ML20310A447

Exhibit 2 to Fasken and Pblro Motion for Leave to File New Contention 3

ML20310A447
Person / Time
Site:	HI-STORE
Issue date:	11/05/2020
From:	Fasken Land & Minerals, Ltd, Kanner & Whiteley, Permian Basin Land and Royalty Owners
To:	Atomic Safety and Licensing Board Panel
SECY RAS
References
ASLBP 18-958-01-ISFSI-BD01, RAS 55853, Holtec International
Download: ML20310A447 (62)

Text

Exhibit 2 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY LICENSING BOARD IN THE MATTER OF Docket No. 72-1051 HOLTEC INTERNATIONAL November 5, 2020 (Consolidated Interim Storage Facility)

FACTS PETITIONERS INTEND TO RELY ON TO SUPPORT NEW CONTENTION NO. 3

• Public Comment in Opposition to the Holtec DEIS from XTO Energy (Deanna Archuleta) Letter to Div. of Rulemaking, Environmental and Financial Support, U.S.

Nuclear Regulatory Commission (Sept. 22, 2020) (ADAMS Accession No. ML20268C261), uploaded to ADAMS on Oct. 5, 2020 (emphasis added) o We are concerned about the proposed Holtec CISF project's potential interference with XTO's existing oil and gas lease rights and operations in New Mexico. now and in the future. Of particular concern to XTO are our oil and gas lease interests that directly underlie or are adjacent to the Holtec project area.

o The DEIS contains critical legal and factual errors on this score. It fails to support its conclusion that "no impact on oil and gas development could ever occur despite Holtecs proposed exclusive use of its project area. DEIS at xxiv. Likewise, it summarily avers that "oil and gas exploration could coexist with Holtecs proposed project. Id. at 9-2. The DEIS does not recognize the full import of the dominant subsurface mineral estate owned by the State of New Mexico and leased to XTO (and other companies) for oil and gas development, which legally cannot be encumbered by an after-the-fact approval of a surface use like Holtec seeks here.

The DEIS does not even indicate that NRC's interagency engagement included the relevant agency for non-federal oil and gas development. the State of New Mexico Land Office ("SLO). Preservation of existing oil and gas lease rights must be resolved prior to publication of any Final EIS and Record of Decision. At a minimum, any license granted to Holtec must contain an express condition of 1

non-interference with existing oil and gas leases within or adjacent to the Holtec project area.

o Holtec proposes to build and operate a nuclear waste storage facility on the surface of lands in Lea County overlaying and directly adjacent to existing oil and gas leases and activities. /d. at 5- 17 ("'[E]xtensive oil and gas production activities surround the proposed project area.")

o The Lease is currently in full force and effect and is held by production under the terms of the Lease, including its habendum clause. One currently undeveloped portion of the Lease is located directly under the proposed location of Holtec's CISF. As we understand from the DEIS, the CISF would occupy the entire surface of this area. Other undeveloped portions of the Lease also are situated adjacent to the proposed CISF area.

o Yet, NRC's NEPA analysis appears to marginalize both the SLO and XTO as a state oil and gas lessee. The DElS omits the SLO and all oil and gas lessees in the area from the long list of agencies and entities with which NRC consulted during preparation of the DEIS or to which NRC distributed the DEIS for review. DEIS at 1-6, 1-7. 11-3. The DEISs analysis suffers as a direct result.

o o The DEIS is also tainted by its heavy reliance on Holtec's submissions to the NRC, which similarly ignore or discount existing oil and gas lease rights.

Previously, NRC appeared to blindly accept Holtec's erroneous assertions that Holtec controls the entire project site. Specifically. Holtec misrepresented to NRC and the SLO that Holtec had entered into third-party agreements to proscribe oil and gas extraction in Holtec's project area. In reality, neither XTO nor any of its affiliated entities has an agreement with Holtec to prohibit or limit in any way oil and gas operation activities on the Lease. To be clear, XTO would not enter into such an agreement with a third party without first securing the SLOs approval and appropriate amendments to the terms of XTOs Lease to avoid any risk of breach, termination, or cancellation. See Lease Sees. 13 and 14. And as is further described below, any purported agreement Holtec may have with potash producers to forgo potash mining cannot limit oil and gas operations in the absence of such local potash mining. In addition, Holtec unsuccessfully lobbied the SLO to impose a negative easement" functioning as a ban on oil and gas development between the surface and 3,000 feet, and a prohibition on any directional or horizontal wells bottomed beneath the site that Holtec believes might 'disturb or conflict with its use of the site.* Letter from New Mexico Public Lands Commissioner to Holtec International (June 19, 2019 SLO Letter), attached hereto as Exhibit 3. The SLO rebuffed that invitation, recognizing potential legal claims for breach of existing leases. ld.

o But this silence and apparent abandonment of Holtecs prior claims does not cure the problem of the DEIS shortchanging impacts to XTOs paramount lease rights to both produce subsurface oil and gas and utilize the surface as necessary for such development.

o Notably, the Lease terms do not reserve to any agency or party the ability to limit XTOs rights to fully develop the oil and gas resources granted within the bounds 2

of the Lease so long as XTO abides by the Lease terms. To the contrary, the Lease grants XTO the exclusive right to develop the minerals underlying the lease and the necessary easements and rights-of-way across the surface to accomplish that objective. See Lease habendum clause. These are valuable property rights . . .The SLO as lessor only reserved cancellation rights in the event XTO defaults or materially breaches the Lease contract. Accordingly, as long as XTO properly holds the Lease by production, XTO has the right to produce all the oil and gas from the Lease area, including correlative use of the surface as necessary, and that right may not be unreasonably limited by Holtec.

o Absent an express limitation in the Lease (such as a no-surface occupancy stipulation), the mineral lessee is entitled to use so much of the surface as is reasonably necessary to develop and produce its minerals. Thus, it is the surface user that must accommodate the exercise of the oil and gas lessees surface use rights, and not the other way around as the DEIS would have it.

o Similarly, the surface owner cannot constrain an oil and gas lessees ability to produce its oil and gas by any means including directional or horizontal drilling.

o Holtec cannot locate a large nuclear waste storage facility on the surface that may prevent XTO from realizing full enjoyment of its fundamental lease rights. If Holtec intends to license or otherwise obtain rights to use the surface of XTOs mineral lease, absent XTOs agreement Holtec may only obtain a surface estate that is subservient to XTOs mineral development and surface use rights, and may not unreasonably interfere with XTOs rights of use. . .Unfortunately, the DEIS includes no such express condition, alternative, or mitigation measure in its recommendation to grant the license as proposed by Holtec.

o Further, each of the DEISs stated reasons for not studying and mitigating potential impacts on existing oil and gas leases collapses under scrutiny.

o First and foremost the DEIS avers that *'the proposed ClSF would have no impact on oil and gas exploration and development in the proposed project area because extraction will continue to occur at depths greater than 930 m [3,050 ft]:* DElS at xxiv-xxv, 4-6, 4-7; see also id. at 3-8. 4-4, 4-5. The DEIS lacks support for this depth-based assumption. Unlike its discussion of particular potash leases, the DEIS does not identify specific affected oil and gas leases or corresponding potential reserves in the vicinity of the proposed CISF site. Further. as the SLO Letter points out the [SLO's] analysis demonstrates the existence of numerous active oil and gas wells within a three-mile radius of the Site at depths of 5,000 feet or less. The DEIS's purported 3.050-feet demarcation also conflicts with Holtecs own submissions to NRC. which had claimed that oil and gas development would be even more constrained near the CJSF project- i.e. that oil and gas activities would be "proscribed in the CISF project area by third-party agreements. as well as Holtecs backtracking to an asserted ban on extraction of oil and gas above a depth of 5.000 feet. Lastly. as described above, the DEIS fails to account for the absence of any depth-based production restrictions in XTO's Lease directly below the ClSF site. See SLO Letter ("The SLO 's oil and gas leases on and adjacent to the Site do not impose any depth restrictions on drilling activities."). Neither NRC nor Holtec 3

has legal authority to unilaterally restrict production from XTO's existing oil and gas Lease to certain depths where XTO has not agreed to such a limitation.

o [] the DEIS finds that the area of land disturbance for construction of the CISF would not encompass an operating oil or gas well or decommissioned former wells.

DEIS at 4-4. But even if that were true, this myopic focus on prior and current facilities is incomplete because it ignores XTOs future development rights.

Because XTOs rights extend for the life of the Lease, i.e., so long as production is ongoing, it does not matter for purposes of the DEIS when production occurs. Thus, impingement of XTOs future production due to construction and operation of Holtecs CISF would adversely impact existing Lease rights held by XTO.

o While there may be restrictions related to potash in this area, these restrictions are designed to provide for orderly development of oil and gas reserves and potash reserves, not for the protection of Holtec. The DEIS also explains that a third-party agreement between Holtec and Intrepid Mining, LLC will preclude potash mining within the project area. DEIS at 5-24. Moreover, Holtec is not a beneficiary to protections for potash development in the area. The DEIS appears to assume that Holtec simply may step into the shoes of potash developers vis--vis oil and gas development. But the DEIS cites no support for that novel position, and XTO is aware of none.

• Public Comment in Opposition to the Holtec DEIS from New Mexico Governor Michelle Lujan Grisham Letter to U.S. Nuclear Regulatory Commission (John Tappert) (Sept. 22, 2020) (ADAMS Accession No. ML20269A025) (emphasis added) o The [NRC] preliminary recommendation is the issuance of a license to Holtec. .

.authorizing the initial phase of the project, unless safety issues mandate otherwise.

Unfortunately, in the [DEIS] developed in support of this recommendation, the NRC failed to address significant environmental and economic concerns. . .

The proposed site is geologically unsuitable despite any environmental reports submitted by Holtec. . .or analysis performed by the NRC. Holtec proposes to bury highly radioactive and toxic spent nuclear fuel to a depth of only 50 feet in an area underlain by concerns for sinkhole developments and shallow groundwater, a precious resource in this state. . . Holtecs proposed CISF site does not provide deep geological isolation for indefinite spent nuclear fuel storage, and the proposed site is unsuitable for spent nuclear fuel storage over a period of decades.

At this time, the NRC cannot guarantee that a permanent repository for spent nuclear fuel in the United States will be developed in 40, 80, or 120 years, or that the proposed Holtec CISF will not become a permanent repository. Even 80 years of storage at the Holtec CISF amounts to impacts beyond the lifetimes of everyone involved in this decision.

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Additionally, the design considerations for the CISF and related infrastructure offer no specific plans for withstanding earthquakes in the region, which are increasing in both frequency and magnitude. . .

New Mexicans, tribes and local governments overwhelmingly oppose Holtecs . . .proposal and the issuance of an NRC license.

Holtec disregarded specific impacts on tribal, minority, and low-income populations in their analysis . . .

The NRCs independent analysis in the draft EIS failed to address significant risks to communities and our economy. The CISF would place unfunded mandates on local communities. Transporting spent nuclear fuel across the nation and New Mexico is complex and extremely dangerous. Safe transportation of spent nuclear fuel requires both well-maintained infrastructure and highly specialized emergency response equipment and personnel that can respond quickly to an incident at the facility or on transit routes.

• Blue Ribbon Commission Report (Recommendations for Consent-Based Siting)

(2012) o Another recommendation is that the roles, responsibilities and authorities of the local, state, and tribal governments (with respect to facility siting and other aspects of nuclear waste disposal) must be an element of the negotiation between the federal government and the other affected governmental units. . .states and tribes should retain - where appropriate , be delegated - direct authority over aspects of regulation, permitting and operations where oversight below the federal level can be exercised effectively and in a way that is helpful in protecting the interests and gaining the confidence of affected communities and citizens.

o BRC notes as one of its recommendations for future facilities, including CISFs, that successful siting for facilities will be based on:

(1) consent-based - in the sense that affected communities have an opportunity to decide whether to accept facility siting decisions and retain significant local control (2) transparent - in the sense that all stakeholders have an opportunity to understand key decisions and engage the process in a meaningful way (3) phased - in the sense that key decisions are revisited and modified along the way rather than being pre-determined (4) adaptive - in the sense that process itself is flexible and produces decisions that are responsive to new information and new technical, social, or political developments 5

(5) standards and science based - in the sense that the public can have confidence that all facilities meet rigorous, objective, and consistently-applied standards of safety and environmental protection (6) governed by partnership arrangements or legally enforceable agreements between the implementing organization and host states, tribes and local communities.

• Public Comment in Opposition to the Holtec DEIS from New Mexico Senator Jeff Steinborn, et al. Letter to U.S. Nuclear Regulatory Commission (Kristine Svinicki),

(Sept. 22, 2020) (ADAMS Accession No. ML20268C343) (emphasis added).

o We write to express our opposition to the proposed [Holtec] [CISF] and concerns about the . . .DEIS[]. This project creates unreasonable health, economic and national security risks for New Mexico and its residents. It would expose many communities to risks during the transportation and storage of high-level radioactive waste. We believe that the scope of the DEIS fails to adequately and reliably assess the risks of this unprecedented proposed project and the many technical variables that exceed national experience. Furthermore, given the impacts of shipping high-level radioactive waste across the country to New Mexico, we are very disappointed by the [NRCs] lack of appropriate adequate outreach and public engagement opportunities required by law.

o This letter of opposition to the proposed Holtec CISF was supported by signature of the following senators and representatives:

Jeff Steinborn (State Senator, District 36)

Peter Wirth (State Senator, District 25)

Shannon D. Pinto (State Senator, District 3)

Linda M. Lopez (State Senator, District 11)

Antoinette Sedillo Lopez (State Senator, District 16)

Mimi Stewart (State Senator, District 17)

Bill Tallman (State Senator, District 18)

Nancy Rodriguez (State Senator, District 24)

Elizabeth Liz Stefanics (State Senator, District 39)

Eliseo Lee Alcon (State Representative, District 6) o Many New Mexico communities oppose this proposal. In addition to opposition from the governor, the commissioner of public lands and a majority of New Mexico's congressional delegation, local governments representing close to 50%

of the population have passed resolutions opposing the [Holtec CISF] or the transportation of high-level radioactive waste through their communities, including the following:

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Town of Lake Arthur 09/07/17 City of Albuquerque 05/21/18 City of Jal 05/29/18 Bernalillo County 06/12/18 City of Las Cruces 07/23/18 Santa Fe County 09/25/18 City of Gallup 09/25/18 McKinley County 10/02/18 City of Belen 11/10/18 Church Rock Chapter Navajo Nation 08/15/18 Navajo Nation Diné Uranium Remediation Advisory Commission 11/29/18 All Pueblo Council of Governors, Representing 20 Indigenous Nations 10/17/19 o In Texas, local governments representing close to 5.4 million people have passed similar resolutions, including the following:

Bexar County 02/21/17 City of San Antonio 03/30/17 Dallas County 04/4/17 Midland County 04/24/17 Nueces County 12/16 City of Denton 10/16/18 City of Midland 11/13/18 El Paso County 11/18

• There is no permanent disposal site for the nation's high-level radioactive waste. Under the federal Nuclear Waste Policy Act of 1982, a permanent repository is supposed to be licensed before a federal government [CISF] facility can be constructed. It is premature and inappropriate to transport and store this waste in New Mexico or any other state until a permanent national strategy has been developed.

• The risks and emergency response liability to local communities is significant. According to Holtec and the DEIS, local communities and the State of New Mexico would be responsible for emergency response should an accident occur during transport of the waste.

This risk would be doubled when the waste is shipped back out of New Mexico to a permanent repository. This exposure would also exist for other communities and states along the transportation route.

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It is unacceptable to approve a national plan that does not adequately fund and execute a comprehensive emergency response capability.

• The NRC cannot predict with complete assurance the safety and performance of the dry casks and canisters for the license period or longer. The current performance history of this technology is less than the 40-year license period for the proposed [Holtec CISF].

• The Holtec HI STORM UMAX canisters, approved only a few years ago by the NRC in 2015, have had problems with design and technology. These occurrences and lack of proven technology provide a clear warning that the NRC cannot adequately consider the performance limitations and risks of storage of large amounts of high-level radioactive waste in New Mexico for this project.

• The NRC cannot account for and calculate the risks of unanticipated accidents or performance deficiency. New Mexico has experienced the high costs and risks associated with unplanned events at the Waste Isolation Pilot Plant.

• There has not been adequate community outreach for the DEIS.

There has been no consent-based citing for this proposal or any proactive interviews with affected communities about its potential impacts. This lack of involvement creates significant concerns regarding the social justice impacts to New Mexicans.

• Experts are concerned about the inability to repackage this waste on-site, either for shipment to a permanent repository or if there are cracked or corroded canisters.

• Public Comment in Opposition to the Holtec DEIS from Cheryl L. Bada, Deputy General, Energy, Minerals and Natural Resources Department (Sept. 22, 2020)

(ADAMS Accession No. ML20268C296) uploaded to ADAMS on Oct. 5, 2020 (emphasis added) o EMNRD finds the technical analysis in the draft EIS inadequate. The draft EIS does not comply with the requirements of Section 102(2)(c) of the National Environmental Policy Act as it fails to adequately describe the geological site, to conduct a thorough evaluation because of numerous technical deficiencies, to include all applicable state regulatory oversite and environmental impact controls, and to adequately assess environmental justice concerns. EMNRD strongly opposes the recommended action of approving the Holtec CISF License and instead supports the No Action Alternative.

o In addition, the draft EIS fails to consider impacts to oil and gas development in the area. In New Mexico, Nearly 40% of all state revenue in New Mexico is generated directly from oil and gas production taxes. According to the Permian Basin 8

Petroleum Association, the proposed site would threaten executed contracts with the United States for operators who have invested in leasing the area for mineral exploration and development for oil and gas production o While the NRC provided some analysis on the No Action Alternative, it did not fully meet its obligations. The NRC did not provide a detailed analysis because the alternatives either would not meet the purpose and need of the proposed project or would cause greater environmental impacts than the proposed action. (draft EIS pages xxiii - xxiv). Moreover, the NRC stated in its Waste Confidence Decision that spent nuclear fuel is safe at its current location, which is a viable No Action Alternative. It is clear the No Action Alternative is the appropriate course. The NRC neglected its obligation to the public by not including the facts and data it used to determine that the impacts of storage at a government-owned CISF, alternative design and storage technologies, an alternative location, and an alternative facility layout would either not meet the purpose and need of the proposed project or cause greater environmental impact than licensing the Holtec facility. The public has a right to review the data and provide public comment.

o The NRC stated in its Waste Confidence Decision1 that spent fuel can be stored safely beyond the operating life of a power reactor, at their current locations, until a national repository for spent nuclear fuel is established. States and regional groups have consistently supported moving the fuel only once - from current locations to a national permanent repository. Moving spent nuclear fuel multiple times increases the likelihood of accidents within the State of New Mexico and elsewhere.

o On March 26, 2020, a magnitude 5.0 earthquake struck West Texas near the New Mexico border. Additionally, two areas in the Delaware Basin have been identified with increased seismic activity during 2019 and 2020. Both locations have no prior history of seismic activity. One cluster of events has been identified in the area near the intersection of the Eddy and Lea county line just north of the state line in Township 26 South, Range 31 East, NMPM.

o The second location of seismic events is centered on Township 18 South, Range 35 East, NMPM. The United States Geological Survey Earthquake Hazard Program has recorded at least 21 events with magnitudes ranging from 3.1 to 2.3 over a three-day period in June 2020. This second location is being investigated as a possible induced-seismicity incident related to deep injection of produced water by disposal wells. This location is approximately 18 miles northeast from the proposed Holtec facility. Further, the draft EIS fails to specifically consider the long-term effects of injection related to oil and gas enhanced recovery projects and the exponential increase of commercial disposal of produced water. The expansion of disposal activities into both shallow and deep intervals has increased the 9

opportunity for induced-seismic events similar to conditions observed in oil and gas producing regions in Arkansas, Texas, and Oklahoma. Currently, there is a pending application for approval of a commercial disposal well with a proposed injection capacity of 30,000 barrels of produced water per day located approximately 228 feet west of the west boundary of the Holtec facility property.

Again, the design considerations for the infrastructure offer no specifics to this future scenario as oil and gas operations continue in the Permian Basin.

o The NRC completely failed to address known safety issues associated with transportation of spent nuclear fuel.

o The NRC did not consider the technical challenges in transporting spent nuclear fuel in any of the GAO reports, the work the NRC engaged in with states and tribes in the Ad Hoc Working Group, or the work conducted by the Western Interstate Energy Board (WIEB) High Level Radioactive Waste Committee (HLRW). Many of the challenges within the October 2014 GAO report3 were identified by experts who identified the uncertainties about the safety of newer fuel versus older fuel.

Further, the NRC provided comments in the 2014 GAO report4 to Congress regarding concerns it held on the transport of high-burn up fuels regarding hydrogen buildup and cladding becoming brittle. The DOE and the Electric Power Research Institute planned a joint development5 to investigate the high burn-up fuel, its cladding, and the cask during transport. The results would take several years with the DOE stating, their strategy would not involve transportation of large amounts of high burn-up fuels until at least 2025giving more time for the development project to yield results, o Additionally, the 2014 GAO report6 included that the guidelines for storage of SNF radiation levels are significantly different than those allowed during transportation rendering some spent nuclear fuel in storage unsuitable and potentially dangerous for transport (only about 30 percent of existing spent nuclear fuel in dry storage is cool enough to transport). The NRC assessment in the draft EIS makes no reference to these very important points regarding the transport of SNF yet implies that the Holtec facility will be licensed up to 120 years and at its maximum buildout to include the entire SNF inventory across the nation.

o The draft EIS fails to fully address and mitigate the potential for acts of terrorism or sabotage along shipping corridors in New Mexico, as is required by 10 CFR Part 73, and highlighted in Western Governors Association Resolution 2018-10, Transportation, Storage and Disposal of Radioactive Waste, Radioactive Materials and Spent Nuclear Fuel. The draft EIS fails to recognize that the acts of terrorism and sabotage do not simply impact the transportation safety of future shipments, 10

but have huge liability impacts to communities, the environment, and socioeconomic factors that should be included in the analysis. The final EIS also should recognize that NRCs licensing of the proposed Holtec facility creates liability against the federal government arising from potential acts of terrorism and sabotage during transportation of spent nuclear fuel. In addition, WGA Resolution 2018-10 calls upon the generator sites of spent nuclear fuel and high-level waste and the federal government to pay for all costs associated with assuring safe transportation, responding effectively to accidents and emergencies that may occur, and otherwise assuring public health and safety. The resolution calls upon nuclear utility companies to adequately fund state and local emergency and medical responder training and resources in case of an accident or terrorist attack while shipping spent nuclear fuel.

o The final EIS must address possible licensing conditions and NRCs obligation to evaluate and respond to adverse impacts to environmental media, e.g., soil, surface water, groundwater o The Governors Radioactive Waste Consultation Task Force is authorized by the Radioactive and Hazardous Materials Act and is comprised of Cabinet Secretaries from the EMNRD, NMED, Department of Public Safety, Department of Health, and Department of Transportation, who represent the interests of the State of New Mexico regarding the safe and uneventful transportation of nuclear waste in and through the state. The Task Force negotiates on behalf of the State of New Mexico with the federal government in all areas relating to the siting, licensing, and operation of new federal disposal facilities for high-level, transuranic, and low level radioactive wastes; conducting technical and policy analyses of related issues; recommending legislation to implement the State's policies with respect to new federal disposal facilities; identifying and disseminating information on impacts associated with those disposal facilities; and coordinating any related investigations or studies undertaken by state agencies.

o The NRC must thoroughly assess potential radiological impacts to workers to ensure incident-free transportation of SNF.

o Radiological impacts to members of the public must be minimized by incident-free transportation of SNF.

o The NRC must thoroughly assess and avoid radiological impacts to workers and the public from SNF transportation accidents and must ensure local communities are prepared to promptly and effectively respond to an accident.

o Radiological health effects references must be clarified and accessible.

o Holtecs described decommissioning and reclamation of project impacts is not guaranteed, potentially leaving New Mexico and its citizens responsible for the costs of responding to environmental and health effects of the CISF.

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o The conclusion in the Summary of Transportation Cumulative Impacts about cancer deaths from the SNF does not adequately characterize the risk to the public.

o The proposed radiological environmental monitoring and reporting program is incomplete and unclear.

• Public Comment in Opposition to the Holtec DEIS from NM Land Commissioner (ADAMS Accession No. ML20269A003) (Sept. 22, 2020) uploaded to ADAMS on Oct.

5, 2020 (emphasis added)

The nuclear waste storage/disposal application also raises significant issues with respect to transportation safety, among other concerns; however, the State Land Offices comments herein are primarily focused on errors, omissions, and unfounded assumptions in the draft Environmental Impact Statement relating to material legal, financial, environmental, and safety considerations that have a significant bearing on the proposed project.

o Holtecs proposed project is problematic for many reasons. The intended site is located in the middle of the Permian Basin, one of the worlds most productive oil and gas regions. Nearly 2,500 oil, gas, and mineral wells or sites are operated by 54 different businesses or entities within a 10-mile radius of the proposed site.

Locating a nuclear storage site above active oil, gas, and mining operations raises serious safety concerns.

o As New Mexicos Commissioner of Public Lands, it is my duty to optimize revenue for New Mexico schoolchildren and other beneficiaries while protecting the long-term health of state trust lands for future generations. By leasing state trust lands for a wide variety of uses, including farming and ranching, renewable energy, and oil and gas development, the State Land Office generates hundreds of millions of dollars each year to support the trust beneficiaries.

The State Land Office, on behalf of its trust beneficiaries, controls the mineral estate at the site of Holtecs proposed waste facility.

o Holtec actually proposes a de facto permanent storage site for nuclear waste shipped from operating, decommissioning, and decommissioned reactors across the country. Considering the initial and planned expansions, it is unlikely to actually serve only as an interim facility.

While Holtec is seeking authorization to store nuclear waste at the Site for a minimum of 40 years, DEIS at xxii, 1-2, it has made clear its intention to keep waste at the Site for more than a century. DEIS at 2-2 (noting that Holtec has indicated that it may seek to renew the license for two additional renewal periods of up to 40 years each for a total of up to 120 years). Holtec has publicly stated that it expects to break ground on the site by 2021 and 12

to accept the first shipment of nuclear waste by 2023, for which it already has booked orders. By Holtecs own estimates, the nuclear waste that it intends to acquire would remain in Lea County until 2048 at the earliest, and the company acknowledges that there is no designated permanent repository anywhere in the nation for high-level nuclear waste. DEIS at 1-2, 2-21. The company also has advertised that the Lea County site is large enough to receive all the used nuclear fuel that currently exists in the entire United States.

o In addition, the proposed location, in one of the worlds top producing oil and gas regions, could have an adverse impact on one of New Mexicos key economic engines.

o Holtec has falsely claimed to have secured agreements from oil and gas operators at or around the site to restrict these activities, specifically assuring the NRC that oil and gas drilling will only occur at depths greater than 5,000 feet. However, there are no such agreements containing these restrictions in place with oil and gas lessees at the project site or the State Land Office. One agreement has been made with Intrepid Mining LLC, a potash mining company, but that agreement has not been approved, as required by that companys lease terms, by the New Mexico State Land Office (State Land Office).

o NRC should be aware that Holtec consistently has misrepresented its prospective ownership and control of the Site. The DEIS incorrectly states that the proposed project area is privately owned by the Eddy-Lea Energy Alliance LLC. DEIS at 2-

2. While the surface estate is privately owned, the mineral estate remains the property of the State of New Mexico, held in trust and managed by the State Land Office. 11 This is not a technicality; there are real consequences that follow from Holtecs misrepresentations; despite the fact that the Site mineral estate is owned and held in trust by the State Land Office, the agency was not consulted by the NRC. See DEIS at iii, 2-29. Instead, the DEIS relies on incorrect and misleading statements made by Holtec that the State Land Office previously noted in its June 19, 2019 letter to the company and NRC (attached as Exhibit B). Had the State Land Office been properly consulted as part of this process, it would have provided NRC staff with accurate information relating to the project site and existing and potential mineral estate activities.

1 The DEIS elsewhere acknowledges that [l]and surrounding the proposed project area is either privately-owned or owned by the BLM or the State of New Mexico . The State of New Mexico owns the subsurface property rights within the proposed project area. DEIS at 3-2. The DEIS conclusions, however, are based on the incorrect assumption that Holtec (through Eddy-Lea Energy Alliance LLC, with whom it may have an agreement not disclosed in the record) controls the Site 13

o Of great concern to me, Holtec claims that it is in discussions with the New Mexico State Land Office regarding an agreement to retire potash leasing and mining within the proposed project area, DEIS at 4-4, 5-24. This statement is false. The DEIS does not indicate any analysis by NRC of actual control of mineral resources at the Site, instead simply accepting Holtecs misrepresentation as true analysis by NRC of actual control of mineral resources at the Site, instead simply accepting Holtecs misrepresentation as true.

o Given the State Land Offices mineral ownership of the land and the lack of restrictions on mineral development at the site, any claim that activities at the site have been limited is incorrect.

o Holtec has claimed in the past, and the DEIS accepts as true, that the State Land Office and its lessees will limit development of mineral resources to accommodate Holtecs intended use of the Site for nuclear waste storage and disposal. As noted above, Holtec is not in discussions with the State Land Office to limit mineral exploration and production at the site.

o Additionally, as the NRC acknowledges, DEIS at 3-6, the proposed nuclear waste facility is in an area of active oil and gas development. Holtec claims that its nuclear waste facility will have no impact on oil and gas exploration and development in the proposed project area because extraction will occur at depths greater than 930 m [3,050 ft]. DEIS at 4-6. While oil and gas production frequently take place in deeper formations, the DEIS simply assumes without discussion that no shallower development can occur now or in the future. State Land Office oil and gas leases, whose terms are prescribed by the New Mexico Legislature, do not impose any depth restrictions on oil and gas development. NRCs actions to approve Holtecs nuclear waste facility, as contemplated by the DEIS, thus could directly impair both the State Land Offices enjoyment of the full benefit of its mineral rights as well as contractual rights afforded to its oil and gas lessees.

o Relying on statements made by Holtec, the DEIS finds that construction of the proposed CISF would not have an effect on oil and gas operations within the proposed project area and that the company has no plans to use any of the plugged and abandoned wells. DEIS at 4-4. This determination is based on incorrect information and unfounded assumptions o First, this is not an assurance the company can make. The State Land Office leases the Sites mineral estate for oil and gas development. Holtec does not own, lease, or have any control whatsoever over the development of the mineral estate. The State Land Office has active oil and gas leases in the project area, which contain provisions that are intended to facilitate the extraction of oil and gas resources and generate royalties for the public schools. Oil and gas operations are conducted as deemed appropriate by the lessees, as long as the activities are in accordance 14

with the lease terms, State Land Office rules and Oil Conservation Division regulations. These leases are held by production and may remain active for decades to come. Holtec has no authority to dictate what does or does not occur with respect to oil and gas mineral estate development o Second, the DEIS incorrectly assumes that should oil and gas activities occur, they will not interfere with the project because oil and gas resources will be accessed through off-site drill islands and at depths below 3,000 feet. DEIS at 3-8, 4-5. While it may be true that targets exist at depths between 3,000 and 16,000 feet and the Belco Tetris Shallow and Belco Deep drill islands could provide an offsite location for wells, there is no assurance that this would occur. The State Land Offices oil and gas lease terms are set by statute and do not contain any depth limitations.

By law and contract, oil and gas lessees are able to explore and develop resources at any depth. Even assuming the State Land Office desired to restrict mineral development to certain depths, it would be subject to potential lawsuits for conflict with the statutory lease. (See Exhibit A). Additionally, the DEIS does not consider what environmental and safety impacts might reasonably manifest if oil and gas operations did occur at shallower depths o As the DEIS notes, potash mining is a major part of the Eddy and Lea County economies. DEIS at 5-24. Potash deposits in the immediate vicinity of the Site are considerable. Potash extraction takes place at depths shallower than 3,000 feet, DEIS at 3-9, so the DEIS conclusion that mineral development at the Site will not be impaired by the nuclear waste facility because such development will occur deeper than 3,000 feet, DEIS at 4-6, does not logically follow.

o The DEIS recognizes that the project proposal may interfere with potash mineral extraction activities at the Site but views the impact as minor considering that there are other available resources in the region. This conclusion fails to consider that the State Land Office, as the trustee of the mineral estate, is obligated to get revenue from the mineral estate that it owns for the trust beneficiary assigned to that specific tract of land, in this case the states public schools. It does not matter that resources exist elsewhere, because the State Land Offices federal and state mandate is to generate money from all the lands it manages. The DEIS notes that potash demand is likely to increase over time with increased mining over the next 20-30 years, DEIS at 5-2, and with the potential potash resources at the site worth millions of dollars, abandoning the opportunity to develop these resources would result in a significant loss of revenue for public schools.

o Furthermore, the DEIS relies on Holtecs incorrect assumption that it will be able to restrict existing and future potash mining in the area. The DEIS notes that Holtec has asserted that [t]he New Mexico State Land Office is currently in discussions with Holtec International regarding an agreement in principle to retire 15

any potash, unencumbered by regulatory restrictions, in perpetuity. DEIS at 4-4.

Discussions Holtec may have had with the previous Commissioner of Public Lands did not result in the issuance of any land use restriction, Holtec is not currently in discussions with me or my staff about such restrictions, and I have made clear that I do not intend to issue any such restrictions.

o Additionally, the EIS found that Holtec has entered into an agreement with Intrepid to relinquish certain potash mineral rights to the State of New Mexico.

DEIS at 4-4. This statement is misleading in several respects. First, any agreement to relinquish a State Land Office lease for the benefit of a third party would require the approval of the Commissioner. NMAC 19.2.3.18. This has not occurred.

Second, if the lease were simply relinquished by Intrepid back to the State Land Office, the potash resource would again be subject to leasing by another company.

Regardless, the approval of the Commissioner is legally required. As such, the safety and environmental assessments that have been conducted so far rely on the mistaken assumption that future potash leasing will not occur in the project area. 2 NRCs conclusion that Holtecs proposal will have no meaningful impacts on potash development at the Site thus is premised on incorrect or incomplete assumptions.

o State Land Office control of the Sites mineral estate is not limited to oil, gas, and potash, but encompasses all mineral resources, including caliche, sand, gravel, and other substances. See DEIS at 3-6 (Mineral extraction in the area of the proposed project area consists of underground potash mining and oil and gas extraction, and noting active State Land Office mineral leases). As the DEIS notes, the Site is located in an area of dense caliche deposits, DEIS at 3-4, 3-18, and nearby there is active sand, gravel, and quarry stone mining for various purposes, including roads and other infrastructure to support renewable energy projects in the area. DEIS at 5-24, 5-25. In addition to exercising control over mineral resources at the Site, the State Land Office is entitled to access and utilize surface lands to facilitate mineral development; [a]s holder of the dominant estate, a mineral owner has the right to use the land, both surface and subsurface, absent an express limitation, as is reasonably necessary to enjoy its property rights. XTO Energy, Inc. v. Armenta, 2008-NMCA-078, ¶ 10, 144 N.M. 212. The DEIS does not take any of these considerations into account, particularly the State Land Offices (and its lessees) right to access and utilize the Sites surface for mineral development purposes.

2 See, e.g., DEIS, Section 5.4, Geology and Soils, noting that because Holtec has entered into an agreement with Intrepid and previously discussed a leasing restriction with a prior Commissioner of Public Lands, the risk of soil subsidence from potash mining was low.

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o Holtec has not been forthcoming about the possible conflict between nuclear waste storage and current or future oil and gas development at the Site. The International Atomic Energy Agency appears top share my and State Land Office lessees concerns about the interaction between nuclear waste storage and preexisting oil and gas development on the very same tract of land. In a 2007 publication, that agency explained that [a]ny potential site will require an adequately controlled single-use land area to accommodate storage facilities, and that potential waste disposal sites should avoid land with exploitable mineral and energy resources. International Atomic Energy Agency, Selection of Away-From-Reactor Facilities for Spent Fuel Storage: A Guidebook, IAEA-TECDOC-1558 (Sept. 2007) at 3.2.2 (pp. 23-24) (emphases added). Despite Holtecs assurances, it does not appear that the company - or the NRC, through the DEIS - has undertaken a thorough and critical analysis of the potential conflicts between nuclear waste storage and the vital economic activities that are already taking place on the Site.

o The DEIS does not capture the full potential costs of the proposed project. It fails to consider the economic cost to the state and region if there were an accident that impacts the ability of companies to work in one of the most productive oil producing regions in the world. Any production decline related to a work stoppage could be hugely detrimental to the states finances, which is heavily dependent on oil and gas taxes and revenues, as well as local economies. It also fails to recognize the potential negative revenue impact to the states public schools if restrictions were put in place limiting mineral extraction at the Site.

o Additionally, the DEIS does not consider the potential serious legacy costs of an accident. If the mineral estate were to become contaminated, the ability of the State Land Office to generate revenue from the Site and nearby areas could be severely limited or rendered impossible. A radioactive mineral estate could also result in vast remediation costs, which could fall on taxpayers and trust land beneficiaries.

o . . . I strongly urge the NRC to adopt the No-Action Alternative and to not issue the proposed license to Holtec.

Concho Letter to Commissioner of Public Lands, Stephanie Garcia Richard (June 12, 2019), attached as Exhibit A.

• Unclear if State Land Office has ability to impose land use restrictions

• Letter also inquired about any existing agreement between Concho and Holtec to limit its operations in the area. Although Concho has engaged in various conversations with, and requested information from, Holtec, Concho has not entered into such an agreement.

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• If a LURC were granted to Holtec, it may amount to a condemnation of Conchos oil and gas lease. Conchos lease is already restricted because it is in a designated potash area and is therefore subject to both state and federal rules and regulations that include designating a development area and a drilling island.

• Until and unless Holtec conducts scientific studies and provides data supporting its proposed use of the subsurface without negative impact to Conchos current and future operations underneath its oil and gas lease, Concho is unable to support Holtecs proposal.

• With WIPP also came funding for substantial improvements to roads that would carry waste bound for WIPP. In addition, annual payments for numerous years were committed for purposes of maintaining infrastructure. In the case of Holtecs proposal there are no funds to improve roads or rail routes. Surely if such work was required for WIPP waste it also needs to be done for this waste. Also, in addition to federal oversight, the New Mexico Environment Department (NMED) oversees WIPPs hazardous waste facility permit to ensure compliance. It does not appear that Holtecs operations will have any state oversight.

• In addition, conditions have changed in Southeast New Mexico following WIPP's opening. The Permian Basin is now not only the most productive oil and gas basin in the United States, but it may also be the most productive basin in the world. At the very least, it is a world class oil and gas reservoir that is contributing to the energy independence of the United States, providing hundreds of thousands of jobs, and adding greatly to the economy of the state and to the revenues of state government. The dramatic increase in production has placed an incredible strain on infrastructure in the area. The shale boom has increased traffic on roadways to the point that Highway 285 is known as the death highway. Large truck traffic is constant and increasing. Adding even more large trucks carrying nuclear waste will exacerbate an already dangerous situation. A similar situation exists for transportation by rail. An increasing number of railcars transport sand and heavy equipment to the region, as well as transport oil and other products from the region. As a result of such increased activity, train derailments have increased.

By adding transportation of nuclear waste via rail and truck, transportation safety may be further compromised. Such risks must be adequately mitigated by Holtec.

• Concho is one of the largest producers of oil and gas in Southeast New Mexico and holds over 160 State of New Mexico leases.

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Concho is committed to being a long-term partner in the production of oil and gas in New Mexico. Therefore, it is important to Concho that its opportunities are not unduly limited in order to continue to provide the many benefits that come from oil and gas production.

Concho respectfully requests that the SLO carefully review Holtec's proposed plans to store nuclear fuel waste and reject their request to limit our oil and gas operations at the proposed site.

EOG Resources pleased that you included EOG in the discussion of this very important issue for the State of New Mexico.

To date, EOG has not engaged in any discussions with Holtec about its proposed operation in New Mexico, nor has EOG entered into any agreements with Holtec. Without the benefit of any such discussions or reviewing the studies and analyses upon which Holtec made its determinations about the potential impact of its operations on oil and natural gas development, EOG is unable to provide a detailed response to the Holtec proposal.

EOG is generally concerned about Holtec siting the facility in a portion of New Mexico with a high level of oil and natural gas development and could reasonably expect that such siting would impact operations as well as future drilling and development in Eddy and Lea Counties, New Mexico.

• Public Comment in Opposition to the Holtec DEIS from New Mexico Environment Department, Letter to John Tappert, NRC (Sept. 22, 2020) submitted via email and posted to ADAMS on Oct. 5, 2020 (emphasis added).

o New Mexico has grave concerns about the inadequacy of the technical analysis in the draft EIS. The inadequate conceptualization of the geologically unsuitable site, the preclusion of a thorough evaluation due to vast technical deficiencies, the lack of inclusion of all applicable state regulatory oversite and environmental impact controls, and the omission of a full assessment of environmental justice concerns all contribute to a draft EIS that negligently fails to meet the requirements of Section 102(2)(c) of the National Environmental Policy Act (NEPA). New Mexico objects strongly to the recommended action of approving the Holtec CISF License and demands the No Action Alternative.

o Given that a permanent repository for high-level radioactive waste does not exist in the United States and there is no existing plan to build one, any interim storage facility will be an indefinite storage facility, including Holtecs CISF. The License Life for the application Holtec submitted to the NRC is forty (40) years, and the License Life can be extended at every license renewal date. The Design Life for the storage facility and cask, canisters, and assemblies is eighty (80) years. The Service Life for the SNF storage site is one hundred and twenty (120) years. At this time, the NRC cannot guarantee that a permanent repository for SNF in the United 19

States will be developed in 40, 80, or 120 years, or that the proposed Holtec CISF facility will not become a permanent repository. Even 80 years of storage at the Holtec CISF amounts to impacts beyond the lifetimes of everyone involved in this environmental review and licensing decision. As early as the 1950s, the National Academy of Sciences recommended disposal of long-lived radioactive wastes in deep, geologically stable formations. Holtec, however, proposes to bury highly radioactive and toxic SNF to a depth of only 50 feet in an area that is underlain by shallow groundwater and subject to concerns about ground subsidence and sinkhole development. Holtecs proposed CISF site does not provide deep geologic isolation for indefinite SNF storage, and the proposed site is unsuitable for SNF storage over a period of decades. Therefore, New Mexico prefers the No Action Alternative. See comment 4 below for further discussion of karst and seismicity. Therefore, New Mexico prefers the No Action Alternative. See comment 4 below for further discussion of karst and seismicity.

o The draft EIS asserts that the CISF project area has a low potential for sinkhole development based on the absence of thick sections of soluble rock near the land surface. The CISF site, however, is located in an area of well-documented concern for development of both recent anthropogenic and long-term natural 5 geologic karst features such as sinkholes.2, 3, 4, 5, 6, 7, 8, 9 The draft EIS makes inconsistent statements regarding the origin of topographic depressions in the region, many of which have been attributed to karstic collapse of the land surface in response to underlying salt and evaporite dissolution. Indeed, lithologic borings located within the proposed Holtec facility encountered slickensides, vertical to sub horizontal fractures of many inches in length, highly fractured zones, and the presence of moisture in core sections in the Chinle Formation. The presence of subsurface deformation, fracture zones and moisture in post-Permian rock contradicts the draft EIS assertion of low risk for sinkhole development.

o Oil and gas operations and potash mining also have created ground subsidence and sinkholes in the region. Dissolution of the Salado Formation associated with oil and gas operations is the primary cause of the Jal, J.W.S., Winks 1&2, Denver, and the I&W brine well sinkholes. There are at least 18 abandoned and plugged wells located on the property that could contribute to the formation of sinkholes if the casing on these wells has been compromised. There is one plugged saltwater disposal well located north-east of the property boundary that could contribute to sinkhole formation and potential subsidence. Additionally, ground subsidence related to potash mine workings, as has been documented in the region, must be evaluated in greater detail as a potential risk to the stability of the CISF facility.

o The draft EIS asserts that operation of the proposed CISF project would not be expected to impact or be impacted by seismic events. The draft EIS provides 20

general information about the history of earthquakes in the region, including a brief reference to earthquakes caused by fluid injection by the oil and gas industry, and asserts that CISF infrastructure will be designed to withstand seismic events, but does not provide specific information about these safeguards. Section 3.4.4 of the draft EIS discusses earthquakes that have occurred in the region, including one near Eunice, NM, with magnitudes of 5.0 or greater. On March 26, 2020, a magnitude 5.0 earthquake struck West Texas near the New Mexico border.

o The sources used for the seismicity section of the draft EIS should include more recent research including the updated model of the reference used for the seismic hazard map and current seismic monitoring by the Texas Bureau of Economic Geology TexNet project and the New Mexico Tech Seismological Observatory.

o Additionally, the 2014 GAO report14 included that the guidelines for storage of SNF radiation levels are significantly different than those allowed during transportation rendering some spent nuclear fuel in storage unsuitable and potentially dangerous for transport (only about 30 percent of existing spent nuclear fuel in dry storage is cool enough to transport). The NRC assessment in the draft EIS makes no reference to these very important points regarding the transport of SNF yet implies that the Holtec facility will be licensed up to 120 years and at its maximum buildout to include the entire SNF inventory across the nation.

Additionally, the state of New Mexico has been actively engaged with the NRC through the DOE-NE office Rail/Routing Ad Hoc working group to identify issues related to transportation of SNF to investigate these uncertainties. The NRC did not include any of the work conducted over the life of the Ad Hoc Working Group in its bounding analysis.

o The draft EIS and supporting documents do not address the weight capacity of existing rail systems or the new rail spur proposed for construction in New Mexico. The weight capacity of rail systems is specified as weight per axle of the rail car. A rail car with 8 or 12 axles can carry a cask without exceeding any limitation, but 12 axles will not take sharp turns, and speed is a factor. The transportation from reactor sites to the proposed storage site in New Mexico is a potential risk that must be adequately addressed in order to maximize risk reduction for New Mexico residents and the environment. Additionally, the Federal Rail Administration has established the S2043 rail car as the standard. The draft EIS fails to incorporate how this standard will be met in transportation planning with the licensee, shipper/railroad industry o Section 4.5.1 of the draft EIS states that the primary impact of a contaminant release to surface water would be from runoff from the impervious SNF storage pad.

Section 4.5.1.1.2 of the draft EIS, however, states that there is no potential for a liquid pathway (such as runoff) to contaminate nearby surface waters with 21

radioactive materials. In addition to being contradictory with regard to off-normal and accidental incidents that might release contaminants to surface water runoff, these statements do not address the possibility that groundwater also might transport contaminants from the proposed storage facility to surface water in nearby playas.

o Any release of contaminants to shallow groundwater at the proposed Holtec CISF site is significant with regard to the potential for contaminants to migrate into water supply wells, springs and playas in the area. Even if some groundwater contains elevated salinity, the migration of contaminated groundwater to springs and playas could create hazards to public health and the environment. These potential human and ecological exposure pathways must be evaluated.

o The draft EIS fails to fully address and mitigate the potential for acts of terrorism or sabotage along shipping corridors in New Mexico, as is required by 10 CFR Part 73, and highlighted in Western Governors Association Resolution 07-02, Expectations of Safety and Security of Shipments. The draft EIS fails to recognize that the acts of terrorism and sabotage do not simply impact the transportation safety of future shipments, but have huge liability impacts to communities, the environment, and social-economic factors that should be included in the analysis.

The final EIS also should recognize that NRCs licensing of the proposed Holtec facility creates liability against the federal government arising from potential acts of terrorism and sabotage during transportation of spent nuclear fuel.

o In addition, Western Governors Association (WGA) Resolution 07-02 calls upon the NRC to fully address the consequences of attacks against all components of the nuclear waste handling and transport system, to include: attacks against transportation infrastructure, the theft of a shipment, use of high-energy explosives against a shipment cask, and direct attacks against a shipment cask using antitank missiles or other armament that could cause a loss of containment. WGA further requests that NRC strengthen its efforts to share information with state and local governments regarding spent fuel shipment vulnerabilities and consequences, recognizing that sharing of information must be conducted within the framework of preventing the release of sensitive or classified information to individuals without a need to know. The WGA Resolution 2018-10 calls upon the generator sites of spent nuclear fuel and high-level waste and the federal government to pay for all costs associated with assuring safe transportation, responding effectively to accidents and emergencies that may occur, and otherwise assuring public health and safety. Additionally, the Resolution calls upon nuclear utility companies to adequately fund state and local emergency and medical responder training and resources in case of an accident or terrorist attack while shipping spent nuclear fuel.

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o The draft EIS does not contain any provision for groundwater monitoring. This is a critical omission given that shallow groundwater exists at the site; this groundwater must be monitored for any evidence of a release into the subsurface.

The draft EIS, 2017 Environmental Report, and Safety Analysis Report (SAR),

Rev. H17 all acknowledge the presence of discontinuous and variable-depth groundwaters at the proposed CISF site and the potential for shallow groundwaters in the vicinity that may be controlled by playa lake levels. Despite three current groundwater monitoring wells and the need for additional groundwater characterization as specified in the SAR, Rev. H, and as noted in the CIS Facility Environmental Report, baseline groundwater monitoring, sampling, and testing will be performed prior to construction of the facility in order to establish baseline measurements, the Surface Water and Groundwater Monitoring subsection within Section 7.3 of the draft EIS specifies no groundwater monitoring and fails to mention the applicants planned 12-month groundwater characterization study which includes additional monitoring wells.

o . In addition, based on NMEDs experience with construction projects, the Department is surprised by the statement in the draft EIS that hazardous wastes are not anticipated to be generated during construction. Table 2.2-3. of the draft EIS does not address a drain system in either the Cask Transfer Building or the Storage Building and does not address where that drain system would discharge. NMED considers the possible mismanagement of hazardous waste to pose a substantial threat to the environment, including groundwater and surface water, and therefore requires a thorough evaluation in the final EIS. As the draft EIS does not describe management of hazardous waste, NMED is concerned about these materials ending up in stormwater that leaves the facility. The playas are regulated Surface Waters of the State and subject to Water Quality Standards at 20.6.4 New Mexico Administrative Code (NMAC) promulgated under New Mexicos Water Quality Act. 18 Before operation, the facility would be required to submit a Notice of Intent to Discharge to the NMED pursuant to 20.6.2.1201 NMAC. The draft EIS fails to describe any measures Holtec will take during facility construction and operation to mitigate or treat stormwater and other discharges from the facility prior to discharge into the playas. Section 4.5.1.1.1 (Construction Impacts).

o The draft EIS makes repeated, yet unsubstantiated, assertions that the Proposed Action will result in no disproportionately high and adverse human health and environmental effects. Given the geologic unsuitability of the proposed site, and the numerous other technical deficiencies as discussed above however, the draft EIS fails to demonstrate that residents of New Mexico, including vulnerable populations, will be adequately protected from exposure to the radioactive and toxic contaminants that could be released to air and water by the Proposed Action.

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o Holtec not included or proposed in Section 4.3.1.3 on Decommission and Reclamation Impacts any surety and warranty proposal to the State of New Mexico to ensure that site reclamations will be funded to the fullest extent. If Holtec should experience financial challenges or unplanned setbacks, this could require New Mexico to fund and direct any remaining decommissioning and reclamation needed to protect its citizens and to restore the environment.

• Texas Governor Greg Abbott Letter to the U.S. Nuclear Regulatory Commission (Nov. 3, 2020).

• Additional Public Comments in Opposition to the Holtec DEIS from:

o Nevada Attorney General Public Comment to U.S. Nuclear Regulatory Commission (Sept. 22, 2020), uploaded to NRC website on Oct. 5, 2020 (ML20267A637) o Scott Kovac, of Santa Fe, New Mexico Public Comment from Nuclear Watch New Mexico (Sept. 22, 2020), uploaded to NRC website on Oct. 5, 2020 (ML20268C322) o Citizen Action NM Public Comment (Sept. 21, 2020), uploaded to NRC website on Oct. 5, 2020 (ML20267A107) o Nevada Attorney General Public Comment to U.S. Nuclear Regulatory Commission (Sept. 22, 2020), uploaded to NRC website on Oct. 5, 2020 (ML20267A637) o 9/22/2020 Deborah Reade of Santa Fe, New Mexico Public Comment NM Threats Map (uploaded by NRC on 10/5/2020) (ML20267A620)

• So far NRC has provided only a pitifully few in-person hearings/meetings in New Mexico and has provided a similarly pitiful range of materials in Spanish and Diné for Low English Proficiency (LEP) persons. The latest move to provide no in-person meetings but only 5 online meetings has discriminated against the very people most affected by the project in Lea and Eddy Counties, including the large numbers of minority and LEP persons in those counties.

• Clearly NRC has ignored this and cut out the very people who should, perhaps, have the most to say about the facility. Both New Mexico's senators have also questioned this practice of eliminating in person meetings, wondering why the rush? Why can't we wait another year until it's safe to include all the affected communities in 24

in-person meetings? It sure feels like dealing with public participation is just a bother to NRC and that you've already made up your minds about the project. we are just an inconvenient waste of your time.

• The lack of translation of materials and the lack of in-person meetings also make it clear that again, NRC, really doesn't care about LEP persons or the minority people living near the site or along the routes. This is discriminatory.

• NRC has declined to provide meetings along the routes, or even to designate the routes properly, trying to limit discussion to the facility itself and to ignore facility transportation completely. This is segmentationdividing one project into smaller parts and only looking at each part independently. This is not allowed by NEPA to which the Holtec project is subject.

• Site location: Really, Holtec couldn't have picked a worse place for this CIS. This is the most important oil and gas producing basin in the world. Until the pandemic, more drilling was going on in Southeast New Mexico than at any point in time and historically, oil and gas production has been a primary economic support of the state through taxes and royalties. Agriculture, ranching and tourism also bring in more than $605,000,000 in income. An HLW release into the air, water or soil could have catastrophic repercussions on these industries.

• Besides the danger to oil and gas development, that development itself has also affected the geology of the area. The land is heaving and sinking throughout the Permian Basin (where Holtec is located) with major sinkholes in several places including one nearby that threatens a road and structures. This is the result of older oil and gas development. Newer development adds fracking to brine injection, and both are causing an increase in man-made seismic events.

Because of the enormous number of wells in the area, this is an increasing problem. There need to be more studies of seismic events of different kinds and how they will affect un-cracked as well as partially and through-wall cracked canisters. How they will affect the complete Vertical Ventilated Modules (VVM) is also important to know. And an increase in frequency and strength of these events must be assumed as they are already following that pattern.

Incorporating these geological events into a study of the suitability of the site and extrapolating into the future for increased fracking 25

and seismic events must be modeled or the DEIS will continue to be inadequate.

• In addition, this is one of the largest karst areas in the world which must also be thoroughly explored. Years of exploratory drilling and study went into the WIPP site EISs and no less should be done here.

Karst areas and areas with high resource development like southeastern New Mexico are really totally unsuitable for a waste storage or disposal facility. This alone should make the site unacceptable. A CIS shouldn't be sited in such an unsuitable location simply because ELEA owns land there. If ELEA and Holtec want to continue, they must be able to show that the site actually is suitable both in hydrology and geology and that the extensive resource development in the area will not affect the site nor be affected by the facility. This has not been adequately done in the DEIS and is another reason why the DEIS is inadequate.

• NRC seems to be following several unsupported assumptions in its approach to the safety of facility transportation. First, it is assumed that there will be no through wall cracks in the thin-walled canisters.

Second, it is assumed that there will be no transportation accidents with canister leaks. Finally, it is assumed that the damage caused to the canisters each time the waste is transferred will be insignificanteven though the waste will be transferred at least 4 times to Holtec, 4 more if transported to Yucca Mountain and even more times if transferred to TADs. None of these is a conservative or prudent assumption, but these are relied on in the DEIS. (For instance, the TADs aren't even addressed in the Holtec ER or the NRC DEIS even though transferring to TADs would result in significant risks.)

• It is reckless to allow canisters to be used at all that can't be inspected and can't be repairedespecially when thick-walled, safer canisters that can be both fully inspected and repaired are already available.

It is reckless and irresponsible to have no plan for a hot cell at Holtecthe only way to repair canisters that can be fixed. This again assumes there will never be a problem with the canisters and there will never be even a single instance of serious human error.

Instead, what is more likely to be the case is something like what occurred at the WIPP project where for 15 years the HEPA filters sat in their HEPA filter banks where everyone had forgotten to fill in the spaces between each filter. When the explosion did occur, the 26

release went out through the filters, but it also went out straight into the environment through the un-filled spaces between the filters.

This is human error.

• The DEIS assumes that Yucca Mountain will open as an HLW disposal repository. However, this is disingenuous. There is no certainty that Yucca Mountain will ever open or that the canisters will be in any shape to be transported to it if it does. After 40 or 100 or 300 years the canisters might be too delicate to move again, or because the risk of another 10,000 or more shipments across the country including 4 or more transfers, might by then be recognized as being extremely dangerous under any circumstances, there is a very real possibility that this hastily conceived and cheaply built "storage" facility might become a permanent repository. Then we will have a shallow, permanent HLW disposal facilityforever in southeast New Mexico. Then these delicate canisters will need to remain "perfect" for hundreds of thousands of years as will the monitoring and maintenance of the VVMs. That Holtec or Holtec and WCS will become permanent repositories is a credible outcome and is inadequately addressed in the DEIS

• Another unsupported assumption is that NRC and Holtec can get Congress to change the law that now prohibits DOE transportation and a CIS storage facility at all until a permanent repository actually exists. This is just so a "temporary" CIS does not become a permanent disposal facility and NRC is trying to find a way around this law. Again, why the rush? Why not follow proper procedure and either create a permanent repository first as the law requires, or change the law first and then start the licensing process for a CIS facility?

• Another possibility is that even if Yucca Mountain does open, the canisters will be too delicate to be transported that far, but that they could still be transported just a few miles to WIPP. New Mexico was promised that WIPP would never take HLW but right now DOE is working to do just that. Holtec has promoted WIPP (a "nearby facility") for HLW disposal in their presentations even though there are serious questions about the interaction of HLW with the WIPP salt and questions about whether adding the high level waste could create accelerated escape pathways for itself and for the transuranic waste that is already emplaced there. If the canisters start to crack and leak this will seem like a great alternative to everyone but the 27

people in New Mexico who will have to make HLW a permanent part of their lives for generations to come. Again, this is a credible outcome and is inadequately addressed in the DEIS.

• Holtec CEO Krishna Singh has been caught trying to bribe whistleblowers to keep them from revealing widespread quality assurance violations in Holtec's containers. He was implicated in another bribe to a TVA official and got caught lying about it on an official form. Why would we want to license a facility with a company that is so corrupt it has been banned and barred from doing business with the TVA? Why would NRC have any illusions that a company like that would follow the letter of the law or put safety first? Again, NRC doesn't seem to care at all about the health or safety of the citizens of this country or their environment.

• NRC must choose the no-action alternative for this project. It is a project that has been conceived in haste and is being continued as cheaply as possible in a reckless and irresponsible way. You can't do Nuclear Safety Lite. Real safety is not cheap. This "Safety is a Journey" approach was the attitude at Los Alamos National Laboratory (LANL) and WIPP that resulted in an explosion and release. The same reckless attitude with this project could kill and disable hundreds of thousands and render southeast New Mexico uninhabitable.

• This project is based very little on scientific and technical knowledge and a lot on fantasy, magical thinking, and NRC's choice to ignore the many red flags that this project waves. This is a recipe for disaster. This approach, combined with NRC's refusal to include anyone but the most minimal number of communities in the public process shows that this is a political project that NRC is pursuing to show the reactor sites that the government is at long last meeting their commitments. Somehow the people of this country have been forgotten, as risks to those living along the routes or near the CIS site are being completely ignored.

• NRC must stop wasting time on Holtec (and WCS) and start switching immediately to thick-walled containers that can be fully inspected and repaired. It is true that there are some reactor sites that are not suitable for dry cask storage facilities for various reasons.

But most of the sites are suitable. HLW should remain at the site or be moved to a dry cask storage site built as close as possible to the original site to minimize transportation risks as required by the 28

NWPA. (And built in a suitable locationnot, for instance, at what is now or soon will be the high tide line, as they've chosen to do at San Onofre.)

• Holtec DEIS 3 o The favorable siting 36 factors Holtec used included (i) private ownership of the land; (ii) equal distance between the 37 cities of Hobbs and Carlsbad, which optimized access for housing, jobs, supplies and other 38 support; (iii) proximity to U.S. Highway 62/180, which provided an advantage for transporting 39 SNF; and (iv) Federal land south of the proposed site offered a potential for expansion of the 40 facilities if needed. The site with the favorable factors was put forward in the Holtec license 41 application (Holtec, 2017, 2019 a,b). Holtec also reviewed the eight criteria that were developed 42 for the GNEP facilities and determined that electricity capacity and water availability were not as 43 important as the other six criteria, because the CISF would not require significant amounts of 44 either.

Holtec stated in its ER (Holtec, 2019a) that neither electric capacity nor water availability 45 were factors that affected the selection of Site 1 for the GNEP nuclear facilities. 4 o Socioeconomics 5 Construction: Impacts would be SMALL to MODERATE and beneficial. The NRC staff 6 anticipates that economic impacts could be experienced throughout the 80-km [50-mi] region 7 of influence (ROI) surrounding the proposed project area as a result of peak employment 8 (135 workers per year) of the proposed CISF project [i.e., concurrent construction and 9 operations stages for the proposed action (Phase 1)] and associated revenue and tax 10 generation.

Expenditures for goods and services to support the peak employment of the 11 proposed CISF project would occur both inside and outside the ROI. The NRC staff recognizes 12 that not all individuals in the ROI are likely to be affected equally; however, most community 13 members would share, to some degree, in the economic growth the proposed CISF project 14 would be expected to generate.

Furthermore, the NRC staff estimates a population growth in 15 the area of less than 0.1 percent, which is not likely to cause adverse impacts on housing, 16 schools, or other public services. Therefore, the NRC staff concludes that socioeconomic 17 impacts resulting from construction of the proposed action (Phase 1) and Phases 2-20 18 (including full build-out) would be SMALL for 33 See Environmental Impact Statement for the Holtec Internationals License Application for a Consolidated Interim Storage Facility for Spent Nuclear Fuel and High-Level Waste, Draft for Comment, NUREG-2237 (March 2020) (ADAMS Accession No. ML20069G420), herein after Holtec DEIS.

4 Holtec DEIS at 2-24.

29

population, employment, housing, and public 19 services and MODERATE and beneficial for local finance.

The proposed CISF project area is in a region of active oil and gas exploration and 15 development, with producing oil and gas fields, support services, pipelines, and compressor 16 stations. Compressor stations are used to pump oil and gas through pipelines. The locations of 17 compressor stations surrounding the proposed CISF project area are shown in EIS Figure 3.2-6. 18 Other facilities related to oil and gas activity in the area include the Zia Gas Plant located 19 approximately 11.6 km [7.2 mi]

northwest of the proposed CISF project area and the R360 (a hydrocarbon remediation landfarm) located 3.2 km [2 mi] southwest of the proposed CISF 2 project area (EIS Figure 3.2-6). 3 Wells associated with past and present oil and gas exploration and development within and 4 surrounding the proposed CISF project area are shown in EIS Figure 3.2-7. The eastern portion 5 of the proposed CISF project area has 18 plugged and abandoned oil and gas wells.

However, 6 none of these plugged and abandoned oil and gas wells are located within the area where the 7 proposed CISF pads would be located or where any land would be disturbed. The closest 8 plugged and abandoned well to the storage and operations area is approximately 0.65 km 9 [0.4 mi] to the east. There is one active oil/gas well on the southwest portion of Section 13 that 10 operates at minimum production to maintain mineral rights. 5 o All oil and gas production horizons in Eddy and Lea Counties, New Mexico, are older (and 12 therefore deeper) than the Salado Formation (Cheeseman, 1978). In the area of the proposed 13 project area, the Salado Formation occurs at depths of 549 to 914 m [1,800 to 3,000 ft] below 14 ground surfaces. Oil and gas exploration targets within and surrounding the proposed project 3-8 Figure 3.2-7 Oil and Gas Industry Wells Within and Surrounding the Proposed CISF Project Area (Source: NMOCD, 2016) 1 area range from relatively shallow oil and gas at approximately 930 to 1,524 m [3,050 to 2 5,000 ft] in upper and middle Permian formations (EIS Section 3.4.1.2) to deep gas targets in 3 5

Holtec DEIS at 3-7.

30

middle Paleozoic formations in excess of 4,877 m [16,000 ft]

deep (ELEA, 2007). The Belco 4 Tetris Shallow and Belco Deep drill islands are located approximately 0.4 km [0.25 mi]

and 5 0.8 km [0.5 mi] west of the proposed project area, respectively, and the Anise Tetris drill island 6 is south of the proposed project area. The no-longer-proposed Green Frog Café drill island 7 would have been located just outside the eastern boundary of the proposed project area 8 (Holtec, 2017, 2019c). These drill islands were established by the BLM in consideration of 9 appropriate oil and gas technology, such that wells can be drilled from the drilling islands to 10 effectively extract oil and gas resources, while managing the impact on underground potash 11 resources (77 FR 71814; December 4, 2012). The drill islands can accommodate multiple oil 12 and gas well locations. 6 o 13 Potash is a major resource in the area of the proposed project. Numerous potash boreholes 14 have been drilled in areas surrounding the proposed CISF project area, and there are potash 15 leases both within and on land adjacent to the proposed CISF project area. Underground 16 potash in the area of the proposed project is owned by BLM or the State of New Mexico and is 17 leased to potash production companies. Potash beneath the proposed project area is owned by 18 the State of New Mexico and is leased to Intrepid Mining LLC (Intrepid). Potash surrounding the 19 proposed project area is leased to various potash production companies, including Intrepid, 20 Mosaic Potash, and Western Ag-Minerals. 21 Intrepid operates two underground potash mines (Intrepid North and Intrepid East), within 22 9.6 km [6 mi] of the proposed CISF project area (EIS Figure 3.2-6). The Intrepid North mine, 23 located to the west, is no longer mining potash underground; however, surface facilities are 3-9 1 currently being used in the manufacture of potash products. The Intrepid East mine, located to 2 the southwest, is still mining underground potash ore (Holtec, 2019a). The potash in these 3 mines is extracted from the Permian Salado Formation at depths of approximately 1,800 to 4 3,000 ft (Holtec, 2019b). The closest mined potash is approximately 3.2 km [2 mi] from the 5 southwestern boundary of the proposed CISF project area. However, the closest active potash 6 mines are at a distance of approximately 6.8 km [4.2 mi] from the proposed CISF project area 7 (Holtec, 2019b). 7 o Community Services 2 Similar to the ongoing regional housing planning and development efforts described in 3 Section 3.11.3 (Housing), community infrastructure projects such as water and electrical utility 4 expansions, roadway 6

Holtec DEIS at 3-7 to 3-8.

7 Holtec DEIS at 3-8 to 3-9.

31

expansions, a new fire station in south Carlsbad, and Carlsbad main 5 street enhancements are planned in the ROI (City of Carlsbad, 2018; State of New Mexico 6 Interstate Stream Commission Office of the State Engineer, 2016). 7 Andrews, Texas, is positioned to support community initiatives in the next several years, 8 including further developing the downtown streetscape and business parks and securing 9 long-term water needs (City of Andrews, 2019). Gaines County continues to heavily invest in its 10 agribusiness, and the City of Seminole is considering transportation improvements for truck 11 traffic (Seminole Economic Development Board, 2018; Permian Basin Regional Planning 12 Commission, 2015) 8 o Community Services 2 Similar to the ongoing regional housing planning and development efforts described in 3 Section 3.11.3 (Housing), community infrastructure projects such as water and electrical utility 4 expansions, roadway expansions, a new fire station in south Carlsbad, and Carlsbad main 5 street enhancements are planned in the ROI (City of Carlsbad, 2018; State of New Mexico 6 Interstate Stream Commission Office of the State Engineer, 2016). 7 Andrews, Texas, is positioned to support community initiatives in the next several years, 8 including further developing the downtown streetscape and business parks and securing 9 long-term water needs (City of Andrews, 2019). Gaines County continues to heavily invest in its 10 agribusiness, and the City of Seminole is considering transportation improvements for truck 11 traffic (Seminole Economic Development Board, 2018; Permian Basin Regional Planning 12 Commission, 2015) 9 o 18 During construction of the proposed action (Phase 1), infiltration of stormwater runoff and leaks 19 and spills of fuels and lubricants can potentially affect the groundwater quality of near-surface 20 aquifers. Holtecs required NPDES permit and Section 401 certification conditions, if required, 21 would set limits on the amounts of pollutants entering ephemeral drainages that may be in 22 hydraulic communication with alluvial aquifers at the proposed project. To minimize and prevent 23 spills, Holtec would develop and abide by a SPCC Plan. The NPDES permit, Section 401 24 certification conditions (if required), and associated SWPPP would specify additional mitigation 25 measures and BMPs that Holtec would implement to prevent and clean up spills. If required, 26 the groundwater discharge permit would further limit the amounts of pollutants allowed to 27 infiltrate into groundwater. 28 In summary, for the construction stage of the proposed action (Phase 1), potable water would 29 be supplied by a new water line that is capable 8

Holtec DEIS at 3.11.5 Community Services at 3-94.

9 Holtec DEIS at 3-94.

32

of supporting the water demands of all support 30 buildings and the concrete batch plant. Excavation of site soils and alluvium for construction of 31 the SNF storage modules is not expected to encounter groundwater, because groundwater is not 32 encountered consistently within the proposed project area and is therefore discontinuous and at 33 sufficient depth below the excavation depth. The NPDES construction permit requirements, 34 Section 401 certification conditions (if required), groundwater discharge permit requirements (if 35 required), and implementation of the required BMPs would protect groundwater quality in shallow 36 aquifers. Specifically, the NPDES permit requirements would provide controls on the amount of 37 pollutants entering ephemeral drainages and specify mitigation measures and BMPs to prevent 38 and clean up spills. Therefore, the NRC staff concludes that the impacts to groundwater during 39 the construction stage of the proposed action (Phase 1) would be SMALL. 10 o Expenditures for goods and services to support the peak employment of the proposed CISF 32 project [i.e., concurrent construction and operation stages for the proposed action (Phase 1)] 33 would occur both inside and outside the ROI.

The NRC staff estimates that applicants purchase 34 approximately 10 percent of their construction materials locally (NRC, 2016); however, Holtec 35 did not provide a detailed estimate of the types and quantities of materials or where materials 36 would be purchased or sourced; therefore, a detailed analysis of the sources for these materials 37 and supplies has not been conducted, and the estimated tax implications from these purchases 38 are not evaluated in this EIS.

The NRC staff did contact the Lea County Economic 39 Development Corporation (LCED) for information on local source materials (Gobat, 2019). The 40 LCED provided the NRC staff with a list of development service providers and suggested that 41 many of the materials needed for the proposed action (Phase 1) should be available for 42 purchase within Lea County, including concrete, steel, gravel/sand, electrical components, and 43 fencing (Gobat, 2019). 11 o In addition to the impacts from direct and indirect revenue and job generation, socioeconomic 14 impacts may include impacts to existing resources. Comparing the estimated number of 15 school-aged children that would move into the ROI (12-32 children as shown in Table 4.11-2) to 16 the total amount of students in the ROI during the 2014-2015 school year (32,669 students, as 17 discussed in EIS Section 3.11.5), the addition of up to 32 school-aged children in the ROI would 18 represent an increase of 0.1 percent. The proposed CISF project would be located within the 19 area served by the Hobbs Municipal School district. Given that the 10 Holtec DEIS at 4-35.

11 Holtec DEIS at 4-74.

33

ROI includes 4 counties and 20 that workers have the option to live in several communities in those counties, the NRC staff 21 determines that it would be unlikely that all school-aged children who move into the ROI would 22 attend schools of the same school district, or that the increase of school-aged children would 23 exceed 0.1 percent in any school district within the 4-county socioeconomic ROI. As provided in 24 EIS Table 4.11-1, the NRC staff determines that an increase of less than 0.1 percent population 25 growth would result in a small impact. The NRC staff applied this concept to the school districts 26 to estimate potential impact from the addition of new students moving into the ROI during peak 27 employment with concurrent construction and operations for the proposed action (Phase 1), 28 which would be small. 12 o Therefore, the NRC staff expects that there would not be a detectable increase 14 in the demand for fire protection or law enforcement services and that existing fire protection 15 and law enforcement personnel, facilities, and equipment would be sufficient to support the 16 population increase. Similarly, a ROI population increase of less than 0.1 percent would not 17 measurably increase the demand for hospital and physician services. As provided in EIS 18 Table 4.11-1, the NRC staff determine that a less than 1-percent increase in local revenue 19 would result in a small impact on public services, and an increase of less than 0.1 percent of the 20 overall population in the ROI would also result in a small economic impact. 21 In summary, the NRC staff concludes that economic impacts could be experienced throughout 22 the 80-km [50-mi] ROI surrounding the proposed project area, as a result of peak employment 23 of the proposed CISF project [i.e., concurrent construction and operation stages for the 24 proposed action (Phase 1)]. While the NRC staff anticipates that impacts on population, 25 employment, housing, and public services would be SMALL, and impacts on local finance would 26 be MODERATE and beneficial, the NRC staff also recognizes that not all individuals in the ROI 27 are likely to be affected equally. For instance, not all residents utilize community services such 28 as schools, fire, police, and health benefits at the same rate. However, most community 29 members would share, to some degree, in the economic growth expected the proposed CISF 30 project would expect to generate. The NRC staff have not conducted additional analyses to 31 determine how the benefits are likely to be distributed among persons or potential beneficiaries 32 in the ROI. 13 o Although the NRC staff determines that the anticipated increase in population would result in a 21 small impact on public services, as discussed in Section 12 Holtec DEIS at 4-75. Notably fails to mention the impact of Intrepid agreement, not yet approved by the State Land Office, which would impact the funding for such schools.

13 Holtec DEIS at 4-76.

34

4.11.1.2, the NRC staff also recognize 22 that the presence of a facility that stores nuclear materials may require additional preparedness 23 of first responders in the event of an incident requiring fire, law enforcement, and health service 24 support. Holtec did not provide a detailed estimate of the additional training and equipment that 25 would be necessary to respond to an incident at the proposed CISF project that are not 26 currently available to first responders, and no studies have been conducted by local agencies or 27 officials with this type of information. Therefore, a detailed analysis of the costs associated with 28 these potential additional resources are not evaluated in detail in this EIS, but NRC has 29 considered first-responder training further in the following paragraphs 14 o Carriers and shippers are required to prepare emergency response plans and provide 31 assistance and information to emergency responders under ANSI N14.27-1986(R1993). The 32 DOT, together with its counterparts in Canada and Mexico, published the 2016 Emergency 33 Response Guidebook, (DOT, 2016) for carriers and State and local first responders to use 34 during the initial phase of an accident involving hazardous materials. . . States are recognized 38 as responsible for protecting public health and safety during transportation accidents involving 39 radioactive materials. Federal agencies are prepared to monitor transportation accidents and 40 provide assistance, if States request them to do so. Eight Federal Regional Coordinating 41 Offices, DOE-funded, are maintained throughout the U.S. Personnel in these offices, are on 42 24-hour call, and are capable of responding to such emergencies with equipment and experts 43 that could advise on recovery and removal of the cask and site remediation (DOT, 2016). 44 Additionally, any event involving NRC-licensed material that could threaten public health and 45 safety or the environment would trigger special NRC procedures.

o Affected communities may be able to obtain emergency response financial assistance 2 necessary for training and equipment from other sources or Federal programs or other sources. . . However, the NRC staff recognize that if 8 SNF is shipped to a CISF, some States, Tribes, or municipalities along transportation routes 9 may incur costs for emergency response training and equipment that would otherwise likely be 10 eligible for funding under NWPA Section 180(c) provisions if the SNF were shipped by DOE 11 from existing sites to a repository. Because needs of individual municipalities along 12 transportation routes and the costs of this training and equipment vary widely, quantification of 13 such would be speculative. Furthermore, how the States may distribute funding for first14 14 Holtec DEIS at 4-78.

35

responder training and equipment to local municipalities is not within NRCs authority and is 15 beyond the scope of this EIS.

o The 9 proposed CISF project area is located in the middle of the Permian Basin oil hub, near the 10 Lea County and Eddy County borders. Lea County and Eddy County are consistently the top 11 two producers of oil in the State and rank in the top five in gas production (Sites Southwest, 12 2012). The oil and gas industry in the region is anticipated to continue to have stable production 13 output with some expansion over the foreseeable future (EIA, 2019a; BLM, 2018). Both 14 counties have economies driven by the oil and gas industries, which tend to cycle through 15 periods of booms and busts, resulting in the push for both Lea and Eddy County to diversify 16 their local economies while still supporting continued development of oil and gas industry 17 infrastructure and support services, such as additional housing and improved water systems 18 (Lea County, 2005; Consensus Planning, 2017). 15 o Caliche is mined near the surface and is crushed for use in surface roads and pads for the oil 2 and gas industry, as well as other road construction activities. There is one caliche mine in 3 Eddy County, and although caliche forms the basis of the Llano Estacado throughout northern 4 and central Lea County, desirable caliche only occurs sporadically in the southern portion of 5 Lea County (Consensus Planning, 2017; BLM, 2018). Both Lea County and Eddy County have 6 high potential for the development of caliche, and as the oil and gas industry continues to grow 7 over the next 20 to 30 years, the demand for caliche will increase (BLM, 2018). 16 o 13 Historically, there were 32 permitted brine well operations in New Mexico, with the majority of 14 those located in Lea and Eddy County. After a collapse of two brine wells in Eddy County in 15 2008, a moratorium was placed on new brine wells (Consensus Planning, 2017). Currently 16 there are only nine active brine wells in New Mexico and only one in Eddy County. 17 o 4 In addition to the energy projects previously described, there are several proposed and existing 5 urban development projects within the region of the proposed CISF.

6 One of the goals stated in Lea Countys most recent Comprehensive Plan is to increase housing 7 in Lea County by 2025, as well as to increase the diversity in types of housing, including rentals, 8 multi-family homes, and high-end homes (Lea 15 Holtec DEIS at 5-2. For an agency that maintains it does not get involved in the business decisions of license applicants it seems contradictory to then get involved in the regional economics of things or conclusory state that there is a push for both Lea and Eddy County to diversify their local economies while still supporting continued development of oil and gas industry infrastructure and support services, such as additional housing and improved water systems (Lea County, 2005; Consensus Planning 2017).

16 Holtec DEIS at 5-3.

17 Holtec DEIS at 5-3.

36

County, 2005). 9 The City of Carlsbad is directing development efforts toward improving previously developed 10 areas and areas that, if improved, would contribute to overall community services and facilities 11 (Sites Southwest, 2012).

There are a few exceptions to this plan, such as a new housing plan 12 announced in March 2019, to provide temporary housing with 400 beds for oil workers (KRQE, 13 2019). Overall, it is the goal of the City of Carlsbad to ensure that future development and 14 urbanization does not negatively impact the citys environmental resources, and the City is 15 making efforts to protect water quality and wildlife, harvest storm water for irrigation and aquifer 16 recharge, and adopt water conservation techniques (Sites Southwest, 2012). The City of 17 Carlsbad recognizes the need for improved water and wastewater systems to support new 18 housing developments and facilities, and funds have been allocated for future water and 19 wastewater system rehabilitations (Sites Southwest, 2012). 18 o 42 As described in EIS Section 5.1.1.1, the Permian Basin is the focus of extensive exploration, 43 leasing, development, and production of oil and gas with the most heavily concentrated area of 44 wells located in eastern Eddy County and western Lea County. As described in EIS 45 Section 3.2.4, extensive oil and gas production activities surround the proposed project area. 46 The location of oil and gas wells within and surrounding the proposed CISF project area are 5-18 1 shown in EIS Figure 3.2-7. One operating gas well is present within the proposed CISF project 2 area along with 18 plugged and abandoned wells. Impacts on land use from continued oil and 3 gas development in the land use geographic scope would include construction of temporary 4 access roads and 1.2-ha [3-ac] drill pads for each drill site (BLM, 2009). 19 o In addition, continued 5 oil and gas development in the geographic scope of the analysis may lead to the need for 6 additional support infrastructure such as compressor stations and pipelines to move oil and gas 7 to market. EIS Figures 3.2-6 and 3.2-9 show oil and gas support facilities and pipelines 8 surrounding the proposed CISF project area. As shown in EIS Figure 3.2-8, the majority of land 9 within the geographic scope of the analysis for land use {i.e., land within a 10-km [6-mi] radius 10 of the proposed CISF project} is within the known potash mining leasing area. As such, 11 administrative controls implemented by the New Mexico Oil Conservation Commission, the 12 New Mexico State Land Office, the State of New Mexico, U.S. Department of the Interior, and 13 BLM would ensure that oil and gas development activities and potash mining activities within 14 the 18 Holtec DEIS at 5-7.

19 Holtec DEIS at 5-17 and 5-18.

37

geographic scope of the analysis for land use are closely monitored and regulated 15 (Holtec, 2019c). 20 o 25 As described in EIS Section 5.1.1.3, New Mexico has a high potential for solar energy 26 generation. However, no current or planned solar facilities are located within the geographic 27 scope of the analysis for land use. As further described in EIS Section 5.1.1.3, there are 28 currently two operational wind projects located within the region of the proposed CISF project 29 area. However, both projects are outside of the geographic scope of the analysis for land use. 30 If any future wind energy projects are developed in the region, they would be generally 31 compatible with other land uses, including livestock grazing, recreation, and oil and gas 32 production activities (BLM, 2005), with long-term disturbance associated with permanent 33 facilities (i.e., access roads, support facilities, and tower foundations)

(BLM, 2011). 34 Both urban development (EIS Section 5.1.1.5) and recreational activities (EIS Section 5.1.1.6) in 35 the region all occur outside of the geographic scope of the analysis for land use. Within the 36 geographic scope of the analysis for land use is the R360 oilfield waste facility located 3.2 km 37 [2 mi] southwest of the proposed CISF. The NRC staff anticipates that with the large amount of 38 oil and gas activity in the area that R360 would continue operating. Furthermore, R360 is 39 privately owned and access is restricted to customers of the facility.

• DEIS at 4-4 to 4-5 Construction of the proposed CISF project would modify the current land use by eliminating 11 cattle grazing on the 133.5 ha [330 ac] of land (the storage and operations area) used for the full 12 build-out of the proposed CISF project facilities and infrastructure. Grazing would be allowed to 13 continue on the remaining 287.5 ha [710 ac] of the 421 ha [1,040 ac]

proposed project area. 14 Approximately 93 percent of land in Lea County is used as rangeland for grazing {approximately 15 1.05 million ha [2.6 million ac]} (NRC, 2012). Eliminating grazing on 133.5 ha [330 ac] of land 16 would result in a loss of 0.01 percent of the land available for grazing. 17 As described in EIS Section 3.2.4, mineral extraction activities in the vicinity of the proposed 18 project consist of underground potash mining and oil and gas extraction. The proposed project 19 area is in an area of known potash leasing. As described in EIS Section 3.2.1, the State of 20 New Mexico and the BLM, respectively, own the subsurface property (mineral) rights within and 21 surrounding the proposed project area, and these rights are leased to production companies for 22 development. Potash beneath the proposed project area is leased to Intrepid Mining LLC 23 (Intrepid), while underground potash surrounding the proposed project area is leased to various 24 potash production companies, including Intrepid, Mosaic Potash, and Western Ag-Minerals. As 25 further described in EIS Section 3.2.4, Intrepid operates two underground potash mines within 20 Holtec DEIS at 5-18.

38

26 9.6 km [6 mi] of the proposed project area (EIS Section 3.2.4) (ELEA, 2016; Holtec, 2019a,b).

27 As noted in the Holtec RAI responses, [t]he New Mexico State Land Office is currently in 28 discussions with Holtec International regarding an agreement in principle to retire any potash, 29 unencumbered by regulatory restrictions, in perpetuity (Holtec, 2019c). In addition, Holtec has 30 entered into an agreement with Intrepid to relinquish certain potash mineral rights to the State of 31 New Mexico (Holtec, 2019c). 32 As discussed further in EIS Section 3.2.4, the proposed project area is in a region of active oil 33 and gas exploration and development. One operating gas well is present within the proposed 34 project area along with numerous plugged and abandoned wells (Holtec, 2019a,b). None of 35 these oil and gas wells are located within the 133.5-ha [330-ac] storage and operation area or 36 where any land would be disturbed by construction activities.

Therefore, construction of the 37 proposed CISF would not have an effect on oil and gas operations within the proposed project 38 area (Holtec, 2019a). In addition, Holtec has stated that it has no plans to use any of the 39 plugged and abandoned wells (Holtec, 2019b). All of the plugged and abandoned wells are 40 located in the eastern portion of the proposed project area. The closest plugged and 41 abandoned well to the storage and operations area is approximately 0.65 km [0.4 mi] to 42 the east. 43 As described in EIS Section 3.2.4, all oil and gas production zones in the area of the proposed 44 CISF occur beneath the Salado Formation at depths greater than 914 m

[3,000 ft] (Cheeseman, 45 1978; Holtec, 2019b). Furthermore, oil and gas exploration targets within and surrounding the 46 proposed project area range from relatively shallow oil and gas at approximately 930 to 1,524 m 4-5 1 [3,050 to 5,000 ft] in upper to middle Permian formations to deep gas targets in middle 2 Paleozoic formations in excess of 4,877 m [16,000 ft] deep (ELEA, 2007). Future oil and gas 3 development (e.g., drilling and fracking) beneath the proposed project area will likely continue to 4 occur at depths greater than 930 m [3,050 ft]. 5 Because of potential conflicts between oil and gas production and potash mining in 6 southeastern New Mexico, the Federal and New Mexico governments have issued 7 requirements for implementing administrative controls to minimize conflict between the 8 industries and ensure the safety of operations (Holtec, 2019c). In December 2012, the 9 U.S. Secretary of the Interior issued Order 3324, Oil, Gas, and Potash Leasing and 10 Development Within Designated Potash Area of Eddy and Lea Counties, NM (77 FR 71814). 11 This order provides procedures and guidelines for orderly co-development of oil and gas and 12 potash resources within the Designated Potash Area (DPA) in southeastern New Mexico (which 13 includes the proposed CISF project area). Under this order, the oil and gas industry uses 14 drilling islands that BLM established, from which all new drilling of vertical, directional, and 15 horizontal wells that penetrate potash formations are allowed, to manage the impact on potash 16 resources. As described in EIS Section 3.2.4, the Belco Tetris Shallow and Belco Deep drill 17 islands are located approximately 0.4 km [0.25 mi]

and 0.8 km [0.5 mi] west of the proposed 18 project area, respectively, and the Anise Tetris drill island to the south of the proposed project 19 area. These drill islands would be used for any future drilling and would ensure that 20 construction and operation of the proposed CISF would not have an impact on oil and gas 21 exploration activities. 22 In addition, the State of New Mexico 39

promulgated Order R-111 to govern oil and gas drilling and 23 plugging activities on State land within the DPA. The BLM adopted similar guidelines in its 24 management of oil and gas exploration and development on Federal land within the DPA 25 (51 FR 39425; October 28, 1986).

Order R-111 underwent numerous revisions in response to 26 changing conditions and relationships within the oil and gas and potash industries. Most 27 recently, the State of New Mexico Oil Conservation Commission (NMOCC) rescinded and 28 replaced the order with R-111-P, on April 21, 1988 (NMOCC, 1988).

• DEIS at 4-6 The proposed CISF 18 may reduce the total amount of potash mining in the region; however, this impact would be 19 minor considering the expansive potash leasing area surrounding the proposed project area. 20 The proposed CISF would have no impact on oil and gas exploration and development in the 21 proposed project area because extraction will continue to occur at depths greater than 930 m 22 [3,050 ft]. Therefore, the NRC staff concludes that the land use impacts during the construction 23 stage for the proposed action (Phase 1) would be SMALL, and potential impacts for 24 Phases 2-20 would also be SMALL.

• DEIS at 4-7 As described in the previous section on construction impacts, plugged and abandoned oil and 16 gas wells within the proposed project area are located in areas that would not be impacted by 17 operation of the proposed CISF. Operation impacts on oil and gas and potash operations would 18 be the same as those of the construction phase. The CISF would have no impact on oil and 19 gas exploration and development in the proposed project area because oil and gas extraction 20 will continue to occur at depths greater than 930 m [3,050 ft]. The proposed CISF may reduce 21 the total amount of potash mined in the region; however, this impact would be minor given the 22 expansive potash leasing area surrounding the site. Operation of the proposed CISF project 23 would not prohibit access to right-of-ways for maintenance of existing gas pipelines within the 24 proposed project area. Because abundant land surrounding the proposed project area would 25 be available for grazing and because land outside the 133.5-ha [330-ac] full build-out storage 26 and operations area would remain largely undeveloped, the NRC staff concludes that land use 27 impacts associated with the operations stage for the proposed action (Phase 1) and for 28 Phases 2-20 of the proposed CISF project would be similar to construction and would 29 be SMALL.

• DEIS 1-9 to 1-10 Coordination With Local State Authorities o Coordination with Other Federal, State, Local, and Tribal Agencies 9 The NRC staff interacted with Federal, State, local, and Tribal agencies during preparation of 10 this EIS to gather information on potential issues, concerns, and environmental impacts related 11 to the proposed CISF project. The consultation and coordination process has included 40

12 discussions with NMED, FWS, NMDGF, local organizations (e.g., county commissioners), as 13 well as Tribal governments. 14 o Interactions with Tribal Governments 15 The NRC recognizes that there are specific government-to-government consultation 16 responsibilities regarding interactions with Federally recognized Tribal governments because of 17 their status as sovereign nations. As such, the NRC offers Federally recognized Tribes the 18 opportunity for government-to-government consultation consistent with the principles in its Tribal 19 Policy Statement, which was issued on January 9, 2017 (82 FR 2402). The Tribal Policy 20 Statement promotes effective government-to-government interactions with Indian and Alaska 21 Native Tribes and encourages and facilitates Tribal involvement in the areas over which the 22 NRC has jurisdiction. To date, the NRC staff has contacted all Federally recognized Indian 23 Tribes with current or historic ties to the project location in southeast New Mexico. Eleven 24 Tribes were contacted in total: the Apache Tribe of Oklahoma, the Comanche Nation, the Hopi 25 Tribe, the Jicarilla Apache Nation, the Kiowa Tribe of Oklahoma, the Mescalero Apache Tribe, 26 the Navajo Nation, the Pawnee Nation of Oklahoma, the Pueblo of Isleta, the Pueblo of 27 Tesuque, and the Ysleta del Sur Pueblo. Appendix A of this EIS contains correspondence 28 related to NRCs outreach with Indian Tribes. The NRC encourages interested Indian Tribes to 29 participate throughout the Holtec CISF environmental review and will continue outreach efforts.

30 Coordination with Federal and State Agencies 31 Coordination with BLM 32 The NRC identified the BLM as a cooperating agency for the Holtec CISF environmental review. 33 The transfer of SNF to and from the main rail line to the proposed CISF would occur using a rail 34 spur. The proposed rail spur would be constructed on BLM land and require BLM permitting. 35 The Memorandum of Understanding (MOU) between the NRC and BLM can be found using 36 ADAMS (Accession No. ML18248A133). For additional details on the BLM Federal action and 37 purpose and need, see EIS Sections 1.2.2 and 1.3.2, respectively. BLM will be the agency 38 responsible for issuing the appropriate right-of-way for the rail spur and permitting any other 39 project-related actions on BLM land. This EIS will serve to fulfill the NEPA responsibilities of 40 both the NRC and BLM, with both agencies issuing a separate Record of Decision. 1-10 1 o Coordination with NMED 2 At the request of the State of New Mexico, NMED was identified as a cooperating agency 3 having special expertise in surface water and groundwater resources for the proposed CISF 4 project. The NRC staff coordinated with NMED staff on water resources for this EIS to describe 5 the affected environment, potential impacts from the proposed project, cumulative impacts, and 6 any additional mitigation measures. The NMED does not have any obligations under NEPA 7 related to the proposed project; however, NMED provided special expertise for water resources 8 41

in and around the proposed site. NMED submitted comments on the preliminary draft EIS, 9 which the NRC staff addressed as appropriate in this draft EIS when doing so would advance 10 the evaluation of the proposed project impacts.

o 11 Coordination with Localities 12 The NRC staff met with city council members of the City of Artesia on April 30, 2018; with the 13 City of Hobbs Mayors Office on May 1, 2018; with the Lea and Eddy County Commissioners 14 and city managers on May 3, 2018; and with the City of Carlsbad Mayors Office on 15 May 3, 2018, to provide a brief overview of the NRC environmental review process and, when 16 possible, address any questions or concerns by members of these local agencies. The NRC 17 staff also met with the Economic Development Board of Lea County (May 1, 2018) and the 18 Carlsbad Soil and Water Conservation Service (May 3, 2018). Lists of attendees and 19 summaries of these discussions can be found in the NRC Site Trip Report (ADAMS Accession 20 No. ML18164A217).

• DEIS 2-1 to 2-2 8 Within the proposed project area, there is a communications tower in the southwest corner; a 39 former gas-producing well with associated tank battery located near the communications tower; 40 a small livestock water drinker; an abandoned oil-recovery facility in the northeast corner; and 41 an oil-recovery facility in the southeast corner (ELEA, 2007). While there are no water wells 42 within the proposed project area, there are 18 plugged and abandoned oil and gas wells located 43 on the property (Holtec, 2019c). None of these plugged and abandoned oil and gas wells are located within the storage and operations area where the independent spent fuel storage 2 installation (ISFSI) would be located or where any land area that would be disturbed as part of 3 the proposed construction and operation of the proposed CISF project.

Holtec ER

• A temporary flexible pipeline for natural gas runs aboveground diagonally through the center of Section 13 (to be relocated prior to construction of the site). 21 o Land uses in the area are limited to oil and gas exploration and production, oil and gas related service industries, livestock grazing, and limited recreational activity.

The only nearby residents are ranchers that occupy several ranches as close as 1.5 21 At 6-7.

42

miles away. A larger transient population exists in the form of potash mine workers, oil field workers, employees of an oil field waste treatment facility and an industrial landfill. One restaurant is nearby (3.5 miles) that serves travelers on U.S. Highway 62/180. The nearest population center is the village of Loving, New Mexico, 30 miles to the southwest. Lands within 5 miles of the Site are privately owned, state lands, or Bureau of Land Management lands. Land use within 5 miles of the Site falls into two categories; livestock grazing and mineral extraction. The nearest residence to the Site is located at the Salt Lake Ranch, 1.5 miles north of the Site.

There are additional residences at the Bingham Ranch, 2 miles to the south, and near the Controlled Recovery Inc. complex, 3 miles to the southwest. There is an average population of less than 20 residents among five ranches within a 5-mile radius. This is a population density of less than five residents per square mile.

Within 50 miles of the Site, except for the communities located in the area, the land use and ownership are essentially the same as within the 5-mile radius. Along with the mining, grazing, and oil/gas activity, agriculture is a major activity. An industrial railroad lies 3.8 miles to the west and a spur will be constructed to serve the Site. 22 o Radiological accidents at the CIS Facility are limited to:

1) A breach of a canister containing used nuclear fuel and the gases which would be emitted to the environment, and/or

2) An inadvertent exposure of an unshielded canister during transfer operations. 23 o In either case the attendant RPT would collect real time data at or near the incident site and relay that data to the RSO and/or EC. A description of the types and methods of onsite and offsite sampling and monitoring can be found in Section 11.4 of the HI-STORE CIS Facility SAR [Ref. 11]. The RSO/EC would determine the appropriate stand-off distance from the incident to protect site workers and implement a recovery plan to mitigate the incident. Determination of projected offsite radiation exposures will be performed in accordance with written procedures. Specific training, drills, and exercises are provided on the potential site accidents to ensure the actions taken in an actual emergency are prompt and effective. The post-emergency assessment provides the basis for decisions regarding re-entry, recovery, and the return to normal operations. The post-assessment is helpful for the analysis of actual accident conditions for the purposes of critique and lessons learned. Collection and retention of data compiled during 22 At 8.

23 At 35.

43

the emergency, provides valuable assessment of the decisions and actions taken and may be required for investigation purposes o Fire and Explosion: The Maljamar Fire Department in Maljamar, New Mexico is located approximately 28 miles from the site. The Monument, New Mexico and the Eunice, New Mexico Fire Departments are located 36 miles and 38 miles respectively from the CIS Facility. Each of these departments are equipped to respond to structural fires, oil well fires, and chemical tank explosions. These departments are located within Lea County under the jurisdiction of Lea County Emergency Management. 24 o 5 Because of potential conflicts between oil and gas production and potash mining in 6 southeastern New Mexico, the Federal and New Mexico governments have issued 7 requirements for implementing administrative controls to minimize conflict between the 8 industries and ensure the safety of operations (Holtec, 2019c). In December 2012, the 9 U.S. Secretary of the Interior issued Order 3324, Oil, Gas, and Potash Leasing and 10 Development Within Designated Potash Area of Eddy and Lea Counties, NM (77 FR 71814). 11 This order provides procedures and guidelines for orderly co-development of oil and gas and 12 potash resources within the Designated Potash Area (DPA) in southeastern New Mexico (which 13 includes the proposed CISF project area). Under this order, the oil and gas industry uses 14 drilling islands that BLM established, from which all new drilling of vertical, directional, and 15 horizontal wells that penetrate potash formations are allowed, to manage the impact on potash 16 resources. As described in EIS Section 3.2.4, the Belco Tetris Shallow and Belco Deep drill 17 islands are located approximately 0.4 km [0.25 mi] and 0.8 km [0.5 mi] west of the proposed 18 project area, respectively, and the Anise Tetris drill island to the south of the proposed project 19 area. These drill islands would be used for any future drilling and would ensure that 20 construction and operation of the proposed CISF would not have an impact on oil and gas 21 exploration activities 25 o The three natural gas pipelines are located east of 31 the proposed 133.5-ha [330-ac] storage and operations area, and the change in land use from 32 construction of the proposed CISF project would not limit access to or maintenance of their 33 right-of-ways. The potable water pipeline that traverses the proposed storage and operations 34 area is owned by Intrepid and services the Intrepid East Mine facility (Holtec, 2019a). Holtec 35 has committed to coordinate with Intrepid to relocate the potable water pipeline so that it would 36 not interfere with construction and operation activities associated with the proposed CISF 37 project (Holtec, 2019a).

24 At 27.

25 Holtec DEIS at 4-5.

44

Because the existing pipeline runs along the surface, relocation of the 38 pipeline would result in minimal additional land disturbance. The City of Carlsbad Water 39 Department would provide potable water for the proposed CISF project from the Double Eagle 40 water system. A new water supply pipe from the Double Eagle system to the proposed CISF 41 project would share the majority of the proposed rail spur right-of-way and, therefore, no notable 42 additional construction would be required to provide water to the proposed facility (Holtec, 43 2019a) 26 o The primary changes to land use during the operations 41 stage of the proposed action (Phase 1) would be land disturbance associated with construction 42 of SNF storage pads and modules for additional phases, because the applicant intends to 43 operate each existing phase concurrently with construction of new phases. 27

• Licensing Report on the HI-STORE CIS Facility, HI-STORE CISF SAR Rev 0J, (Sept.

15, 2020) (ADAMS Accession No. ML20295A428) officially released on October 21, 2020.

No water wells are located on the Site. However, the Site has been associated with oil and gas exploration and development with at least 18 plugged and abandoned oil and gas wells located on the property. However, none of these plugged and abandoned oil and gas wells are located within the area where the ISFSI would be located or where any land would be disturbed and they are not expected to affect the construction and operation of the CIS Facility. Table 2.1.5 shows basic information for all oil and gas wells within 1 mile of the facility and Figure 2.1.25 shows their relative location. There are no active wells in the facility boundaries and there are no plans to use any of the plugged and abandoned wells on the Site. SAR 2-3 With regard to future projections, there are no reasonably foreseeable projects expected to occur within 5 miles of the CIS Facility boundary and no changes to the existing transient workforce were forecast by the employers in the area [2.1.14]. Consequently, it is assumed that the transient population of 303 workers would remain constant going forward. . . As shown on Figure 2.1.14 and 2.1.15, almost all of the land immediately surrounding the property is owned and managed by the BLM. Land uses in the area are limited to oil and gas exploration and production, oil and gas related services industries, livestock grazing, and limited recreational activity. Lands within six miles of the Site are privately owned, state lands, or BLM lands. Land use within six miles of the Site falls into two categories; livestock grazing and mineral extraction. SAR at 2-7 to 2-8.

Mineral extraction in the area consists of underground potash mining and oil/gas extraction. Both industries support major facilities on the surface, although mining surface facilities are confined to a fairly small area. Intrepid Mining LLC (Intrepid) owns two potash mines located within 6 26 Holtec DEIS at 4-5.

27 Holtec DEIS at 4-6.

45

miles of the Site. The Intrepid North facility, located approximately 5 miles to the west, is no longer actively mining potash underground. However, the surface facilities are still being used in the manufacture of potash products. The Intrepid East facility is still mining its underground potash ore [2.1.3]; however, as can be seen in Figure 2.1.23, the nearest mine workings remain approximately 2.1 miles to the southwest of the site. Mineral resources near the Site, as determined from the USGS Mineral Resources Data System and the New Mexico Mining Minerals Division, are mapped on Figure 2.1.21. The USGS and NM MMD databases indicate that the CIS Facility is not co-located with existing mining facilities. SAR at 2-8.

When the potash to be extracted is at a depth of 3,000 feet or deeper and/or the potash is located in sedimentary rock, then solution mining provides a cost effective, efficient and safe way to extract the resource. Conventional mining involves extracting a lot of rock material to access the mineral resource resulting in large underground caverns and this excess waste material must also be stored on the surface. With solution mining, a brine is heated and injected into the deposit to dissolves the potash. The potash-rich brine is then pumped out of the cavern to the surface where the water is evaporated. Solution mining is currently used at a number of operations in New Mexico, and Intrepid Potash was approved to conduct solution mining of potash minerals at the HB Solution Mine, located over 15 miles from the site, in order to extract some of the remaining ore from suspended mines in the main potash mining area [2.1.16]. SAR at 2-9.

As shown on those figures, numerous potash core holes have been drilled in the areas surrounding the CIS Facility and there are potash leases surrounding the CIS Facility Site. Figure 2.1.24 shows the buffer zones as defined by Order 3324 [2.1.25] that surround the site. This order is designed to ensure coordination between oil and gas drilling and potash mining. It mandates a 1/4 mile buffer zone around all oil wells and a 1/2 mile buffer zone around all gas wells and drill islands that mining operations cannot occur. Order 3324 applies to the secretarys potash area as defined in the Mineral Leasing Act in 1939. These buffers blocking mine workings to south and east, as well as the inactive status of the mine workings to the west of the facility provide assurance that future potash mining will not affect the site. .

The decommissioning process of wells has similar requirements for protection of and from salts.

Oil and gas exploration targets range from relatively shallow oil and gas at 3,050 feet deep in the Delaware Canyon Formation (specifically the Yates Formation) to deep gas targets in middle Paleozoic formations in excess of 16,000 feet deep [2.1.16]. SAR at 2-11.

The Jal sinkhole, which developed in 2001, is located about 8 miles northwest of Jal, New Mexico and approximately 50 miles southeast of the proposed CIS facility Site. The geologic settings of the Wink and Jal sinkholes are similar to that of the CIS Facility Site as they occurred at the basin margin above the Capitan Reef. In each incident, sinkholes formed around a well location and the sinks had diameters ranging from 200 to over 700 feet. Although the exact cause of development of these sinkholes is not known, it is suspected that casing failure allowed unsaturated water to 46

come into contact with, and subsequently dissolve, salt layers [2.1.16]. When considering distance (Table 2.1.5 and Figure 2.1.25) and current drilling regulations, there is no risk of sinkholes affecting the CISF. . . The Belco and Tetrus drill islands are located along the southern edge of the CIS Facility Site and property boundary, and are intended to accommodate multiple oil and gas well locations, all or most of which will be horizontal wells completed below the Bone Springs formation (7,800 feet below the ground surface. Oil and gas drilling has occurred on those drill islands in the past and could be used in the future. Similarly, as shown on Figure 2.1.20, oil and gas wells have been drilled in the Green Frog Café Drill Island located just east of the proposed CIS Facility [2.1.17]. According to Order No. 3324 (from the Secretary of the Interior, For Oil, Gas, and Potash Leasing and Development within the Designated Potash Area of Eddy and Lea Counties, New Mexico), a buffer zone of 1/2 mile around gas wells and 1/4 mile around oil wells is established in which no potash mining can occur [2.1.25]. These buffer zones for drill islands and wells near the site can be seen in Figure 2.1.24. There are 17 active or plugged wells within 1 mile of the site. All wells, active or plugged, are more than 1000 feet from the storage location and, therefore, are not a concern for the effects of subsidence, Figure 2.1.25. SAR at 2-12.

Socioeconomics. Construction and operation of the CISF would result in direct and indirect economic benefits within the region of influence (ROI). There would be no adverse direct impacts to the nearby communities. There would be minimal demands on local social resources and infrastructure to meet housing and other social infrastructure needs, based on the anticipated increases in employment for the CISF. The total number of workers at the Site could be as many as 135 annually. Given that the 2015 labor force within the ROI was 77,433, the addition of 135 workers would result in a 0.2 percent increase to regional employment. There are no known significant new projects in the project area, and for purposes of this cumulative impact assessment, the existing activities (nuclear or non-nuclear) are assumed to continue at current levels, with no significant impact on socioeconomic resources HOLTEC INTERNATIONAL, HI-STORE CISF LICENSE APPLICATION RESPONSES TO REQUESTS FOR ADDITIONAL INFORMATION, PART 5, RESPONSE SET 1, RELEASED JUNE 2020 (ADAMS Accession No. ML20153A779)

RAI 2-3 Clarify the contradictory statements in the SAR regarding the existence of a producing oil/gas well in the southwest portion of the proposed CISF site. Additionally, clarify whether the former producing well, as stated in SAR Section 2.1.2, Site Description, is the same well described as an active oil/gas well in SAR Section 2.2.2, Pipelines, in the southwest portion of 47

the proposed CISF site. Section 2.2.2 of the SAR, Pipelines, states that an oil/gas producing well exists at the proposed site. The SAR Figure 2.1.2 also shows a producing well in the southwest corner of the facility. However, SAR Section 2.1.2, Site Description, and SAR Section 6.5.2 (d),

Potential Fire Hazards, state [t]here are no active wells on the site SAR Section 2.1.2 also lists a former producing gas and distillate well near the communication tower. This information is necessary to determine compliance with 10 CFR 72.24(a), 72.90(a) through (d), 72.94, and 72.98.

Holtec Response Sections 2.1.2 and 2.2.2 have been revised to clarify the description of oil/gas facilities located within the Property and those specifically in Section 13. The HI-STORE Facility will be located within Section 13 however all of the structures described will either be removed prior to construction (as noted) or remain outside the footprint of the facility. Section 6.5.2 (d) has been revised to clarify location of structures in relation to the property and HI-STORE facility itself.

RAI 2-5 Clarify how the structures currently on the proposed site would be dealt with during construction and operation phases of the proposed facility in SAR Section 2.1.2, Site Description. Section 2.1.2 of the SAR identifies several existing structures at the proposed site.

However, no information has been presented in the SAR as to what happens to the following existing structures at the site during construction and operation phases of the proposed facility: (1) a communication tower, (2) two oil recovery facilities with associated hardware, and (3) a producing oil/gas well. The applicant should describe the proposed plan(s) to deal with each of the existing structures at the proposed site during the construction and/or operational phases of the proposed facility. The description should include detailed characteristics of the existing structures and assessments of potential hazards posed by them to the proposed facility if they would not be dismantled or, in the case of the producing oil/gas wells, abandoned and plugged. This information is necessary to determine compliance with 10 CFR 72.24(a), 72.90(a) through (d), 72.94, and 72.98.

Holtec Response Section 2.1.2 has been revised to clarify the location of structures on the Property. The section has been revised to clarify which of the structures are to be removed and that the rest are not within the footprint of the HI-STORE facility. The structures not being removed will have no impact on construction and the hazards to the operating facility are currently 48

discussed. Additional changes to this section may occur as a result of ongoing evaluations in response to remaining Chapter 2 RAIs.

HOLTEC INTERNATIONAL, HI-STORE CISF LICENSE APPLICATION RESPONSES TO REQUESTS FOR ADDITIONAL INFORMATION, PART 5, RESPONSE SET 2, RELEASED OCTOBER 21, 2020 (ADAMS Accession No. ML20260H139)

• 2-8 Justify why having oil and gas exploration and production activities near the proposed facility would not pose a hazard in SAR Section 2.1.4, Land and Water Use.

As discussed in RAI 2-3, SAR Section 2.2.2, Pipelines, states that one oil/gas well is currently producing in the southwest portion of the property. Additional wells may also be drilled in nearby oil/gas leases in the future which could possibly travel below the proposed site. In addition, activities associated with well completion and production may pose hazard to the proposed facility for example, leakage of gas from the wellhead or gas flaring operation.

Additionally, SAR Section 2.1.4, Land and Water Use, states that multiple horizontal holes will be drilled to the Bone Spring formation from the Belco Shallow and Belco Deep drill islands.

These drill islands are very close to the proposed site, approximately 400 m [1,320 ft] and 800 m 2,640 ft], respectively. Similarly, holes were drilled from the Green Frog Café drill island just east of the proposed site. The potential for subsidence due to corrosion of the casings of the abandoned drill holes is illustrated by the formation of the Wink and Jal sinkholes described in SAR Section 2.1.4. The hazards from potential land subsidence induced by casing failure, any future horizontal drilling beneath the site, or from oil/gas production from nearby wells should be evaluated and assessed to demonstrate that important to safety structures at the proposed facility and facility operations are not affected.

This information is necessary to determine compliance with 10 CFR 72.24, 72.90(a) through (d), 72.94, and 72.98.

49

Holtec Response This response addresses three hazards to the proposed CISF: sinkholes and subsidence from well casing failures, hazards from nearby active oil and gas wells, and hazards from horizontal drilling.

Sinkholes and Subsidence from Well Casing Failures Land subsidence is the phenomenon or response that occurs when an underground opening is created. The major hazard associated with land subsidence from drilling operations is the formation of sinkholes at or near the wellhead. As described in SAR Section 2.1.4, the Jal and Wink (Wink I and Wink II) sinkholes are examples of land subsidence associated with drilling operations. As described further below, the major causes of these sinkholes were inappropriate borehole management practices and excessive water control activities. Poor borehole management practices led to an increase in casing damage that resulted in casing failures that exposed large sections of the salt layers to the borehole. Then, excessive water control activities increased the rates of salt dissolution in the underlying soils which created large underground cavities that eventually collapsed and resulted in sinkholes.

Wink Sink I Wink Sink I formed approximately 2 miles north of Wink, TX on June 3, 1980 at the abandoned No. 10-A Hendrick oil well. The No. 10-A well is one of 1400 wells that have been drilled in the Hendrick oil field since its discovery in 1926. One of the major problems in the Hendrick field since its beginnings has been the disposal of great volumes of oil-field brine produced along with the oil. Water production in the field ranged from 600,000 to 875,000 barrels per day in the 1930s. Nearly 50 evaporative pits ranging in sizes from 1 to 30 acres were used at one time or another as disposal pits in the 4 square miles surrounding the Wink collapse and subsidence features. The sinkhole at Wink Sink I is approximately 400 ft in diameter with additional fissures (tension fractures) adjacent to the sinkhole. Salt dissolution and collapse associated with Wink Sink I resulted from, or at least was accelerated by, recharging shallow aquifers from leakage of unsaturated wastewater from the disposal pits along with oil-field activity in the immediate vicinity of the sink.

50

The No. 10-A Hendrick well was drilled at the site of the sinkhole. It is believed that the well was drilled with freshwater drilling fluid that enlarged or washed out the borehole within the salt layer. Ineffective cement jobs, and possible fractures in the cement, may have opened pathways for water movement up or down the borehole outside of the casing. Because of probable salt dissolution and borehole enlargement during drilling through the Salado salts, the small amount of cement reportedly used (800 sacks) to set the casing in the hole was probably only enough to cement the lower part of the hole, thus leaving most of the salt section exposed behind the casing. The casing in the well is also suspected to be further damaged by corrosion from production of great quantities of oilfield brine as well as from the use of explosives to realign the well. It is possible that the explosives not only fractured the Tansill formation and increased its permeability locally but also may have fractured the cement farther up the borehole. Additionally, final removal of the casing from the well in 1964 left an uncemented borehole in the interval from the base of the Santa Rosa aquifer to the top of the Rustler Formation.

All of the above-mentioned activities aided in conducting fresh water from the swollen shallow aquifers down the borehole to the salt beds thus dissolving the salt and forming a void which eventually caused the sink hole [1]. Salt dissolving waters may also have ascended from below the salt layer with similar results. The hydraulic head of the Capitan Reef is above the elevation of the Salado at the No. 10-A Hendrick well. Fresh water could rise under artesian pressure and denser brine could move down the borehole under gravity exacerbating the cavity formation.

Wink Sink II On May 21, 2002, Wink Sink II developed 1 mile south of Wink Sink I and is centered on the site of a former water-supply well, the Gulf Oil Corporation No. WS-8 Grisham-Hunter Surface Fee. The sinkhole at Wink Sink II is approximately 950 ft in diameter. The Gulf WS-8 well was completed September 18, 1960, and was drilled into the Capitan Reef to a total depth of 3,583 ft. At this well location the top and base of the Salado Formation are at depths of 1,353 ft and 2,252 ft, respectively. The Gulf WS-8 was plugged prior to formation of Wink Sink II, but during its productive life it yielded about 800 million bbl of water for waterflood operations. It is suspected that Wink Sink II formed mainly because of the water production at the Gulf WS-8 well

[1]. Specifically, produced water from the Capitan Reef leaked through the well tubing and casing 51

into the salt formation. It is also possible that unsaturated water from shallow aquifers may have flowed down through the borehole against the salt or water from the Capitan Reef ascended under artesian pressure after the well was abandoned creating a brine density flow similar to Wink I.

Jal Sink The Jal Sink formed about 8 miles north-northwest of Jal, NM sometime between August 31 and September 5, 1998. The sinkhole is roughly 75 ft east of the Skelly No. 2 Jal Water System (Jal WS-2) water-supply well and is approximately 170 ft in diameter. The stratigraphy in the vicinity of the Jal Sinkhole is similar to that at the Wink Sinkholes. In the Jal WS-2 well, the depth to the top of salt in the Rustler Formation is 1,530 ft, and the depth range of the salt-bearing Salado Formation is 1,944 ft to 3,310 ft. The Jal WS-2 produced relatively low salinity water for waterflood operations from the Capitan Reef at depths from 3,890 ft to a total depth of 4,500 ft. In 1979, a workover of the Jal WS-2 well revealed collapsed casing in the Rustler interval at 1,642 ft. The well was plugged and abandoned, with cement plugs set in the casing at depths of 1,418-1,550 ft, 72-414 ft, and 0-10 ft. The casing was then perforated, and cement was emplaced at three levels: behind the casing at 1,250 ft, below a packer at 1,140 ft, and behind the casing at 400 ft. It is suspected that salt dissolution might have occurred after plugging of the well, because approximately 300 ft of the salt section was exposed behind the casing. However, the 1979 workover report indicates that the casing in the salt-bearing Rustler interval had collapsed prior to plugging. Salt also may have been dissolved during operation of the well, possibly as a result of a lack of integrity of the casing. Ultimately, it is believed that the sinkhole resulted from dissolution of salts from well leakage during well operations and the circulation of fresh water and uncontrolled dissolution of evaporites after the well was plugged and abandoned [2].

Relevant Information for Existing Wells Near the CISF Table 1 below shows the relevant information for all oil and gas wells within 1 mile of the facility including their approximate distance to the ISFSI [3]. Figure 1 shows their relative location to the proposed HI-STORE Facility. As noted, there is 1 active gas well, 3 active oil wells, 12 plugged oil wells, and 1 cancelled oil well (never drilled). Note, information on the regional stratigraphy can be found in SAR Section 2.6 and Section 3.3 of the HI-STORE Environmental Report.

Table 1: Oil and Gas Wells within 1 mile of HI-STORE Facility 52

Assessment of Risks for Existing Wells near the CISF As described above, the Jal and Wink sinkholes resulted from subsurface dissolution of salt caused by freshwater leakage in improperly cased abandoned oil and water wells. The key factor at the Wink II and Jal sinkholes was that their source wells during their operating years were used for oilfield brine extraction or freshwater extraction for waterflood operations. These operations likely corroded the well casings. Leakage from Wink I, Wink II, and Jal were further exacerbated by poor borehole management activities (the use of explosives for well realignment, ineffective cement jobs, and removal of the casings prior to plugging). The development of underground cavities which eventually became sinkholes was likely initiated and then accelerated by the activities during the productive years of each well continuing when they were plugged and abandoned.

As none of the wells in the vicinity of the proposed Facility has been used for these types of water extraction activities, Holtec believes that there is little risk of these wells experiencing land subsidence or becoming sinkholes during the life of the Facility. Additionally, as it relates to evaluating the risk to safety-related structures, all of the wells and drill islands are greater than 1,000 ft away from the storage area. As stated above the Jal, Wink I, and Wink II sinkholes are approximately 170, 400, and 950 ft in diameter, respectively. Therefore, even if any one of the wells near the proposed Facility were to become a sinkhole similar to what happened at the Jal and Wink sinkholes, they would not pose any risk to safety-related structures at the Facility.

Risks of New Wells near the CISF According to Order 3324, all future wells near the site would be on drill islands. All drill islands are outside the site boundary. Current state regulations set much stricter requirements for drilling and completion of wells when compared to the processes that have been used historically in the area. All new wells near the Facility will follow the latest regulations for drilling, operations, and eventual plugging or abandonment of wells [4]. The current regulations are designed to ensure the integrity of the borehole and to prevent the mechanisms that lead to salt dissolution.

Specifically, current drilling regulations are designed to prevent communication between underground sources of oil, gas, and water strata. During the drilling of an oil well, operators are required to seal and separate the different strata above the producing or injection horizon to prevent 53

their contents from passing into other strata. Drilling fluid must be of sufficient salinity as to match the salt content of the zone being drilled [5]. This requirement is specifically intended to prevent enlarged drill holes. Casing levels (surface, intermediate, and production) and cement plugs are designed and placed to ensure that all formations bearing usable-quality ground water, oil, gas, and geothermal resources, are protected through isolation. The current regulations and drilling practices described above make the risk of casing corrosion (which can cause casing failure) and transmission between strata minimal.

Hazards from Nearby Active Oil and Gas Wells No new oil and gas wells will be constructed within the Facility boundaries because new drill islands will not be permitted on the privately owned land and, as described further below, any new drilling outside of Facility boundaries would not pose any risk to the safety-related structures.

The hazardous effects associated with gas leakage at the well head and gas flaring operations can be characterized as heat dissipation and overpressure resulting from an ignition of the combustible oil or gas. When considering the distance between the safety-related structures at the Facility and a prospective new oil and gas well, the only heat transfer from a fire would be through radiative effects and the heat exchange factor (view factor) would be so small that any effects from the fire would be negligible. Therefore, the hazardous effect of most concern for the safety-related structures at the Facility is the possible overpressure that would result from an explosion event. As shown in the response to RAI 2-7, the probability for a pipeline leakage to be large enough, in the right location, and to lead to an explosion large enough to have any effect on safety-related structures at the Facility are so small that they can be considered negligible and screened from further consideration. Holtecs position is that the risks associated with gas leakage at wellheads would be similar to those for pipeline leakage.

Gas flaring is an activity where a combustion device is used to burn unwanted or excess gases and liquids released during normal or unplanned oil and gas extraction operations. The flaring of associated gas may occur at the top of a vertical flare stack or it may occur in a ground-level flare in an earthen pit. Gas flaring is usually a controlled burn with hazardous effects characterized as heat dissipation and noise generation from the active flame and possible overpressure from initial gas ignition. These effects can be considered localized to the immediate area surrounding the wellhead. Therefore, when considering the minimum distance to a 54

prospective new or active wells, gas flaring operations do not have any impact on safety-related structures at the Facility. Therefore, there would be no risks to safety-related structures at the Facility due to leakage of gas from the wellhead or gas flaring operations.

Hazards from Horizontal Drilling Currently, there are no horizontal wells that travel beneath the Site. Any new wells with horizontal legs that travel beneath the site would first be drilled offsite vertically to a depth greater than 3,050 ft, as this is the shallowest oil or gas formation in the vicinity of the site. Once a wellbore starts travelling horizontally, it stays within its own strata (within the production zone). Because of this, horizontal drilling does not create any additional risk of fluid transfer across multiple strata which is the greatest concern for dissolution of salts and land subsidence. If a horizontal well were to collapse at a depth greater than 3,050 ft, there would be no noticeable effect at the ground surface. Therefore, as long as the vertical portion of the wellbore is maintained properly and in accordance with the current regulations (described above), a well with horizontal legs does not create any additional hazards to the Facility when compared with vertical wells.

Conclusions Based on the above information, there is little to no potential for hazards to important-to safety structures at the proposed facility from oil and gas well activity including existing plugged wells, currently active producing wells, and any future well exploration and production activities.

The above information in Table 1 and Figure 1 has been added into SAR Section 2.1.

References:

1. Johnson, Kenneth & Collins, Edward & Seni, Steven. (2003). Sinkholes and land subsidence owing to salt dissolution near Wink, Texas, and other sites in western Texas and New Mexico. Evaporite Karst and Engineering/environmental Problems in the United States. 109. 183-195.

2. Powers, Dennis. (2003). Jal Sinkhole in Southeastern New Mexico: Evaporite dissolution, drillholes, and the potential for sinkhole development.

3. New Mexico Oil Conservation Division, NM OCD Oil and Gas Map - ArcGIS Web Application, <nm-emnrd.maps.arcgis.com/apps/webappviewer/index.html>.

4. New Mexico Administrative Code Title 19, Natural Resources and Wildlife.

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5. State of New Mexico Energy, Minerals and Natural Resources Department - Oil Conservation Commission, Case No. 9316, Order No. R-111-P.

• 2-12: Provide a rationale for why mining operations at nearby underground potash mines or extraction of oil and gas from underneath the CISF would not pose any hazard to the proposed facility from surface subsidence. Also, justify why mining of potash would not be feasible beneath or around the proposed CISF site for the proposed duration of the license.

Section 2.1.4 of the SAR, Land and Water Us, states that for potash mining at a depth of 900 m [3,000 ft], the horizontal extent of the surface subsidence would be another 900 m [3,000 ft] extended outward from the farthest mine workings undergoing collapse of the overlying strata, assuming an angle of influence of 40o. Consequently, the applicant states that any subsidence from the nearby mines would not pose any hazard to the proposed facility. However, current locations of the mine workings nearest to the proposed facility site are not provided in the SAR. Section 2.1.4 of the SAR states that the mine workings of the Intrepid East Mine are nearly 9.6 km [6 mi]

southwest of the proposed site, citing the proposed GNEP Siting Study (Reference 2.1.3 of SAR).

Additionally, SAR Figure 2.1.17, citing a figure from the 2007 GNEP Siting Study (Reference 2.1.3 of the HI-STORE SAR), states that the nearest underground potash mine working is 3.2 km

[2 mi] from the proposed site. Information on the distance of the nearest mine working from the proposed site dates from 2007. Therefore, information on any progress of the mine workings in the ensuing years should be described and the current location(s) as well as any projected future mine workings should be used and provided in assessing the potential subsidence hazards to the proposed site.

Sections 2.1.4 and 2.6.4 of the SAR, Stability of Subsurface Materials, state that Intrepid will not conduct any potash mining on the site and cites an agreement between the applicant and Intrepid Potash LLC. The application should discuss the rationales for the conclusion that potash would not be extracted under and around the site during the licensed life of the project.

Similarly, SAR Section 2.6.4 states that there would be no subsidence concerns from any future oil and gas extraction beneath the site. The application should also discuss the rationale for why future oil and gas extraction beneath the site would not present a subsidence concern.

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This information is necessary to determine compliance with 10 CFR 72.24(a), 72.90(a) through (d), 72.94, and 72.98.

Holtec Response The proposed CISF resides in the Secretary of the Interiors Designated Potash Area as defined under the authority of the Mineral Leasing Act of 1939. Oil, gas, and potash leasing and development are closely controlled by Order 3324 [1]. This order ensures coordinated development between oil and gas and potash to ensure mine safety. Additional discussion of the local mines is provided in response to RAI 2-10. To ensure safety in potash mines, the Order requires a 1/2 mile buffer around gas vertical wells and a 1/4 mile buffer around oil vertical wells, Figure 1. Also, it should be noted that Order 3324 restricts new wells to drill islands to limit interference between oil, gas, and potash operations. This buffer provides a horizontal standoff between vertical drilling and mining operations. Applying the buffer system to the drill islands and active wells around the proposed CISF shows that potash mining is not probable in the vicinity of the proposed CISF, Figure 1 (added to FSAR Chapter 2). Subsidence effects from potash mining will not likely be seen over the life of the facility based on the following:

1. Location of potash mines (SAR Figure 2.1.23).

2. Current inactive status of the closest mine workings. The closest mine workings approaching the mining accessible side (west) of the site are part of the Intrepid North facility and are not actively mined. The facility is used for surface operations only.

3. Distance mines would have to be extended to affect the facility;

4. Location of the vertical well buffers, Figure 1 (new SAR Figure 2.1.24). As stated previously, all future oil and gas vertical wells must be installed on drill islands designated by the BLM [1,3].

It should also be noted that the shallowest oil and gas formation, the Yates formation, is greater than 3050ft below the surface at the CISF site and located below the Salado Formation (salt layer).

Because of this fact, any horizontal drilling under the site would occur at greater than 3050ft.

Subsidence from horizontal drilling is shown not to be a concern, as described in RAI 2-8. The combination of the depth of horizontal drilling, the thick Salado Formation, and the limited subsidence potential of a horizontal borehole (small diameter casing to collapse, no dissolution risk in oil formation) makes any surface effects non-existent. Discussion of Order 3324 added to 57

SAR section 2.1.4. Figure 2.1.24 added to show drill island buffer zones. Figure 1 -Order 3324 Buffers for Oil and Gas Wells in the Secretarys Potash Area in the vicinity of the HI-STORE CIS Facility [1][2]

References for 2-12:

1. Secretary of the Interior, Order No. 3324 - Oil, Gas, And Potash Leasing and Development within the Designated Potash Area of Eddy and Lea Counties, New Mexico. 2012.

2. New Mexico Oil Conservation Division, NM OCD Oil and Gas Map - ArcGIS Web Application, <nm-emnrd.maps.arcgis.com/apps/webappviewer/index.html>.

3. Bureau of Land Management, Carlsbad Field Office Drill Islands Map. Carlsbad, New Mexico, 8/25/2019.

• 2-25: Provide additional information on the potential for surface deformation due to past, present or future human activities at the proposed site. Specifically, clarify whether there are any oil and gas extraction activities, including casing corrosion or failure leading to dissolution of carbonate or evaporite deposits in the subsurface, that could result in surface deformation. Justify the basis for the 5,000 ft minimum depth of oil drilling or fracking activities; clarify the depth to the shallowest oil or gas field in the site subsurface; and characterize the potential for surface deformation at the site due to drilling or fracking at the depth of the shallowest oil or gas resource mining exploration or extraction activities in the subsurface for the licensed life of the proposed facility.

Section 2.6.4 of the SAR, Stability of Subsurface Materials, states that [t]here are no surface, drillhole, or mining indications that subsidence and collapse chimneys occur at the Site or surrounding area. However, SAR Section 2.1.4, Land and Water Use, states that because of the extent of the evaporites (salt and anhydride), drilling and completion operations have to be conducted in a manner that prevents the dissolution of the salt and protects the well during drilling and through the productive lives of the wells, often 20 to 30 years or more. SAR Section 2.1.4 also states that [t]here are several examples in the Permian Basin of catastrophic subsidence as a result of suspected oil field casing corrosion and dissolution of salt, including the Wink Sinks and al Sink, both of which have similar subsurface stratigraphy to the HI-STORE CISF site. Despite the occurrence of past catastrophic subsidence at these locations, and potential for future oil and gas extraction activities at the site, the application does not address the potential for catastrophic 58

subsidence at the CISF site due to current and future oil and gas extraction activities or describe actions to prevent future catastrophic subsidence. Section 2.6.4 of the SAR further states that any future oil drilling or fracking beneath the Site would occur at greater than 5,000 feet depth, which ensures there would be no subsidence concerns. However, public information from the State of New Mexicos Energy, Minerals and Natural Resources Department shows the presence of nearby active oil and gas wells within a three-mile radius of the site that are less than 5,000 ft depth. In addition, the application does not consider surface deformation from the exploration or extraction of minerals or other resources other than potash, oil, or gas.

This information is necessary to determine compliance with 10 CFR 72.98(c)(2) and 72.103(f)(2)(ii).

Holtec Response Note that the minimum horizontal drilling depth has been revised throughout the SAR to reflect the shallowest oil and gas deposit in the area being 3050 below the surface. See the response to RAI 2-8 for location and status of oil and gas wells within a 1-mile radius of the site.

Horizontal drilling activities, including hydraulic fracturing (fracking) , beneath the site will be a minimum of 3050 deep as the shallowest oil and gas deposits in the area are in the Yates/Seven Rivers [1] formation, which resides below the salt layer, the Salado Formation.

Fracking poses negligible potential for surface subsidence as the materials being extracted are generally being removed by replacement. The extracted materials are forced out by a sand/water mixture, with the sand remaining in the fractures. Fracking occurs in generally noncompressible rock formations and does not leave large void spaces that would be available to collapse. The potential for subsidence at the surface due to horizontal drilling activities is negligible and is also discussed in the response to RAI 2-8 and 2-12.

The statement referenced in the RAI above regarding site specific surface indications, discussed in FSAR section 2.6.4, references surveys performed of the site to determine if any current or past drilling operations would affect the CISF. These surveys show that there are no signs of these issues at the surface. The statement referenced in the RAI above regarding current drilling regulations, discussed in FSAR section 2.1.4, describes the overall protection required of drilling operations by current regulations to prevent the dissolution and subsidence effects 59

experienced in early less regulated drilling activities in the state. Detailed description of the current active and inactive drilling operations adjacent to the site can be reviewed in response to RAI 2-8.

As discussed in the Response to RAI 2-8, the existing oil and gas wells near the CISF facility are at a great enough distance from the ISFSI to be considered not a hazard, including any potential for surface deformation. Future vertical drilling near the site in the secretarys potash area can only occur within permitted drill islands per Order 3324. Drill islands will not be allowed on the HI-STORE Property. Therefore, any future vertical drilling will also be sufficiently distant from the ISFSI to not pose a hazard. Additionally, all new oil and gas drilling in New Mexico is regulated by NMAC Title 19 Chapter 15 requirements, which ensure the wells are safe during operation and abandonment.

The potential for surface deformation due to mining activities near the site is discussed in the Response to RAIs 2-10, 2-11, and 2-12. FSAR chapter revisions for these RAIs are described in each response.

References for 2-25:

1. New Mexico Oil Conservation Division, NM OCD Oil and Gas Map - ArcGIS Web Application, <nm-emnrd.maps.arcgis.com/apps/webappviewer/index.html>.

ER-GEN-2: Clarify whether Holtec qualifies for National Pollutant Discharge Elimination System (NPDES) General Permits for construction and industrial stormwater. If Holtec qualifies for both General Permits, confirm that no additional State water quality authorization is required. If Holtec does not qualify for both General Permits, describe Holtecs plans and schedule for applying for individual NPDES stormwater permits, a water quality certification under Section 401 of the Clean Water Act (CWA), or for requesting a waiver from the State for the Section 401 water quality certification. Section 1.4.2.1 of the HI-STORE CISF Environmental Report identifies the need for a National NPDES Construction Stormwater Permit during construction to prevent impacts to jurisdictional waters, and a NPDES General Permit for Industrial Stormwater or an individual NPDES permit during operations for stormwater runoff to waters of the State. A NPDES permit pursuant to Section 402 of the CWA is subject to a CWA Section 401 water quality certification. Under Section 401 of the CWA, a federal agency may not issue a permit or 60

license to conduct activity that may result in discharge into waters of the U.S. unless a Section 401 certification is issued verifying compliance with existing water quality requirements, or a waiver is issued from the State.

This information is necessary to determine compliance with 10 CFR 51.45(b), (c), and (d).

Holtec Response Per discussions with USACE Albuquerque District's Regulatory Office on 6/15/2020, the USACE does not consider the areas surrounding the Site, Waters of the United States (WOTUS). Therefore, the areas are under the jurisdiction of the New Mexico Environmental Department, Ground Water Quality Bureau and Surface Water Qualities Bureau. Holtec is currently working with the program manager of the NMED Surface Water Quality Bureau and is in the process of submitting a Notice of Intent (NOI) with these agencies. Upon review of the NOI, the agencies will determine the applicable permits. Upon acceptance of the HI-STORE license, Holtec will file for the identified permits with the intention that the permits will be acquired prior to construction or operation as applicable. Holtec will continue to work with the NMED program manager or their designee throughout the process.

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