ML20141E927

SER Approving Amend to License SNM-1227,reflecting Use of Parent Company Guarantee & to Update Decommissioning Cost Estimate

ML20141E927
Person / Time
Site:	Framatome ANP Richland
Issue date:	05/16/1997
From:	Weber M NRC OFFICE OF NUCLEAR MATERIAL SAFETY & SAFEGUARDS (NMSS)
To:
Shared Package
ML20141E884	List: ML20141E878 ML20141E902 ML20141E927
References
NUDOCS 9705210147
Download: ML20141E927 (2)

Text

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seenu h, Al . UNITED STATES '

c gj Y jl; e NUCLEAR REGULATORY. COMMISSION wasniwarow, o.c. senes-coot 1j I kg

• May 16,.1997 j 4

, { DOCKET: :70-1257 j LICENSEEh Siemens Power Corporation Richland, Washington- i

SUBJECT:

SAFETY. EVALUATION REPORT: AMENDMENT APPLICATION DATED JUNE'14,-

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'1996 AND MARCH 12, 1996, TO' REFLECT THE USE OF THE PARENT-COMPANY-  ;

. GUARANTEE AND TO UPDATE THE DECOMISSIONING COST ESTIMATE a

BACKGROUND ]

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j On June 14, 1996, Siemens Power Corporation (SPC) submitted a request to u'se a '

F parent company guarantee to provide financial assurance for plant decomiss-ioning.L The parent company guarantee replaces two standby Letters of Credit totaling $27,000,000. After NRC review of ths. June 14 submission, a request for additional information (RAI) was transmitted to the licensee. Three t telephone conferences were then held between SPC and NRC staff. The main issue concerned SPC's use of German accounting principles,.as opposed to U.S.

generally accepted accounting procedures (GAAP), in the determination of SPC's total assets within the United States. SPC responded to NRC's comments in a letter' dated March 5, 1997. NRC review of this submittal concluded that all issues concerning.the parent company guarantee had been sufficiently resolved.

On March 12, 1997, SPC submitted revised pages of Part I of License SNM-1227 S to reflect the use of the parent company guarantee for financial asrurance.

4 The March 12, 1997, submittal also included an update to the 1994 decomissioning cost estimate. In Section 6 of its Decommissioning Funding Plan, submitted to NRC on August .15,1994, SPC comitted to updating its P ' decomissioning cost estimate periodically as conditions warrant. In addition,.by letter dated April 28, 1993, SPC comitted to updating the cost i estimate prior to startup of the new Dry Conversion Facility. The March'12,

. 1997, submittal was replaced by a submittal on May 1,1997, which corrected an  ;

. omitted footnote on page 7-2 of the license application. 1 DISCUSSION On June"14, 1996, SPC submitted a request to use a parent company guarantee to provide financial assurance for plant decomissioning. After review of this submittal, NRC staff identified four concerns, which were transmitted to the i licensee by letter dated October-11, 1996. The main concern was'SPC's use of German accounting' principles as' opposed to U.S. GAAP. The NRC staff was-also i concerned that-the deadlines specified in the guarantee ~ agreement were 30 days

. . longer than those recommended in' Regulatory Guide 3.66 for submitting i financial documents at the end.of the fiscal year.and for providing alternate i financial assurance'if necessary. In addition to addressing these concerns,

- 'SPC was asked to notarize the parent company guarantee and to execute the l amendment;to the standby trust agreement.  ;

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2 By letter dated March 5, 1997, SPC resolved the NRC's concerns. SPC submitted 1 documentation that confirms that the parent company, Siemens Aktiengesellschaft (SAG), has a consolidated tangible net worth plus accrued decommissioning costs that is greater than six times the decommissioning cost estimate, as calculated under U.S. GAAP. In addition, the documentation ,

I showed that SAG's total assets in the U.S. have been calculated in accordance with U.S. GAAP. In the March 5 submittal, the deadlines specified in the j guarantee agreement were also revised to agree with the recommended deadlines  !

in Aegulatory Guide 3.66, the guarantee agreement was notarized, and the amendment to the standby trust agreement was executed.

By letter dated March 12, 1997, SPC submitted a license amendment to reflect i the use of the parent company guarantee and to include an update to the 1994 decommissioning cost estimate. However, due to the accidental omission of a footnote on page 7-2 of the March 12, 1997, license application, X replacement pages were submitted on May 1, 1997. ,

The 1994 cost estimate was revised to include the decommissioning costs of the new Dry Conversion Building. In addition, because remodeling of the Lagoon Uranium Recovery (LUR) facility to include the Solids Processing Facility (SPF) has been completed, the cost estimate was also revised to include the l decommissioning costs of the LUR/SPF facility and to remove the expended capital costs.

The cost estimate was also revised to reflect a reduction in the estimated volume of contaminated equipment and material to be buried when the U0 2 i building, Specialty Fuels building, and auxiliary facilities are I decommissioned. SPC explained that the burial container void volume assumed l in the 1994 estimate was erroneously twice as much as it was intended to be.

The cost estimate was also revised to reflect an increase in burial rates of approximately 60% for containerized waste and an increase in inflation of slightly more than 9% over the past three years. 1 The net result of these changes is a decrease of slightly over $400,000 in the total decommissioning cost estimate, from $27,000,000 to $26,581,475.

Therefore, the level of financial assurance provided by the parent company guarantee of $27,000,000 is still adequate. ,

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CATEGORICAL EXCLUSION These changes are considered administrative in nature. The staff has determined that the proposed changes do not adversely affect public health and l safety or the environment. Therefore, in accordance with 10 CFR 51.22(c)(ll),  !

neither an environmental assessment nor an environmental impact statement is warranted for this action.

CONCLUSION The NRC staff has reviewed the licensee's proposed amendment and has determined that the proposed changes will have no adverse effect on public health and safety or the environment. Therefore, approval of the amendment application is recommended.

The Region IV inspection staff has no objection to this proposed amendment.

Principal Contributors p* ,,4 @

Susan D. Chotoo # g' d 7 F Kim Hardin J tm Q r 6*