ML20207B533

Draft Rept, Regulatory Analysis on Energy Compensation Sources for Well Logging & Other Regulatory Clarifications Changes to 10CFR39

ML20207B533
Person / Time
Issue date:	01/31/1999
From:	NRC OFFICE OF NUCLEAR MATERIAL SAFETY & SAFEGUARDS (NMSS)
To:
Shared Package
ML20137R858	List: ML20207B476 ML20207B499 ML20207B506 ML20207B511 ML20207B516 ML20207B522 ML20207B528 ML20207B533
References
FRN-64FR19089, RULE-PR-39 AG14-1-013, AG14-1-13, AG14-1-14, NUDOCS 9906010054
Download: ML20207B533 (37)

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REGULATORY ANALYSIS ON ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS - CHANGES TO 10 CFR PART 39 Draft Report U.S. Nuclear Regulatory Commission Office of Nuclear Materials Safety and Safeguards January 1999 4kBFCCp

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f 60 054 990518 PDR 3'$4FR1908C

TA.BLE OF CONTENTS AB STRACT.............................

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1. INTRO DUCTION..............................................

4 1.1 Statement of Problem and Background.

..4 1.1.1 Energy Compensation Sources 5

1.1.2 Tritium Neutron Generator Target Sources......................... 5 1.1.3 Overview of Proposed Regulatory Changes........................ 6 l

1.2 Statement of Problem and Background......................

.7 1.3 Current Licensing and Radiation Safety Regulations..............

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2. IDENTIFICATION AND PRELIMINARY ANALYSIS OF ALTERNATIVE APPROACHES... 9 2.1 Option 1..................

................................. 9 2.2 Option 2......................

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3. ANALYSIS OF VALUES AND IMPACTS 12 3.1 Identification of Affected Attributes....

12 3.2 Analytical Meth od........................................

14 3.2.1 Data Collection 14 3.2.2 Summary of Licensee Responses..

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3.2.3 Calculating Values and Impacts of Alternatives...................

16 3.3 Resul t s.................................

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4. AGREEMENT STATE IMPLEMENTATION ISSUES.........

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5. B ACKFIT ANALYSIS.................................................. 23

6. DECISION RATIONALE FOR SELECTION OF THE PROPOSED REGULATORY ACTION. 24

7. RELATIONSHIP TO OTHER PROCEDURAL REQUIREMENTS................

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8. PAPERWORK REDUCTION ACT ANALYSIS

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REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39 ABSTRACT l

This regulatory analysis examines the values and impacts expected to result from a set of proposed changes to the existing well logging regulations in 10 CFR Part 39. The proposed changes will accommodate a new technology t%t uses low activity sources to simultaneously log wells while drilling and proposes other modification c;) improve, clarify and update Part 39. These changes are described in a May 1998 Rulemaking Plan (SECY-98-105) entitled, " Energy Compensation Sources for Well Logging and Other Regulatory Clarifications - Changes to 10 CFR Part 39.

This regulatory analysis evaluates the values and impacts expected to result from two regulatory options: (1) no-action; and (2) the proposed action alternative. Under the proposed action, the 'U.S.

Nuclear Regulatory Commission (NRC) would allow licensees to obtain regulatory relief from the current licensing and radiation safety requirements for well logging for low activity energy compensation sources (ECSs) and tritium neutron generator target sources. Specifically, NRC plans to reduce the regulatory burden on licensees to account for innovative and new technology while maintaining adequate protection of public health and safety. The most significant change to 10 CFR Part 39 would exclude a licensee using an ECS or a tritium neutron generator target source from the costly procedures for well abandonment.

Under Option 1. the no-action alternative, NRC would maintain the current licensing and radiation safety requirements for well logging as prescribed in 10 CFR Part 39, and additional requirements in other parts (as described in Section 1). In NRC's estimation, many of these requirements are overly burdensome for low activity (less than 3.7 MBq [100 Ci]) ECS sources and 1,110 GBq (30 Ci) tritium neutron generator target sources. Under this option, however, licensees would continue to be 1

required to meet the ewent requirements contained in Part 39.

This regulatory analysis estimates the following values and impacts associated with the proposed changes to the current well logging requirements contained in 10 CFR Part 39.

Relative to the no-action option (Option 1), the proposed action (Option 2) would result in industry operation savings for licensees. First, under Option 2, licensees would avoid the costly requirements for well abandonment for low activity ECSs and tritium neutron generator target sources. Second, licensees would realize savings associated with leak testing of these sources by reducing significantly the frequency of leak tests required to comply with NRC requirements (once every three years versus every six months). Third, licensees would be provided the flexibility to determine the best method for protecting against inadvertent intrusion on an abandoned source (for sources with activities greater than 3.7 MBq [100 Ci] or tritium neutron generator target sources above 1,110 GBq [30 Ci]).

Relative to the no-action option (Option 1), the proposed action (Option 2) would result in operation savings for NRC. Specifically, under Option 2, NRC would realize savings by i

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CHANGES TO 10 CFR PART 39 i

reducing the number of abandonment reviews for low activity ECSs and tritium neutron generator target sources. Further, NRC could realize additional savings associated with the change proposed for Section 39.77 allowing flexibility during an emergency for abandoning irretrievable sources. Also, minimal savings would result from fewer exemption requests. Since January 1,1997, there have been six exemption requests (related to the proposed changes) and all were granted. These attributes are either difficult to evaluate at this time, or are of minimal value, and thus have not been quantified in this analysis.

Relative to the no-action option (Option 1), the proposed action (Option 2) would result in additional costs for NRC implementation. Specifically, the consolidated regulatory guidance project would need to incorporate all necessary guidance for well logging licensees into NUREG-1556, Consolidated Guidance About Materials Licenses, Program Specific Guidance About Well-legging Licenses. This would require both draft and final NUREG versions. NRC anticipates, however, that the affect on this NUREG would not be significant, since this update would be done regardless of whether this miemaking were completed. Therefore, the values have not been quantified in this analysis.

Relative to the no-action option (Option 1), Option 2 would reduce the burden on state and local government organizations actively involved in the regulation of well logging operations, thus yielding these organizations an annual cost savings. These values are expected to be minimal, and have not been quantified in this analysis.

Relative to the no-action option (Option 1), Option 2 would result in enhanced regulatory efficiency, particularly by eliminating the need for preparing reporting and recordkeeping information for abandonment of low activity ECSs and tritium neutron generator target sources.

In addition, Option 2 would provide greater regulatory certainty and clarity than the no-action option, and would ensure consistent treatment among all well logging licensees. These values, while believed to be significant, have not been quantified in this analysis.

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1. INTRODUCTION NRC has issued a rulemaking plan for amending its current licensing and radiation safety requirements for well logging at 10 CFR Part 39. ' The regulations controlling use of well logging technology were promulgated in 1987. Since that time, new technologies have emerged that were not envisioned when the original regulations were written. NRC's intent is to revise these regulations to accommodate the use of these newer technologies. NRC is currently studying two regulatory options to accomplish this. This document presents NRC's regulatory analysis of these options.

1.1 Statement of Problem and Background Almost all oil and gas produced today comes from accumulations in the pore spaces of resen'oir rocks - usually sand stones, limestones, or dolomi.es. The amount of oil or gas contained in a unit volume of the reservoir is the product of its porosity by the hydrocarbon saturation. The volume of the formation containing the hydrocarbons is used to estimate total reserves and to determine whether the accumulation is commercially viable. Knowledge of formation thickness of the reservoir is needed to compute volume in addition, evaluating the productivity of a reservoir requires knowing its permeability (i.e., how easily the fluid can flow through the pore system). The main parameters needed to evaluate a reservoir, then, are its poros:ty, hydrocarbon saturation, thickness, area, and permeability. In addition, the reservoir geometry, formation temperature and pressure, and lithology can play a major role in the evaluation, completion, and productivity of a reservoir. Downhole well logging provides a method of deriving or inferring accurate values for the hydrocarbon and water saturations, porosity, permeability, and lithology of the reservoir rock.

When NRC first promulgated its 10 CFR Part 39 regulations, well logging technology required drilling to stop. After removing portions of the drilling pieces, field workers then lowered logging tools -

- encapsulated radioactive sources with associated detector crystals -into the well on a mreline. The depth of the well could range from hundreds of meters to greater than 10,000 meters (m) [32,810 feet (ft)]. As the logging tool was slowly raised from the bottom of the well, information collected by the detectors was sent to the surface through the wireline and plotted on a chart. Now, more recent technology, referred to as " logging while drilling"(LWD) allows well logging to be accomplished during drilling. The technology provides "real-time" data during drilling operations and improves evaluation of geologic formations. In addition to the larger sources, logging while drilling technology uses a low activity radioactive source, known as an ECS to calibrate the larger source.

Changes to

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CIIANGES TO 10 CFR PART 39 1.1.1 Energy Compensation Sources An ECS is a low activity source ( typically less than 3.7 megabequerels (MBq) [100 microcuries

( Ci))) compared to the normal 110 to 740 gigabequerel (GBq) [3 to 20 Ci] sources used in well logging.

Typical radionuclides used in these sources are Am-241, an alpha particle emitter, and Cs-137, a beta and gamma emitter. Source sizes vary widely depending upon the manufacturer and the intended use of the ECS. The majority of the tools used in well logging operations are custom designed for specific applications. Even so, the standard design is fairly typical: the encapsulated source is mounted inside a steel (or other similar metal) pressure housing in the interior of the LWD tool. The pressure housing (and other tool components) provides additional encapsulation to protect the source from operational impacts (e.g., pressure, stresses). An example of a licensed ECS source is provided below:

Steering and Gamma Ray Sub - Manufactureu by Anadrill, Inc., this device uses two 2.2 uCi americium-241 (Am-241) sources. This model is designed for downhole use during logging (or measurement while drilling) operations. It provides a spectrum of gamma radiation in the wellbore due to the naturally occurring concentrations of thorium, uranium and potassium in the surrounding rock formations. The gamma spectrum is measured using a ruggedized gamma ray spectrometer. The spectrometer uses two detectors: each containing its own Am-241 source acting as a reference for energy and activity, allowing the detector to compensate for efficiency fluctuations due to temperature changes in the borehole. The spectrometer and associated electronics operate at one atmosphere pressure within a sealed pressure housing made of stainless steel. This housing is positioned to allow drilling mud to flow between the outer diameter of the pressure housing and the inner diameter of the drilling collar (which acts as an additional encapsulation for the source). The diameter of the tool ranges from between 6.5 and 9 inches, with an overalllength of approximately 133 inches. The Am-241 sources are mounted within the pressure housing on the side of each of the scintillating crystals of the spectrometer. The entire detector is then wrapped with 0.10 inch thick silicone rubber and teflon shrink tubing to assist in shock isolation. The wrapped detector is then press fit within the pressure housing. The pressure housing and drill collar shield all of the Am-241 gamma rays emitted toward.he outside of the tool. Therefore, the presence of the Am-241 cannot be detected from outside the tool. The device is designed to operate in a high pressure and temperature environment. Testing of the devices indicates an ability to withstand both normal and extreme conditions of handling and use.

1.1.2 Tritium Neutron Generator Target Sources Tritium neutron generator target sources are used in neutron logs. Neutron logs are used principally for delineation of porous formations and determination of their porosity. They respond primarily to the amount of hydrogen in the formation. Thus, in clean formations whose pores are filled with water or oil, the neutron log reflects the amount of liquid-filled porosity. These sources are not used in logging while drilling tools. They are used in the more traditional well logging procedure (i.e.,

wireline logging).

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CHANGES TO 10 CFR PART 39 Neutrons are uncharged particles, each having a mass almost identical to the mass of a hydrogen atom. High energy neutrons are continuously emitted from a radioactive source (tritium) in the tool.

These neutrons collide with nuclei of the formation materials, and with each collision, the neutrons lose energy. The energy lost per collision depends on the relative mass of the nucleus with which the neutron collides. Thus the slowing of the neutrons is dependent on the amount of hydrogen in the formation.

These tools are used similar to wireline drilling, whereby the tool is lowered into the well on a wire and measurements are taken while drilling has ceased. Neutrons are generated when a voltage is applied to the tritium neutron generator target source. An example of a licensed tritium n.atron generator target source is provided below:

Downhole Accelerator - This source, manufactured by Haliburton Logging Sources, Inc. uses an H-3 source with a maxirnum activity of 100 GBq (3 Ci) in oil and gas well logging applications.

The system consists of a pulsed deuterium-tritiurn accelerator, a scintillation detector, a digital telemetry system and w.ociated electronics. This system is approximately 23 feet in length and 1-11/16ths inches in diameter. The accelerator tube is 7 inches long and 1-5/16ths inches in diameter. The device is used for neutron activation of underground formations for quantitative and qualitative analysis. It is designed to operate at pressures up to 20,000 psi and at temperatures of 400'F. A radiation hazard exists only when the accelerator is energized. It will then produce IE.aneutrons per second. The expected useful life of the accelerator is more than 400 hours0.00463 days <br />0.111 hours <br />6.613757e-4 weeks <br />1.522e-4 months <br />.

1.1.3 Overview of Proposed Regulatory Changes In the May 1998 Rulemaking Plan, NRC determined that 10 CFR Part 39 should be changed to reflect the changes in the well logging industry. Specifically, NRC believes that many of the requirements in 10 CFR Pan 39, when applied to either an ECS or tritium neutron generator target source, may be overly burdensome. Because the existing regulations do not allow for variations based on the activity of the source, licensees using an ECS must currently meet all the requirements of 10 CFR i

Pan 39. Examples of overly burdensome requirements deal with well abandonment (Sections 39.15 and I

39.77), leak testing (Section 39.35), design and performance criteria for sealed sources (Section 39.41),

and monitoring of sources lodged in a well (Section 39.69). In the proposed action, NRC intends to apply the sections dealing with leak testing (Section 39.35), physical inventory (Section 39.37) and records of material use (Section 39.39) to the use of an ECS. Requirements established in other parts of NRC regulations (e.g., Parts 20 and 30) are still applicable to ECSs and tritium neutron generator target sources.

NRC's proposed rulemaking addresses these issues by modifying the regulations in 10 CFR Part 39 to define an ECS and tritium neutron generator target and provide appropriate regulations for using these technologies in well logging applications. The most significant change would exclude the user of an ECS from the costly procedures for well abandonment currently found in 10 CFR Part 39.

Well abandonment, in addition to specific reporting and approval requirements, requires that the source January 1999 5

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be immobilized and sealed in place with a cement plug, that the cement plug be protected from inadvertent intrusion, and that a permanent plaque be mounted at the surface of the well. NRC proposes to implement less stringent abandonment requirements for ECSs, for sources measuring less than 3.7 MBq (100 Ci), and for tritium neutron generator target sources with sources measuring less than 1,110 GBq (30 Ci)in oil and gas wells where surface casing is set.

1.2 Statement of Problem and Background Based on information about the changing technology in the well logging industry, NRC developed a Rulemaking Plan to consider the need to update Pari 39. On May 28,1997, NRC staff provided a draft Rulemaking Plan entitled, " Energy Compensation Sources for Well Logging and Clarifications -- Changes to 10 CFR Part 39"(SECY-97-111) to the Agreement States for comment.

NRC staff received comments c:a the draft Rulemaking Plan from the States of Utah, Blinois, and Washington. These States generally supponed the proposal and provided specific information and comments. Where appropriate, NRC staff incorporated these comments into the final Rulemaking Plan contained in SECY-98-105, dated May 12,1998. (NRC,1998)

In the final Rulemaking Plan, NRC staff proposes to modify the existing regulations to account for the use of this technology. NRC staff believes these modifications would reduce regulatory burden to I

both NRC and Agreement State licensees with minimal impact to public health and safety. In addition, NRC proposes changing other sections of Part 39 to improve, clarify, and update the regulations.

1.3 Current Licensing and Radiation Safety Regulations NRC's current requirements pertaining to licensing and radiation safety for well logging operation; are contained in 10 CFR Part 39, and cross-reference other provisions in 10 CFR Parts 19,20, 21,30,40,70,71, and 150 (e.g., notices, and reporting, radiation protection standards, possession of by-product material, licensing of source material and special nuclear material, packaging and transportation of radioactive material, and exemptions and continued regulatory authority of Agreement States). The proposed rule would not affect *e applicability of these other parts as they pertain to ECSs and tritium neutron generator target sources. The rulemaking is intended only to amend certain requirements contained in Part 39 that relate specifically to well logging operations.

As noted above, NRC's formal requirements for licensing and radiation safety for well logging are contained in 10 CFR Part 39. The requirements specified therein include:

General provisions defining the scope and purpose of the requirements, definitions of key terms associated with the requirements, and requirements specific to information collection (Subpart A);

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CHANGES TO 10 CFR PART 39 Specific licensing requirements for the use oflicensed material for well logging (Subpart B);

these provisions require compliance with the licensing requirements contained in other NRC regulations, including Section 30.33 for by-product material, dection 40.32 for source material, and Section 70.33 for special nuclear material, as applicable; Equipment labeling, use, testing, inventory, and recordkeeping requirements (Subpart C);

Radiation safety requirements, including training (inclusive of requirements contained in Parts

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19,20, and 39), operating and emergency procedures, personnel monitoring, radiation surveys, and contamination control (Subpart D):

Security, records and notification requirements, including onsite recordkeeping, incident notification, and abandonment procedures (Subpart E);

Exemptions (Subpart F); and Enforcenwnt provisions (Subpart G).

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2. IDENTIFICATION AND PRELIMINARY ANALYSIS OF ALTERNATIVE APPROACHES The Rulemaking Plan for this rulemaking identified one specific option to address the issues identified in Section 1. This regulatory analysis discusses the option specified in the rulemaking plan, l

and a no-action alternative.

2.1 Option 1 Under Option 1, the no-action alternative, NRC would maintain the current licensing and radiation safety requirements for well logging as prescribed in 10 CFR Part 39, and additional requirements in other pans (as described in Section 1). In NRC's estimation, many of these requirements are overly burdensome for low activity (less than 3.7 MBq [100 Ci]) ECS sources and less than 1,110 GBq (30 Ci) tritium neutron generator target sources. Under this option, however, licensees would j

continue to be required to meet the requirements outlined in Section 1.2 above.

l Under Option 1, licensees would have the opportunity to request an exemption from the current I

requirements on a case-by-case basis if they believe that the current level of regulation would be more than necessary based on the level of perceived risk. While exemptions could provide regulatory relief in the future, NRC believes that Option I would do so with less regulatory certainty than Option 2 discussed below. In addition, NRC believes that Option 1 may result in inconsistencies among licensees and would result in higlier costs to both the licensee populations and NRC because of the cost inefficiencies of dealing with the exemption issue on a case-by-case basis.

2.2 Option 2 Under Option 2, NRC would allow licensees to obtain regulatory relief from the current licensing and radiation safety requirements for well logging for low activity sources. Specifically, NRC is proposing to reduce the regulatory burden on licensees to account for innovative and new technology while maintaining adequate protection of public health and safety. The most significant change to 10 CFR Part 39 would exclude a licensee using an ECS or tritium neutron generator target source from the costly procedures for well abandonment. Well abandonment, in addition to specific reporting and approval requirements, requires that the source be immobilized and sealed in place with a cement plug, that the cement plug be protected from inadvertent intmsion, and that a permanent plaque be mounted at the surface of a well.

l In its Rulemaking Plan, NRC proposes several specific changes to improve, clarify, and update Part 39 requirements to provide regulatory relief and account for the use of new well logging technology.

The possible changes are discussed below:

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i CHANGES TO 10 CFR PART 39 Revise requirements for ECSs containing less than 3.7MBq (100 Ci) for oil and gas wells.

NRC is proposing to eliminate the well abandonment requirements for ECSs containing less than 3.7MBq (100 uCi). Well abandonment, in addition to specific reporting and approval requirements, requires that the source be immobilized and sealed in place with a cement plug,

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that the cement plug be protected from inadvertent intmsion, and that a permanent plaque be i

mounted on the surface of the well. Current requirements in Section 39.35 specify that leak testing shall be conducted for beta-gamma emitting sources with activities above 3.7 MBq (100 Ci), and for alpha-emitters (above 0.37 MBq [10 Ci]) no less frequently than every six months. Current industry practices use several radionuclides in ECSs, the most typical being Cs-137 and Am-241. Typic:! activity levels of these radionuclides used in well logging applications do not exceed 1.8 MBq (50 Ci). Beta-gamma emitters with activity levels below 3.7 MBq (100 uCi) are already exempt from leak testing requirements. NRC proposes modifying Section 39.35 by changing the time interval for leak testing ECSs to not less than 3 years for non-exempt low activity sources. The changes proposed by NRC would, therefore, only affect those licensees using non-exempt sources.

Revise requirements for tritium neutron generator target sources containing less than 1,110 GBq (30 Cl) of tritium. Tritium neutron sources typically contain less than 740 GBq (20 Ci) of tritium. The neutron generaa sget sources only produce a neutron stream when a voltage is applied. For well logging applications, NRC is proposing that the tritium neutron generator target sources below 1,110 GBq (30 Ci) be subject to all requirements contained in Part 39 except: (1) sealed source design and performance criteria (Section 39.41) and (2) well abandonment procedures (Sections 39.15 and 39.77) when a surface casing is used. Tritium neutron generator target sources are already exempt from leak testing requirements contained in Section 39.35. NRC believes that the potential hazards associated with these sources do not warrant the existing well abandonment requirements in tLe event of an irretrit.vable source.

Modify Section 39.15 to provide for performance-based criteria for inadvertent intrusion on an abandoned source. The current requirement at Section 39.15(a)(5)(ii) requires a mechanical device to prevent inadvertent intrusion on the source that must be set at a point above the cement plug, unless the cement plug and source are not accessible to any subsequent drilling operations. NRC bclieves this requirement to be too restrictive in some cases, dependent upon the individual well abandonment. NRC proposes that licensees using high activity sources (above 3.7 MBq (100 uCi) or tritium neutron generator target sources above 1,110 GBq (30 Ci)

" prevent inadvertent intmsion on the source," which would require that the source be protected but allow the licensee the flexibility to determine the best method. This change would not affect I

the requirement in (a)(5)(i) for a well logging source to be immobilized with a cement plug or the f

requirement in (a)(5)(iii) for a permanent plaque. This modification would allow licensees i

greater procedural latitude while continuing to ensure source integrity. For example, if a j

significant amount of drilling equipment is abandoned in the well, I

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CIIANGES TO 10 CFR P ART 39 this equipment maybe effective in preventing inadvertent intrusion on the source, but may not meet the requirements of Section 39.15. These requirements would only apply to larger sources (i.e., above 3.7 MBq [100 uCi]) and tritium neutron generator target sources above 1,110 GBq (30 Ci).

Modify Section 39.77 requirements for notification and procedures for abandoning irretrievable well logging sources. This section specifies that NRC approval must be obtained prior to implementing abandonment procedures for an irretrievable source. In some circumstances, such as high well pressures that could lead to fires or explosions, the delay required to notify NRC may cause an immediate threat. NRC proposes to modify Section 39.77 to allow immediate abandonment without prior NRC approval if a delay could cause an immediate threat to public health and safety. Notification would still be required after completing abandonment. These requirements woul 3 only apply to sources above 3.7 MBq (100 Ci) or tritium neutron generator target sources above 1,110 CBq (30 Ci).

Include the generic exemption for sealed sources in 1989 within the regulations. NRC issued a generic exemption from the current design and performance criteria for sealed sources (Section 39.41), allowing the use of older sealed sources which meet an older standard for well logging operations. Sealed sources manufactured prior to July 14,1989. may use design and performance criteria specified under United States of America Standards Institute (USASI)

N5.10-1968 or the criteria contained in Section 39.41. The use of the USASI standard is based on the NRC Notice of Generic Exemption (54 Federal Register 30883). This exemption is currently in use, but has not been incorporated in Pan 39. NRC proposes to revise Part 39 to include this exemption within the regulations.

Update Part 39 to remove date that is time sensitive and have since passed. Section 39.49 contains a requirement dependent on a date that has already passed and is no longer appropriate.

NRC proposes to remove references to the date that has already passed, to avoid confusion on the part oflicensees.

Update Sections 39.15,39.35, and 39.41 of Part 39 to conform with NRC's metric policy by stating parameter values in dual units with metric units first and with English units in brackets.

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3. ANALYSIS OF VALUES AND IMPACTS This section examines the values and impacts expected to result from NRC's rulemaking, and is presented in three subsections. Section 3.1 identifies the attributes that are expected to be affected by the rulemaking. Section 3.2 describes the analytical method used to quantify values and impacts. Finally, the proposal's effects on values and impacts are presented in Section 3.3.

3.1 Identification of Affected Attributes This section identifies and describes the factors within the public and private sectors that the regulatory attematives (discussed in Section 2) are expected to affect. These factors were classified as attributes against the list of potential attributes provided by NRC in Chapter 5 ofits Regulatory Analysis Technical Evaluatior: Handbook. Each attribute listed in Chapter 5 was evaluated. Following are attributes that would not be affected by the proposed rule:

Iluman Health and Property - For several reasons, NRC believes that Option 2 would provide sufficient safeguards against radiation exposure to humans and property. NRC believes that excluding low activity (less than 3.7 MBq [100 Ci]) ECSs and 1,110 GBq (30 Ci) tritium neutron generator target sources from the well abandonment requirements is protective of human health and property. NRC also believes that reducing the time period for conducting leak testing of non-exempt sources will reduce the burden on licensees while maintaining protection of human health and property. As part of this rulemaking, NRC has conducted an environmental assessment to evaluate the potential risks associated with these proposed changes. The results of this analysis indicate that risk to human health would not significantly increase as a result of these modifications. Next NRC believes that allowing flexibility in determining the best method for protecting against inadvertent intrusion on an abandoned source in an oil and gas well (for sources greater than 3.7 MBq [100 Ci] or tritium neutron generator target sources above 1,110 GBq [30 Ci]) is appropriate because it still requires that the source be protected, but provides for the use of performance-based criteria to determine the best method. No change is being made to the requirement that the source be protected from inadvertent intrusion. Further, NRC believes that its proposal to allow for delayed notification in cases of well abandonment will decrease the potential risk to human health and property by allowing for immediate abandonment in cases of immediate threat. In fact, in NRC's estimation, delays caused by requiring notification prior to undertaking abandonment could lead to increased risk to health and property (e.g., fires and explosions)in some instances.

• Regulatory Analysis Technical Evaluation Handbook, Final Report, NU'REGIBR-0184,0ifice of Nuclear Regulatory Research, January 1997.

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CHANCES TO 10 CFR PART 39 General Public - The proposed action is not expected to have any effects on the general public.

l Improvements in Knowledge - The proposed action is not expected to result in any improvements in knowledge.

Antitrust Considerations - The proposed action is not expected to have any antitrust effects.

Safeguards and Security Considerations - The proposed action is not expected to have any effects on the existing level of safeguards and security.

Environmental Considerations -The proposed action is not expected to have any significant effect on the existing level of protection of environmental considerations.

i The proposed regulatory actions are expected to involve the following attributes:

Industry Operation - Relative to the no-action option (Option 1), the proposed action (Option

2) would result in industry operation savings for licensees. First, under Option 2, licensees would avoid the costly requirements for well abandonment for low activity sources ECSs and tritium neutron generator target sources. Second. licensees would realize savings associated with leak testing of ECSs by reducing significantly the frequency of leak tests required to comply with NRC requirements (once every three years versus every six months). Third, licensees would be provided the flexibility to determine the best method for protecting against inadvertent intrusion on an abandoned source (for sources with activities greater than 3.7 MBq [100 Ci] or tritium neutron generator target sources above 1,110 GBq [30 Ci]).

NRC Operation - Relative to the no-action option (Option 1), the proposed action (Option 2) would result in operation savings for NRC. Specifically, under Option 2, NRC would realize savings by reducing the number of abandonment reviews for low activity ECSs and tritium neutron generator target sources. Further, NRC could realize additional savii.gs associated with the change proposed for Section 39.77 allowing flexibility during an emergency for abandoning irretrievable sources. Also, minimal savings would result from fewer exemption requests. Since January 1,1997, there have been six exemption requests (related to the proposed changes) and all were granted. These attributes are either difficult to evaluate at this time, or of minimal amount, and thus have not been quantified in this analysis.

NRC Implementation - Relative to the no-action option (Option 1), the proposed action (Option

2) would result in additional costs for NRC implementation. Specifically, the consolidated regulatory guidance project would need to incorporate all necessary guidance for well logging licensees into NUREG-1556, Consolidated Guidance About Materials Licenses, Program Specipe Guidance About Well-Logging Licenses. This would require both draft and final NUREG versions. NRC anticipates, however, that the affect on this NUREG would not be January 1999 12

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i DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS -

CHANGES TO 10 CFR PART 39 i

i significant, since this update would be done regardless of whether this rulemaking were completed. Therefore, the values have not been quantified in this analysis.

Other Government - Relative to the no-action option (Option 1), Option 2 would reduce the burden on state and local government organizations actively involved in the regulation of well i

logging operations, thus yielding these organizations an annual cost savings. These values are expected to be minimal, and have not been quantified in this analysis.

Regulatory Efficiency - Relative to the no-action option (Option 1), Option 2 would result in enhanced regulatory efficiency, particularly by eliminating the need for preparing reporting and recordkerping information for abandonment of low activity ECSs and tritium neutron generator target sources. In addition, Option 2 would provide greater regulatory certainty and clarity than the no-action option, and would ensure consistent treatment among all well logging licensees.

These values are not believed to be significant and have not been quantified in this analysis.

3.2 Analytical Method This section describes the general methods used to structure the analysis and calculate results.

The quantifiable results of the analysis (see Section 3.3) are based primarily on the costs of satisfying NRC's requirements for licensing and radiation safety for well logging. Although the rulemaking would also result in regulatory efficiency, among other attributes (see Section 3.1), these values have not been quantified.

The discussion in this section is divided as follows: Section 3.2.1 summarizes the types of data collected for this analysis. Section 3.2.2 provides a summary of the licensee responses received. Section 3.2.3 describes the methodology that was used to determine the values associated with the regulatory options under consideration.

3.2.1 Data Collection To help quantify the effects of the proposed rule, a data collection effort wat

4 ducted to obtain information from well logging licensees using ECSs and tritium neutron guerator target sources and manufacturers of ECSs and tritium neutron generator target sources. Due to time, resource and OMB clearance constraints, NRC elected to survey only a sample of licensees (less than 10). However, NRC is confident that the information obtained from these licensees represents conditions in the industry. NRC first prepared a list of licensees and manufacturers, and selected a total of nine contacts. An initial list of questions was developed to obtain information on the following topics:

Number of abandonments due to in. tievable sources (ECS or tritium neutron generator target source)in an average year, including cost of the abandunment and depth of the source.

January 1999 13

DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS -

CHANGES TO 10 CFR PART 39 Need for erection of a permanent plaque for an abandoned well to identify the horizontal and venicallocation of the source.

Use of sources manufactured prior to the July 14,1989 generic exemption from Section 39.41, including description of problems with these sources in logging or logging while drilling tools.

Description of leak tests conducted on ECSs and the time interval under which they are tested.

Cost of conducting a leak test on a per source basis.

Variability in cost of conducting leak tests in conjunction with routine maintenance / repair versus leak testing at six month intervals.

Estimate of costs to meet the design and performance criteria of Section 39.41, including a breakout of the specific costs associated with vibration testing (Section 39.41(a)(3)(iii)).

Identification of problems associated with conducting vibration tests.

Number of preliminary designs (prototypes) since 1989 that were not registered because of failing the vibration test.

3.2.2 Summary of Licensee Responses This section provides a summary of the responses by licensees to NRC's information request for the key parameters necessary for this analysis.

Licensees reponed an average of only 8 abandoned ECSs per year. Three respondents reported that they have never abandoned an ECS in a well logging operation. The depth at which these sources were abandoned ranged from thousands of feet to in excess of 12,500 feet. Costs for abandonment of an ECS varied widely based on a variety of factors, including depth of the source, location of the well (off-shore or land), and the cost components reponed.3 Abandonment costs reponed ranged from a low of approximately $5,000 to a high of over $1 million for a single source.

' Costs for abandonment varied widely based on the items the respondent included in their estimates.

Some respondents only included the cost of replacing the source in their estimate, while other licensees accounted for additional costs, including lost drill rig time, and costs for complying with abandonment requirements and reponing.

January 1999 14

r DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTIIER REGULATORY CLARIFICATIONS --

{

CIIANGES TO 10 CFR PART 39 One respondent indicated abandoning a tritium neutron generator target source. This respondent indicated that the depth of the source when abandoned was in excess of 10,000 feet. Most respondents noted that because retrieval of a lodged source is mainly a function of the depth of the source at the time it becomes lodged and whether the source is located in the well casing, the likelihood of retrieval of tritium neutron generator target sources at shallow depths, within the j

surface casing, is extremelv high.

j Licensees indicated that the costs associated with leak testing well logging tools containing ECSs ranged from $7 to $50 for a wipe test, and up to $100,000 to disassemble the tool and test the source, including the costs of taking the tool out of service. Two respondents indicated that they do not conduct leak testing for two reasons: (1) they use only gamma-beta emitting sources containing less than 3.7 MBq (100 Ci), and (2) they use only tritium neutron generator target sources, both of which are currently exempted from leak testing requirements. Without exception, however, licensees believe that the robust nature of the sources significantly decreases the need to leak test these tools on a frequent basis. No respondent indicated that an ECS that had been wipe tested had been found to have leaked. Respondents noted that a more appropriate interval for leak testing would be during routine maintenance on the tool, or when it is removed from service for repair.

Licensee responses indicate that the maintenance interval for well logging tools contaimng an ECS is highly variable. While some 1.icensees reported a routine interval (inspection every month, or once per year), other licensees indice.ted that the interval can be much longer (up to 18 months), depending on how long the tool is ir, the field. Respondents indicated that maintenance and repair to these tools is not typically conc'.ucted in the field.

One licensee responded that it had never hr.d a prototype design fail to meet the requirements of Section 39.41 solely because the design failed the vibration test. This respondent further indicated that, typically, no more than one prototype design is developed in a year, and that the cost of conducting the vibration test for each prototype is approximately $2,400.

3.2.3 Calculating Values and Impacts of Alternatives This section describes how each of the regulatory options under consideration was analyzed to quantify values and impacts associated with the options' licensing and radiation safety requirements for well logging. Option 1 is the no-action alternative and, as such, would have no values or impacts to be estimated. As a result, this discussion focuses on the quantification of values and impacts associated with Option 2.

The requirements proposed in Option 2 are deregulatory in nature and would affect licensees in several ways. First, licensees would avoid the costly requirements for well abandonment for low activity sources. Second, licensees would realize savings associated with leak testing of these sources by January 1999 15

DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39 reducing significantly the time interval for conducting such tests to comply with NRC requirements (once every three years versus the current requirement of not more than every 6 months). Third, licensees would be provided the flexibility to determine the best method for protecting against inadvertent intrusion on an abandoned source (for sources with activities greater than 3.7 MBq [100 Ci]) or tritium neutron generator target sources above 1,110 GBq (30 Ci). The cost savings associated with this proposed change have not been calculated for this analysis. Due to limited resources and time, and because the major focus of the proposed rule is to exclude low activity ECSs and tritium neutron generator target sources from well abandonment procedurcs, NRC elected to focus its data collection efforts on the costs associated with abandonment oflow activity ECSs and tritium neutron generator target sources. NRC anticipates, however, that the cost savings associated with changes in abandonment requirements for large sources (i.e., greater than 3.7 MBq [100 Ci]) or tritium neutron generator target sources above 1,110 GBq (30 Ci) would not be significant.

The proposed changes described in Option 2 would benefit NRC in that NRC would realize savings by reducing the number of abandonment reviews for low activity ECSs and tritium neutron generator target sources. Further, NRC could realize additional savings associated with the change proposed for Section 39.77 allowing flexibility during an emergency for abandoning irretrievable sources. Due to the limited number of reviews eliminated, the values have not been quantified in this analysis. The savings are not believed to be significant. State and local government organizations regulating licensing and radiation safety requirements for well logging would benefit under Option 2 in a similar fashion.

The proposed changes under Option 2 would also result in other values that are not quantified in this analysis. In particular, the proposed changes would result in enhanced regulatory efficiency because they would provide greater regulatory certainty and clarity than the no-action option and would ensure consistent treatment among all well logging licensees.

Savings and costs to licensees, state and local govemments, and NRC from Option 2 are calculated as follows:

Estimate the cost savingsfor abandoning a source.

The costs for abandonment are variable based on several factors, including the depth at which the source is abandoned, or whether the source is in a on-shore (land) or off-shore (water) well. In general, these costs include the costs of replacing the tool, the costs for plugging the hole (cementing), and the costs for marking the location of the source. In addition, there are other costs associated with recordkeeping and notification associated with abandonment of a source downhole. NRC collected data from a representative sample of well logging licensees to determine specifically the costs associated with abandonment of a low activity ECS or tritium neutron generator target source. Due to the variability of the costs, accounting for the factors described above, NRC has included the high and low estimates provided by licensees as a range January 1999 16

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DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39 of possible costs. In estimating the total annual savings to be realized by amending the abandonment requirements, NRC calculated the number of abandonments indicated by each respondent and multiplied this number by the respondent's estimate of the cost for abandonment per event. These numbers were then totaled to provide an estimate of the minimum cost savings that could be expected to be realized.

Estimate the cost savingsfor conducting a leak test on a low activity ECS only.

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The cost for conducting a leak test on an ECS type well logging source can vary due to the specific conditions under which the test is conducted. For example,if the test is conducted using a wipe test on the outside of the tool, these costs may be significantly less than the costs for

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disassembling the tool and sampling the actual source. In addition, low activity gamma and beta emitting sources (i.e., sources containing less than 3.7 MBq [100 Ci]) are currently exempted from leak testing requirements. Because NRC does not have sufficient data to determine the number of non-exempt sources leak tested in a year, NRC estimated the costs associated with conducting individual leak tests for a single source and provided a range for the costs on a per

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source basis. To calculate a total annual cost savings from leak testing requirements, NRC limited its discussion to the survey respondents and assumed one source for each respondent.

This number was multiplied by two to account for the requirement to conduct a leak test every six months. The proposed changes would effectively reduce the annual number of tests from 2 to one-third (i.e., because the proposed option would require one test every three years). To estimate the total annual cost for each source, the cost per test reported was multiplied by 0.33.

The total annual cost savings for each source is the difference between the total annual costs under the current rule and the total annual cost under the proposed rule. These values were then added across all sources to estimate the minimum total annual cost savings that could be expected to be realized as shown below:

Item 1: Annual cost for leak testing per source (current rule) =

(Cost per leak test) x 2 (Number of annual leak tests)

Item 2: Annual cost for leak testing per source (proposed rule) =

(Cost per leak test) x 0.33 (Effective number of annual leak tests)

Item 3: Annual cost savings per source = Item 1 -Item 2 Item 4: Total annual cost savings = Sum of amounts calculated undar Item 3 Further, tritium neutron generator target sources are already exemptW from leak testing i

requirements, and thus no costs or cost savings are associated with these sources.

January 1999 17

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DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39 3,3 Results The results of the analysis for each of the affected attributes identified in Section 3.1 are shown below in Exhibit 3-1, including: (1) the qualitative results for Regulatory Efficiency F 0,, yeater regulatory certainty and clarity, reore consistent treatment of licensees), NRC Impkmentatio, (i.e.,

f revision of regulatory guidance), NRC Operation (i.e., abandonment review cost savings), Other Govemment (i.e., cost savings similar to NRC); and (2) the quantitative results for Industry Operation (i.e., annual licensee cost savings for conducting leak tests and source abandonment). As shown in the exhibit, there are no values or impacts associated with Option 1 (the no-action alternative). Rather, licensees would still need to meet all requirements for testing and abandonment as currently specified, unless they submit a request for an exemption.

Option 2 would result in savings to licensees usociited with well abandonment and leak testing.

in addition to possible savings in ensuring against inadvertent intrusica of abandoned sources greater than 3.7 MBq (100 Ci) or tritium neutron generator target sources above 1,110 GBq (30 Ci). While tb cost savings estimated here only reflect a sample of the licensees,it is important to note that there would be no increase in costs to licensees associated with the proposed changes to Part 39. In fact,it can be expected that the values identified in Exhibit 3-1 could be larger when applied to all licensees. In addition, Option 2 would result in increases in regulatory efficiency relative to the no-action alternative.

In particular, Option 2 would provide greate; regulatory certainty and clarity than the no-action option, would ensure consistent treatmant ?.mang all lice. sees, and would eliminate the need for costly delays in effecting regulatory exemptions. These increases in regulatory efficiency have not been quantified, but are believed to be of significance.

On the impact side, NRC would incur very minor costs associated with updating NUREG-1556,

. Consolidated Guidance About Materials Licenses, Program Specific Guidance About Well-Logging Licenses.

January 1999 18

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CHANGES TO 10 CFR PART 39 Exhibit 3-1 Estimated Values and Impacts Under Options 1 and 2 Option 1 Option 2 n.

Values Avoided costs to licensees of abandonment of source downhole Range:

$1K. 51M Estimated totalannual cost savings:

$5M Avoided costs to licensees for conducting leak testing on sources Range:

$7-5100K Estimated totalannual cost savings:

$100K Avoided costs to licensees of preventing inadvertent intrusion on Minor abandoned sources above 100 uCi and tritium neutron generator target sources above 30 Ci Increase in regulatory certainty and clarity; increase in consistency of Minor treatment of licensees; and redt, ion in delays associated with the exemption process Avoided costs to NRC of reviewing abandonment repons and Minor exemption requests 1

Avoided costs to Other Governments Similar to NRC Impacts increased costs to NRC of updating NUREG-1556 Minor January 1999 19

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CHANGES TO 10 CFR PART 39

4. AGREEMENT STATE IMPLEMENTATION ISSUES NRC issued a draft rulemaking plan to Agreement States for comment on proposed changes to 10 CFR Part 39 on May 28,1997. Comments were received from three states: Illinois, Utah, and Washington. In general the states agreed that the current regulations in Part.39 needed modification to reflect the use of new " logging while drilling" technology. a summary of the significant comments and NRC's responses is provided below:

The State of Illinois argued that ECSs with activities exceeding 3.7 MBq (100 Ci) for beta / gamma emitters or 0.37 MBq (10 Ci) for alpha emitters should be leak tested and therefore, ECSs should not be given a categorical exemption to leak testing requirements. The State of Washington commented that tritium sources have been known to leak and that proper monitorir.g of these sources should be required. NRC intends to define an ECS as having 3.7 MBq (100 Ci) or less of radioactive material and therefore, by definition an ECS would be excluded from the existing leak testing requirements of Section 39.35(e). Further, based on design requirements, alpha emitters will not be included in the definition of an ECS. NRC does not currently, nor will it in its proposed rulemaking, require leak testing of tritium sealed sources.

These sources are specifically exempted from leak testing requirements in Section 39.35(e).

The State of Illinois believes that some degree of protection is necessary for ECSs lost near the land surface. NRC intends to build into the regulations separate provisions for ECSs based on whether a surface casing is used or not. Surface casings are used to protect fresh water aquifers from contamination and are extensively used in oil and gas exploration. NRC believes that a surface casing will provide adequate near surface protection (refer to the Environmental Assessment for information on the risk of abandonment near the land surface). When surface casings are not used, more rigorous recovery operations will be required.

The State ofIllinois does not believe that ECSs should be categorically excluded from design and performance criteria for sealed sources (Section 39.41). The State of Utah, on the other hand, suggests that ECSs should be excluded from Part 32 (Section 32.210 discusses registration of sealed sources). Although NRC intends to exclude ECSs from the rigorous design and performance criteria of Section 39.41, the ECSs will still need to meet the licensing requirements of Section 32.32(g), which require more general design and performance criteria.

Both the States of Illinois and Washington believe that the example used in the draft rulemaking plan comparirig radioactive sources in ECSs and gas and aerosol detectors as a basis for excluding ECSs is inappropriate. NRC will remove this reference from the rulemaking, and the Environmental Assessment will assess whether ECSs can be safely excluded from the requirements of Part 39.

January 1999 20

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CHANGFS TO 10 CFR PART 39 The State ofIllinois commented that neutron generator devices containing tritium targets also require above-ground testing for operability and calibration and can produce radiation levels l

constituting high radiation areas. The State argues that the revised regulations should allow testing and operation of such devices precided procedures are in place to monitor radiation levels and ensure that adequate safety procedures are in place and implemented. NRC agrees with this concept. Tritium sources will remain subject to Section 39.63 (operating and emergency procedures).

The State ofIllinois raised concerns about some sources meeting USASI standards. They noted an event where a source experienced damage due to vibration within a source holder.

Specifically, vibration of a sealed source within a source holder may have led to a loss of containment. Therefore, the assumption that sources built under the USASI standard would be so rugge:I as to preclude a public health and safety problem has been called into question. The State als, suggested that the way in which sealed sources maybe loaded into source holders has not beer thoroughly evaluated and suggested that NRC may wish to consider the source and the source. older combination. NRC understands that the problem identified was not related to the USASI standard, but an improperly assembled source holder. There was no loss of containment.

The vibration test is not designed to account for an improperly loaded source. Historically, the NRC has not regulated source holders or the well logging devices in which the source holders or sources are placed. NRC also notes that there has been no history of problems with the source and source holder combinations. NRC has cencluded that no rule change is necessary, and in any event, the comment is beyond the scope of this rulemaking.

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January 1999 21

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CHANGES TO 10 CFR PART 39 I

5. BACKFIT ANALYSIS l

The NRC has determined that the backfit rule,10 CFR 50.109, does not apply to this proposed rule because these amendments do not involve any provisions that would impose backfits to a facility as defined in 10 CFR 50.109(a)(1).

January 1999 22

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CHANGES TO 10 CFR PART 39

6. DECISION RATIONALE FOR SELECTION OF THE PROPOSED REGULATORY ACTION 1.

Option 1, the no-action alternative, would retain the existing requirements for licensing and radiation safety for well logging. Option 2 would relieve licensees from overly burdensome requirements associated with well abandonment and leak testing for sources containing less than 3.7 MBq (100 Ci) activity, and for well abandonment for tritium neutron generator target i

sources containing less than 1,110 GBq (30 Ci) tritium. In addition, Option 2 would clarify existing requirements for other larger sources, and provide for the use of performance-based criteria for preventing inadvertent intrusion on an abandoned source. Relative to Option 1, Option 2 would yield net benefits to licensees, state and local governments, and NRC without additional risk to the public.

2.

The proposed requirements under Option 2 would result in enhanced regulatory efficiency because they would provide greater regulatory certainty and clarity than Option 1 (the no-action altemative), and would ensure consistent treatment among all licensees.

3.

Because licensees would be able to reduce their licensing and radiation safety requirements thus avoiding the costs of abandoning low activity sources. Option 2 could result in an annual cost savings in excess of $5 million. Additional cost savings could be realized under Option 2 from the extension of the time period for conducting leak testing non-exempt low activity sources from every six months to every three years (approximately $100,000).

l 4.

NRC's environmental assessment supporting this rulemaking indicates that the risks associated with the proposed changes are protective of health and safety. Data collected by NRC indicate that these sources are very robust, do not typically leak, and are not abandoned on a frequent basis.

5.

For the reasons stated in (1) through (4) above, Option 2 is superior to Option 1 (the no-action attemative).

January 1999 23

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FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39

7. RELATIONSHIP TO OTHER PROCEDURAL REQUIREMENTS This action would be enacted through a Proposed Rule Notice and public comment and a Final i

i Rule, with promulgation expected in calendar year 2000. Implementation can begin immediately following the enactment of the final rulemaking. No impediments to implementation of the recommended alternative have been identified, with the exception of the minor revisions to NUREG-1556.

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CHANGES TO 10 CFR PART 39

8. PAPERWORK REDUCTION ACT ANALYSIS This section fulfills NRC's obligation under the Paperwork Reduction Act to examine the information collection impacts of its regulatory actions, in this case in regard to a rulemaking addressing NRC's current licensing and radiation safety requirements for well logging. NRC is proposing to modify these requirements, which are contained in 10 CFR Part 39 to account for new technologies developed since the requirements contained in Part 39 were first promulgated.

I NRC's analysis indicates that its proposal is deregulatory in nature and would result in a decreased burden on licensees with regard to reporting and recordkeeping operating wells (with a surface casing), that abandon an ECS or tritium neutron generator target source within that well. Licensees would not be required to report such abandonment to NRC, which is estimated to be a reduction in burden of approximately 4.5 hours5.787037e-5 days <br />0.00139 hours <br />8.267196e-6 weeks <br />1.9025e-6 months <br /> per request ($39.77) NRC has determined, that, because the burden reduction for this information collection is insignificant, Office of Management and Budget (OMB) clearance is not required. Current requirements associated with information collection under 10 CFR Part 39 were previously approved by OMB in approval number 3150-0130.

January 1999 25

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ATTACHMENT 4 4

CONGRESSIONAL LETTERS

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ATTACHMENT 4 CONGRESSIONAL LETTERS I

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UNITED STATES g

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WASHINGTON, D.C. 2055W1 o

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The Honorable James M Inhofe, Chairman Subcommittee on Clean Air, Wetlands, Private Property and Nuclear Safety Committee on Environment and Public Works United States Senate Washington, DC 20510

Dear Mr. Chairman:

The U.S. Nuclear Regulatory Commission (NRC) has sent the enclosed proposed amendments to the Commission's rules in 10 CFR Part 39 to the Office of the Federal Register, for publication and comment. These amendments, if sdopted, would acknowledge and accommodate the use of welllogging technology that has been developed since NRC promulgated well logging regulations in 1987 The proposed amendments would also improve, clarify, and update well logging regulations to reduce confusion. These changes may also reduce the need for licensees to request exemptions from unnecessary requirements. The proposed rule is intended to reduce the potential burden on licensees without adversely affecting public health and safety.

Sincerely, Dennis K. Rathbun, Director Office of Congressional Affairs

Enclosure:

Federal Reaister notice cc: Senator Bob Graham

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The Honorable James M. Inhofe, Chairman Subcommittee on Clean Air, Wetlands, Private j

Property and Nuclear Safety i

Committee on Environment and Public Works

-United States Senate I

Washington, DC 20510

Dear Mr. Chairman:

1 The U.S. Nuclear Regulatory Commission (NRC) has sent the enclosed proposed l

' amendments to the Commission's rules in 10 CFR Part 39 to the Office of the Federal Register, l

for publication and comment. These amendments, if adopted, would acknowledge and accommodate the use of welllogging technology that has been developed since NRC 3

1 promulgated well logging regulations in 1987. The proposed amendments would also improve, L

clarify, and update well logging regulations to reduee confusion. These changes may also j

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reduce the need for licensees to request exemptions from unnecessary requirements. The proposed rule is intended to reduce the potential burden on licensees without adversely l

affecting public health and safety.

Sincerely, Dennis K. Rathbun, Director Office of Congressional Affairs l

Enclosure:

Federal Reaister notice

cc: Senator Bob Graham Distribution:

Subj/ central, EDO R/F ldentical letter sent to the Honorable Joe Barton i

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WASHINGTON, D.C. 20555 6 1 o

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The Honorable Joe L. Barton Chairman, Subcommittee on Energy and Power Committee on Commerce United States House of Representatives Washington, DC 20515

Dear Mr. Chairman:

The U.S. Nuclear Regulatory Commission (NRC) has sent the enclosed proposed amendments to the Commission's rules in 10 CFR Part 39 to the Office of the Federal Register, for publication and comment. These amendments, if adopted, would acknowledge and accommodate the use of well logging technology that has been developed since NRC 1

promulgated welllogging regulations in 1987. The proposed amendments would also improve, clarify, and update welllogging regulations to reduce confusion. These changes may also reduce the need for licensees to request exemptions from unnecessary requirements. The proposed rule is intended to reduce the potential burden on licensees without adversely affecting public health and safety.

Sincerely, Dennis K. Rathbun, D! rector Office of Congressional Affairs l

Enclosure:

Federal Renister notice cc: Ralph M. Hall l

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ATTACHMENT 5 PRESS RELEASE 1

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G:\\dpr\\ logging.wpd February 11, 1999 8:52 AM DRAFT (For SECY paper)

NRC PROPOSES CHANGES TO REGULATIONS ON WELL LOGGING The Nuclear Regulatory Commission is proposing to amend its regt..ons governing the use of radioactive materials in well logging, an oil and gas exploration technique.

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The proposed revisions reflect changes in well logging technology that have occurred since the NRC issued its existing well-logging regulations in 1987. Other changes would improve and clarify the regulations to reduce confusion. The revisions are intended to reduce the burden on well logging licensees without adversely affecting public health and safety.

Well logging is used in oil and gas exploration to help predict the commercial viability of new or existing wells. It traditionally involves lowering a well logging tool, including a sealed source of radioactive material (usually Americium-241 or Cesium-137) and an associated radiation detector, into a well on a wireline.

Information collected by a detector is sent to the surface through **'e wireline and plotted on a chart as the logging tool is slowly raised from the bottom of the well. The data can include properties of the underground formation, such as the type of rock, l

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porosity, hydrocarbon content and density. Licensed radioactive materials are used for similar purposes in coal and other mineral exploration.

When the current NRC regulations were issued, the well logging process required licensees to stop drilling the hole for the well while parts of the drilling pieces were removed and the logging tool was lowered down the well. Improved technology now in use allows licensees to lower a logging tool down a well at the same time that the hole for the well is being drilled.

The r.ew technology is commonly referred to as " logging while drilling." It requires licensees to use an extra, relatively small radioactive source in addition to the larger radioactive sources currently used. The smaller source is used to calibrate the well logging tool and help make sure it is working properly during the " logging while drilling" operation. This new technology not only permits improved evaluation of geologic formations, but also can reduce drilling costs and improve safety.

NRC's existing well logging regulations, based on the use of only larger radioactive sources, include provisions that are unnecessary and potentially burdensome for the additional small sources. The proposed revisions would eliminate such unnecessary requirements.

Details of these proposed changes and other changes designed to improve and clarify well logging requirements are discussed in a Federal Register notice to be issued shortly. Interested persons are invited to submit written comments within 75 days of the Federal Register notice to the Secretary, U.S. Nuclear Regulatory Commission, Washington, D.C. 20555-0001, Attention: Rulemakings and Adjudications Staff.

Comments may also be submitted electronically via the NRC's interactive rulemaking web site at http://ruleforum.llnl Gov.

D ATTACHMENT 6 APPROVED FOR PUBLICATION 1

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Acoroved For Publication The Commission delegated to the EDO (10 CFR 1.31(c)) the authority to develop and promulgate rules as defined in the APA (5 U.S.C. 551 (4)) subject to the limitations in NRC Management Directive 9.17. Organization and Functions, Office of the Executive Director for

{

Operations, paragraphs 0213,038,039, and 0310.

The attached proposed rule, entitled " Energy Compensation Sources for Well Logging and Other Regulatory Clarifications," amends 10 CFR Part 39 to acknowledge and accommodate the use of welllogging technology that has been developed since the NRC promulgated well logging regulations in 1987. The proposed amendments would also improve, clarify, and update welllogging regulations to reduce confusion. These changes may also reduce the need for licensees to request exemptions from unnecessary requirements. The proposed rule is intended to reduce the potential burden on licensees without adversely affecting public health and safety.

This proposed rule does not constitute a significant question of policy, nor does it amend regulations contained in 10 CFR Parts 7,8, or 9 Subpart C conceming matters of policy. I,

)

therefore, find that this proposed rule is within the scope of my rulemaking authority and am proceeding to issue it.

I 1

h 31 @T g4 f

Frank J. Mir

, SM( f

(

Acting Exec @uTive Director for Operatio Date i

f

r AS /Y- /

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l ENVIRONMENTAL ASSESSMENT OF ENERGY COMPENSATION SOURCES FOR WELL l

LOGGING AND OTHER REGULATORY CLARIFICATIONS

- CHANGES TO 10 CFR PART 39 Draft Report U.S. Nuclear Regulatory Commission Office of Nuclear Materials Safety and Safeguards January 1999 4kn PEGyg

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CHANGES TO 10 CFR PART 39 EXECUTIVE

SUMMARY

This environmental assessment (EA) examines the potential environmental, health and safety (EH&S) impacts arising from a set of proposed changes to the existing well logging regulations in 10 CFR Part

39. The proposed changes will accommodate new technology that uses low activity sources to simultaneously log wells while drilling and proposes other modifications to improve, clarify and update Part 39. These changes are described in a May 1998 Rulemaking Plan (SECY-98-105) entitled," Energy Compensation Sources for Well Logging and Clarifications - Changes to 10 CFR Part 39."

As required by 10 CFR Part 51 regulations, this EA evaluates the potential EH&S impacts associated with two regulatory options: (1) the proposed action and (2) the no-action alternative. Under the proposed action, the U.S. Nuclear Regulatory Commission (NRC) intends to establish a limit of 3.7 megabequerels (MBq) [100 microcuries ( Ci)) for energy compensation sources (ECSs) and 1,110 g;gabequerels (GBq) [30 Ci] for tritium neutron generator target sources. This EA evaluates radioactive sources currently used in ECSs, namely Americium-241 (Am-241), Cesium-137 (Cs-137), and Thorium-i 232 (Th-232), as well as Curium-250 (Cm-250), which serves as an upper bound for the health risk assessment. The assessment also evaluates tritium for tritium neutron generator sources. Under the no-action option, NRC will not change the existing regulations in Part 39 to specifically accommodate ECSs or tritium neutron generator target sources.

For the proposed action, this EA estimates the maximum dose to workers exposed to these sources.

Based on the analytical method described herein, the EA concludes that:

Under the limits proposed for ECS and tritium neutron generator target source designs, the maximum estimated dose to workers is below the annual Federal public health limit of 100 millirem per year (mrem /yr).

For the no-action, a 1987 EA of the original Part 39 rulemaking resulted in a finding of no significant impact (FONSI) for well-logging devices using licensed material, which typically contain activity levels of i10 to 740 GBq (3 to 20 Ci).

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DRAFTREPORT ENVIRONMENTAL ASSESSMENT OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS -

CHANGES TO 10 CFR PART 39 TABLE OF CONTENTS I

EXECUTIVE SUMM ARY...................................

...........i 1.0 B AC KG ROUND....................................................

2 1.1 In t rod uct i on...................................................... 2 i

1.1.1 Energy Compensation Sources..................

............ 2 1.1.2 Tritium Neutron Generator Target Sources....................

.3 1.2 Rule maki n e Plan.............................

.... 4 1.3 Purpose of this Environmental Assessment......

.4 2.0 NEED FOR THE PROPOSED ACTION................................... 5 2.1 Prooosed Act ion................................................... 5 3.0 POTENTIAL ENVIRONMENT, HEALTH. AND SAFETY IMPACTS OF THE PROPOSED ACTION AND ALTERNATIVES............................ 8 3.1 Pro posed Act i on..................................................... 8 3.1.1 Introduction............................................. 8 3.1.2 Discussion of Recommendations with Potential EH&S Impacts...

.. 8 3.1.3 In hal ation................................................ 10 3.1.4 Skin Contamination...................................... 1 1 3.1.5 In gesti on....................................

13 3.1.6 Comparison of Results to NRC's Annual Public Health Limit......... 17 3.2 No-A c t i on.......................................................

1 7 4.0 AGENCIES AND PERSONS CONSULTED........................... 18 4.1 A gencies Con su lted................................................ 18 4.2 Licen sees Con sulted.............................................

18

5.0 REFERENCES

19 AC RO NYM S.................................................

....... 20 Attachment A -

SUMMARY

OF LICENSEE SURVEY......................... 21 A.1 Summarv of Licensee Survey Ouesti m...............

. 21 9

A.2 Summary of Licensee Survey Responses...................

........ 21 Attachment B - DOSE CALCULATIONS FOR ECS AND TNG DESIGNS.....

24 B.1 Overview of Dose Calculations and Results.............................. 24 January 1999 1

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CHANGES TO 10 CFR PART 39

1.0 BACKGROUND

j 1.1 Introduction j

Almost all oil and gas produced today comes from accumulations in the pore spaces of reservoir rocks -

usually sandstones, limestones, or dolomites. The amount of oil or gas contained in a unit volume of the reservoir is the product of its porosity and hydrocarbon saturation. The volume of the formation containing the hydrocarbons is used to estimate total reserves and determine whether the accumulation is commercially viable. Knowledge of formation thickness of the reservoir is needed to compute the volume. Evaluating the productivity of a reservoir requires knowing its permeability (i.e., how easily the j

fluid can flow through the pore system). Thus, the main parameters needed to evaluate a reservoir are porosity, hydrocarbon saturation, thickness, area, and permeability. In addition, the reservoir geometry, formation temperature and pressure, and lithology can play a major role in the evaluation, completion, and production of a reservoir. Downhole well logging provides a method of deriving or inferring accurate values for the hydrocarbon and water saturations, porosity, permeability, and lithology of the i

reservoir rock.

1 When the U.S. Nuclear Regulatory Commission (NRC) first promulgated its 10 CFR Part 39 regulations, well logging technology required drilling to stop, then after removing portions of the drilling pieces, field workers lowered logging tools - encapsulated radioactive sources with associated detector crystals - into the well on a wireline. The depth of the well could range from hundreds of meters to greater than 10,000 meters (m) [32,810 feet (ft)]. As the logging tool was slowly raised from the bottom of the well, information collected by the detectors was sent to the surface through the wireline and plotted on a chart.

Now, more recent technology, refened to as " logging while drilling"(LWD) allows well logging to be accomplished during drilling. The technology provides "real-time" data during drilling operations and j

improves evaluation of geologic formations. In addition to the larger sources, LWD technology uses an j

additional low activity radioactive source, known as an energy compensation source (ECS) to calibrate the larger source. This source is described below.

1.1.1 Energy Compensation Sources An ECS is a low activity source (typically less than 3.7 megabequerels (MBq) [100 microcuries ( Ci)])

compared to the normal 110 to 740 gigabequerels (GBq) [3 to 20 Ci] sources used in well logging.

Typical radionuclides used in these sources are Am-241, an alpha particle emitter, and Cs-137, a beta and gamma emitter. Source sizes vary depending upon the manufacturer and the intended use of the ECS.

The majority of the tools used in well logging operations are custom designed for specific applications.

Even so, the standard design is fairly typical: the encapsulated source is rnounted inside a steel (or other similar metal) pressure housing in the interior of the LWD tool. The pressure housing (and other tool components) provides additional encapsulation to protect the source from operational impacts (e.g.,

pressure, stresses). An example of a licensed ECS source is provided below.

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CHANGES TO 10 CFR PART 39 Steering and Gamma Ray Sub - Manufactured by Anadrill, Inc., this device uses two 0.081

=

MBq (2.2 uCi) Am-24I sources. This model is designed for downhole use during logging (or measurement) while drilling operations. It provides a spectrum of gamma radiation in the wellbore due to the naturally occurring concentrations of thorium, uranium, and potassium in the j

surrounding rock formations. The gamma spectrum is measured using a mggedized gamma ray spectrometer. The spectrometer uses two detectors; each containing its own Am-241 source acting as a reference for energy and activity, allowing the detector to compensate for efficiency fluctuations due to temperature changes in the borehole. The spectrometer and associated electronics operate at one atmosphere pressure within a sealed pressure housing made of stainless steel. This housing is positioned to allow drilling mud to flow between the outer diameter of the pressure housing and the inner diameter of the drilling collar (which acts as an additional encapsulation for the source). The diameter of the tool ranges from between 16.5 and 23 centimeters (cm) [6.5 and 9 inches (in)], with an overall length of approximately 338 cm (133 j

in). The Am 241 sources are mounted within the pressure housing on the side of each of the scintillating crystals of the spectrometer. The entire detector is then wrapped with 0.25 cm (0.10 in) thick silicone rubber and Teflon shrink tubing to assist in shock isolation. The wrapped detector is then press fit within the pressure housing. The pressure housing and drill collar shield all of the Am-241 gamma rays emitted toward the outside of the. tool. Therefore, the presence of the Am-241 cannot be detected from outside the tool. The device is designed to operate in a high pressure and temperature environment. Testing of the devices indimes an ability to withstand both normal and extreme conditions of handling and use.

1.1.2 Tritium Neutron Generator Target Sources -

~

Tritium neutron generator target sources are used in neutron logs. Neutron logs are used principally for delineation of porous formations and determination of their porosity. They respond primarily to the hydrogen in the formation. 'Ihus, in clean formations whose pores are filled with water or oil, the neutron log reflects the amount of liquid-filled porosity. Neutrons are uncharged particles, each having a mass almost identical to the mass of a hydrogen atom. High energy neutrons are continuously emhted -

from a radioactive source (tritium) in the tool. These neutrons collide with nuclei of the formation materials, and with each collision, Jose energy. The energy lost per collision depends on the relative mass of the nucleus with which the neutron collides. Thus, the slowing of the neutrons is dependent on the amount of hydrogen in the formation. These tools are used similar to wireline drilling, whereby the tool is lowered into the well on a wire and measurements are taken while drilling has ceased. A neutron stream is only generated when a voltage is applied to the tritium neutron generator target source. An example of a licensed tritium neutron generator target source is provided below.

Downhole Accelerator - This source, manufactured by Haliburton Logging Sources Inc., uses tritium, with a maximum activity of 110 GBq (3 Ci), for both oil and gas well logging applications. The design consists of a pulsed deuterium-tritium accelerator, a scintillation detector, a digital telemetry system, and associated electronics. This entire system is approximately 7 m (23 ft) long and 4.3 cm (1-11/16th in) wide. The deuterium-tritium January 1999 3

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CHANGES TO to CFR PART 39 accelerator tube is 18 cm (7 in) long, with a 3.3 cm (1-5/16th in) diameter. The device is used for neutron activation of underground formations for quantitative and qualitative analysis and is designed to operate at pressures up to 20,000 pound per square inch (psi) and at temperatures of 204*C (400*F). A radiation hazard exists only when the accelerator is energized. It will then produce IE+8 neutrons per second. The expected useful life of the accelerator is more than 400 hours0.00463 days <br />0.111 hours <br />6.613757e-4 weeks <br />1.522e-4 months <br />.

1.2 Rulemakine Plan Based on information about the changing technology in the well logging industry, NRC decided to develop a rulemaking plan to possibly update Part 39. On May 28,1997, NRC published the draft rulemaking plan entitled, " Energy Compensation Sourecs for Well Logging and Clarifications - Changes to 10 CFR Part 39"(SECY-97-11l). The States of Utah, Illinois, and Washington provided comments on the draft rulemaking plan. These States generally supported the proposal and provided specific information and comments. Where appropriate, NRC staff incorporated these comments into the final rulemaking plan contained in SECY-98-105, dated May 12,1998. (NRC,1998)

In the final rulemaking plan, NRC determined that Part 39 has no specific provisions for low activity sources, and that several requirements, when applied to either ECSs or tritium neutron generator target sources, may be overly burder,some. Further, because the existing regulations do not allow for variations based on the activity of the source, licensees that use an ECS must meet all the requirements of Part 39.

Examples of overly burdeusome requirements include well abandonment (Sections 39.15 and 39.77),

leak testing (Section 39.35), design and performance criteria for sealed sources (Section 39.41), and monitoring of sources lodged in a well (Section 39.69).

NRC's proposed rulemaking addresses these issues by modifying the regulations in Part 39 to define an ECS and tritium neutron generator target source and provide appropriate regulations for using these technologies in well logging applications. The most signific :: change would exempt users of these technologies from the costly well abandonment procedures currently found in Part 39. Well abandonment, in addition to specific reporting and approval requirements, requires that the source be immobilized and sealed in place with a cement plug, that the cement plug be protected from inadvertent intrusion, and that a permanent plaque be mounted at the surface of the well. NRC proposes to implement less stringent abandonment requirement for ECS sources measuring less than 3.7 MBq (100 uCi) and tritium neutron generator target sources measuring less than 1.110 GBq (30 Ci). In addition, NRC proposes changing other sections of Part 39 to improve, clarify, and update the regulations.

l.3 hipose of this Environmental Assessment The purpose of this environmental assessment (EA) is to examine the potential environmental, health and safety (EH&S) impacts arising from the proposed changes to the existing regulations in Part 39. As required by 10 CFR Part 51, this EA describes the proposed action, the need for the proposed action, alternatives to the proposed action, including no-action, and the potential EH&S impacts of each action.

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CHANGES TO 10 CFR PART 39 2.0 NEED FOR THE PROPOSED ACTION 2.1 Proposed Action Under the proposed action, NRC would allow licensees to obtain regulatory relief from the current licensing and radiation safety requirements for well logging using low activity sources (e.g., ECSs) and tritium neutron generator target sources. Specifically, NRC plans to reduce the regulatory burden on licensees while maintaining adequate protection of health and safety. In the final rulemaking plan, NRC proposes several 3pecific changes to improve, clarify, and update Part 39 requirements to provide regulatory relief and account for the use of new well logging technology. The possible changes are discussed below:

Revise requirements for ECSs containing less than 3.7 MBq (100 Cl) for oil and gas wells.

NRC is proposing to eliminate the well abandonment requirements for ECSs containing less than 3.7 MBq (100 uCi). Well abandonment, in addition to specific reporting and approval requirements, requires that the source be immobilized and sealed in place with a cement plug, i

that the cement plug be protected from inadvertent intrusion, and that a permanent plaque be mounted on the surface of the well. Current requirements in Section 39.35 specify that leak testing shall be conducted for beta-gamma emitting sources with activities above 3.7 MBq (100 Ci), and for alpha-emitters (above 0.37 MBq [10 uCi]) no less frequently than every six months. Current industry practices use several radionuclides in ECSs, the most typical being Cs-137 and Am-241. Typical activity levels of these radionuclides used in well logging applications do not exceed 1.8 MBq (50 Ci). Beta-gamma emitters with activity levels below 3.7 MBq (100 Ci) are already exempt from leak testing requirements. NRC proposes modifying Section 39.35 by changing the time interval for leak testing ECSs to not less than three (3) years for non-exempt low activity sources. The changes proposed by NRC would, therefore, only affect those licensees using non-exempt sources.

Revise requirements for tritium neutron generator target sources containing less than 1,110 GBq (30 Cl) of tritium. Tritium neutron sources typically contain less than 740 GBq (20 Ci) of tritium. The neutron generator target sources only produce a neutron stream when a voltage is applied. For well logging applications, NRC is proposing that the tritium neutron generator target sources below 1.110 GBq (30 Ci) be subject to all requirements contained in Part 39 except: (1) sealed source design and performance criteria (Section 39.41) and (2) well abandonment procedures (Sections 39.15 and 39.77) when a surface casing is used. Tritium neutron generator target sources are already exempt from leak testing requirements contained in Section 39.35. NRC believes that the potential hazards associated with these sources do not warrant the existing well abandonment requirements in the event of an irretrievable source.

Modify Section 39.15 to provide for performance based criteria for inadvertent intrusion on an abandoned source. The current requirement at Section 39.15(a)(5)(ii) requires a mechanical device to prevent inadvertent intmsion on the source that must be set at a point above

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CHANGES TO 10 CFR PART 39 the cement plug, unless the cement plug and source are not accessible to any subsequent drilling operations. NRC believes this requirement is too restrictive in some cases. Theretore, NRC proposes that licensees " prevent inadvertent intrusion on the source," which would require that the source be protected but allow the licensee the flexibility to determine the best method. This change would not affect the requirement in (a)(5)(i) for a well logging source to be immobilized with a cement plug or the requirement in (a)(5)(iii) for a permanent plaque. This modification would allow licensees greater procedural latitude while continuing to ensure source integrity.

For example, if a significant amount of drilling equipment is abandoned in the well, this equipment may be effective in preventing inadvertent intrusion on the source, but may not meet the requirements of Section 39.15. Those requirements would only apply to larger sources (i.e.,

above 3.7 MBq [100 Ci] or tritium neutron generator target sources above 1,110 GBq [30 Ci]).

Modify Section 39.77 requirements for notification. This section specifies that NRC approval must be obtained prior to implementing abandonment procedures for an irretrievable source.

NRC proposes to modify Section 39.77 to allow immediate abandonment without prior approval if a delay could cause an immediate threat to public health and safety. Notification would still be required after completing the abandonment. De existing notification requirements of Section j

39.77 would still apply to larger sources (i.e., above 3.7 MBq [100 uCi]) or tritium neutron l

generator target sources above 1,110 GBq (30 Ci).

Include the generic exemption for sealed sources in 1989 within the regulations. NRC issued a generic exemption from the current design and performance criteria for sealed sources (Section 39.41), allowing the use of older sealed sources which meet an older standard for well logging operations. Sealed sources manufactured prior to July 14,1989, may use design and performance criteria specified under United States of America Standards Institute (USASI)

N5.10-l%8 or the criteria contained in Section 39.41. The use of the USASI standard is based on the NRC Notice of Generic Exemption (54 Federal Register [FR] 30883). This exemption is currently in use, but has not been incorporated in Part 39. NRC proposes to revise Part 39 to j

include this exemption within the regulations.

j Update Part 39 to remove date that was time sensitive at the original date of promulgation.

Section 39.49 contains a requirement that was dependent on a date that has already passed and are is longer appropriate. NRC proposes to remove references to this date in Part 39 that has already passed, to avoid confusion on the part of licensees.

Update Sections 39.15,39J5, and 39.41 of Part 39 to conform with NRC's metric policy by stating parameter values in dual units with metric units first and with English units in brackets.

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CHANGES TO 10 CFR PART 39 2.2 No-Action For the purposes of this EA, the no-action alternative is to keep the existing regulations for well-logging i

l sources codified in 10 CFR Part 39.

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CHANGES TO 10 CFR PART 39 3.0 POTENTIAL ENVIRONMENT, HEALTH, AND SAFETY IMPACTS OF THE PROPOSED ACTION AND ALTERNATIVES 3.1 Proposed Action 3.1.1 Introduction As described in Section 2.1, the proposed action comprises seven recommended changes to 10 CFR Part

39. The first five recommendations, which address radioactive source limits for both ECSs and tritium neutron generator target sources, design performance, inadvertent intrusion of abandoned sources, notification, and generic exemptions for sealed sources manufactured prior to July 14,1989, are applicable to EH&S. Thus, each of these recommendations is evaluated in this EA. The remaining two recommendations, which are administrative, are not applicable to EH&S and are not evaluated.

3.1.2 Discussion of Recommendations with Potential EH&S Impacts Energy compensation sources incorporate an encapsulated source oflicensed material, most commonly Am-241 and Cs-137, which is prepared to be as insoluble and nondispersible as practicable to comply with 10 CFR 39.41(a)(2).' Although the encapsulated source can be physically placed in different types of drilling assemblies, the fundamentals of the technology are the same. That is, the encapsulated source is mounted inside a steel (or other similar metal) pressure housing in the interior of the LWD tool. The pressure housing (and other tool components) provide additional encapsulation to protect the source from operational impacts (e.g., pressure, stresses).

Radioactive Source Limits The proposed source limits of 3.7 MBq (100 pCi) for ECSs and 1,110 GBq (30 Ci) for tritium neutron generator target sources are based on NRC's understanding of the latest designs. As discussed previously, current ECS and tritium neutron generator target source designs use up to 1.8 MBq (50 Ci) of Am-241 (or another radionuclide) and 740 GBq (20 Ci) of tritium, respectively. 2 To provide licensees flexibility in their designs while maintaining reasonable assurance of human health and environmental protection, NRC proposes establishing an upper limit of 3.7 MBq (100 Ci) and 1,110 GBq (30 Ci) for ECS and tritium neutron generator target source designs, respectively.

i 8 In an industry survey conducted in support of this rulemaking found one licensee that uses Thorium-232

(~Ih-232)in its ECSs.

2 See Attachment A for more information.

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CHANGES TO 10 CFR PART 39 Design Performance Based on both an industry survey conducted in support of this rulemaking (see Attachment A) and a-review of reportable events information in NRC's Nuclear Material Events Database (NMED), these LWD tools are highly robust.' The survey found that no licensee had ever experienced any failures (i.e.,

leakage) of these encapsulated sources. Funher, several licensees reported that their sources are doubly encapsulated, which would exceed NRC's proposed design regulations for ECS designs. Several licensees stated that their ECSs are routinely used at depths of about 4,600 n. (15,000 ft), and another i

l licensee mentioned that its design can withstand forces of up to 30 g. From the NMED review, since 1993, out of the fourteen reponable events to NRC involving well logging sources, none identified any design failures or leakages of either ECS or tritium neutron generator target sources.

Given that the source is effectively isolated inside the pressure housing, the likelihood of failure by corrosion, particularly within the economic lifetime of any oil or gas well, is highly improbable. Source capsules manufactured to regulatory standards can withstand normal downhole pressures and temperatures, and they are highly corrosion resistant. According to the Society of Petroleum Engineers (SPE), provided no erosion due to fluid movement, an encapsulated source should maintain its integrity in excess of 750 years. (SPE,1994)

Notification NRC proposes to modify Section 39/11 to allow immediate abandonment without prior approval if a delay could cause an immediate threat to public health and safety. Notification would still be required after completing the abandonment. Although notification is an important requirement, NRC believes that the licensee should first take prompt action toward protecting human health and the environment in the event of an abandonment, then make the necessary notifications to contact NRC of this event. Therefore, this proposed action should generally result in improved human health and safety benefits.

Generic Exemptionfor Sealed Sources Manufactured Before 1989 Based on a Notice of Generic Exemption that was published July 25,1989 (54 FF 30883), NRC issued a generic exemption for scaled sources manufactured before 1989. Although the exemption is currently in use, it has not yet been incorporated in Part 39. NRC proposes to revise Part 39 to include this exemption within the regulations. This modification to Part 39 would result in the same human health and safety benefits defined in the Federal Register notice.

Ihe Nuclear Material Events Database (NMED) is maintained b'y NRC under contract with the Idaho National Engineering and Environmental Laboratory (INEEL), and includes radiation exposure events reported by l

both NRC and Agreement State licensees.

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CHANGES TO 16 CFR PART 39 Inadvertent intrusion ofAbandoned Sources NRC proposes that licensees " prevent madvertent intrusion of.. " sources with activities above 3.7 MBq (100 uCi). Specifically, NRC would r luire that the source be protected but would allow the licensee the flexibility to determine the best method. NRC's proposed action would not affect the existing requirement in (a)(5)(I) for a well logging source to be immobilized with a cement plug or the requirement in (a)(5)(iii) for a permanent plaque. Therefore, this modification would allow licensees greater procedural latitude while continuing to ensure source integrity.

. Abandonment of Low Activity ECS or Tritium Neutron Generator Target Source For purposes of this EA, the following failure mode is considered:

. Damage and mpture of the encapsulated source with subsequent release of radioactive material

' by a drill-through event, contaminating the well bore fluids which would circulate to the surface during tripping events.*

Although the likelihood of damage and rupture by a drill-through event scents very low given the limited use of these sources and the low number of annual abandonments of ECSs and tritium neutron generator target sources, a radiological exposure analysis was performed to estimate the human health risks for this scenario. The analysis presumes an ECS or tritium neutron generator target source is ruptured by a drill.

through event, releasing its radioactive material and causing contamination of the well bore and eventually surface equipment by the drilling muds during a tripping event. The analysis assumes, regardless of the form of the radionuclide (i.e., solid piece, compressed powder), that the radioactive material is fragmented or disturbed by the drilling bit and transported to the surface in the mud system.

The analysis identifies three potential human exposure pathways resulting from a drill through event-inhalation, skin contamination, and ingestion - all of which are discussed in the following sections.

3.1.3 Inhalation

. Inhalation was excluded from analysis because of radionuclide entrainment in the drilling muds and a very low resuspension and evaporation rates. First, after the encapsulated source is ruptured, the radionuclide will tend to bind to both the formation and the drilling muds due to its high surface charge.

Therefore, any radioactivity carried to the surface by the drilling muds will remain in the drilling muds because of this binding. Second, resuspension of deposited material on the ground surface will not become airbome, because none of the three mechanisms that result in movement of particles deposited d 'Ihe analysis assumes that the radionuclide exposure will occur during routine " tripping" events, when the drill pipe is pulled from the hole. Based on industry experience, these events typically occur once for each 760 m (2,500 ft) of depth drilled.

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1 CHANGES TO 10 CFR PART 39 l -

onto surfaces, (e.g., surface creep, saltation, and tme suspension) will overcome the effects of binding.

Finally, given the high surface charge, evaporation of the drilling muds at the surface would not release much, if any, respirable fraction of the entrained radionuclide.

3.1.4 Skin Contamination Assumptions This analysis makes several assumptions regarding skin contamination by exposure to the drilling muds.

First, direct skin exposure to contaminated drilling muds would be unlikely because of the protective clothing (coveralls, gloves, hard hats, and goggles) worn by the workers. Second, the radioactive material concentration would be greatly diluted given the large volume of drilling muds at the typical depths for which ECSs and tritium neutron generator target sources are used (120 m [400 ft) to 4,600 m

[15,000 ft]). Third, the quantity of any contaminated muds that might splatter on unprotected skin and/or penetrate (soak) the protective clothing would be minuscule. Finally, given the availability and use of portable showers and other water sources at the drill site, any contaminated muds that might splatter on the workers would be washed away relatively quickly. Nevertheless, for the purpose of this EA, the 2

analysis assumes a skin exposure area of 6.5 cm (g ;,2),

Dilution of the radioactive source accounts for the large volume of drilling muds generated by the drilling operation. The amount of dilution by the drilling muds depends on the volume of the drill hole. The analysis assumes a standard drill hole, which uses an i 1.5 cm (4-l/2 in) outer diameter drill pipe, generates 0.01554 barrels (bbl)/ linear foot of drilling mud volume. (Dow,1984) Therefore, a minimum drilling depth of 120 m (400 ft) generates about 9.88E+5 cm (6.2 bbi) of drilling mud.5 The analysis 3

also assumes that the total amount of drilling muds is a factor of ten greater than the actual volume of the well. This assumption matches a standard industry practice of accounting for the drilling fluids (water) pumped into and circulated within the entire well. Using this factor, the standard drill hole (11.5 cm [4-4 1/2 in) outer diameter) drilled to a minimum depth of 120 m (400 ft) generates 9.88E+6 cm (62 bbl) of 3

drilling mud volume.

Dose Calculations The dose calculation for skin contamination is based on the dose-rate factors for ground-surface contamination presented in Table 8.2 of NUREG/CR-3332 (NRC,1983). Starting with the proposed limit of 3.7 MBq (100 Ci) for ECSs and 1,110 GBq (30 Ci) for tritium neutron generator target sources, doses were calculated for five radionuclides, namely: (1) Cs-137, (2) Am-241, (3) Th-232, (4) Rubidium-88 [Rb-88), and (5) tritium. The first four radionuclides apply to ECS designs, while tritium applies only to tritium neutron generator target sources. Rubidium-88 has the highest dose-rate factor for ground-8 See Section 3.1.5," Assumptions" for a detailed discussion of minimum drilling depth.

January 1999 1I

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l DRAFTREPORT ENVIRONMENTAL ASSESSMENT OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39 l

surface exposure. Therefore, it serves as the upper bound for the dose calculations for skin contamination. The dose-rate factor for each radionuclide is as follows:

2 Cs-137 7.4E-5 Sv/yr per Bq/cm l

t 2

Am-241 0.0 Sv/yr per Bq/cm Th-232 No dose-rate factor 2

Rb-88 5.1E-3 Sv/yr per Bq/cm 2

Tritium 0.0 Sv/yr per Bq/cm Based on a source limit of 3.7 MBq (100 Ci) for Cs-137 and a dose-rate factor for ground-surface 2

exposure of 7.4E-5 Sv/yr per Bq/cm, and assuming:

2 2

an area of exposed skin of 6.5 cm (1 in )

To calculate the estimated annual dose through skin contamination, multiply the dose-ratefactorfor ground-surface exposurefor skin by the source limit and by the skin a dilutson volume o(9.88E+6 cm' (62 661) contamination rate, then divide that product by the dilution from the drilling muds at a minimum depth volume and the area ofexposedskin:

of 120 m (400 ft),

2 (7.4E-5 Sv/yr per Bq/cm x 3.7E+6 Bq/

the estimated annual dose from skin contamination (9.88E+6 x 6.5 cm') = 4.3E-6 Sv/yr would be 4.3E-6 Sv/yr (0.43 mrem /yr).

Table I summarizes the estimated annual doses from skin contamination for these radionuclides. As shown below, the expected annual dose to drilling workers from skin contamination is below Federal public health limit of 100 mrem /yr.

Table 1. Estimated Annual Skin Contamination Dose for Each Radionuclide Cs 137 Am 241 Th 232 Rb-88 Tritium (100 uCI)

(100 Cl)

(100 yCi)

(100 Cl)

(30 Cl) 4.3E-6 Sv/yr 0.00 Sv/yr NA' 2.9E-5 Sv/yr 0.00 Sv/yr (0.43 mrem /yr)

(0.00 mrem /yr)

(29 mrem /yr)

(0.00 mrem /yr)

' Table 8.2 of NUREG/CR-3332 (NRC,1983) does not indicate a dose-rate factor for 'Ih-232, therefore no skin contamination dose can be eticulated.

January 1999 12 l

l DRAFTREPORT ENVIRONMENTAL ASSESSMENT OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS.-

CHANGES TO 10 CFR PART 39 3.1.5 Ingestion Assumptions The ingestion risk analysis relies on several assumptions to reflect conditions likely to occur as part of the drill-through event of an abandoned source. For convenience Table 2 contains a summary of these assumptions. Detailed explanations am provided later in this section.

Table 2. Summary of Assumptions Used in Ingestion Exposure Analysis l

Assumption Description Radionuclide exposure during routine Ingestion exposure to contaminated muds only occurs during tripping tripping events events, when the workers raise the pipe to the surface - an activity that typically occurs once every 760 m (2,500 ft) of depth drilled.

3 Maximumingestion rate of 30 cm A trip occurs once for every 2,500 ft of well depth drilled. He (I oz) analysis assumes that the maximum ingestion rate increases by 30 cm2 for each 2,500 ft drilled because of the increased time available for possible exposure. His value represents a factor of fifty (50) greater than the predicated ingestion rate of not more than 0.6 cm'(0.02 oz),

but has been chosen for conservatism.

Drill hole size Based on standard of 11.5 cm (4-1/2 in) outer diameter drill pipe.

Minimum depth Abandonment can only occur outside the well casing, which runs to a minimum depth of 120 m (400 ft).

Well volume Based upon drill hole size, depth drilled, and the standard industry l

practice of applying of factor of ten (10) to the well volume to account I

for drilling fluids.

1 Dilution of the radionuclide he radioactive source term is diluted by the total volume of drilling

)

concentration by the drilling muds muds generated at depths from 120 m (400 ft) to 4,600 m (15,000 ft).

Additive exposure effects of deeper The dose estimate at a minimum depth of 120 m (400 ft) is added to drilling the dose estimates calculated for subsequent depths (up to 4,600 m

[15,000 ft]).

Drill workers would only be exposed The abandonment rate for ECS and TNG sources averages eight (8) l to abandoned ECS or TNG sources per year. Therefore, the likelihood of a single worker being involved l

once per year in a drilling event that ruptures more than one source annually is extremely small based upon the total number of wells undergoing logging while drilling.

January 1999 13

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l ENVIRONMENTAL ASSESSMENT OF ENERGY COMPEN% TION SOURCES l

FOR WELL LOGGING AND OTHER REGULATORY CLAR1riCATIONS -

l CHANGES TO 10 CFR PART 39 Dose Calculations The dose calculation for ingestion is based on the dose conversion factors (DCFs) presented in Table 2.2 of the Federal Guidance Report No. I1.' Starting with the proposed limit of 3.7 MBq (100 Ci) for ECSs and 1,110 GBq (30 Ci) for tritium neutron generator target sources, doses were calculated for five radionuclides, namely: (1) Cs-137, (2) Am-241, (3) Th 232, (4) Cm-250, and (5) tritium. The first four radionuclides apply to ECS design, while tritium applies only to tritium neutron generator target sources.

Curium-250 has the highest ingestion DCF of all radionuclides. Therefore, it serves as the upper bound for the annual ingestion dose. The DCF for each radionuclide is as follows:

Cs-137 1.35E-8 Sv/Bq Am-241 9.84E-7 Sv/Bq Th-232 7.38E-7 Sv/Bq Cm-250 2.10E-5 Sv/Bq Tritium 1.73E-Il Sv/Bq As described earlier, the ingestion scenario considers a drill-through event of an ECS or tritium neutron generator target source. The drill-through event ruptures the encapsulated source, releasing its radioactive material and causing contamination of the well bore and eventually surface equipmerr 'ay.hu drilling muds. Based upon industry experience, ECSs and tritium neutron generator orges ocorces can i

always be retrieved if somehow lodged inside the casing of the well, which typicaSy run at least 120 m (400 ft) deep. The analysis assumes a minimum depth of 120 m (400 ft), or 9st beyond the bottom of the casing, for a drill through event. In addition, the analysis assumes the e.urrence of a tripping event, though an actual one might not occur at a depth of 120 m (400 ft) to casure a conservative exposure estimate."

The analysis assumes a standard drill hole, which uses 11.5 cm (4 l/2 in) outer diameter drill pipe, generates 0.01554 bbl / linear foot of drilling mud volume. A minimum drilling depth of 120 m (400 ft) 3 generates about 9.88E+5 cm (6.2 bbi) of drilling mud. The analysis also assumes that the total amount j

of drilling muds is a factor of ten greater than the volume of the well (see Section 3.1.4 above).

i 7 " Exposure-to-Dose Conversion Factors for Ingestion, Federal Guidance Repon No. I1. (EPA,1988).

' A tripp.nx event might occur at the minimum depth of 120 m (400 ft) if it was necessary to inspect the drill bit after drilling through parts of the logging tool.

January 1999 14 a

DRAFTREPORT ENVIRONMENTAL ASSESSMENT OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

i l

CHANGES TO 10 CFR PART 39 For ingestion, the analysis assumes that the radionuclide exposure will occur during routine tripping events (assumed to occur once for every 2,500 ft of well depth drilled), when the drill pipe is pulled from the hole. Based on industry experience, these events typically occur once for each 760 m (2,500 ft) of depth drilled.' For each event, the analysis postulates a maximum ingestion rr.te of 30 cm'(1 oz) of drilling mud for every 2,500 ft of well depth drilled. This value is a factor of fifty (50) greater than expected, because, according to an industry representative, the actual ingestion rate would probably be no more than 1/50

• of one ounce per tripping event.'8 However, a value of one ounce was used to ensure cor.servatism in the analysis.

Based on a source limit of 3.7 MBq (100 Ci) for Cs-137, an ingestion rate of 30 cm'(1 oz), and a DCF of 1.35E-8 Sv/Bq, and assuming:

a minimum well depth of 120 m(400 ft),

a single trip per well, and a dilution volume of 9.88E+6 cm'(62 bbl),

the estimated ingestion dose would be 0.0152 mrem /well.

At this same depth, the estimated ingestion doses for the other radionuclides are:"

Am-241 1.11 mrem /well Th-232 0.829 mrem /well Cm-250 23.6 mrem /well Tritium 5.83 mrem /well

' Personal communication with Mr. Ray Dickes, Radiation Safety Officer, Schlumberger, January 5 and 6, 1999.

'" Ibid.

" See Attachment B for calculation.

January 1999 15 l

1:AAFTREPORT ENVIRONMENTAL ASSI SSMENT OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGUI

• TORY CLARIFICATIONS -

l CHANGES TO 10 CFR PART 39 At greater depths (760 m to 4,600 m (2,500 ft to 15,000 ft]), the effects of tripping will incrementally increase the estimated dose as more and more exposures occur. Therefore, for an upper bound to the dose calculation based on greater depths, the estimated ingestion dose for greater depths includes the estimated ingestion dose at shallower depths. The dose calculations for Cm-250, for a drill through event at different well depths, is shown below.

Given: D = [(Source limit) x (Ingestion quantity) x (DCF)]/(Dilution volume) y where, Dy Dose contribution at y feet from ingestion of I oz of contaminated mud. for each

=

2,500 ft of well depth drilled.

Note: Contamination occurs during removal of the drill assembly, which occurs once for every 2,500 ft of well depth drilled. For example, at a depth of 5,000 ft, the total dose includes the dose contribution at 400 ft,2,500 ft, and 5,000 ft.

D"",=

Total dose t to a worker from a drill through event at 400 ft at a certain well depth X is:

D"", = D,x, + D m + D, +.. +Dx 2

Using Cm-250 for a drill through event at 5,000 ft D". =

D,. + D m + D.

2 D, = [(100 uCi) x (30 cm') x (2.1E-05 x 3.7E+09 mrem /uCi)]/(9.88E+06 cm') = 23.6 mrem /well D

[(100 uCi) x (60 cm') x (2.1E-05 x 3.7E+09 mrem /uci)]/(6.17E+08 cm')

7.56 mrem /well D, = [(100 Ci) x (90 cm') x (2.1E-05 x 3.7E+09 mrem /uCi)]/(l.23E+08 cm') =

5.66 mrem /well Therefore, D*% = (23.6 + 7.56 + 5.66) mrem /well = 36.82 mrem /well Attachment B shows the total dose estimates for all five radionuclides down to a maximum depth of 4,600 m (15,000 ft). For convenience, Table 3 summarizes the results of the dose calculation for each radionuclide for all drilling depths.

l lariuary 1999 16 l

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l DRAFTREPORT ENVIRONMENTAL ASSESSMENT OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS -

CHANGES TO 10 CFR PART 39 Table 3. Total Estimated Ingestion Dose for Each Radionuclide (mrem /well) l Depth Cs-137 Am 241 Th 232 Cm-250 Tritium m (ft)

(100 uCI)

(100 Cl)

(100 yCI)

(100 uCI)

(30 CI)

I20(400) 0.0152 1.I1 0.829 23.6 5.83 760(2,500) 0.0200 1.46 1.09 31.2 7.70 1,520(5,000) 0.0237 1.73 1.29 36.8 9.10 2,280 (7,500) 0.0269 1.96 1.47 41.9 10.3 3,040 (10,000) 0.0299 2.18 1.64 46.6 11.5 3,800 (12,500) 0.0329 2.39 1.80 51.1 12.6 4,500 (l5,000) 0.0357 2.60 1.95 55.5 13.7 3.1.6 Comparison of Results to NRC's Annual Public Health Limit The results shown in Table 3 represent estimated doses for an individual worker involved in drilling a single well Given an abandonment rate of 8 sources per year (see Attachment A Section A.2), the analysis assumes that drill workers would receive exposures to abandoned sources only once per year.

Therefore, the estimated doses shown in Table 3 for each radionuclide, at all depths, can be considered annual, and are less than NRC's public health limit of 100 mrem /yr. In the unlikely event that a worker i

receives multiple exposures in a given year, the total dose for each radionuclide, except Cm-250, which l

is not actually used or anticipated to be used as an ECS source, would still be below NRC's annual public health limit.

3.2 No-Action l

For the no-action, a 1987 EA of the original Part 39 rulemaking resulted in a finding of no sigmficant l

impact (FONSI) for well-logging devices using licensed material, which typically contain activity levels of 110 to 740 GBq (3 to 20 Ci). Thus, the current regulations as they apply to LWD sources would result in no change to potential EH&S impacts.

January 1999 17

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DRAFTREPORT ENVIRONMENTAL ASSESSMENT OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39 4.0 AGENCIES AND PERSONS CONSULTED One Federal agency and several Part 39 licensees provided technical, economic and safety-related information on LWD tools to enhance NRC's understanding of this technology. These organizations participated in a telephone survey to answer questions about source abandonments, LWD tool design and performance, regulatory exemptions, and leak testing. Attachment A summarizes the survey questions and results.

4.1 Acencies Consulted U.S. Department of the Interior - U.S. Geological Service 4.2 Licemees Consulted Baker Atlas" Halliburtou Energy Services Schlumberger Sperry-Sun" Computalog Wireline Services,Inc.

BPB Instruments, Inc.

Tucker Technologies" AEA Technology, QSA Inc. (formerly Amersham Corp.)

I 12 Formerly known as Western Atlas International, Inc.

'3 A subsidiary of Dresser Industries, Inc.

" This firm does not use either ECSs or TNGs.

January 1999 18

1 DRAFTREPORT ENVIRONMENTAL ASSESSMENT OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39 I

S.0 REFERENCES (Dow,1984) Dowell Division of Dow Chemicals U.S.A. " Field Data Handbook," p. 85.

(EPA,1988) U.S. Environmental Protection Agency," Limiting Values Of Radionuclide Intake And Air Concentration and Dose Conversion Factors For Inhalation, Submersion, and Ingestion - Federal Guidance Report No. I1," EPA 520/1-88-020.

(NRC,1998) U.S. Nuclear Regulatory Commission, "Rulemaking Plan: Energy Compensation Sources for Well Logging and Clarifications - Changes to 10 Part 39," SECY-98-105, May 12.

(NRC,1983) U.S. Nuclear Regulatory Commission," Radiological Assessment: A Textbook on Environmental Dose Analysis," NUREG/CR-3332, September.

(SPE,1994) Society of Petroleum Engineers," Operational and Environmental Safety with Nuclear LWD Tools," Second International Conference on Health, Safety & Environment in Oil & Gas Exploration &

Production, January 25-27.

Bibliography i

Allen, D., et al, Logging While Drilling, April 1989.

l Cade, R.W., Joshi Technologies International, Horizontal Wells: Development and Applications, October 1998.

Schlumberger Educational Services, log Interpretation Principles / Applications,1989.

l l

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ENVIRONMENTAL ASSESSMENT OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39 l

l ACRONYMS AEOD Analysis and Evaluation of Operational Data CFR Code of Federal Regulations i

DCF Dose Conversion Factor EA Environmental Assessment ECS Ewgy Compensation Source EH&S Environment, Health, and Safety EPA EnvironmentalProtection Agency l

FR Federal Register FONSI Finding of No Significant Impact INEEL Idaho Nuclear Engineering and Environmental Laboratory LWD Logging While Drilling NMED Nuclear Material Events Database NRC Nuclear Regulatory Commission SPE Society of Petroleum Engineers USASI United States of America Standards Institute l

1 1

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January 1999 20

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l DRAFTREPORT ENVIRONMENTAL ASSESSMENT OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

l CHANGES TO 10 CFR PART 39 Attachment A --

SUMMARY

OF LICENSEE SURVEY A.1 Summary of Licensee Survey Ouestions To help quantify the effects of the proposed rule, a data collection effon was conducted to obtain information from well logging licensees using ECSs and tritium neutron generator target sources and manufacturers of ECSs and tritium neutron generator target sources. Due to time, resource and OMB clearance constraints, NRC elected to survey only a sample of licensees (less than 10). However, NRC is confident that the information obtained from these licensees represents conditions in the industry. NRC first prepared a list of licensees and manufacturers, and selected a total of nine contacts. A list of questions needed for this EA was developed to obtain information on the following topics:

Number of abandonments due to irretrievable sources (ECSs or tritium neutron generator target sources) in an average year, including depth of source.

Need for erection of a permanent plaque for an abandoned well to identify the horizontal and verticallocation of the source.

Description of leak tests conducted on ECSs and the time interval under which they are tested.

i Robustness of the ECS design.

]

=

I Exposure pathways for workers in the event an ECS or tritium neutron generator target source is drilled through.

Amount of contamination that workers could be exposed to in the event an ECS or tritium

=

neutron generator target source was drilled through.

A.2 Summarv of Licensee Survey Responses I

This section provides a summary of the bcensee survey responses to NRC's information request for the key parameters for this analysis.

Respondents reponed an average of 8 abandoned ECSs per year. The depth at which these sources were abandoned ranged from 1,000 to 12,500 ft. Three respondents reponed never abandoning an ECS in a well logging operation.

One respondent reponed abandoning a tritium neutron generator target source. This respondent j

stated that the depth of the source when abandoned was greater than 10,000 ft. Most respondents noted that because retrieval of a lodged source mainly depends on the depth of the January 1999 21

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DRAFTREPORT ENVIRONMENTAL ASSESSMENT OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS -

CHANGES TO 10 CFR PART 39 source at the time it becomes lodged and whether the source is in the well casing, the likelihood of retrieval of tritium neutron generator target sources at shallow depths, within the surface casing, is extremely high.

Respondents mentioned that any potential radiological exposure pathways would occur at the surface via the circulating fluids (i.e., drilling muds)inside the well. One respondent suggested the containment and disposal of drilling fluids as another potential radiological exposure pathway. Most respondents stated that radiological exposure and site contamination would be negligible.

Only one respondent reported the use of a tool containing an ECS or tritium neutron generator target source where surface casing was not set. This respondent indicated that this situation typically occurred in mineral or water well logging operations.

Respondents indicated the need to account for dilution of the radioactive source term by drilling muds in evaluating risks associated with source abandonment. Respondents also indicated that identifying the horizontal and vertical location of the source with a permanent plaque would be useful for source abandonmen.t. However, one respondent questioned the usefulness, while two licensees stressed that the plaque should only be mounted if practical. Another respondent suggested marking the horizontal location with a fence around the approximate area of the source.

Respondents reported that the typical types and activity levels of radioactive materials used in j

ECSs were 0.8 Ci of Cs-137 and 2f to 50 Ci of Am-241. Licensees reported the current types

, and activity levels of radioactive materials used in tritium neutron generator target sources to range from 0.3 to 20 Ci of tritium.

Two respondents v not perform leak testing because they only use (1) gamma-beta emitting sources containing las than 100 microcuries and (2) tritium neutron generator target sources; both of which are already exempted from leak testing requirements. Without exception, licensees believe that the robust nature of the sources significantly decreases the need for frequent leak testing. Not one respondent indicated that a wipe tested ECS was found to have l

leaked. Respondents noted that a more appropriate interval for leak testing would be during routine maintenance on the tool or when removed from service for repair.

1 Several licensees emphasized the robustness of the ECS design (i.e., achieving depths of 4.600 m j

[15,000 ft) and withstanding forces of up to 30 g). Several licensees mentioned that their ECS sources were doubly or triply encapsulated.

Licensees indicated that the maintenance interval for well logging tools containing an ECS is highly variable. While some licensees reported a routine interval (inspection every month, or once per year), other licensees indicated that the interval can be much longer, depending on how January 1999 22 u

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DRAFTREPORT ENVIRONMENTAL ASSESSMENT OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS -

l CHANGES TO 10 CFR PART 39 fong the tool is in the field. Respondents indicated that maintenance and repair to these tools is not typically conducted in the field.

Respondents providing information indicated that exposure from a drill through event of an ECS or tritium neutron generator target source would result in contamination of the fluids (drilling 1

muds) circulating in the well casing or hole and that exposure would only occur when the fluids circulated to the surface (i.e., during a tripping event when the drill stem is removed and i

cleaned). In all cases, respondents providing information on this question indicated that the exposure would be very minimal if any occurred at all.

One respondent indicated that a very conservative estimate for the amount of contaminated drilling mud a worker could ingest from a drilled through ECS or tritium neutron generator target source was one ounce per tripping event, which typically occurs once for every 2,500 ft of well depth drilled. This estimate was based on the assumption that a tripping event takes 2 minutes per 60 ft of drill stem to complete. The respondent qualified this statement, however, indicating that the actual amount of contaminated drilling mud that a worker could ingest during a tripping event was more realistically approximately 1/50* of one ounce per tripping event.

i I

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January 1999 23

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ENVIRONMENTAL ASSESSMENT OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTIIER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39 Attachment B -- DOSE CALCULATIONS FOR ECS AND TNG DESIGNS i

B.1 Overview of Dose Calculations and Results j

Calculations of the estimated ingestion dose (mrem /well) at various depths can be found in Tables B.1 through B 7.

Janur:y 1999 24 l

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4 79 2 REGULATORY ANALYSIS ON ENERGY COMPENSATION SOURCES FOR WELL 4

LOGGING AND OTHER REGULATORY CLARIFICATIONS - CHANGES TO 10 CFR PART 39 Draft Report U.S. Nuclear Regulatory Commission Office of Nuclear Materials Safety and Safeguards January 1999

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4 TABLE OF CONTENTS

- AB STRACT....................................................................... 2

1. INTRODUCTION............................................................... 4 1.1 Statement of Problem and Background............................. 4 1.1.1 Energy Compensation Sources

................................... 5 1.1.2 Tritium Neutron Generator Target Sources.......................... 5

_ _ l.1.3 ' Overview of Proposed Regulatory Changes........................... 6 1.2

. Statement of Problem and Background..................................... 7 1.3 Current Licensing and Radiation Safety Regulations.......................... 7

2. IDENTIFICATION AND PRELIMINARY ANALYSIS OF ALTERNATIVE APPROACHES... 9 2.1 Opt ion 1. _.......................................................... 9 2.2 Option 2.....................................................,........9

3. ANALYSIS OF VALUES AND IMPACTS.......................................... 12 3.1 Identification of Affected Attributes...................................... 12 3.2 Analytical Method...................................................

14 3.2.1 Data Collection................................................

14 -

3.2.2 Summary of Licensee Responses.................................. 15 3.2.3 Calculating Values and Impacts of Altematives......................

16 3.3 Re sul t s............................................................. 19

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4. AGREEMENT STATE IMPLEMENTATION ISSUES................................. 21

-]

4

5. B ACKFIT ANALYSIS........................................................... 23

6. DECISION RATIONALE FOR SELECTION OF THE PROPOSED REGULATORY ACTION. 24

7. RELATIONSHIP TO OTHER PROCEDURAL REQUIREMENTS....................... 25

8. PAPERWORK REDUCTION ACT ANALYSIS..................................... 26 January 1999 i

DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS -

CHANGES TO 10 CFR PART 39 ABSTRACT This regulatory analysis examines the values and impacts expected to result from a set of proposed changes to the existing well logging regulations in 10 CFR Part 39. The proposed changes will accommodate a new technology that uses low activity sources to simultaneously log wells while drilling and proposes other modifications to improve, clarify and update Part 39. These changes are described in a May 1998 Rulemaking Plan (SECY 98-105) entitled, " Energy Compensation Sources for Well Logging and Other Regulatory Clarifications - Changes to 10 CFR Part 39.

This regulatory analysis evaluates the values and impacts expected to result from two regulatory

' options: (1) no-action; and (2) the proposed action alternative. Under the prcposed action, the U.S.

Nuclear Regulatory Commission (NRC) would allow licensees to obtain regulatory relief from the current licensing and radiation safety requirements for well logging for low activity energy compensation sources (ECSs) and tritium neutron generator target sources. Specifically, NRC plans to reduce the regulatory burden on licensees to account for innovative and new technology while maintaining adequate protection of public health and safety. The most significant change to 10 CFR Part 39 would exclude a licensee using an ECS or a tritium neutron generator target source from the costly procedures for well abandonment.

Under Option 1, the no-action alternative NRC would maintain the current licensing and radiation safety requirements for well logging as prescribed in 10 CFR Part 39, and additional requirements in other parts (as described in Section 1). In NRC's estimation, many cf these requirements are overly burdensome for low activity (less than 3.7 MBq (100 uCi]) ECS sources and 1,110 GBq (30 Ci) tritium neutron generator target sources. Under this option, however, licensees would continue to be required to meet the current requirements contained in Part 39.

This regulatory analysis estimates the following values and impacts associated with the proposed changes to the current well logging requirements contained in 10 CFR Part 39.

Relative to the no-action option (Option 1), the proposed action (Option 2) would result in industry operation savings for licensees. First, under Option 2, licensees would avoid the costly requirements for well abandonment for low activity ECSs and tritium neutron generator target sources. Second, licensees would realize savings associated with leak testing of these sources by reducing significantly the frequency of leak tests required to comply with NRC requirements (once every three years versus every six months). Third, licensees would be provided the flexibility to determine the best method for protecting against inadvertent intrusion on an abandoned source (for sources with activities greater than 3.7 MBq [100 uCi] or tritium neutron generator target sources above 1,110 GBq [30 Ci]).

Relative to the no-action option (Option 1), the proposed action (Option 2) would result in operation savings for NRC. Specifically, under Option 2, NRC would realize savings by January 1999 1

DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS -

CHANGES TO 10 CFR PART 39 l

reducing the number of abandonment reviews for low activity ECSs and tritium neutron generator target sources. Further, NRC could realize additional savings associated with the change proposed for Section 39.77_ allowing flexibility during an emergency for abandoning irretrievable sources. Also, minimal savings woulJ result from fewer exemption requests. Since January 1,1997, there have been six exemption requests (related to the proposed changes) and all were granted. These attributes are either difficult to evaluate at this time, or are of minimal value, and thus have not been quantified in this analysis.

Relative to the no-action option (Option 1), the proposed action (Option 2) would result in additional costs for NRC implementation. Specifically, the consolidated regulatory guidance project would need to incorporate all necessary guidance for well logging licensees into NUREG-1S$6, Consolidated Guidance About Materials Licenses, Program Specific Guidance About Well-Logging Licenses. This would require both draft and final NUREG versions. NRC anticipates, however, that the affect on this NUREG would not be significant, since this update would be done regardless of whether this rulemaking were completed. Therefore, the values have not been quantified in this analysis.

Relative to the no-action option (Option 1), Option 2 would reduce the burden on state and local government organizations actively involved in the regulation of well logging operations, thus yielding these organizations an annual cost savings. These values are expected to be minimal, and have not been quantified in this analysis.

Relative to the no-action option (Option 1), Option 2 would result in enhanced regulatory

, efficiency, particularly by eliminating the need for preparing reporting and recordkeeping information for abandonment of low activity ECSs and tritium neutron generator target sources.

In addition. Option 2 would provide greater regulatory certainty and clarity than the no-action option, and would ensure consistent treatment among all well logging licensees. These values, while believed to be significant, have not been quantified in this analysis.

January 1999 2

DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTiiER REGULATORY CLARIFICATIONS -

CHANGES TO 10 CFR PART 39

1. INTRODUCTION NRC has issued a rulemaking plan for amending its current licensing and radiation safety requirements for well logging at 10 CFR Part 39. ' The regulations controlling use of.well logging technology were promulgated in 1987. Since that time, new technologies have emerged that were not envisioned when the original regulations were written. NRC's intent is to revise these regulations to accommodate the use of these newer technologies. NRC is currently studying two regulatory options to accomplish this. This document presents NRC's regulatory analysis of these options.

1.1 Statement of Problem and Background Almost all oil and gas produced today comes from accumulations in the pore spaces of reservoir rocks - usually sandstones, limestones, or dolomites. The amount of oil or gas contained in a unit volume of the reservoir is the product ofits porosity by the hydrocarbon saturation. The volume of the formation containing the hydrocarbons is used to estimate total reserves and to determine whether the accumulation is commercial!y viable. Knowledge of formation thickness of the reservoir is needed to compute volume. In addition, evaluating the productivity of a reservoir requires knowing its permeability (i.e., how easily the fluid can flow through the pore system). The main parameters needed to evaluate a reservoir, then, are its porosity, hydrocarbon saturation, thickness, area, and permeability. In addition, the reservoir geometry, formation temperature and pressure, and lithology can play a major role in the evaluation, completion, and productivity of a reservoir. Downhole well logging provides a method of deriving or inferring accurate values for the hydrocarbon and water saturations, porosity, permeability, and lithology of the reservoir rock.

When NRC first promulgated its 10 CFR Part 39 regulations, well logging technology required drilling to stop. After removing portions of the drilling pieces, field workers then lowered logging tools -

- encapsulated radioactive sources with associated detector crystals - into the well on a wireline. The depth of the well could range from hundreds of meters to ireater than 10,000 meters (m) [32,810 feet (ft)). As the logging tool was slowly raised from the bottom of the well,information collected by the detectors was sent to the surface through the wireline and plotted on a chart. Now, more recent technology, referred to as " logging while drilling"(LWD) allows well logging to be accomplished during drilling. The technology provides "real-time" data during drilling operations and improves evaluation of geologic formations. In addition to the larger sources, logging while drilling technology uses a low activity radioactive source, known as an ECS to calibrate the larger source.

Changes tokbbh!i

,NE January 1999 3

DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPEFSATION SOURCES FOR WELL LOGGING AND OTHER REGULATOP i CLARIFICATIONS -

CHANGES TO 10 CFR PART 39 1.1.1 Energy Compensation Sources An ECS is a low activity source ( typically less than 3.7 megabequerels (MBq) [100 microcuries

( Ci)]) compared to the normal 110 to 740 gigabequerel (GBq) [3 to 20 Ci] sources used in well logging.

Typical radionuclides used in these sources are Am-241, an alpha particle emitter, and Cs-137, a beta and gamma emitter. Source sizes vary widely depending upon the manufacturer and the intended use of the ECS. The majority of the tools used in well logging operations are custom designed for specific applications. Even so, the standard design is fairly typical: the encapsulated source is mounted inside a steel (or other similar metal) pressure housing in the interior of the LWD tool. The pressure housing (and other tool components) provides additional encapsulation to protect the source from operational impacts (e.g., pressure, stresses). An example of a licensed ECS source is provided below:

Steering and Gamma Ray Sub - Manufactured by Anadrill, Inc., this device uses two 2.2 uCi americium-241 (Am-241) sources. This model is designed for downhole use during logging (or measurement while drilling) operations. It provides a spectrum of gamma radiation in the wellbore due to the naturally occurring concentrations of thorium, uranium and potassium in the surrounding rock formations. The gamma spectrum is measured using a ruggedized gamma ray spectrometer. The spectrometer uses two detectors; each containing its own Am-241 source acting as a reference for energy and activity, allowing the detector to compensate for efficiency fluctuations due to temperature changes in the borehole. The spectrometer and associated electronics operate at one atmosphere pressure within a sealed pressure housing made of stainless steel. This housing is positioned to allow drilling mud to flow between the outer diameter of the pressure housing and the inner diameter of the drilling collar (which acts as an additional encapsulation for the source). The diameter of the tool ranges from between 6.5 and 9 inches, with an overalllength of approximately 133 inches. The Am-241 sources are mounted within the pressure housing on the side of each of the scintillating crystals of the spectrometer. The entire detector is then wrapped with 0.10 inch thick silicone rubber and teflon shrink tubing to assist in shock isolation. The wrapped detector is then press fit within the pressure housing. The pressure housing and drill collar shield all of the Am-241 gamma rays emitted toward the outside of the tool. Therefore, the presence of the Am-241 cannot be detected from outside the tool. The device is designed to operate in a high pressure and temperature environment. Testing of the devices indicates an ability to withstand both normal and extreme conditions of handling and use.

1.1.2 Tritium Neutron Generator Target Sources Tritium neutron generator target sources are used in neutron logs. Neutron logs are used principally for delineation of porous formations and determination of their porosity. They respond primarily to the amount of hydrogen in the formation. Thus, in clean formations whose pores are filled with water or oil, the neutron log reflects the amount of liquid-filled porosity. These sources are not used in logging while drilling tools. They are used in the more traditional well logging procedure (i.e.,

wireline logging).

1 January 1999 4

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CHANGES TO 10 CFR PART 39 Neutrons are uncharged particles, each having a mass almost id:nimi to the mass of a hydrogen atom. High energy neutrons are continuously emitted from a radioactive purce (tr!aum) in the tool.

These neutrons collide with nuclei of the formation materials, and with each cellision, the neutrons lose energy. The energy lost per collision depends on the relative mass of the nucleus w;2 dich the neutron collides. Thus the slowing of the neutrons is dependent on the amount of hydrogen in the formation.

These tools are used similar to wireline drilling, whereby the tool is lowered into the well on a wire and measurements are taken while drilling has ceased. Neutrons are generated when a voltage is appl;ed to the tritium neutron generator target source. An example of a licensed tritium neutron generator target source is provided below:

Downhole Accelerator - This source, manufactured by Haliburton Logging Sources, Inc. uses an H.3 source with a maximum activity of 100 GBq (3 Ci) in oil and gas well logging applications.

Tha system consists of a pulsed deuterium-tritium accelerator, a scintillation detector, a digital telenetry system and associated electronics. This system is approximately 23 feet in length and 1-11/16ths inches in diameter. The accelerator tube is 7 inches long and 1-5/16ths inches in diameter. The device is used for neutron activation of underground formations for quantitative and qualitative analysis. It is designed to operate at pressures up to 20,000 psi and at temperatures of 400*F. A radiation hazard exists only when the accelerator is energized. It will then produce IEdneutrons per second. The expected usefullife of the accelerator is more than 400 hours0.00463 days <br />0.111 hours <br />6.613757e-4 weeks <br />1.522e-4 months <br />.

1.1.3 Overview of Proposed Regulatory Changes In the May 1998 Rulemaking Plan, NRC determined that 10 CFR Part 39 should be changed to reflect the changes in the well logging industry. Specifically, NRC believes that many of the requirements in 10 CFR Part 39, when applied to either an ECS or tritium neutron generator target source, may be overly burdensome. Because the existing regulations do not allow for variations based on the activity of the source, licensees using an ECS must currently meet all the requirements of 10 CFR Part 39. Examples of overly burdensome requirements deal with well abandonment (Sections 39.15 and 39.77), leak testing (Section 39.35), design and performance criteria for sealed sources (Section 39.41),

and monitoring of sources lodged in a well(Section 39.69). In the proposed action, NRC intends to apply the sections dealing with leak testing (Section 39.35), physical inventory (Section 39.37) and records of material use (Section 39.39) to the use of an ECS. Requirements established in other parts of NRC regulations (e.g., Parts 20 and 30) are still applicable to ECSs and tritium neutron generator target sources.

NRC's proposed rulemaking addresses these issues by modifying the regulations in 10 CFR Part 39 to define an ECS and tritium neutron generator target and provide appropriate regulations for using these technologies in well logging applications. The most significant change would exclude the user of an ECS from the costly procedures for well abandonment currently found in 10 CFR Part 39.

Well abandonment, in addition to specific reporting and approval requirements, requires that the source January 1999 5

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CHANGES TO 10 CFR PART 39 be immobilized and sealed in place with a cement plug, that the cement plug be protected from j

inadvertent intrusion, and that a permanent plaque be mounted at the surface of the well. NRC proposes to implement less stringent abandonment requirements for ECSs, for sources measuring less than 3.7 MBq (100 Ci), and for tritium neutron generator target sources with sources measuring less than 1,110 GBq (30 Ci) in oil and gas wells where surface casing is set.

1.2 Statement of Problem and Background Based on information about the changing technology in the well logging industry, NRC developed a Rulemaking Plan to consider the need to update Part 39. On May 28,1997, NRC staff provided a draft Rulemaking Plan entitled, " Energy Compensation Sources for Well Logging and Clarifications - Changes to 10 CFR Part 39"(SECY-97-Ill) to the Agreement States for comment.

NRC staff n:ceived comments on the draft Rulemaking Plaii from the States of Utah, Illinois, and Washington. These States generally supported the proposal and provided specific information and comments. Where appropriate, NRC staff incorporated these comments into the final Rulemaking Plan contained in SECY-98-105, dated May 12,1998. (NRC,1998)

In the final Rulemaking Plan, NRC staff proposes to modify the existing regulations to account for the use of this technology. NRC staff believes these modifications would reduce regulatory burden to both NRC and Agreemer.t State licensees with minimal impact to public health and safety. In addition, NRC proposes changing other sections of Part 39 to improve, clarify, and update the regulations.

1.3 Current Licensing and Radiation Safety Regulations NRC's current requirements pertaining to licensing and radiation safety for well logging operations are contained in 10 CFR Part 39, and cross-reference other provisions in 10 CFR Parts 19,20, 21,30,40,70,71, and 150 (e.g., notices, and reporting, radiation protection standards, possession of by-

{

product material, licensing of source material and special nuclear material, packaging and transportation of radio' active material, and exemptions and continued regulatory authority of Agreement States). The proposed rule would not affect the applicability of these other parts as they pertain to ECSs and tritium neutron generator target sources. The rulemaking is intended only to amend certain requirements contained in Part 39 that relate specifically to well logging operations.

As noted above, NRC's formal requirements for licensing and radiation safety for well logging are contained in 10 CFR Part 39. The requirements specified therein include:

I General provisions defining the scope and purpose of the requirements, definitions of key terms

=

associated with the requirements, and requirements specific to information collection (Subpan A);

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CHANGES TO 10 CFR PART 39 Specific licensing requirements for the use of licensed material for well logging (Subpart B);

these provisions require compliance with the licensing requirements contained in other NRC regulations, including Section 30.33 for by-product material, Section 40.32 for source material, and Section 70.33 for special nuclear material, as applicable; Equipment labeling, use, testing, inventory, and recordkeeping requirements (Subpart C);

Radiation safety requirements, including training (inclusive of requirements contained in Parts 19,20, and 39), operating and emergency procedures, personnel monitoring, radiation surveys, and contamination control (Subpart D);

Security, records and notification requirements, including onsite recordkeeping, incident notification, and abandonment procedures (Subpart E);

Exemptions (Subpart F); and Enforcement provisions (Subpart G).

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CHANGES TO 10 CFR PART 39

2. IDENTIFICATION AND PRELIMINARY ANALYSIS OF ALTERNATIVE APPROACHES The Rulemaking Plan for this miemaking identified one specific option to address the issues identified in Section 1. This regulatory analysis discusses the option specified in the rulemaking plan, and a no-action alternative.

2.1 Option 1 Under Option 1, the no-action alternative, NRC would maintain the current licensing and radiation safety requirements for well logging as prescribed in 10 CFR Part 39,.and additional requirements in other parts (as described in Section 1). In NRC's estimation, many of these requirements are overly burdensome for low activity (less than 3.7 MBq [100 Ci]) ECS sources and less than 1,110 GBq (30 Ci) tritium neutron generator target sources. Under this option, however, licensees would continue to be required to meet the requirements outlined in Section 1.2 above.

Under Option 1, licensees would have the opportunity to request an exemption from the current requirements on a case-by-case basis if they believe that the current level of regulation would be more than necessary based on the level of perceived risk. While exemptions could provide regulatory relief in the future, NRC believes that Option I would do so with less regulatory certainty than Option 2 discussed below. In addition, NRC believes that Option i may result in inconsistencies among licensees and would result in higher costs to both the licensee populations and NRC because of the cost inefficiencies of dealing with the exemption issue on a case-by-case basis.

2.2 Option 2 Under Option 2, NRC would allow licensees to obtain regulatory relief from the current licensing and radiation safety requirements for well logging for low activity sources. Specifically, NRC is proposing to reduce the regulatory burden on licensees to account for innovative and new technology while maintaining adequate protection of public health and safety. The most significant change to 10 CFR Part 39 would exclude a licensee using an ECS or tritium neutron generator target source from the costly procedures for well abandonment. Well abandonment, in addition to specific reporting and approval requirements, requires that the source be immobilized and sealed in place with a cement plug, that the cement plug be protected from inadvertent intrusion, and that a permanent plaque be mounted at the surface of a well.

In its Rulemaking Plan, NRC proposes several specific changes to improve, clarify, and update Part 39 requirements to provide regulatory relief and account for the use of new well logging technology.

The possible changes are discussed below:

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CHANGES TO 10 CFR PART 39 Revise requirements for ECSs containing less than 3.7MBq (100 uCI) for oil and gas well NRC is proposing to eliminate the well abandonment requirements for ECSs containing l 3.7MBq (100 uCi). Well abandonment, in addition to specific reporting and approval requirements, requires that the source be immobilized and sealed in place with a ceme that the cement plug be protected from inadvertent intrusion, and that a permanent plaque mounted on the surface of the well. Current requirements in Section 39.35 specify that leak testing shall be conducted for beta-gamma emitting sources with activities above 3.7 MB Ci), and for alpha-emitters (above 0.37 MBq [10 uCi]) no less frequently than every six months. Current industry practices use several radionuclides in ECSs, the most typical be 137 and Am-241. Typical activity levels of these radionuclides used in well logging applicat do not exceed 1.8 MBq (50 Ci). Beta-gamma emitters with activity levels below 3.7 MBq Ci) are already exempt from leak testing requirements. NRC proposes modifying Section 39.3 by changing the time interval for leak testing ECSs to not less than 3 years for non-exempt activity sources. The changes proposed by NRC would, therefore, only affect those licensees using non-exempt sources.

Revise requirements for tritium neutron generator target sources containing less than 1,110 GBq (30 Cl) of tritium. Tritium neutron sources typically contain less than 740 GBq (

Ci) of tritium. The neutron generator target sources only produce a neutron stream when a voltage is applied. For well logging applications, NRC is proposing that the tritium neutron generator target sources below 1,110 GBq (30 Ci) be subject to all requirements contained in P:ut 39 except: (1) sealed source design and performance criteria (Section 19.41) and (2) well abandonment procedures (Sections 39.15 and 39.77) when a surface casing is used. Tritium i

neutron generator target sources are already exempt from leak testing requirements contained in Section 39.35. NRC believes that the potential hazards associated with these sources do not warrant the existing well abandonment requirements in the event of an irretrievable source.

Modify Section 39.15 to provide for performance-based criteria for inadvertent intrusion on an abandoned source. The current requirement at Section 39.15(a)(5)(ii) requires a mechanical device to prevent inadvertent intrusion on the source that must be set at a point above the cement plug, unless the cement plug and source are not accessible to any subsequent dri operations. NRC believes this requirement to be too restrictive in some cases, dependent upon the individual well abandonment. NRC proposes that licensees using high activity sources (above 3.7 MBq (100 Ci) or tritium neutron generator target sources above 1,110 GBq (30 Ci)

" prevent inadvertent intrusion on the source," which would require that the source be protected but allow the licensee the flexibility to determine the best method. This change would not affect the requirement in (a)(5)(i) for a well logging source to be immobilized with a cement plug or the requirement in (a)(5)(iii) for a permanent plaque. This modification would allow licensees greater procedural latitude while continuing to ensure source integrity. For example, if a significant amount of drilling equipment is abandoned in the well, January 1999 9

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CHANGES TO 10 CFR PART 39 this equipment maybe effective in preventing inadvertent intrusion on the source, but may not meet the requirements of Section 39.15. These requirements would only apply to larger sources (i.e., above 3.7 MBq (100 uCi]) and tritium neutron generator target sources above 1,110 GBq (30 Ci).

Modify Section 39.77 requirements for notification and procedures for abandoning irretrievable well logging sources. This section specifies that NRC approval must be obtained prior to implementing abandonment procedures for an irretrievable source, in some circumstances, such as high well pressures that could lead to fires or explosions, the delay required to notify NRC may cause an immediate threat. NRC proposes to modify Section 39.77 to allow immediate abandonment without prior NRC approval if a delay could cause an immediate threat to public health and safety. Notification would still be required after completing abandonment. These requirements would only apply to sources above 3.7 MBq (100 Ci) or tritium neutron generator target sources above 1,110 GBq (30 Ci).

Include the generic exemption for sealed sources in 1989 within the regulations. NRC issued a generic exemption from the current design and performance criteria for sealed sources (Section 39.41), allowing the use of older sealed sources which meet an older standard for well logging operations. Sealed sources manufactured prior to July 14,1989, may use design and performance criteria specified under United States of America Standards Institute (USASI)

N5.10-l%8 or the criteria contained in Section 39.41. The use of the USASI standard is based on the NRC Notice of Generic Exemption (54 Federal Register 30883). This exemption is currently in use, but has not been incorporated in Part 39. NRC proposes to revise Part 39 to include this exemption within the regulations.

Update Part 39 to remove date that is time sensitive and have since passed. Section 39.49 contains a requirement dependent on a date that has already passed and is no longer appropriate.

NRC proposes to remove references to the date that has already passed, to avoid confusion on the part of licensees.

Update Sections 39.15,39.35, and 39.41 of Part 39 to conform with NRC's metric policy by stating parameter values in dual units with metric units first and with English units in brackets.

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CHANGES TO 10 CFR PART 39

3. ANALYSIS OF VALUES AND IMPACTS This section examines the values and impacts expected to result from NRC's rulemaking, and is presented in three subsections. Sechn 3.1 identifies the attributes that are expected to be affected by the miemaking. Section 3.2 describes the analytical method used to quantify values and impacts. Finally, the proposal's effects on values and impacts are presented in Section 3.3.

a 3.1 Identification of Affected Attributes This section identifies and describes the factors within the public and private sectors that the regulatory alternatives (discussed in Section 2) are expected to affect. These factors were classified as attributes against the list of potential attributes provided by NRC in Chapter 5 of its Regulatory Analysis TechnicalEvaluation Handbook.2 Each attribute listed in Chapter 5 was evaluated. Following are attributes that would not be affected by the proposed rule:

Human Health and Property - For several reasons, NRC believes that Option 2 would provide

=

sufficient safeguards against radiation exposure to humans and property. NRC believes that excluding low activity (less than 3.7 MBq [100 Ci]) ECSs and 1,110 GBq (30 Ci) tritium neutron generator target sources from the well abandonment requirements is protective of human health and property. NRC also believes that reducing the time period for conducting leak testing of non-exempt sources will reduce the burden on licensees while maintaining protection of human health and property. As part of this rulemaking, NRC has conducted an environmental assessment to evaluate the potential risks associated with these proposed changes. The results of this analysis indicate that risk to human health would not significantly increase as a result of these modifications. Next, NRC believes that allowing flexibility in determining the best method for protecting against inadvertent intrusion on an abandoned source in an oil and gas well (for sources greater than 3.7 MBq [100 uCi] or tritium neutron generator target sources above 1,110 GBq [30 Ci]) is appropriate because it still requires that the source be protected, but provides for

'the use of performance-based criteria to determine the best method. No change is being made to the requirement that the source be protected from inadvertent intrusion. Further, NRC believes that its proposal to allow for delayed notification in cases of well abandonment will decrease the potential risk to human health and property by allowing for immediate abandonment in cases of immediate threat. In fact, in NRC's estimation, delays caused by requiring notification prior to undertaking abandonment could lead to increased risk to health and property (e.g., fires and explosions)in some instances.

• Regulatory Analysis Technical Evaluation Handbook, Final Report, NUREGIBR-0184,0flice of Nuclear Regulatory Research, January 1997.

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CHANGES TO 10 CFR PART 39 General Public -The proposed action is not expected to have any effects on the general public.

Improvements in Knowledge - The proposed action is not expected to result in any improvements in knowledge.

Antitrust Considerations -The proposed action is not expected to have any antitrust effects.

Safeguards and Security Considerations - The proposed action is not expected to have any effects on the existing level of safeguards and security.

Environmental Considerations -The proposed action is not expected to have any significant effect on the existing level of protection of environmental considerations.

The proposed regulatory actions are expected to involve the following attributes:

Industry Operation - Relative to the no-action option (Option 1), the proposed action (Option

2) would result in industry operation savings for licensees. First, under Option 2, licensees would avoid the costly requirements for well abandonment for low activity sources ECSs and tr: tium neutron generator target sources. Second, licensees would realize savings associated with leak testing of ECSs by reducing significantly the frequency of leak tests required to comply with NRC requirements (once every thme years versus every six months). Third, licensees would be provided the flexibility to determine the best method for protecting against inadvertent intrusion on an abandoned source (for sources with activities greater than 3.7 MBq [100 Ci] or tritium

. neutron generator target sources above 1,110 GBq [30 Ci]).

NRC Operation - Relative to the no-action option (Option 1), the proposed action (Option 2) would result in operation savings for NRC. Specifically, under Option 2, NRC would realize 4

savings by reducing the number of abandonment reviews for low activity ECSs and tritium J

neutron generator target sources. Further, NRC could realize additional savings associated with the change proposed for Section 39.77 allowing flexibility during an emergency for abandoning irretrievable sources. Also, minimal savings would result from fewer exemption requests. Since January 1,1997, there have been six exemption requests (related to the proposed changes) and all were granted. These attributes are either difficult to evaluate at this time, or of minimal amount, and thus have not been quantified in this analysis.

NRC Implementation - Relative to the no-action option (Option 1), the proposed action (Option

2) would result in additional costs for NRC implementation. Specifically, the consolidated regulatory guidance project would need to incorporate all necessary guidance for well logging licensees into NUREG-l556, Consolidated Guidance About Materials Licenses, Program Specific Guidance About Well-Logging Licenses. This would require both draft and final NUREG versions. NRC anticipates, however, that the affect on this NUREG would not be January 1999 12 i

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CHANGES TO 10 CFR PART 39 significant, since this update would be done regardless of whether this rulemaking were completed. Therefore, the values have not been quantified in this analysis.

Other Government - Relative to the no-action option (Option 1), Option 2 would reduce the burden on state and local government organizations actively involved in the regulation of well logging operations, thus yielding these organizations an annual cost savings. These values are expected to be minimal, and have not been quantified in this analysis.

Regulatory Efficiency - Relative to the no-action option (Option 1), Option 2 would result in enhanced regulatory efficiency, particularly by eliminating the need for preparing reporting and recordkeeping information for abandonment oflow activity ECSs and tritium neutron generator target sources. In addition, Option 2 would provide greater regulatory certainty and clarity than l

the no-action option, ar.d would ensure consistent treatment among all well logging licensees.

These values are not believed to be significant and have not been quantified in this analysis.

3.2 Analytical Method This section describes the general methods used to structure the analysis and calculate results.

The quantifiable results of the analysis (see Section 3.3) are based primarily on the costs of satisfying NRC's requirements for licensing and radiation safety for well logging. Although the rulemaking would also result in regulatory efficiency, among other attributes (see Section 3.1), these values have not been quantified.

The discussion in this section is divided as follows: Section 3.2.1 summarizes the types of data collected for this analysis. Section 3.2.2 provides a summary of the licensee responses received. Section 3.2.3 describes the methodology that was used to determine the values associated with the regulatory options under consideration.

3.2.1 Data Collection To help quantify the effects of the proposed rule, a data collection effort was conducted to obtain information from well logging licensees using ECSs and tritium neutron generator target sources and manufacturers of ECSs and tritium neutron generator target sources. Due to time, resource and OMB clearance castraint( NRC elected to survey only a sample of licensees (less than 10). However, NRC is confider, that the information obtained from these licensees represents conditions in the industry. NRC first pre;emd a list of licensees and manufacturers, and selected a total of nine contacts. An initial list of question has developed to obtain information on the following topics:

Number of abandonments due to irretrievable sources (ECS or tritium neutron generator target source) in an average year, including cost of the abandonment and depth of the source.

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CHANGES TO 10 CFR PART 39 Need for erection of a permanent plaque for an abandoned well to identify the horizontal and verticallocation of the source.

Use of sources manufactured prior to the July 14,1989 generic exemption from Section 39.41, including description of problems with these sources in logging or logging while drilling tools.

Description of leak tests conducted on ECSs and the time interval under which they are tested.

Cost of conducting a leak test on a per source basis.

Variability in cost of conducting leak tests in conjunction with routine maintenance / repair versus leak testing at six month intervals.

Estimate of costs to meet the design and performance criteria of Section 39.41, including a breakout of the specific costs associated with vibration testing (Section 39.41(a)(3)(iii)).

Identification of problems associated r*

onducting vibration tests.

Number of preliminary designs (prototypes) since 1989 that were not registered because of failing the vibration test.

3.2.2 Summary of Licensee Responses This section provides a summary of the responses by licensees to NRC's information request for the key parameters necessary for this analysis.

Licensees reported an average of only 8 abandoned ECSs per year. Three respondents reported that they have never abandoned an ECS in a well logging operation. The depth at which these sources were abandoned ranged from thousands of feet to in excess of 12,500 feet. Costs for abandonment of an ECS varied widely based on a variety of factors, including depth of the source, location of the well (off-shore or land), and the cost components reported.'

Abandonment costs reported ranged from a low of approximately $5,000 to a high of over $1 million for a single source.

3 Costs for abandonment varied widely based on the items the respondent included in their estimates.

Sone respondents only included the cost of replacing the source in their estimate, while other licensees accounted for additional costs, including lost drill rig time, and costs for complying with abandonment requirements and reporting.

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CHANGES TO 10 CFR PART 39 One respondent indicated abandoning a tritium neutron generator target source. This respondent indicated that the. depth of the source when abandoned was in excess of 10,000 feet. Most respondents noted that because retrieval of a lodged source is mainly a function of the depth of the source at the time it becomes lodged and whether the source is located in the well casing, the likelihood of retrieval of tritium neutron generator target sources at shallow depths, within the surface casing,is extremely high.

- Licensees indicated that the costs associated with leak testing well logging tools containing ECSs ranged from $7 to $50 for a wipe test, and up to $100,000 to disassemble the tool and test the source, including the costs of taking the tool out of servpe. Two respondents indicated that they do not conduct leak testing for two reasons: (1) they ese only gamma-beta emitting sources containing less than 3.7 MBq (100 Ci); and (2) they use only tritium neutron generator target sources, both of which are currently exempted from leak testing requirements. Without exception, however, licensees believe that the robust nature of the sources significantly decreases the need to leak test these tools on a frequent basis. No respondent indicated that an ECS that had been wipe tested had been found to have leaked. Respondents noted that a more appropriate interval for leak testing would be during routine maintenance on the tool, or when it is removed from service for repair.

Licensee responses indicate that the maintenance interval for well logging tools containing an,

i ECS is highly variable. While some licensees reported a routine interval (inspection every month, or once per year), other licensees indicated that the interval can be much longer (up to 18 months), depending on how long the tool is in the field. Respondents indicated that maintenance and repair to these tools is not typically conducted in the field.

One licensee responded that it had never had a prototype design fail to meet the requirements of Section 39.41 solely because the design failed the vibration test. This respondent further indicated that, typically, no more than one prototype design is developed in a year, and that the cost of conducting the vibration test for each prototype is approximately $2,400.

3.2.3 Calculating Values and Impacts of Alternatives This section describes how each of the regulatory options under consideration was analyzed to quantify values and impacts associated with the options' licensing and radiation safety requirements for well logging. Option I is the no-action altemative and., as such, would have no values or impacts to be estimated. As a result, this discussion focuses on the quantification of values and impacts associated with Option 2.

The requirements proposed in Option 2 are deregulatory in nature and would affect licensees in several ways. First, licensees would avoH the costly requirements for well abandonment for low activity sources. Second, licensees would realize savings associated with leak testing of these sources by January 1999 15

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CHANGES TO 10 CFR PART 39 reducing significantly the time interval for conducting such tests to comply with NRC requirements (once every three years versus the current requirement of not more than every 6 months). Third, licensees would be provided the flexibility to determine the best method for protecting against inadvertent ir. trusion on an abandoned source (for sources with activities greater than 3.7 MBq [100 Ci]) or tritium neutron generator target sources above 1,110 GBq (30 Ci). The cost savings associated with this proposed change have not been calculated for this analysis. Due to limited resources and time, and because the major focus of the proposed rule is to exclude low activity ECSs and tritium neutron generator target sources from well abandonment procedures, NRC elected to focus its data collection efforts on the costs associated with abandonment of low activity ECSs and tritium neutron generator target sources. NRC anticipates, however, that the cost savings associated with changes in abandonment

. requirements for large sources (i.e., greater than 3.7 MBq [100 Ci]) or tritium neutron generator target

~

sources above 1,110 GBq (30 Ci) would not be significant.

The proposed changes described in Option 2 would benefit NRC in that NRC would realize savings by reducing the number of abandonment reviews for low activity ECSs and tritium neutron generator target sources. Funher, NRC could realize additional savings associated with the change proposed for Section 39.77 allowing flexibility during an emergency for abandoning irretrievable sources. Due to the limited number of reviews eliminated, the values have not been quantified in this analysis. The savings are not believed to be significant. State and local government organizations regulating licensing and radiation safety requirements for well logging would benefit under Option 2 in a similar fashion.

The proposed changes under Option 2 would also result in other values that are not quantified in this analysis. In particular, the proposed changes would result in enhanced regulatory efficiency because they would provide greater regulatory certainty and clarity than the no-action option and would ensure consistent treatment among all well logging licensees.

Savings and costs to licensees, state and local governments, and NRC from Option 2 are calculated as follows:

Estimate the cost savingsfor abandoning a source.

The costs for abandonment are variable based on several factors, including the depth at which the source is abandoned, or whether the source is in a on-shore (land) or off-shore (water) well. In general, these costs include the costs of replacing the tool, the costs for plugging the hole (cementing), and the costs for marking the location of the source. In addition, there are other costs associated with recordkeeping and notification associated with abandonment of a source downhole. NRC collected data from a representative sample of well logging licensees to determine specifically the costs associated with abandonment of a low activity ECS or tritium neutron generator target source. Due to the variability of the costs, accounting for the factors described above, NRC has included the high and low estimates provided by licensees as a range January 1999 16

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l CHANGES TO 10 CFR PART 39 of possible costs. In estimating the total annual savings to be realized by amending the abandonment requirements, NRC calculated the number of abandonments indicated by each respondent and multiplied this number by the respondent's estimate of the cost for abandonment l

per event. These numbers were then totaled to provide an estimate of the minimum cost savings that could be expected to be realized.

Estimate the cost savingsfor conducting a leak test on a low activity ECS only.

The cost for conducting a leak test on an ECS type well logging source can vary due to the specific conditions under which the test is conducted. For example, if the test is conducted using a wipe test on the outside of the tool, these costs may be significantly less than the costs for disassembling the tool and sampling the actual source. In addition, low activity gamma and beta emitting sources (i.e., sources containing less than 3.7 MBq [100 pCi]) are currently exempted from leak testing requirements. Because NRC does not have sufficient data to determine the number of non-exempt sources leak tested in a year, NRC estimated the costs associated w'ith conducting individual leak tests for a single source and provided a range for the costs on a per source basis. To calculate a total annual cost savings from leak tes. ting requirements. NRC limited its discussion to the survey respondents and assumed one source for each respondent.

l This number was multiplied by two to account for the requirement to conduct a leak test every six months. The proposed changes would effectively reduce the annual number of tests from 2 to one-third (i.e., because the proposed option would require one test every three years). To estimate the total annual cost for each source, the cost per test reported was multiplied by 0.33.

The total annual cost savings for each source is the difference between the total annual costs

.under the current rule and the total annual cost under the proposed rule. These values were then added across all sources to estimate the minimum total annual cost savings that could be expected to be realized as shown below:

Item 1: Annual cost for leak testing per source (current rule) =

(Cost per leak test) x 2 (Number of annual leak tests)

Item 2: Annual cost for leak testing per source (proposed rule) =

(Cost per leak test) x 0.33 (Effective number of annual leak tests)

Item 3: Annual cost savings per source = Item 1 -Item 2 Item 4: Total annual cost savings = Sum of amounts calculated under Item 3 Further, tritium neutron generator target sources are already exempted from leak testmg requirements, and thus no costs or cost savings are associated with these sources.

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DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

' CHANGES TO 10 CFR PART 39 3.3 Results The results of the analysis for each of the affected attributes identified in Section 3.1 are shown below in Exhibit 3-1, including: (1) the qualitative results for Regulatory Efficiency (i.e., greater i

regulatory certainty and clarity, more consistent treatment of licensees), NRC Implementation (i.e.,

revision of regulatory guidance), NRC Operation (i.e., abandonment review cost savings), Other Government (i.e., cost savings similar to NRC); and (2) the quantitative results for Industry Operation (i.e., annual licensee cost savings for conducting leak tests and source abandonment). As shown in the exhibit, there are no values or impacts associated with Option 1 (the no-action attemative). Rather, licensees would still need to meet all requirements for testing and abandonment as currently specified,

)

unless they submit a request for an exemption.

Option 2 would result in savings to licensees associated with well abandonment and leak testing,

)

in addition to possible savings in ensuring against inadvertent intrusion of abandoned sources greater than 3.7 MBq (100 Ci) or tritium neutron generator target sources above 1,110 GBq (30 Ci). While the cost savings estimated here only reflect a sample of the licensees, it is important to note that there would be no increase in costs to licensees associated with the proposed changes to Part 39. In fact, it can be i

expected that the values identified in Exhibit 3-1 could be larger when applied to all licensees. In addition, Option 2 would result in increases in regulatory efficiency relative to the no-action alternative.

In particular, Option 2 would provide greater regulatory certainty and clarity than the no-action option, would ensure consistent treatment among all licensees, and would eliminate the need for costly delays in effecting regulatory exemptions. These increases in regulatory efficiency have not been quantified, but are believed to be of significance.

On the impact side, NRC would incur very minor costs asscciated with updating NUREG-1556, Consolidated Guidance About Materials Licenses, Program Specific Guidance About Well Logging Licenses.

i 1

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DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39 Exhibit 31 Estimated Values and Impacts Under Options 1 and 2 Option i Option 2 Values Avoided costs to licensees of abandonment of source downhole Range:

$1K-$1M Estimated totalannual cost savings:

$5M Avoided costs to licensees for conducting leak testing on sources Range:

$7-5100K Estimated totalannual cost savings:

$100K Avoided costs to licensees of preventing inadvertent intrusion on Minor abandoned sources above 100 Ci and tritium neutron generator ta get sources above 30 Ci Increase in regulatory certainty and clarity; increase in consistency of Minor treatment of licensees; and reduction in delays associated with the exemption process 3

Avoided costs to NRC of reviewing abandonment reports and Minor exemption requests Avoided costs to Other Governments Similar to NRC impacu Increased costs to NRC of updating NUREG-1556 Minor January 1999 19 J

1 DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39

4. AGREEMENT STATE IMPLEMENTATION ISSUES NRC issued a draft rulemaking plan to Agreement States for comment on proposed changes to 10 CFR Part 39 on May 28,1997. Comments were received from three states: Illinois, Utah, and Washington. In general the states agreed that the current regulations in Part 39 needed modification to reflect the use of new " logging while drilling" technology. a summary of the significant comments and NRC's responses is provided below:

The State ofIllinois argued that ECSs with activities exceeding 3.7 MBq (100 uCi) for beta / gamma emitters or 0.37 MBq (10 uCi) for alpha emitters should be leak tested and therefore, ECSs should not be given a categorical exemption to leak testing requirements. The State of Washington commented that tritium sources have been knowr to leak and that proper I

monitoring of these sources should be required. NRC intends to define an ECS as having 3.7

)

MBq(100 Ci) or less of radioactive material and therefore, by definition an ECS would be

{

excluded from the existing leak testing requirements of Section 39.35(e). Further, based on design requirements, alpha emitters will not be included in the definition of an ECS, NRC does not currently, nor will it in its proposed rulemaking, require leak testing of tritium sealed sources.

These sources are specifically exempted from leak testing requirements in Section 39.35(e).

I The State of Illinois believes that some degree of protection is necessary for ECSs lost near the -

=

land surface. NRC intends to build into the regulations separate provisions for ECSs based on whether a surface casing is used or not. Surface casings are used to protect fresh water aquifers from contamination and are extensively used in oil and gas exploration. NRC believes that a i

surface casing will provide adequate near surface protection (refer to the Environmental Assessment for information on the risk of abandonment near the land surface). When surface casings are not used, more rigorous recovery operations will be required.

The State of Illinois does not believe that ECSs should be categorically excluded from design and performance criteria for sealed sources (Section 39.41). The State of Utah, on the other hand, suggests that ECSs should be excluded from Part 32 (Section 32.210 discusses registration of sealed sources). Although NRC intends to exclude ECSs from the rigorous design and performance criteria of Section 39.41, the ECSs will still need to meet the licensing requirements of Section 32.32(g), which require more general design and performance criteria.

Both the States of Illinois and Washington believe that the example used in the draft rulemaking plan comparing radioactive sources in ECSs and gas and aerosol detectors as a basis for excluding ECSs is inappropriate. NRC will remove this reference from the rulemaking, and the Environmental Assessment will assess whether ECSs can be safely excluded from the i

requirements of Part 39.

January 1999 20 2

m DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS -

CHANGES TO 10 CFR PART 39 The State of Illinois commented that neutron generator devices containing tritium targets also

=

require above-ground testing for operability and calibration and can produce radiation levels constituting high radiation areas. The State argues that the revised regulations should allow testing and operation of such devices provided procedures are in place to monitor radiation levels and ensure that adequate safety procedures are in place and implemented. NRC agrees with this concept. Tritium sources will remain subject to Section 39.63 (operating and emergency procedures).

The State ofIllinois raiscd concerns about some sources meeting USASI standards. They noted an event where a source experienced damage due to vibration within a source holder.

Specifically, vibration of a sealed source within a source holder may have led to a loss of containment. Therefore, the assumption that sources built under the USAS! standard would be so rugged as to preclude a public health and safety problem has been called into question. The State also suggested that the way in which sealed sources maybe loaded into source holders has not been thoroughly evaluated and suggested that NRC may wish to consider the source and the source holder combination. NRC understands that the problem identified was not related to the USASI standard, but an improperly assembled source holder. There was no loss of containment.

The vibration test is not designed to account for an improperly loaded source. Historically, the NRC has not regulated source holders or the well logging devices in which the source holders or sources are placed. NRC also notes that there has been no history of problems with the source and source holder combinations. NRC has concluded that no rule change is necessary, and in any event, the comment is beyond the scope of this miemaking.

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DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39

5. BACKFIT ANALYSIS The NRC has determined that the backfit rule,10 CFR 50.109, does not apply to this proposed rule because these amendments do not involve any provisions that would impose backfits to a facility as defined in 10 CFR 50.109(a)(1).

January 1999 22

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4 DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39

6. DECISION RATIONALE FOR SELECTION OF THE PROPOSED REGULATORY ACTION 1.

Option I, the no-action alternative, would retain the existing requirements for licensing and radiation safety for well logging. Option 2 would relieve licensees from overly burdensome requirements associated with well abandonment and leak testing for sources containing less than 3.7 MBq (100 Ci) activity, and for well abandonment for tritium neutron generator target sources containing less than 1,110 GBq (30 Ci) tritium. In addition, Option 2 would clarify existing requirements for other larger sources, and provide for the use of performance-based criteria for preventing inadvertent intrusion on an abandoned source. Relative to Option 1, Option 2 would yield net benefits to licensees, state ana. al governments, and NRC without additional risk to the public.

2.

The proposed requirements under Option 2 would result in enhanced regulatory efficiency because they would provide greater regulatory certainty and clarity than Option 1 (the no-action alternative), and would ensure consistent treatment among all licensees.

3.

. Because licensees would be able to reduce their licensing and radiation safety requirements thus avoiding the costs of abandoning low activity sources, Option 2 could result in an annual cost savings in excess of $5 million. Additional cost savings could be realized under Option 2 from the extension of the time period for conducting leak testing non-exempt low activity sources from every six months to every three years (approximately $100,000).

4.

NRC's environmental assessment supporting this rulemaking indicates that the risks associated with the proposed changes are protective of health and sVety. Data collected by NRC indicate that these sources are very robust, do not typically leak, and are not abandoned on a frequent basis.

5.

For the reasons stated in (1) through (4) above, Option 2 is superior to Option 1 (the no-action alternative).

I i

January 1999 23

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REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS -

CHANGES TO 10 CFR PART 39

7. RELATIONSHIP TO OTHER PROCEDURAL REQUIREMENTS This action would be enacted through a Proposed Rule Notice and public comment and a Final Rule, with promulgation expected in calendar year 2000. Implementation can begin immediately following the enactment of the final rulemaking. No impediments to implementation of the recommended alternative have been identified, with the exception of the minor revisions to NUREG-1556.

I January 1999 24 1

fj DRAFTREPORT REGULATORY ANALYSIS OF ENERGY COMPENSATION SOURCES FOR WELL LOGGING AND OTHER REGULATORY CLARIFICATIONS --

CHANGES TO 10 CFR PART 39

8. PAPERWORK REDUCTION ACT ANALYSIS This section fulfills NRC's obligation under the Paperwork Reduction Act to examine the information collection impacts of its regulatory actions, in this case in regard to a rulemaking addressing NRC's current licensing and radiation safety requirements for well logging. NRC is proposing to modify these requirements, which are contained in 10 CFR Part 39 to account for new technologies developed since the requirements contained in Part 39 were first promulgated.

NRC's analysis indicates that its proposal is deregulatory in nature and would result in a decreased burden on licensees with regard to reponing and recordkeeping operating wells (with a surface casing), that abandon an ECS or tritium neutron generator target source within that v e'.;. Licensees would not be required to report such abandonment to NRC, which is estimated to be a reduction in burden of approximately 4.5 hours5.787037e-5 days <br />0.00139 hours <br />8.267196e-6 weeks <br />1.9025e-6 months <br /> per request (639.77). NRC has determined, that, because the burden reduction for this information collection is insignificant, Office of Management and Budget (OMB) clearance is not required. Current requirements associated with information collection under 10 CFR Pan 39 were previously approved by OMB in approval number 3150-0130.

January 1999 25