IR 05000272/1984025
| ML16342B078 | |
| Person / Time | |
|---|---|
| Site: | Salem  |
| Issue date: | 01/09/1985 |
| From: | Doerflein L, Hillman B, Norrholm L NRC OFFICE OF INSPECTION & ENFORCEMENT (IE REGION I) |
| To: | |
| Shared Package | |
| ML16342B079 | List: |
| References | |
| 50-272-84-25, 50-311-84-30, NUDOCS 8501240103 | |
| Download: ML16342B078 (80) | |
Text
I MCIFIC QA S ADD ELECTRIC COMPARE 3F W ~ ~
77 BEALE STREET
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SAN FRANCISCO, CALIFORNIA94I06
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(4) 5) 78I.42I1
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TW>':G 572 6587 dAMES D. SHII PCR VICE tMQOtNT ONOIAA~ OWCIATKW April 17, 1985 PGandE Letter No.:
DCL-85-152 Hr. George M. Knighton, Chief Licensing Branch No.
Division of Licensing Office of Nuclear Reactor Regulation U. S.
Nuclear Regulatory Cemission Mashington, D.C.
20555 Re:
Docket No. 50-275, OL-DPR-80 Docket No. 50-323 Diablo Canyon Units 1 and
Allegations Regar ding Cardinal Bolts
Dear Hr. Knighton:
Enclosed are responses to the allegations which r elate to Cardinal Industr ial Products, contained in the affidavits attached as Exhibits 4 and 10 to the Government Accountability Project (GAP) petition dated March 14, 1985.
For convenience, PGandE has adopted a nutIhering system that indicates the date of the GAP petition March 14, (314), the exhibit number (.4 or.10) and the paragraph nuaher of the affidavit (.Ol,.02, etc).
Responses to the other affidavits attached to the GAP petition will be forwarded later.
Kindly acknowledge receipt of this material on the enclosed copy of this letter and return it in the enclosed addressed envelope.
Sincerely, iffer Enclosure cc:
R.
T.
Dodds J.
B. hartin H.
E. Schierling Service List
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GAP Allegations 8314.04.01, 314.04.02, 314.04.03, 314.04.04, 314.04.05, and 314.04.06 It is alleged that:
Pullman Power Products'iscrepancy Report 0 9173 (12-21-84),
issued as a result of MRC I.E. Information Notice 84-52 and PGAE's Quality Assurance Implementation Audit 84408S of Cardinal Industrial Products, does [sic3 not address/provide for a system of identification, documentation, segregation and disposition of Cardinal materials previously purchased and installed by Pullman in both units of the Diablo Canyon Nuclear Plant.
This is a
nonconformance to 10CFR50 Appendix B Criteria XV-Nonconforming Materials, Parts or Components and Criteria XVI - Corrective Action.
(2/23/85 Hudson Aff. at 2.)
10CFR50 Appendix B Criteria XV requires measures shall be established to control materials which do not conform to requirements in order to prevent their inadvertent use or installation.
These measures shall include, as appropriate, procedures for identification, documentation, segregation, disposition, and notification to affected organizations.
Criteria XVI requires that measures shall be established to assure that conditions adverse to quality, such as deficiencies, deviations, defective material and nonconformances are promptly identified and corrected.
These requirements have not been implemented for Cardinal materials previously purchased and installed by Pullman in the plant.
(2/23/85 Hudson Aff. at 2.)
Pullman's DRP 9173 only addresses/provides for a system of identification and documentation for material in Pullman's warehouse or storage areas which were manufactured by Cardinal.
Only Cardinal material in Pullman's warehouse or storage areas are [sicj identified and placed on tern orar Hold.
This limited corrective action is at the d rection of PGSE's General Construction Division.
PGSE General Construction Letter of 12-21-84 by R. Lieber and R.
Hobgood, states as a result of identified deficiencies in Cardinal Bolts OA Program, "all fasteners in Class one storage supplied by Cardinal Bolt, including those supplied 0436A PGandE Letter No. DCL-85-152
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by a third party", must be immediately identified.
The Letter goes on to state that "Pullman is authorized to release these materials from the Class one storage for installation, provided a system is established that will identify each fastener by size, material type, purchase order, heat and/or lot number, and installed location".
PG&E"s [sic3 General Construction Division does not address/provide for a system of identification, documentation and segregation of Cardinal materials previously purchased and installed by Pullman in the plant.
This is a nonconformance to 10CFR 50 Appendix B
Criterias [sicj XV and XVI.
(2/23/85 Hudson Aff. at 2-3.)
PG&E General Construction Division has directed Pullman based on their instructions from PG&E's Quality Assurance Division.
PG&E Quality Assurance Letter of 12-20-84, by QA Manager S.M.
Skidmor e, identifies that Cardinal has provided fastener material for Diablo Canyon Power Plant on seven purchase orders (4 kPO and 3 GC).
The Letter states that as a result of identified deficiencies,
"the quality of the fasteners materials we have received from Cardinal on the purchase orders listed above is indeterminate at this time".
The PG&E OA Manager then recommended
"that the items supplied by Cardinal be located and tagged".
PG&E Quality Assurance Division's recommendation deals only with material from the seven PG&E purchase orders.
The Letter only request [sic3 a research of records to determine if there have been other purchases from Cardinal.
PG&E's Quality Assurance Division instructions to General Construction Divsion [sicj does not specifically address/provide for a system of identification, documentation and segregation of Cardinal materials previously purchased and installed by Pullman in the Plant.
This is a nonconformance to 10CFR50 Appendix B
Criterias [sicl XV and XVI.
(2/23/85 Hudson Aff. at 3. )
The failure by PG&E's Quality Assurance and General Construction Divisions and Pullman's DRP 9173 to address/identify, document and segregate Cardinal materials previously purchased and installed by Pullman in the plant is a significant condition adverse to quality.
PG&E's OA Divison [sicl Letter states that the OA Audit of Cardinal 0436A w 2 PGandE Letter No. DCL-85-152
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"identified significant deficiencies in their past quality assurance program".
The Cardinal Industrial Products Corporation
"Report To Our Customers" by D.C. Fielder states that With very limited exceptions, all the areas of concern raised by the NRC related to prior OA Programs..."
With limited exceptions, it is the Cardinal OA program prior to its 1-9-84 ASME certification as a "material manufacturer" and "material supplier" that the NRC and PG5E QA Division is concerned with.
Yet Cardinal materials purchased and installed by Pullman prior to 1-9-84 are not addressed by DRk'173.
(2/23/85 Hudson Aff. at 4.)
Pullman has purchased and installed Cardinal materials at the Diablo Canyon Nuclear Plant since sometime in the 1970's.
Pullman 's Diablo Canyon Site QA/OC Manager D.
Geske performed an ASME,Section III, NCA-3800 Vendor Quality System Audit of Cardinal Industrial Products in 1980.
A Pullman Interoffice Correspondence, 2-27-81, from A.A. Eck, Director of QA to W.L. Cox, Senior QA Auditor of the Pullman Quality Engineering Group, stated
"per request from the Diablo Canyon Project, please keep Cardinal Bolt current on the AYL.
Diablo will continue to use very heavily over the next few years".
(2/23/85 Hudson Aff.
at 4.)
Pullman has purchasedand Lsic3 installed large amounts of Cardinal materials that falls [sicj under the NRC and PGEE identified past OA program deficiencies.
Yet Pullman, at the direction of PGSE, has not included the installed material under the scope of DRP 9173 for identification, documentation, segregation and control.
This is a
nonconformance to 10CFR50 Appendix B Criteria XV and XVI and is a condition adverse to quality.
(2/23/85 Hudson Aff. at 4. )
PGandE's Quality Assurance Department instruction of December 20, 1984, was based on the seven Cardinal Industrial Products'Cardinal
) purchases identified as of that date.
The instructions did address identifying, documenting, and tagging the items purchased on those seven purchase. orders.
0436A
PGandE Letter No. DCL-85-152
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The letter also requested the recipients to research their records, to identify any additional purchases from Cardinal, and to notify the guality Assurance Department of any such additional purchases.
Subsequent to the December 20, 1984 letter, the entire Pullman files were researched and the additional Pullman purchase orders were identified and investigated.
On January 16, 1985, PGandE Quality Assurance notified the Diablo Canyon Project (DCP) that the results of the investigation indicated that 92'X of the line items purchased from Cardinal were addressed in Cardinal 's revalidation program and 0A requested the DCP to conduct appropriate disposition on. the remaining 8V.
PGandE has been working closely with Cardinal to assure appropriate inclusion of materials furnished to PGandE in their revalidation program which was approved by the NRC on February 11, 1985.
The Nonconformance Report (NCR)
initiated by the General Construction Department remains open pending the resul ts of the Cardinal revalidation program.
I With regard to the identification, documentation, and segregation of Cardinal materials previously purchased and installed by Pullman, the identification has occurred by the research of the purchase orders.
The associated material will be located, if necessary, depending upon the resul ts of the Cardinal 0436A
PGandE Letter No. DCL-85-152
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'p reval fdatfon program.
Hawever, the reval fdatfon program to date has only,,
conRrmed that the material supplied to Diablo Canyon by Cardinal fs fn compliance with speci ffcatfon requirements and fs acceptable as installed.
The alleger's concerns raised fn these allegations are sfmf'lar to those raised by another alleger which are also being responded to at this time.
See responses to Allegation f314.10.11 through 314.10.14.
0436A
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GAP Allegations f314.04.07, 314.04.08, 314.04.10, 314.04.11, 314.04.12 and 314.04.13 It is alleged that:
The quality of Cardinal materials purchased and installed by Pullman prior to 1-9-84 is indeterminate for two reasons.
First, because of significant deficiencies identified by the NRC and PGSE in Cardinal 's Past t}uality Assurance Program.
And second, because Pullman's own Vendor t)uality System Audits of Cardinal performed during the early 1980's were inadequate and did not comply with ASME,Section III, NCA-3800 (Metallic hhterial Manufacturer 's and Material Supplier's Quality System Program) requirements and 10CFR50 Appendix 8 Criteria'II (Control of Purchased Material, Equipment, and Services)
requirements.
(2/23/85 Hudson Aff. at 5. )
An examination of a Pullman
"Vendor Quality System Audit Checklist Applicable to Material N'anufacturers and hbterial Suppliers - Checklist No. 1", dated 7-21-81, for Cardinal Industrial Products, reveals significant deficiencies in Pullman's Corporate Vendor auditing program and Pullman's ability to qualify Cardinal to ASME SectionIII [sic1 requirements as a 'haterial manufacturer" or "material supplier".
Several of these deficiencies are generic in nature.
(2/23/85 Hudson Aff. at 5.)
But a more significant finding is that Pullman's Vendor Ouality System Audit of Cardinal did not address Heat Treating of materials.
Checklist item 0 18 - Verify if heat treating is performed in accordance with approved procedures - is marked not applicable and no audit was performed.
Checklist item 0 19 - Record the measure of control of furnace temperature by part or zone temperature
- is marked not applicable and no audit was performed.
Checklist item 0 20 - Record measures for temperature aenitoring - is marked not applicable and no audit was performed.
Checklist item 0 21 - Record and verify that the heating and cooling rates, maximum and minimum temperatures at specified times [sicj in accordance with code and customer requirements.
Verify by heat treat 0442A PGandE Letter No. OCL-85-152
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charts or CMTR's - is marked not applicable and no audit was perforated.
Checklist item f 29 - Verify that vendors certified material test reports have provisions for heat treatment, hold temperature and cooling method and time-is marked not applicable and no audit was performed.
(2/23/85 Hudson Aff. at 5-6.)
Pullman's Vendor Ouality System Audit program for Cardinal is in nonconformance to ASME Section III, NCA-3820.a, b and c (1980 Edition) and 10CFR50 Appendix B Criteria VII, since Pullman did not audit the heat treatment of fasteners manufactured and/or supplied by Cardinal.
This is a
significant condition adverse to quality.
(2/23/85 Hudson Aff. at 6.)
As the 1981 Lead Auditor performing Pullman's Vendor Ouality System Audit of Cardinal, I used the 1980 Vendor Ouality System Audit as my format for areas to be audited.
The 1980 Audit of Cardinal performed by Diablo Canyon Site OA/QC Manager D.
Geske did not address Cardinal's heat treating program.
Taking my lead from the 1980 Audit, I assumed that Heat Treating was not an applicable section of Cardinal 's Ouality System Program to be audited.
It should be noted that Pullman's Corporate Senior OA Auditor, W. L.
Cox, who reviewed both the 1980 and 1981 Vendor Audits and then included Cardinal on the Approved Vendors List, did not identify this omission of a critical area of Cardinal 's Ouality System Program and require corrective action to be implemented.
(2/23/85 Hudson Aff. at 6.)
Bolts and Fasteners manufactured and/or supplied by Cardinal that required Heat Treating cannot be assured by Pullman Vendor Ouality System Audits to have been performed in accordance with procedures, code and customer requirements
.
(2/23/85 Hudson Aff. at 6. )
The alleger states that he took his lead from the 1980 audit when he marked
"not auditable" in the 1981 Audit Checklist, Items 19 through 21.
However, in fact, the audit was conducted correctly as heat treating was not performed 0442A
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by Cardinal for Pullman orders during the audit period.
Keat treatment for Pullman orders was performed by vendors on the Car dinal approved vendor list (AVL). Therefore, heat treating records for Pullman orders were, in fact, not auditable at the Cardinal facility.
In addition, the adequacy of Cardinal 's subcontractor qualification program was checked under Pullman's audit checklist Ouestion 39.
Therefore, there is no deficiency in the 1980 and 1981 audits of Cardinal with respect to heat treating and no non-conformance to ASME Section III NCA or 10 CFR 50, Appendix B.
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GAP Allegation f314.04.09 It is alleged that:
PGGE's QA Divfsfon audit of Cardinal kdentfffed as a
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significant deficiency that certifications for the heat treating of materials did not contain the heat number of the subject material.
(2/23/85 Hudson Aff. at 5.)
Cardinal has been conducting a detailed certification review as a part of their revalidation program.
The materials identified in the PGandE audit as having the heat number documentation deficiency on heat treating certifications are included in Cardinal 's certification review.
This review is complete'or the above heat treating certifications in question and has verified that the appropriate documentation for material certification is now in place.
0444A PGandE Letter No. DCL-85-152
GAP Allegation f314.04.14 It is alleged that:
Attachment Pl to Pullman's 1981 Vendor Quality System Audit Checklist is a list of Cardinal 's Quality Assurance Manual Sections and Cardinal Standard Practices Procedures.
Although the QA Manual has a section on Special Processes, there is no Standard Practices Procedure listed for the Heat Treating of Materials.
Cardinal appears to have had no Quality System Program covering Heat Treating of Yaterial during this time period.
The parent absence of a Cardinal Standard Practice for Heat Tr @ting of Materials is a nonconformance to ASME, Section I~ NCA-3820.c, NCA-3862.a.l, NCA-3866.1 and NCA-3866.4 (1980 Edition) and 10 CFR50 Appendix B Criteria IX - Control of Special Processes.
Because of Pullman's failure in 1980, 1981 and possibility [sicj other years, to audit Cardinal 's Heat Treating program and the apparent absence of a Cardinal Standar d Practice Procedure for Heat Treating of materials, there is no assurance that Heat Treating performed during this time period was controlled in accordance with material specifications and the rules of ASME,Section III, NCA-3800 and 10CFR50 Appendix B Criterias [sicl IV (Procurement Document Control ), VII (Control of Purchased Material, Equipment, and Services),
and IX (Control of Special Processes).
(2/23/85 Hudson Aff. at 7.)
ASME Section III, Subsection NCA-3820(c), provides that material manufacturers who do not hold a Quality System Certificate Manufacturer (OSCM) will be surveyed and audited.
In this instance this was done by Pullman on Cardinal and, therefore, there is no violation of the regulations.
ASME Section III, Subsection NCA-3862(a) states the manufacturer shall have a
OA manual and procedures to implement the manual.
As Cardinal did not do any heat treating for Pullman orders during the audit period, Pullman did not need 0449A PGandE Letter No. DCL-85-152
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to audit Cardinal 's heat treating procedure.
The applicable audit point would I
be under the Cardinal program for qualifying subcontractors, and this point was audited by the alleger in his July 21, 1981 audit under Item 39 of the v(.>'ullman vendor audit checklist.
NCA-3866.4 requires the manufacturer to use process sheets, or equivalent, to assure special processes, including heat treating, are properly performed.
pu11man audit checklist Ouestions 12 and 13 dea1t with process sheets.
Since Q'he heat treating for Pullman orders was done by others, the Cardinal process sheets would not include heat treating as a step.
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PGandE Letter Ho. DCL-85-152
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6AP Allegation 8314.04.15 It is alleged that:
A second deficiency in Pullman's Vendor Ouality System Audit of Cardinal performed in 1981 was that the Audit Checklist, item f5, did not list and no audit was performed to determine if the person or department responsible for defining and implementing the overall effectiveness of the quality program reported regularly on the effectiveness of the program.'ullman's failure to audit this area fs a
nonconformance to ASIDE,Section III, NCA-3820.a,b and c, HCA-3864.1.b.4 and 10CFR50 Appendix B Criteria VII.
This is a generic deficiency in Pullman's
"Vendor Ouality Audit Checklist Ho. 1" used for Material Nanufacturers and Material Suppliers.
All vendors audited by Pullman using this checklist have a
OA Program of indeterminate quality based on this omission.
(2/23/85 Hudson Aff. at 7-8.)
The alleger claims that Pullman failed to audit and determine if the person or department responsible for defining and implementing the overall effectiveness of the quality program reported regularly on the effectiveness of the program.
This is not true.
Item 5 of the Pullman vendor quality audit checklist provides as follows:
"Check organization chart to determine if the person or department responsible for defining and implementing the overall effectiveness of the program is:
A.
Designated in writing.
B.
Independent from production pressures.
C.
Direct access to managment.
PGandE Letter No. DCL-85-152
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The alleger, who was also the auditor, gave this item a satisfactory mark (S)
and his observation was:
"Ouality Assurance Manual, Section 3 - All three items are impl emen ted.
Item 7 of the Pullman vendor audit checklist states
"Explain how management reviews the adequacy of the program."
The auditor-alleger also gave this item a satisfactory mark (S) and his observation was:
"The President signs and approves the OA Manual.
The Director of OA signs and approves standard practices.
Internal Audits are forwarded to the President for review, approval, and/or implementation of corrective action."
Thus, the a11egation is in direct contradiction to auditor-a11eger's oun audit /jP" observati ons.
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GAP Allegation f314.04.16 It fs alleged that:
A thir d deficiency in Pullman's Vendor Ouality System Audit of Cardinal performed in 1981 was, that the Audit Checklist 0 9 only addressed Nondestr uctive Examination personnel to determine if they were qualified to perform their duties.
These NDE personnel were not Cardinal employees, but employees of Eagle Intermountain Testing, a subcontractor.
No Cardinal employee who performed functions within the scope of ASME Section III were audited to determine if they were qualified as specified by Section III.
This included the Director of OA, the Internal Auditor, OA/OC Inspectors, Engineers, and Production personnel performing special processes.
None of these Cardinal personnel were audited by Pullman to determine if they were qualified to perform their gobs.
This is a nonconformance to ASME,Section III, NCA-3820.a,b and c, NCA-3864.2.a (1980 Edition ) and 10CFR50 Appendix B Criter ia VII.
This is a generic deficiency in Pullman's
"Vendor Ouality Audit Checklist No. 1" used for hbterial Manufacturers and Material Suppliers.
All Vendors audited by Pullman using this Checklist No.
1 have non NDE personnel of indeterminate qualifications performing ASME III functions.
(2/23/85 Hudson Aff. at 8.)
Mith regard to the audit of non-NDE vendor personnel by Pullman, paragraph NCA 3864.2. (a) of ASME Section III states that the material manufacturer or material supplier has the responsibility to assure that all personnel performing functions within the scope of NCA 3800 are qualified as speci fied in NCA 3800.
The only special qualifications specified in NCA 3800 are for NDE personnel (NCA 3864.2. (b)).
Therefore, no "generic deficiency" exists in the Pullman vendor audit checklist regarding non NDE personnel because they do 0451 A PGandE Letter No. DCL-85-152
not need to be specially quali fied pursuant to NCA 3800.
NCA-3820(a), (b),
and (c), and 10 CFR Appendix B Criteria VII have nothing to do with
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qualification of personnel, the subject of the allegation.
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GAP Allegation f314.04.17 It is alleged that:
A fourth deficiency in Pullman's Vendor Ouality System Audit of Cardinal performed in 1981 was that Audit Checklist item 810 - Are examinations performed in accordance with procedures, approved by PPP as specified by Pullman's purchasing specification - was marked not audited.
The Checklist item f10 has a comment that
"NDE is performed by Eagle Interneuntain Testing" and "Procedures used are as specified on each customers [sicj purchase order".
But this cannot be verified since no audit was per formed on any NDE procedures (Eagle Intermountain or Cardinal ) or on any other type of examination procedure, against any Pullman purchasing specification.
Examination procedures used by Cardinal are of indeterminate quality.
This is a nonconformance to ASME,Section III, NCA-3820.a,b and c, NCA-3866.3.a (1980 Edition) and 10CFR50 Appendix B
Criteria VII.
(2/23/85 Hudson Aff. at 8-9.)
Marking "not audited" for Item 10 of the checklist was appropriate.
This checklist question was applicable only if a specific NDE requirement was specified by Pullman's purchasing specifications.
In this instance the application was for bolting, which does not include any requirements for Pullman approval of NDE procedures.
Thus, there was nothing to audit and no nonconformance to standards.
Mr. Geske, as 0A/OC Manager, was fully aware of the requirements of Pullman's purchasing specifications and he knew that Pullman did not specify review and approval of NDE procedures on the purchase order.
He therefore appropriately indicated
"not audited" on his checklist.
This was also an appropriate entry by the alleger-auditor since the purchase order criteria had not changed.
0452A PGandE Letter No. DCL-85-152
As prevfously stated, the requfrement to approve NDE procedures was not fmposed on the Pullman purchase orders to Cardfnal.
However, Pullman dfd have thfs as a requfrement for some of fts other 5obs and, therefore, thfs ftem was properly fncluded as part of the checklfst.
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GAP Allegation f314.04.18 It is alleged that:
A Pullman Power Products Letter, Log No.81-193, dated 8-6-81, to Cardinal Industrial Products, from Milliam L.
Cox, Senior QA Auditor, advises Cardinal that "by virtue of satisfactory completion" of a OA Program audit, they had been included on Pullman's list of approved vendors.
Pullman informed Cardinal that they had been classified as a "Material Manufacturer qualified to furnish Steel Bolting and Fasteners intended for use in ASME,Section III, Class 1, 2, and 3 fabrication".
Yet the Pullman Vendor Quality System Audit of Cardinal performed in 1980 and 1981 had significant deficiencies.
Major portions of Cardinal 's Quality System Program were not audited by Pullman as required by ASME,Section III, NCA-3820 and 10CFR50 Appendix B Criteria VII.
The area not audited by Pullman have significant impact on determining if Cardinal meet [sic1 the requirements of ASME Section III, NCA-3800.
The failure by Pullman to survey, qualify and audit Cardinal as required by ASME Section III, NCA-3800 and 10CFR50 Appendix B Criteria VII, means Pullman's method of approving Vendors is of indeterminiate
[sic3 quality and that Cardinal 's Quality System Program for this time period is of indeterminate quality.
(2/23/85 Hudson Aff. at 9.)
The alleged significant deficiencies in the Pullman Vendor Audit of Cardinal have been answered in the responses to GAP Allegations f314.04.07 and.08 and 8314.04.10 through 314.04.17 above.
This allegation is nothing more than a
redundant and vague summary of the preceding ones.
It has been shown that Pullman's checklist covered applicable requirements.
Areas identified as "not audited" were properly so identified as they were not applicable to the scope of services perforated for Pullman by Cardinal.
0453A PGandE Letter ko. DCL-85-152
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GAP Allegations t314.10.06 It is alleged that:
Exhibit 1 is the June 29, 1984, NRC Information Notice entitled,
"Inadequate Material Procurement Controls on the Part of Licensees and Vendors".
The information contained in this report infers si gni ficant deficiencies in the quality assurance program of Cardinal Industrial Products, a supplier referenced in my original report on this issue.
This information was also available to the PV staff throughout the licensing process, but was not mentioned as being applicable to Diablo Canyon.
The fact that the NRC cited Cardinal for poor quality assurance cannot lend any credence to the idea that A-307 bolts were produced from wel dable stock material.
(2/22/85 O'eill Aff. at 5.)
As of this date there has been absolutely nothing found either by way of audit, inspection, or testing to call into question the weldability of A307 materials.
The A307 Grade B material is only one of many kinds of material provided by Cardinal.
Numerous detailed document reviews, and mechanical and chemical tests have repeatedly shown that the materials provided by Cardinal meet applicable requirements.
Nonetheless, the Cardinal revalidation program included testing of ASTM A307 materials to demonstrate compliance to chemical and physical requirements.
That testing has been completed and there were no n ega tive resul ts.
In addition, during early April 1985, an NRC audit team conducted a week long investigation of Cardinal 's implementation of their revalidation program at the Cardinal facility.
At the exit meeting on April 5, 1985, Hr.
Tom Burns of 0492A PGandE Letter hb.
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Brookhaven National Laboratories, consultant to NRR, stated that the chemistries of the A307 materials he had randomly inspected tare all readily eel dabl e.
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GAP Allegation 1314.10.07 and 314.10.08 It is alleged that:
As a result of the NRC audit, PGSE's own auditors coincidentally found the same deficiencies in Cardinal 's past quality assurance program approximately six months after the RRC re1eased Information Notice 54-52, and near1y a year after the release of VPB Inspection Report 99900840/83-01.
These findings were conveniently ignored until well after any licensing impact, and are detailed in a
PGAE letter dated December 20, 1984, which is included as Exhibit 2.
(2/22/85 O'eill Aff. at 6.)
It is alleged that:
In classic style, PGEE describes a serious breakdown in quality assurance, yet then offers only superficial corrective action.
It has been my experience that this type of response to deficiencies is PGEE's idea of correcting the problem.
PGhE's letter, identified as Exhibit 2 states, inter a1ia that:
"...audit 84408S of Cardinal Industrial Products, Las Vegas, Nevada, December 6-7, 1984, identified significant deficiencies in (Car dinal 's ) past quality assurance program.
We are providing this notification prior to the formal audit report because the findings may have an adverse impact on material supplied by Cardinal."
and from Page 2:
"...the quality of the fastener materials (PG&E) has received on the purchase orders listed above is indeterminate at this time."
and "...after a few more corrective actions are verified, (Cardinal) could be reinstated as a
qualified supplier... "
( 2/22/85 O'eill Aff. at 6-7. )
0493A PGandE Letter No. DCL-85-152
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PGandE received Information Notice (IN) 84-52 in the mid-August 1984 time frame.
The Information Notice expressly provided that no reply was required.
After investigation, however, PGandE initiated corrective action measures as follows:
September 28, 1984 - PGandE formally removed Cardinal from the Oualified Suppliers List.
October 1984 - PGandE initiated a review effort of past purchases for Diablo Canyon to identify all purchases from Cardinal.
'ovember 1984 - PGandE identified six PGandE and one Foley purchase orders to Cardinal.
4.
December 6-7, 1984 - PGandE conducted an implementation audit of Cardinal past performance and a qualification audit for future purchases.
The results of the implementation audit established that certain of the documentation and implementation deficiencies identified during the NRC inspection were applicable to fasteners supplied to Diablo Canyon.
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December 20, 1984 - PGandE Ouality Assurance Department issued a
memo to notify the Diablo Canyon site that because of the identified deficiencies, the quality of Cardinal supplied materials was at that time indeterminate and requested the subject items be tagged pending the results of the Ouality Assurance Department's investigation.
The memo requested that records be searched for any additional purchases from Cardinal that had not already been identified.
The memo a'fso stated:
"Cardinal has instituted a revalidation program through third party testing as a result of the NRC Inspection, and they have agreed to include the materials supplied to PGandE as a part of that revalidation program.
Cardinal still has many samples of the same materials sent to PGandE in their warehouse stock that can be used in the third party tests, but PGandE may be requested to locate and return a sample of some items to Cardinal for testing.
We expect to obtain the revalidation results from Cardinal by February 1985.
Meanwhile, we recommend that the items supplied by Cardinal be located and tagged in accordance with the applicable requirements of your depar tmental procedures.
We request that you research your records and notify Mr. D.
S.
Aaron on extension 3020/3490 if there have been other purchases from Cardinal."
6.
December 21, 1984 - In response to the December 20, 1984 memo, PGandE generated nonconformance report nurser (NCR No. ) DCO-84-SC-N015 and Pullman generated discrepancy report number (DR No.) 9173 to 0493A
PGandE Letter No. DCL-85-152
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disposition the Cardinal materials and perform further research to identify whether any additional purchases were made from Cardinal.
7.
January 3-4, 1985 - PGandE conducted an audit of Cardinal to verify corrective actions to the December 3-4, 1984 qualification audit.
Further, the auditors performed a detailed review to determine whether the Diablo Canyon purchases made by PGandE and Pullman were included in the Cardinal revalidation program and identified that 92%
of the purchase order line items (approximately 915 line items) were addressed in the Cardinal revalidation program.
8.
January 9, 1985 - PGandE Quality Assurance Department contacted Hr. Ellis M. Merschoff of the inspection and Enforcement Vendor Program Branch to determine the status of the NRC's approval of the Cardinal revalidation action plan.
Hr. Herschoff was also informed that PGandE has Cardinal products installed at Diablo Canyon and was conducting an investigation of the specific purchases.
9 ~
January 16, 1985 - PGandE Quality Assurance Department forwarded to the Diablo Canyon Project a
memo with an attached list of the remaining eight percent of purchase order line items that were not included in Cardinal 's revalidation action plan.
The memo requested 0493A-4-PGandE Letter No. DCL-85-152
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that the Diablo Canyon Prospect conduct appropriate disposition on the listed items.
10.
February 11, 1985 - the NRC accepted Cardinal 's revised action plan.
Parch 13, 1985 - PGandE formally reinstated Cardinal on the Oualified Suppliers'ist upon closure of the findings identified during the December 6-7, 1984 audit.
12.
April 17, 1985 - The Cardinal program consists of four steps which are (1) Agency formalization - 100+ complete, (2) Subcontractor validation - 100% complete except for validation of foreign-supplied carbon steel washers which will be completed prior to issuance of a new purchase order for washers, (3) Material verification - 97.5%
complete, and (4) Certification review -
90% complete and is scheduled for completion by April 19, 1985.
To date, the program has shown that all materials shipped to DCPP satisfy PGandE material specification requirements.
However, one order item was certified to higher mechanical strength properties than was provided or ordered.
Cardinal certified one order to be 1-1/8" by 17" A193 Gr B8 Class II studs.
Testing of this material demonstrates compliance to ASTt1 A193 Gr B8 Class I.
The Pullman purchase order did not specify the 0493A-5-PGandE Letter Ho. DCL-85-152
Class II requirements and the studs were used in a flange bolting application for which Class I requirements are appropriate.
Therefore, the material shipped to DCPP meets the purchase order requirements and the requirements for its applications.
In sugary, PGandE has not "conveniently ignored [findings regarding Cardinal3 until well after any licensing impact."
In fact, PGandE has conducted, and is continuing to conduct, a corrective action program that is timely, conservative, and thorough, to reasonably assure the quality of the materials supplied by Cardinal for use at Diablo Canyon.
0493A PGandE Letter No. DCL-85-152
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GAP Allegation f314.10.09 It is alleged that:
From the above statements, PG8E has inferred that the current program at Cardinal is not quite acceptable, yet the discrepant materials are the product of the prior quality program at Cardinal which wasn 't identified by PGKE until late 1984.
This admission raises questions as to the adequacy of the vendor audits performed by PGAE and their subcontractor, Pullman, which should have found these conditions prior to late 1984.
(P(22/85 0'Neill Aff. at 7.)
I.
The Diablo Canyon Ouality Program for supplier control complies with PGandE licensing commitments to Regulatory Guides 1.144 and 1.123, ANSI N45.2.13, ANSI N45.2.12; ANSI N45.2.6, and ANSI N45.2.23 and includes:
o Supplier Oualification Audits o
Supplier Implementation Audits o
Supplier Source Inspections o
Qnsite Receipt Inspections o
Inspector Qualifications o
Auditor Qualifications 0495A PGandE Letter No. DCL-85-152
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A.
PPOCUREMENT SPECIFICATIONS As PGandE identifies a need for procurement, engineers develop procurement speci fications.
These speci fications include techni cal and quality requirements for items being procured.
Included in these specifications are quality requirements for receipt inspection.
Source inspection or post-receipt qualification testing requirements may also be included.
These specifications are then reviewed by PGandE quality control personnel for appropriateness of quality requirements.
Prior to procurement, the speci fying engineers determine the status of supplier qualification as discussed bel ow.
B.
SUPPL IER OUALIFICATION Mhen a supplier's program is relied upon for control of quality, procurement for safety-related items does not occur until that supplier has been qualified.
The process for supplier qualification is as follows:
1)
ASME - A supplier with a current ASME certificate can be qualified for the scope of work covered by the certificate.
0495A
PGandE Letter No. DCL-85-152
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2)
NRC Topical - A supplier can be qualified ifit has an approved t}uality Assurance Program by NRC.
An evaluation is performed by the PGandE Ouality Assurance Department to assure that the supplier's quality assurance program is applicable to the items being procured.
3)
PGandE Ouality Assurance Department obtains a prospective supplier's quality assurance program descri ption and performs a
documented review to assure that the quality assurance program satisfies the quality requirements of the procurement specification.
Once the PGandE Ouality Assurance Department is satisfied that the supplier's quality assurance program description satisfies the procurement specification, a supplier qualification is performed.
The PGandE system for supplier qualification integrates several methods as follows:
a.
CASE - A supplier can be qualified if listed in the Coordinating Agency for Supplier Evaluation register.
If the supplier is listed, copies of audit reports are obtained and reviewed for an assessment of the supplier's capability to implement his quality assurance program description.
This evaluation, again, is based upon the specific quality requirements of the procurement specifications.
0495A PGandE Letter Ho. DCL-85-152
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b.
Bechtel ESL - A supplier can be qualified ifit is listed on the Bechtel Evaluated Suppliers List. If this method is utilized, the Quality Assurance Depar tment utilizes the same methodology as described in paragraph (a. ) above.
c.
Qualification Audit - PGandE Quality Assurance Department performs a supplier qualification audit of suppliers who cannot be qualified using the methodologies described above.
This qualification audit is performed by, as a
minimum, a lead auditor who is qualified in accordance with ANSI N45.2.23.
The audit methodology is performed per the requirements of ANSI N45.2.12 and includes the auditing of suppliers'apabilities to audit and qualify their subsuppliers and contractors, such as Pullman Power Products.
Once the supplier is qualified, the supplier is listed in the PGandE Qualified Suppliers List, and the procurement specification is issued to the supplier.
0495A
PGandE Letter Ho. DCL-85-152
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C.
SUPPL IER IHPLENENTATION AUDITS The PGandE Duality Assurance Department schedules supplier implementation audits once a supplier is known to have initiated work.
The audit process is performed and documented in accordance with the requirements of ANSI N45.2.12 and is performed by, as a
minimum, a lead auditor who is qualified in accordance with ANSI.
An audit is essentially a snapshot in time of the implementation of a quality system.
Samples of work are selected on a random basis to determine the effectiveness of the quality system.
Mhile properly performed audits should result in useful and reliable information, even top performance and
"due care" by the auditors cannot always assure that the audit's results are faultless.
The PGandE audit staff receives ongoing training to stay abreast of current quality system auditing methods and requirements; actively reviews audit techniques recommended by industry quality organizations such as ASOC, ASME, EEI, CASE, and NFUF; and when desireable, adjusts auditing methods to minimize the possibility of gathering inaccurate audit information.
0495A PGandE Letter No. DCL-85-157
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D.
SUPPLIER SOURCE INSPECTIONS The PGandE Engineering Quality Control Department performs documented inspections at suppliers'acilities in accordance with inspection plans based on the requirements of procurement specifications.
Inspectors are qualiFied in accordance with ANSI N45.2.6.
E.
ONSITE RECEIPT INSPECTION PGandE performs receipt inspection of all materials received from suppliers that are to be used in safety-related applications.
This H
inspection is performed as specified on the procurement specification to assure that items comply with procurement requirements.
Inspectors qualified in accordance with ANSI N45.2.6 perform inspections in accordance with approved inspection procedures.
Nonconformances are handled in accordance with approved procedures and comply with the identification, segregation, and dispositioning requirements of 10 CFR 50, Appendix B.
0495A-6-PGandE Letter No. DCL-85-152
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F.
PERSONNEL OVALIFICATIONS PGandE personnel performing the activities associated with audits and inspections are familiar with, trained, and qualified in accordance with ANSI N45.2.6 and ANSI N45.2.23, as appropriate.
These integrated quality systems provide PGandE with adequate confidence that materials procured confor m to specifications.
In addition, these integrated quality systems have been inspected and found acceptable by the NRC.
0495A
PGandE Letter No. DCL-85-152
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GAP Allegation f314.10.10 It is alleged that:
The letter included as Exhibit 2 instructs PGSE site'ersonnel to locate and identify materials supplied by Cardinal for "revalidation testing".
The context of this letter, and subsequent site actions, indicate that the material will be accepted as-is on the basis of evaluation of field samples.
As procurement controls on the stock used to produce these materials is suspect,
"revalidation" could simply mean falsi fication of material test reports.
If safety-related materials cannot be supported with certifications to the source supplier, the material must be replaced with material that can meet this requirement.
In the case of welded ASTN A-307 studs, all installations of this type should be r eplaced with cer tified, weldable material of P-1 chemical composition or verified as to chemistry limits.
(2/22/85 O'eill Aff. at 7-8.)
The memo from S.
M. Skidmore to J.
R. Banning of December 20, 1984, discussed the revalidation program being conducted by Cardinal, which, in part, included material retesting for physical and chemical attributes.
This program includes retesting of material s from foreign suppliers to Cardinal where the validity of the materials'ertifications could not be readily ascertained.
Materials provided by the above overseas vendors require sample testing of the specific categories of materials purchased by these subcontractors.
The sampling method is in accordance with the requirements of NIL STD 105D for providing a confidence factor of 95% for each category.
The material used was from inventory from the same stock in Cardinal 's warehouse, or from the inventory of Cardinal customers.
The alleger assumes that "[m]aterial will be accepted as is on the basis of evaluation of field samples."
He is incorrect 0496A PGandE Letter No. DCL-85-152
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in his assumption because the material being retested under the revalidation program is being done to verify the original mater ial certifications.
The alleger's conjecture that "'revalidation'ould simply mean the falsification of testing reports" is without merit.
The retesting being conducted under the Cardinal revalidation program is presently occurring under an approved Ouality Assurance Program for Cardinal 's subcontractors who are conducting this retesting.
The alleger is also incorrect when he states that
"if safety-related materials cannot be supported with certifications to the source supplier, the material must be replaced with material that can meet this requirement."
If the certifications to the source supplier are in doubt, the material can be retested in accordance with industry standards to ascertain its suitability for use in a safety-related application.
This is what is presently being done under the Cardinal revalidation program.
0496A
PGandE Letter No. DCL-85-152
GAP Allegations $314.10.11, 314.10.12, 314.10.13, and 314.10.14 It is alleged that:
Although PGAE site personnel are instructed by PG&E corporate quality assurance personnel to identi fy all Cardinal material, the instructions relayed to the subcontractor Pullman have changed.
Exhibit 3 is the letter describing the deficiency to Pullman.
Instead of identifying all Cardinal material and placing it on hold, Pullman is directed to place only the material on order or in storage on hold, and this is only a temporary hold.
In this manner, the material installed in the plant, which presumably came from the past quality program in question, is excluded from any evaluation or corrective action.
(2/22/85 O'Heill Aff. at 8.)
It is alleged that:
Although PGAE is ultimately responsible to report conditions to the NRC, PGSE directs Pullman to use their inhouse discr epancy r epor ting system to identify the indeterminate Cardinal fasteners.
Pullman identified this on Discrepancy Report (DR) 9173, which is included as Exhibit 4.
This report was evaluated by Pullman not to be reportable under the requirements of 10 CFR 21, although it could describe widespread use of indeterminate material throughout both [hit 1 and 2.
(2/22/85 O'Heill Aff. at 8.)
It is alleged that:
Discrepancy Report 9173 is written against material that is on order or in storage, and only for Unit 2.
This type of
"corrective action" is a smoke screen designed to confuse site personnel as to the actual discrepancy.
Notice that DR 9173 hardly defines the deficiency, but is more concerned with allowing the discrepant material back into the field for use.
All of the activities associated with identifying the discrepant material are to be completed in one day, December 21, 1984.
This is an example of the unrealistic deadlines imposed by an incompetent management, which clouds the real issue.
To identify all installations 0497A PGandE Letter No. DCL-85-152
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of Cardinal material would be a formidable task, considering the volume of r ecords that would require r evi ew.
(2/22/85 O'eill Aff. at 9. )
It is alleged that:
From the example above, PGSE is allowed to evade the requirement to report this condition to the NRC under
CFR 21.
This is accomplished by telling Pullman to evaluate the condition for reportability.
Pullman finds the condition non-reportable (in every case),
PGAE agrees,
.
and the NRC finds that "the licensee met their reporting requirements in a responsible manner".
This is the method of reporting and correcting deficiencies at Diablo Canyon.
(2/22/85 O'eill Aff. at 9.)
The alleger is correct in stating that Pullman was not directed to locate all Cardinal material as installed and to place it on hold.
Ke is incorrect, however, in translating that fact into a conclusion that the installed material
"is excluded from any evaluation or corrective action."
As set forth in response to Allegation 8314.10.07, PGandE has embarked upon an extensive corrective action program.
Cardinal has embarked upon a comprehensive revalidation program, which is under the close scrutiny of the NRC.
The alleger also correctly states that no 10 CFR Part 21 report has been made by Pullman or PGandE.
The inference he attempts to draw is, however, incorrect.
To date, there has been no need to make a report under Part 21.
To date, reviews in progress continue to show that all materials furnished by Cardinal for use at Diablo Canyon are in compliance with specification 0497A
PGandE Letter No. DCL-85-152
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requirements and are acceptable as installed.
That being the case, the requirement to evaluate reportability under Part 21 has not yet arisen.
Should any materials be found to be deficient, PGandE will evaluate repor tab ility.
At the time DR 9173 was written, and still today, only documentation deficiencies have been identified and there is no evidence of any defective material in the plant.
Nevertheless, precautionary measures were taken on stored materials pending the results of further investigations.
No unreasonable deadline was imposed to perform the actions requested.
The corrective action programs of Cardinal, PGandE, and Pullman require appropriate disposition of material found to be defective, if any.
0497A
PGandE Letter Ho. DCL-85-152
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A"'CIiIVC9 O
VigP PA.C IP ZC GAB A.ZD ELECTRIC C 0M'.NY l995 PPP I EI PI.I IP: tIO
BEALE STREET, SAN FRANCISCO, CALIFORNIA 94106 1 JLEPAONE (475) 781.4211 1IFBID("l"'.
'pril 17, 1985 PGandE Letter No.:
DCL-85-153 Mr. John B. Martin, Regional Administrator U.
S.
Nuclear Regulatory Commission, Region V
1450 Maria Lane, Suite 210 Walnut Creek, CA 94596-5368 Re:
Docket No. 50-275, OL-DPR-80 Docket No. 50-323 Diablo Canyon Units 1 and
Cardinal Industrial Corporation - Status Report
Dear Mr. Martin:
In response to your verbal request, enclosed are five (5) copies of a report prepared by PGandE entitled "Status Report on the Cardinal Industrial Products Corporation Revalidation Program and Related Items As They Apply to Diablo Canyon as of April 17, 1985."
Kindly acknowledge receipt of this material on the enclosed copy of this letter and return it in the enclosed addressed envelope.
Sincerely, ORIGINAL SIGNED BY Encl osure cc:
R.
T.
Dodds G. H.
E. Schierling Service List J.
D. Shi ffer
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