ML20217H094

Insp Rept 99901093/98-01 on 980319.No Violations or Noncompliance Noted.Major Areas Inspected:Circumstances Surrounding Supply of Nuclear safety-related Phenolic Graphite Coated Fasteners

ML20217H094
Person / Time
Issue date:	03/27/1998
From:	NRC (Affiliation Not Assigned)
To:
Shared Package
ML20217H077	List: ML20217H071 ML20217H094
References
REF-QA-99901093 99901093-98-01, 99901093-98-1, NUDOCS 9804030175
Download: ML20217H094 (6)

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U.S. NUCLEAR REGULATORY COMMISSION OFFICE OF NUCLEAR REACTOR REGULATION l Report no: 99901093/98-01 Organization: Allied Group

Contact:

David Perkins, Quality Assurance Manager (610)275 2200 Nuclear Activity: Manufacturer and supplier of threaded fasteners, ferrous and nonferrous bars, fittings, flanges, and other products used in nuclear applications.

l Dates: March 19,1998 I

inspectors:

Gregory C. Cwalina, Senior Operations Engineer James A. Davis, Materials Engineer Approved by: Robert A. Gramm, Chief Quality Assurance Section i

Quality Assurance, Vendor inspection and Maintenance Branch Division of Reactor Controls and Human Factors Enclosure -

9804030175 980327 PDR GA999 ENVALNUT l 99901093 PDR l

r 1 INSPECTION

SUMMARY

The NRC inspectors examined the circumstances surrounding the supply of nuclear safety-related phenolic graphite coated fasteners to the Public Service Electric and Gas l

Company (PSE&G), the licensee for the Salem nuclear plant. Specifica'ly i pertaining to the above, the inspectors reviewed the implementation of selected portions of Allied Group's (Allied) quality assurance (QA) program for compliance with the requirements of 10 CFR 50, Appendix B. The inspectors also reviewed the implementation of Allied's program for identifying and evaluating deviations and reporting of defects and failures to j comply under the requirements of 10 CFR Part 21. i I

The inspection bases were:

10 CFR Part 50, Appendix B, " Quality Assurance Criteri? for Nuclear Power Plants and Fuel Reprocessing Plants."

10 CFR Part 21, " Reporting of Defects and Noncompliance."

i During this inspection, no violations or nonconformances were identified.

2 STATUS OF PREVIOUS INSPECTION FINDINGS yjalation 99901093/87-01-01(Closed)

During a June 1987 inspection of Allied Nut & Bolt Company, the inspectors found that l Allied failed to post copies of Section 206 of the Energy Reorganization Act of 1974.

i During this inspection, the inspectors observed Allied's postings and determined that they met the requirements of 10 CFR P&rt 21, including posting of Section 206.

Violation 99901093/87-01-02 (Clostd)

During a June 1987 inspection of Allied Nut & Bolt Company, the inspectors found that Allied did not pass the requirements of 10 CFR Part 21 on to certain sub-tier vendors.

During this inspection, the inspectors observed procurement documents to sub-tier vendors and noted that the requirements of Part 21 had been appropriately passed on.

3 INSPECTION FINDINGS AND OTHER COMMENTS 3.1 Description of Facilities and Activities The Allied Group consists of two organizations, the Allied Nut & Bolt Company, Inc. and the Allied Precision Machine Company, Inc. Allied has been granted a Quality System Certificate (QSC-528, expires May 3, 2000) by the American Society of Mechanical Engineers (ASME) as a Material Organization (MO), for manufacturing and supplying ferrous and nonferrous bars, threaded fasteners, seamless fittings, flanges, and other 2

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k products. Inspection and test capability includes complete dimensional and visual inspection, tensile and hardness testing, and chemicel analysis capability for carbon and low alloy steels. Nondestructive examination and heat treating are subcontracted to approved suppliers. )

j 3.2 Review of Allied's 10 CFR Part 21 Proaram and its implementation The inspectors reviewed Allied Procedure QAl:1, "10 CFR Part 21 Procedure For Reporting of Defects and Noncompliance," Revision 3, April 8,1997. The practices for identifying and reporting deviations and the time frames for evaluation and notification are appropriately described in QAl:1. The procedure requires any Allied employee who identifies a deviation to document the deviation in Section I of the Allied Part 21 Report form (included in QAl:1). The responsibility for documenting the results of deviation evaluations and the need to inform customers and/or the NRC are also described. T inspectors noted some minor weaknesses in procedure QAl:1. The weaknesses were identifled to the Allied QA manager who stated that appropriate revisions would be incorporated.

The inspectors also observed 10 CFR Part 21 postings at the manufacturing facility and found them to be consistent with the current requirements.

3.3 Review of Suopjy of Phenolic Graohite Coated Fasteners to PSE&G

a. Insoection Scoce The NRC inspectors reviewed the document files related to the supply of phenolic graphite coated fasteners to PSE&G for use at the Salem nuclear generating station.

b. Observations and Findinas PSE&G Purchase Order On June 15,1990, PSE&G issued pttrchase order (PO) P2-381636 to Allied Nut & Bolt Company. Inc. The PO called for the supply of numerous fasteners (nuts, bolts and screws) coated with a " phenolic graphite." The PO specified that the coating was to be supplied by the G* Chemical Corporation (G*) c/o the King Finishing Company (King). The original PO specified that the order was nuclear safety related and that 10 CFR Part 21 applied. The PO also specified QA requirements in accordance with OAF-19 No. QC-3847. OC-3847 listed QA program requirements to include PSE&G's QA program; 10 CFR Part 50, Appendix B; 10 CFR Part 21; and ASME NCA-3800.

The PO was filled by Allied in the following manner. Allied supplied the specified fasteners to King. King applied the coating material, supplied by G*, to the fasteners in accordance with Gs procedures and subject to G* QA oversight. The coated fasteners were retumed to Allied prior to shipment to PSE&G.

' Allied Survey of G* In anticipation of the PO, Allied performed a survey of G* at the coating subcontractor, King Finishing Company on June 1,1990. Results of the survey 3

were included in an Allied intemal memorandum dated June 11,1990. The survey results include the following statements:

G* Chemical Corp. is the manufacturer of a proprietary bonded solid film lubricant coating system that is applied by subcontracted i (job shop) finishing companies.

Prior to this survey G* Chemical was qualified by specific reference to their product on Allied's customer purchase orders.

The purpose of this survey was twofold; to check the control of Code material during the coating process and to review G'Chemicars quality program to assure that the coating materials being applied comply with the original coating materials tested and accepted as described in G* Chemical's report, "PEPCOAT" A Study in protection and performance.

.. discussions with Mr. King [QA Manager- G*] and Mr. Heisel

[ Corrosion Engineer - G*] indicate that each batch of PEPCOAT is analyzed for elements or compounds considered to be deleterious in the Nuclear Power Industry, but the resistance and lubricity testing, originally performed in 1982 through 1984 has not been checked since then.

The survey report raised some questions regarding the coating material. First, Allied lacked assurance that current batches of the coating " perform in a manner similar to the performance obtained when the lubricity and corrosion resistance of the original product was tested." Second, Allied was concemed that the coefficient of friction may vary from batch to batch, which may have an effect on calculated torque values.

PSE&G Purchase Order Revisions Based upon the survey, Allied communicated their concems to PSE&G on June 13,1990. In that letter, Allied stated that they were unable to evaluate the consistency or quality of the product because it is a proprietary product.

Attematively, periodic testing could be performed, however, G* indicated they had not performed any tests since the original product was tested and they would not perform any until they mixed their next batch. Allied informed PSE&G that Allied found that response unacceptable and halted coating of Allied material.

In order to resolve the issue, Allied requested PSE&G to inform them, in writing, that the 1

coating materials were not safety-related and that Allied would not be held responsible j for the quality and performance of the PEPCOAT coating.

PSE&G responded in a telefax from J. Harper dated June 14,1990. That fax supplied QAF-19 No. QC3847A which would be applicable to all POs in relation to PEPCOAT.

The fax noted that PSE&G did not require traceability of the coating and that Allied was only acting as PSE&G's agent in obtaining PEPCOAT and had no liability with regard to l

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PEPCOAT.

Subsequently, QC3847A, which removed specific QA requirements from the coating material, was amended to the PO.

Allie_d Purchase Order to G* Allied obtained the coating service from G* through several POs. The inspectors reviewed POs Q19622 (June 20,1990), Q19803 (July 13,1990),  !

and Q20046 (August 8,1990). The inspectors noted that all 3 POs required G* to certify  ;

that the corrosion resistance and lubricity of the applied lot was equivalent to that  !

described in the report, "PEPCOAT A Study in Protection and Performance." In addition, the POs required a Certified Material Test Report and a Certificate of Compliance (CoC). ,

Finally, the PO invoked the requirements of Part 21. In filling the order, G* supplied a  !

CoC for all 3 POs (dated June 29,1990, July 23,1990, and August 10,1990) attesting i that PEPCOAT " meets the corrosion resistance and lubricity as described in the Pepcoat Technical Manual."

c. Conclusions I i

PSE&G issued a safety-related PO to Allied which originally included the phenolic i graphite coating. Based upon a survey conducted by Allied, PSE&G removed QA requirements relating to the coating from the PO. Therefore, the inspectors concluded l that PSE&G relieved AI!ied from any material or regulatory responsibility relating to the coating.

3.4 Qualification of PEPCOAT ,

a. Inspection Scope i

During this inspection, the inspectors reviewed documentation regarding the qualification of PEPCOAT as a nuclear grade lubricant.

b. Observations and Findiggs Based upon discussions with Allied personnel, the inspectors determined that, in 1994, Allied was trying to fill a PO for phenolic graphite coated fasteners on an expedited time frame. Their contacts with G* indicated that material was not readily available to bomplete the PO requirements in a timely manner. Allied contacted another lubricant manufacturer, E/M Corporation (E/M), to see if E/M supplied a graphite coating that met the requirements of the nuclear industry. E/M supplied Allied with literature regarding i

two of their products Everlube 6122, a bonded solid film lubricant designed to meet the needs of the nuclear industry (i.e., formulated without elements considered deleterious to nuclear power plant components), and Everlube 6120, a similar material designed for non-nuclear applications.

Allied noted that the technical data sheet provided by E/M for Everlube 6120 was identical to the data sheet provided by G* for PEPCOAT. However, the technical data l

sheet for Everlube 6122, the nuclear grade lubricant, was different in some key aspects.

The inspectors reviewed the subject data sheets and confirmed Allied's findings. Allied then noted that the qualification report provided by G* (PEPCOAT, A Study in Protection 5

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and Performance) was similar to one provided by E/M for Everlube 6122. Allied was informed by E/M that Everlube 6122 had been supplied to Precision Engineered Products Company (subsequently acquired by G*) who marketed the product as PEPCOAT 6122. Allied was later informed that E/M had not been selling or supplying Everlube 6122 for several years.

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After receiving this information, Allied informed PSE&G by memorandum of August 24, 1994, that the coating PSE&G had been receiving from G* was not the same coating that was tested for nuclear use. Allied also informed PSE&G that Allied would no longer supply parts coated with PEPCOAT as supplied by G* The memorandum also noted that Allied could not perform an evaluation in accordance with Part 21.

c. Conclusiom Based upon documentation reviewed, the inspectors determined that there is some i

doubt as to whether PEPCOAT, as marketed by G*, is a nuclear grade coating.

The inspectors determined that Allied's memorandum to PSE&G constituted a courtesy notification with respect to Part 21. (Note: the inspectors determined that a notification l was not required because PSE&G had relieved A!!ied of any responsibility for the coating j material.)

PARTIAL LIST OF PERSONS CONTACTED Allied Grouc J. Rosenstock, Chief Executive Officer M. Rosenstock, Executive Vice President D. Perkins, Quality Assurance Manager Conrad O' Brie _a_Gellman & Rohn. P.Q.

J. Guernsey b ITEMS OPENED, CLOSED AND DISCUSSED l'

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.C1999A 99901093/87-01-01 VIO Failure to post Section 206 l' 99901093/87-01-02 VIO Failure to pass Part 21 to subtier vendors 6

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