatives Washington, D.C. 20515

Dear Congressman Schumer:

Shortly before the Congress recessed last November, the Senate passed H.R. 3355, the Violent crime control and Law Enforcement Act of 1993. Of particular interest to the Nuclear Regulatory Commission (NRC) is title XLV of the bill, the Public Safety and Recreational Firearms Use Protection Act, which would restrict -

the manufacture, transfer, and possession of semiautomatic assault weapons and large capacity ammunition feeding devices.

On May 5, 1994, the House of Representatives passed H.R. 4296,

, which is similar in substance to title XLV of H.R. 3355. These bills will soon be before a Conference Committee on which I understand you will serve as a Conferee.

As currently written, H.R. 4296 and title XLV of H.R. 3355 could affect adversely the security of NRC-licensed commercial nuclear power plants and facilities possessing a formula quantity,of strategic special nuclear material (SSNM). Both types of facilities employ security personnel armed with weapons such as those that would be subject to the restrictions relating to semiautomatic assault weapons to safeguard the facility. They also use large capacity ammunition feeding devices.

Sections 4505 and 4507 of H.R. 3355 and sections 2 and 4 of H.R.

4296 would exempt departments and agencies of the United States from the restrictions described above. However, as drafted, these sections would cover guards only at Government-owned facilities, such as facilities that are owned by the Department c' Energy. We believe the same exemption should apply to NRC-licensed facilities.8 Therefore, if bans of assault weapons and large capacity feeding devices are included in the final legislation, we recommend that 1

The exemptions for law enforcement officers authorized by U.S. departments or agencies to purchase firearms or large capacity ammunition feeding devices for official use, contained in H.R. 4296, will not alleviate the problem. Most NRC-licensed sites do not have guards who are deputized as law enforcement officers.

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. 2 the conference ccanittee amend the exemptions for departments and agencies of the United states, now contained in sections 4505 and 4507 of HR. 3355 and sections 2 and 4 of H.R. 4296, by inserting the following before the semicolon at the end of the exemption 1

, or to any person (including employees or contractors of such person) who is (1) required by Federal regulation to estab1Lah and maintain an onsite physical protection system and security organization, and (ii) licensed pursuant to title I of the Atomic Energy Act of 1954 or subject to regulation under title II of that Act I would be happy to provide further information regarding this matter, should you so desire.

sincerely, Ivan Salin "The provisions that would be amended are currently identified in H.R. 3355 as paragraph (4)(A) of section 922(s) and paragraph (2)(A) of section 922(u) of title 18, United States code, and in H.R. 4296 as paragraph (4)(A) of section 922(v) and paragraph (3)(A) of section 922(x) of title 18.

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