COTTER CORPORATION CANON CITY MILLING FACILITY

Transcription

1 CALENDAR YEAR 2005 APPENDIX B INDEPENDENT ALARA AUDIT OF THE RADIOLOGICAL AND ENVIRONMENTAL PROGRAMS AT THE COTTER CORPORATION URANIUM MILL, CANON CITY, COLORADO COTTER CORPORATION CANON CITY MILLING FACILITY Canon City, Colorado June 30, 2006

2 F I N A L R E P O R T Independent As Low As is Reasonably Achievable (ALARA) Audit of the Radiological and Environmental Programs Cotter Corporation Canon City Milling Facility Cañon City, Colorado Prepared for Cotter Corporation Canon City Milling Facility Cañon City, Colorado June 6, 2006 URS 8181 East Tufts Avenue Denver, Colorado

3 Executive Summary In accordance with the provisions of the Cotter Corporation's State of Colorado Department of Public Health and the Environment (CDPHE) radioactive materials license, URS Corporation conducted an independent as low as reasonably achievable (ALARA) audit of the facilities and operations of the Cotter Corporation's milling facility located in Cañon City, Colorado. The comprehensive audit was conducted to evaluate the radiation safety and environmental effluent programs implemented at the facility that provide site employees and the public in the vicinity with assurances that radiological exposures and releases to the environment are minimized. After a comprehensive review of the Cotter Corporation radiation safety and environmental program documentation, the on-site portion of the ALARA audit of the Mill was performed on May 1 through 3, 2006, by the URS Audit Team with the support of the Cotter Corporation radiation, environmental, safety and management representatives at the facility. At the time of the audit, the Mill was not receiving or processing ore. General plant activities were limited to facility maintenance and measures to sustain compliance with the license requirements. Several findings, deficiencies, and observations were noted during the audit. These are described in detail in the audit report. Findings are considered to be significant deviations from established requirements, and are summarized below: The Cotter management and Radiation Safety Officer (RSO) failed to take prompt, appropriate actions to correct known deficiencies. Employees were not notified of their bioassay results in writing. The opportunities to examine personnel exposures to external radiation and internal intakes for trends in specific areas were limited by the wide variations of activities and production rates and materials processed. The maximum total effective dose equivalent (TEDE) among site workers in 2005 was reported to be 577 millirem (mrem), which is lower than values reported for Although the average and maximum committed effective dose equivalent (CEDE) and TEDE values represent a decrease for 2005, the variability of operations may be responsible for these decreases. Many factors influence the decrease in these dose values and thus these numbers could not be normalized based on production rates or inventory. Cotter Corporation Uranium Mill 1 May 22, Independent ALARA Audit

4 Introduction Cotter Corporation is a nuclear fuel cycle supply company that is authorized by the United States Atomic Energy Act and licensed by the state of Colorado to engage in activities for the commercial processing and recovery of uranium and vanadium at their Uranium Mill, located in Cañon City, Colorado. Cotter Corporation is a General Atomics (GA) affiliate headquartered in Denver, Colorado. Uranium milling is a highly regulated industry governed by the conditions and requirements specified in the radioactive material license. In the State of Colorado, the Nuclear Regulatory Commission (NRC) has discontinued licensing responsibilities, and the Colorado Department of Public Health and Environmental (CDPHE) has assumed these responsibilities. The CDPHE has the responsibility for the licensing and use of radioactive materials in Colorado under the Radiation Control Act (Title 25, Article 11) and the State of Colorado Rules and Regulations pertaining to Radiation Control (6 CCR ). As a condition of the Cotter Radioactive Materials License issued by the CDPHE (License Number COLO , Amendment Number 41, Order on Consent and Addendum to Order on Consent ), License Condition states, The licensee shall annually commission an independent audit, including conclusions and recommendations from review of all audits, inspections, employee exposure data, effluent release data, and environmental data to determine if: the radiation, hazardous materials, and safety programs related to radioactive materials and byproduct materials (including chemicals used in the milling process) are adequate, the quality assurance program is adequate, any upward trend is developing in personnel exposure for an identifiable category of worker or type of operation or effluent release, any exposure or effluent might be lowered under the concept of as low as reasonably achievable (ALARA), and equipment for effluent and exposure control is being properly used, maintained, and inspected. Cotter Corporation contracted URS Corporation (URS) to conduct this independent audit in accordance with the license provisions and provide a detailed report to be included in the Cotter Corporation Annual Report to be submitted to the CDPHE by June 30, The scope of the audit was focused on elements of licensed operations that have potential radiological aspects impacting the condition of the plant, its workers and the environment. After a comprehensive review of the Cotter Corporation radiation safety and environmental program documentation, the URS Audit Team, with the support of the Cotter Corporation radiation, environmental, and safety staff and the site management, performed the on-site portion of the independent ALARA audit of the Cotter Corporation Uranium Mill on May 1 through 3, At the time of the audit, the Mill was determined to be in a "stand down" mode, and the plant was not receiving or processing ore due to decisions based on business and financial objectives. General plant activities were limited to facility maintenance and measures to sustain compliance with the Cotter Corporation Uranium Mill 2 May 22, Independent ALARA Audit

5 license requirements. The Cotter Corporation on-site radiochemistry laboratory was in transition as well. Although future plans included conducting isotopic and quantitative analysis of samples, as it had previously, the laboratory was primarily being used to screen samples to determine the necessary radiation safety protection provisions for specific tasks. URS assessed Cotter Corporation compliance practices with respect to the applicable CDPHE regulations and the conditions specified in the license. As outlined in the license, URS evaluated the nominal work practices and evaluated these against the facility license, pertinent CDPHE regulations, and written operating procedures specified in the Cotter Corporation Radiological Health and Safety Procedures Manual, Site Safety Manual, Site Security Manual, Laboratory Procedures Manual, Site Liquids and Solid Materials Management Plan, and the Quality Assurance Program Plan. In addition, a number of NRC Regulatory Guides, some which are specified in the license, were used to evaluate programs with respect to the concepts of ALARA. These were: Regulatory Guide 4.14, Radiological Effluent and Environmental Monitoring at Uranium Mills, Revision 1, April 1980 Regulatory Guide 4.15, Quality Assurance For Monitoring Programs - Effluent Streams and the Environment, Revision 1, February 1979 Regulatory Guide 8.10, Operating Philosophy for Maintaining Radiation Exposures As Low As Reasonably Achievable, Revision 1-R, September 1975 Regulatory Guide 8.22, Bioassay at Uranium Mills, Revision 1, August 1988 Regulatory Guide 8.30, Health Physics Surveys at Uranium Recovery Facilities, Revision 1 May 2002 Regulatory Guide 8.31, Information Relevant to Ensuring that Occupational Radiation Exposures at Uranium Recovery Facilities Will Be As Low As Reasonably Achievable, Revision 1 May 2002 Included in the audit report are recommendations of methods to lower potential exposures to site workers and the general public and limiting releases from the facility. Audit findings were based on visual observations; review of the Cotter Corporation files and records and submittals to the State that were made available to the audit team; and interviews with Cotter Corporation employees. No collection or analysis of soil, air, water, or waste samples was conducted during the audit. During the independent ALARA audit, URS examined each of the license conditions in detail, and established a specific checklist to identify compliance issues associated with each condition. This checklist appears as Attachment A. It includes an evaluation of the facility ( satisfactory, concern or unsatisfactory ) with regard to each license condition, and provides a brief description of the evidence used to make the evaluation. Cotter Corporation Uranium Mill 3 May 22, Independent ALARA Audit

6 Audit Schedule and Participants The independent ALARA audit of the Cotter Uranium Mill consisted of the sequential activities listed below. 1. URS provided written notification as to the purpose, scope, schedule, and regulatory basis for the independent audit to Cotter Corporation. Included in the notification document were auditors names, background, pre-audit checklists, auditee personnel needed for interviews, and health and safety requirements for facility access. 2. Opening audit meeting was conducted with key Cotter personnel on 1 May Tours of Cotter milling facilities, interviews, record reviews and examination, discussions, etc., were conducted on 1 through 3 May Final exit meeting with key personnel was conducted on 3 May The draft audit report for Cotter review and response was submitted to Cotter Corporation on 22 May URS prepared and submitted the final audit report to Cotter Corporation following receipt of review comments. Key personnel participating in the Annual Independent Audit included: Auditors: Auditees: URS Audit Team Sally K. Miller (Project Manager) Scott W. Maxey (Lead Auditor) Gary M. Sandquist (Auditor) Cotter Corporation Personnel John Hamrick, Mill Manager James Cain, Environmental Coordinator/Radiation Safety Officer Mark Currey, Assistant Radiation Safety Officer Richard Wooten, Health and Safety Supervisor Richard Ortega, Senior Environmental Technician Mitch Abbate, Laboratory Manager Frank W. Adamic, Quality Assurance Coordinator Kristy Usnick, Radiation Safety Clerk Audit Results The annual independent audit for 2006 of Cotter Corporation Uranium Mill was conducted by the URS Audit Team using American Society of Mining Engineers (ASME) Standard NQA-1 as the quality assurance (QA) standard for audit nomenclature and assessment standards. The independent audit (as defined by ASME NQA-1) was designed and conducted as a planned and documented activity performed to determine by investigation, examination, or evaluation of Cotter Corporation Uranium Mill 4 May 22, Independent ALARA Audit

7 objective evidence the adequacy of compliance with established procedures, instructions, drawings, and other applicable documents, and the effectiveness of implementation. The findings, deficiencies, observations and recommendations included in this report are based on the results determined from the audit. Audit results are categorized into four types per the ASME NQA-1 and are defined as follows: 1) A finding is considered a significant deviation from established requirements (e.g., license requirements, radiation regulations, ALARA principals, etc.) and are supported by the identification and assessment of related or repeating deficiencies and observations. 2) Deficiencies are considered to be potential or actual isolated infraction(s) of established requirements that pose a potential for significant violation if not adequately addressed and ameliorated. 3) Observations reflect both positive and negative observations of physical and personnel interview evidence. 4) Recommendations are proposals by the audit team for addressing findings, deficiencies, and observations and are meant to be useful only. The Licensee has the final responsibility for addressing the findings and deficiencies to the satisfaction of the appropriate licensing authority. The Cotter Corporation management and support staff was cooperative and attentive to the needs of the auditors, which facilitated an effective audit. Prior to the audit, Cotter Corporation organized materials to address each license condition and assigned responsibility for each item to a Cotter employee. An updated organizational chart was available, and the facility possessed a vast amount of institutional knowledge evident in key personnel, including the members of the radiation protection and safety leadership, who have provided long-term support of the facility. A management system with written procedures had been initiated to address radiological regulatory compliance at the facility, and written procedures to control the work and manage the hazards for each area of operation were available. The effectiveness of the written procedures and the training to those procedures were questionable as demonstrated by the content of the Notice of Violations and Orders by the CDPHE in response to specific incidents. Findings Finding 1: The Cotter management and RSO failed to take prompt, appropriate actions to correct known deficiencies. Basis for finding: A review and subsequent investigation of the deficiencies and the recommendations outlined in the 2005 Independent Audit Report showed that Cotter Corporation failed to formally address each issue and track the progress of potential corrective efforts. This is an infraction of License Condition 8.7, which states that the licensee's management and RSO shall take prompt and appropriate action to correct known deficiencies in the facility's procedures, processes, equipment, and site conditions. Formal audits that identify deficiencies in meeting license conditions or program requirements outlined in the written procedures are subject to regulatory scrutiny and can lead to regulatory action that can carry repeat or willful classifications. While it was apparent that elements outlined in the report were reviewed and, in some cases, some Cotter Corporation Uranium Mill 5 May 22, Independent ALARA Audit

8 Finding 2: Deficiencies Deficiency 1: action was taken or considered, no formal and documented process was established. Based on the available resources, it appeared that no action was taken in some cases. Recommendation: Ensure that the RSO and/or the ALARA Committee implement a mechanism to address audit findings and track corrective actions. URS recommends placing all audit findings, including those specified in the 2005 ALARA Audit, on a spreadsheet and assigning responsibility for them to specific representatives who will address them appropriately, track corrective actions and verify completion. Employees were not notified of their bioassay results in writing. Basis for finding: The participation in the bioassay program was extensive at the facility. CDPHE regulations, 6CCR , Part 10, Notices, Instructions, and Reports to Workers, state that radiation exposure data for an individual and the results of any measurement, analysis and calculations of radioactive materials deposited or retained in the body of an individual shall be reported to the individual and it shall be in writing. Bioassay results are medical records that provide evidence of exposure and need to be reported to affected employees. The facility rarely notified employees of results of specific bioassay measurement results and never in writing, even when significant incidents occurred and committed effective dose equivalents were calculated for employees. While the facility did report annual doses, including assigned committed effective dose equivalent (CEDE), to workers on an NRC Occupational Dose Record ( Form 5 or equivalent), these results were usually based exclusively on air monitoring data. Subsequent investigation supported that both the annual dose and the actual results of measurements, analysis, and calculations of radioactive material deposited or retained in the body shall be reported to workers in writing. Recommendation: Clearly identify the objectives of the bioassay program for the facility. Institute a program to notify employees in writing of their bioassay results and the relevance of the results. This recommendation applies to urinalysis and in vivo counting (lung scan) results. Written operating procedures are ineffective and insufficient to support the safe and regulatory compliant operation of the Cotter Milling Facility. Basis for deficiency: A Notice of Violation (NOV) was issued by the CDPHE on 6 May 2005 citing several items of noncompliance. These citations referenced inadequate procedures to maintain employee exposures ALARA; no procedure or Radiation Work Cotter Corporation Uranium Mill 6 May 22, Independent ALARA Audit

9 Deficiency 2: Permit (RWP) to prevent employee exposure during week of 18 October 2004; inadequate utilization of personal protective equipment (PPE) for exposed employees; and inadequate laboratory procedures, quality assurance (QA), training, and analysis to properly analyze biological samples of exposed workers. Cotter is also subject to CDPHE Compliance Order Number , which asserts that operating and safety procedures do not exist to ensure safe operation and regulatory compliance of the facility. In response to the CDPHE, Cotter has retained Jacobs Engineering Group, Inc., to prepare procedures addressing milling operations. These procedures were provided to Cotter with various revisions. Revision 2, dated 18 Dec 05, completed the submission to Cotter by Jacobs. Evidence that Cotter Management had reviewed, accepted, and implemented these procedures was not available during this audit. This deficiency identified the following license conditions that are not fully satisfied by current Cotter written procedures and records. License Condition 8.7 deficient procedures License Condition 13.1 inadequate written procedures License Condition 14.1 safety evaluation of procedures License Condition 17.1 inadequate PPE for safety related activities License Condition 18.2 substitution of RWPs for written procedures License Condition 33.2 correction of procedure deficiencies Recommendation: Establish a management system (including comprehensive written procedures) for safe operations that governs all activities conducted at the facility. Review the procedures and ensure that they are formally approved by Cotter management in accordance with an established procedure. Implement the procedures through documented training of all affected Cotter employees. Properly identified, weekly, documented inspections by the RSO of each active work area to evaluate site conditions and proper implementation of radiation protection program and safety program are not in evidence. Basis for deficiency: License Condition 10.2 requires weekly, documented inspections by the RSO of each active work area to evaluate site conditions and proper implementation of radiation protection program and safety program. Cotter asserts that activities of the ALARA Committee, of which the RSO is an active member, effectively satisfy this license condition. However, no documentation exists in the ALARA Committee records to indicate that the ALARA Committee s activities address this weekly requirement. Recommendation: Establish a program to ensure that the weekly inspections are formally addressed and documented in accordance with license conditions. Cotter Corporation Uranium Mill 7 May 22, Independent ALARA Audit

10 Deficiency 3: Deficiency 4: Deficiency 5: Documentation of certain quarterly activities required of the RSO is not in evidence. Basis for deficiency: License Condition requires that for each quarter during active operations the RSO must (1) conduct an audit of logs and reports of inspection, (2) perform an evaluation of adequacy of implementation of license requirements, and (3) provide written recommendations to mill manager of necessary corrective actions. Cotter asserts that activities of the ALARA Committee, of which the RSO is an active member, effectively satisfy this license condition. However, no documentation exists in the ALARA Committee records to indicate that the ALARA Committee s activities actually address this quarterly requirement. Recommendation: Establish a program that assures that these leadership reviews are conducted and formally documented. No annual review of the respirator protection program had been conducted. Basis of Deficiency: The evaluation of the facility s respiratory program, as compared to past audit findings, suggested that significant improvements to the program had been implemented. However, Cotter procedure RH-190, Respirator Use and Fit Testing, and regulatory standard requirements call for annual review of the program. This review had not been performed. Recommendation: Perform a formal annual review of the respirator program, and prepare and submit a written assessment report identifying deficiencies, needed modifications, and methods to enhance the program s effectiveness to facility management. Certain training requirements were not met. Basis for deficiency: Training deficiencies were noted during the audit. Examination of the training records indicated semi-annual emergency drills and emergency response training were not conducted in accordance with ER-010, Emergency Response, and License Condition 9.1, Response Plan. In addition, some employees (e.g., Mill Manager) had not completed the "read and sign" training of identified procedures. The training database and record keeping system was adequate to demonstrate compliance; however, the timeliness of data entry was lagging. Other evidence pointing to training deficiencies included reports of events leading to injuries as a result of failure to wear appropriate PPE during specific activities. These events and information from employee Cotter Corporation Uranium Mill 8 May 22, Independent ALARA Audit

11 Deficiency 6: Observations interviews indicated that personnel were, at times, assigned job responsibilities for which they were not specifically or effectively trained. Such situations are in conflict with the objective of on-the-job training requirements outlined in License Condition 16.4 and are inconsistent with the requirements of License Condition 17.1, which specifies the requirements for the selection, use, maintenance and care of PPE. Recommendation: Establish and use a matrix of training requirements by job activity and frequency to avoid training noncompliance issues. Implement training programs as identified in the matrix. Personal exit survey practices were not in accordance with procedures, inconsistent among workers, and not accurately reported. Basis for deficiency: Although the quarterly 10% spot check surveys to verify the effectiveness of personal exit surveys showed no signs of personal contamination above the release limits, observations and interviews of employees performing personal exit surveys prior to leaving the facility were found to be out of compliance with RH-200, Personal Release Surveys. This is a reoccurring audit finding. Workers were observed performing a variety of scanning techniques to detect alpha and beta radiation, and some workers did not appear to understand that to effectively detect alpha radiation, the surface of the detector must be maintained at or below 1 cm. It is possible that employees have become frustrated attempting to meet the release limits specified in the procedures and have reported inaccurate nominal values in order to exit the facility. (The established release limits were at essentially background levels.) The observations were made when the site had low traffic through the exit survey location. During production, when larger groups of people are leaving at the same time, additional pressure may exist to release people more quickly, further increasing the potential for inaccurate exit surveys. Recommendation: Reexamine the release limits and establish revised release limits that offer a clearer distinction between contamination and natural background radiation but do not compromise safety. More instruments or staggered end-of-shift schedules may need to be considered to avoid the potential for contaminated personnel leaving the facility. Although a personal contamination monitor (PCM) would be ideal, the cost may be prohibitive. Regardless of what instrument is used, workers must be adequately trained and must adhere to the established exit procedures to assure contaminated personnel are not leaving the facility. The release limits, while extremely protective, were set at a level that makes distinguishing between contamination and background levels of radiation difficult, especially for beta radiation where a higher background may exist. Observation 1: Cotter Corporation Uranium Mill 9 May 22, Independent ALARA Audit

12 Calibration methods to determine airflow and volume measurements of personal and area samples used to determine Committed Effective Dose Equivalents (CEDE) of workers might not be sufficient to accurately report values. Basis for observation: Personal air monitoring was frequently conducted to determine potential inhalation intakes, and the results were used to assign Committed Effective Dose Equivalents (CEDE) to employees. The importance of this monitoring suggests that personal air monitoring air pumps be calibrated more frequently than quarterly and that less reliance be placed on the pump internal rotometer (ball inside tube) to validate that flow rates have not changed. Recommendation: Pre- and post-calibrate personal monitoring pumps for each monitoring event in order to reasonably determine the average flow rate so that an accurate air volume can be calculated. To achieve this in a timely manner, obtain better calibration technology, such as that found in the BIOS DryCal calibrator. The current calibration equipment (bubble spirometer) is time-consuming and difficult to use. Observation 2: Labeling of containers and tanks at the facility could be enhanced to facilitate ALARA conditions and comply with MSHA Regulations Basis for observation: License Condition 20 specifies that the labeling of containers must be in accordance with Part 4 of the CDPHE regulations. Part 4.31 allows for container labeling exceptions, provided that access to containers is restricted to approve users with process knowledge. NRC Regulatory Guide 8.30, Health Physic Surveys at Uranium Recovery Facilities, allows for limited-labeling requirements, provided the fence line and all entrances are appropriately posted and contain the statement, Any area within the Facility may contain Radioactive Material. However, Mine Safety and Health Administration (MSHA) regulatory requirements and ALARA considerations exist. MSHA s Hazard Communication (HAZCOM) for the Mining Industry (30 CFR Part 47) requires container labeling to notify workers of hazards in the work place. The final rule requires that each container of hazardous chemical be labeled, tagged or marked with the identity of the hazardous chemical and appropriate warnings. Additional MSHA clarification states that while pipes and piping systems are not considered containers, fixed, mobile and temporary vessels are containers and subject to the labeling provisions of HAZCOM. Recommendations: Consider labeling vessels and containers with hazard labels. In addition, containers with potentially large quantities of radioactive materials, such as containers in the Wagon Wheel Area, could be labeled with the exposure rate (dose) measurement results and contamination levels as applicable. Ensure that the fence line and entrance postings contain the statement(s) specified in the regulatory guide. Cotter Corporation Uranium Mill 10 May 22, Independent ALARA Audit

13 Observation 3: Documented root cause investigations of bioassay (urinalysis) action limit exceedances were lacking, and discrepancies existed between CEDEs based on airmonitoring data and bioassay results. Basis for observation: As a practical tool, bioassay results were used to measure the effectiveness of facility controls and to determine areas of potential exposure concerns. Specific exceedances of the action level were recorded. Significant potential exposure events were investigated, and the CEDE values for individuals were calculated. Bioassay results represent medical evidence of an uptake and potential deposition of radioactive material in the body. Procedure RH-050, Uranium Bioassay, section 7.3.1, states that the RSO shall initiate an investigation for bioassay results greater than 10 μg/l. Section states that a dose will be calculated for these exceedances that will be substituted for dose calculated on the uranium air concentrations data. Although some investigation was conducted, this was informal and the follow-up assignment of calculated CEDE (dose) based on bioassay results was not consistently applied as the procedure requires. Longterm liability issues may exist because of potential discrepancies between bioassay results and assigned CEDE values based on air monitoring data. Recommendations: Review and revise the bioassay program to clearly address the scope and objectives of the program and determine if alternatives exist to limit the amount of bioassay samples collected and improve the quality of the data (24-hour composite sampling) obtained. Evaluate the use of continuous air monitors (CAMs) in selected areas as an option to reduce the volume of bioassay samples needed to evaluate the exposure conditions of the facility. Review RH-050 and determine if the data management practices are aligned with the procedure and establish a formal process for addressing incidents in the plant, including bioassay exceedances. Identify and examine discrepancies between bioassay results and assigned CEDE values based on air monitoring data, and document the resolution or explanation of such discrepancies. Observation 4: Sealed sources were not leak tested semi-annually (i.e., at 6-month intervals). A sealed source device registry was available for most, but not all sources, allowing for a 3-year leak test frequency. Basis for finding: Sealed sources specific to the license were leak (wipe) tested every three years in accordance with the provisions outlined in Cotter Corporation RH-160, Leak Testing. Although the State had technically approved this procedure as part of their procedure reviews, this procedure may be inconsistent with the License Condition 21.2, which states that each sealed source authorized in Item 6 of the license shall be tested in accordance with the requirements of RH4.16 of the regulations at intervals not to exceed Cotter Corporation Uranium Mill 11 May 22, Independent ALARA Audit

14 six (6) months or as specified in the NRC Sealed Source and Devise Registry for the specific devise. While some of the industrial control sources had sealed source device registries that allowed for a 3-year leak test frequency, other sealed sources may not have had registries and may be subject to a semi-annual leak test schedule. Recommendation: Conduct leak testing of sealed sources semi-annually as specified in the license. Revise RH-160 to reflect the schedule change. Note that the copy of the Cotter procedure RH- 160 submitted to URS for review was missing the micro (μ) curie unit for wipe test leak action levels. The procedure called for a curie action level, not microcuries. (This unit was not missing in the RH-160 procedure available for review at the facility.) General Observations The radiation safety, safety, laboratory and management representative of the facility were qualified and possessed the necessary experience to effectively administer the radiation safety and ALARA programs at the facility. Management and technical leadership had a great deal of institutional and regulatory knowledge about the issues affecting the industry and the plant. The implementation of a detailed, written management system will help ensure that the radiation safety program and the facility remain in regulatory compliance should the loss of one of the key individuals occur. The radiation safety personnel and management were committed to effectively maintaining ALARA exposures of workers, the general public, and the environment. The ALARA Committee was meeting more frequently than required, as outlined in AD-080, ALARA Program, and the general ALARA goals were being meet. Weekly inspections, required by License Condition 10.2, were being performed by a rotating subset of the ALARA Committee. The establishment of annual ALARA goals, which are independent from previous years, and performance tracking of those efforts, could dramatically enhance the Committee s effectiveness. The opportunities to examine personnel exposures to external radiation and internal intakes for trends in specific areas were limited by the wide variations of activities and production rates and materials processed. For example, at the time of the audit, the facility was in a "stand down" mode with no firm timetable for resumption of production activities. The maximum total effective dose equivalent (TEDE) among site workers in 2005 was reported to be 577 mrem, which is lower than values reported for Although the average and maximum CEDE and TEDE values represent a decrease for 2005, the variability of operations may be responsible for these decreases. Many factors influence the decrease in these dose values and thus these numbers could not be normalized based on production rates or inventory. The condition of the physical facility and the permanent equipment, such as eye wash stations and safety showers to support certain operations, was not adequate to assure worker safety. The facility and the equipment to support normal operations were dated, and in some cases may need significant improvements. Prior to resuming processing activities, a detailed pre-startup Cotter Corporation Uranium Mill 12 May 22, Independent ALARA Audit

15 evaluation or readiness review, as specified in the license, must be performed and will be essential to safe operations. This review should include hazard assessments, controls, and facility inspections. Cotter Corporation Uranium Mill 13 May 22, Independent ALARA Audit

16 Conclusions The personnel resources of the Cotter Uranium Milling Facility were at minimal levels. Any additional decrease in radiation safety or safety staff would limit the facility s ability to remain in regulatory compliance and may jeopardize licensing. The current staffing levels are insufficient to support normal production operations, and the facility is encouraged to increase the staffing levels prior to commencing normal operations. The facility has a documented procedural basis for executing standard mill operations. However, at the time of the assessment, most operations were controlled by the use of RWPs because of the diverse activities during the "stand down. Written procedures for routine production operations were available though their effective implementation in the plant was questionable, as demonstrated by a cluster of significant exposure events where employees failed to follow established requirements. These events have resulted in NOVs and issuance of the CDPHE Compliance Order. Providing the technical and managerial personnel and required resources to prepare and review comprehensive written procedures for mill operations, and then performing thorough training of all personnel to these procedures, may demonstrate to CDPHE the commitment required to resume the fully compliant and safe operation of the facility. Cotter Corporation Uranium Mill 14 May 22, Independent ALARA Audit

17 Attachment A Checklist for Annual Independent Audit Conducted by URS Corporation COTTER RADIOACTIVE MATERIAL LICENSE COLORADO DEPARTMENT OF PUBLIC HEALTH AND ENVIRONMENT HAZARDOUS MATERIALS AND WASTE MANAGEMENT DIVISION LICENSE NUMBER: COLO , AMENDMENT NUMBER: 41, Order on Consent and Addendum to Order on Consent Dates of Audit: 1-3 May 2006 Auditors: Scott W. Maxey Lead Auditor Gary M. Sandquist LICENSE CONDITION ASSESSMENT EVIDENCE License Condition 6.A: The licensee is authorized to accept, receive, possess, handle ores and other Department approved classified materials for the commercial processing and recovery of uranium and vanadium. The total quantity of all such materials is limited to: Western Slope native ores 440,000 tons no greater than 0.42% U3O8. Evidence: Records: RADTRAK, SAR, AR, Mill Operation and Transportation Records License Condition 6.B: The licensee is authorized to possess ores and other Department approved classified materials for small scale testing and process development for recovery of uranium, zirconium, silica and other minerals, providing the ultimate processing and recovery is primarily for uranium, as required by the Atomic Energy Act. The total quantity of all such materials the licensee is authorized to possess, handle, and test these materials is limited to: Uranium/Zirconium Ore 13,300 tons no greater than 0.25% U nat,1% Th-nat Amazon Sands Ore 30 tons no greater than 0.5% U-nat, 2% Th-nat CaF2 material 2,000 tons no greater than 4.0% U-nat, 1% Th-nat Off-spec Yellowcake 2,000 tons no greater than 90% U-nat Euxenite Ore 20 tons no greater than 15% U-nat Satisfactory _X_ Concern Not Satisfactory Person Contacted: Jim Cain Evidence: Records: RADTRAK, SAR, AR, Mill Operation and Transportation Records License Condition 6.C: The licensee is authorized to process and distribute to authorized recipients concentrated uranium product (yellowcake). The licensee is authorized to possess and store yellowcake in quantities not to exceed 500 metric tons (1,000,000 pounds). Evidence: Shipping Records, Mill Operation Records Page 1 of 33 Date 6/28/2006

18 License Condition 6.D: The licensee is authorized to utilize and maintain the designated onsite impoundments in accordance with Department approved parameters. The total quantity of materials placed into these impoundments shall not exceed without Department approval: 1.35 M yd3 (approximately 1.57 M metric tons at 1.3 tons/yd3) for materials currently in the primary impoundment; 440,000 yd3 (approximately 572,000 metric tons) for licensee-generated tailings and other process residues for placement in the primary impoundment for currently authorized materials M yd3 (approximately 2.5 M metric tons) for all existing materials in the secondary impoundment. 4 M yd3 (approximately 4.64 M metric tons) cleanup and decommissioning reserve for all licensee-generated source and type 2 byproduct material consisting of ore, soils, sludges, mill debris, rubble, process residues, and other materials associated with mill decommissioning and the remediation of near-offsite soils compatible with the impoundment materials. Materials considered listed hazardous waste under the Resource Conservation and Recovery Act shall not be disposed in the impoundments. Evidence: RADTRAK License Condition 6.E: The licensee is authorized to collect and analyze environmental samples, air monitoring samples, and worker bioassay samples containing U, Th, Ra, and their associated radioactive progeny for assessment of public and worker doses. & Mitch Abbate Evidence: Environmental, Occupational Files License Condition 6.F: The licensee is authorized to possess and use up to 18 sealed sources (Thermo Measure Tech, Model 57157C) each source not to exceed 7.4 GBq (200 mci) of 137Cs. Sealed sources are to be used in Texas Nuclear Model 5176 source holder for the measurement of mass density in ore or other slurries for process control., Kristy Usnick Evidence: RADTRAK, Source Files License Condition 6.G: The licensee is authorized to possess and use 1 sealed source (Amersham Model CDC.P4), not to exceed 740 MBq (20 millicuries) of 137Cs. Sealed source may only be used in EG&G Berthold Model LB7440 D gamma gauges for measurement of slurry density and flow in piping. Evidence: Not received Page 2 of 33 Date 6/28/2006

19 License Condition 6.H: The licensee is authorized to possess and use up to 60 sealed sources (Berthold Systems Model 39002) each source not to exceed 370 kbq (10 µci) of 137Cs. These sources may only be used in Berthold Systems, Inc. Model NW-201 Series gamma gauges for the measurement of slurry density and flow in piping. Evidence: RADTRAK, Source files License Condition 6.I: The licensee is authorized to possess and use up to 6 sealed sources (EG&G Berthold Model P ) each source not to exceed 370 MBq (10 mci) of 137Cs. Sealed sources are to be used in EG&G Berthold Model LB300L gamma gauges for level measurement in process tanks. Evidence: Not received License Condition 6.J: The licensee is authorized to possess and use 2 sealed sources (Thermo Measure Tech, [formerly Texas Nuclear] Model 57157C) not to exceed 1.85 GBq (50 mci) of 137 Cs. Sealed sources may only be used in Texas Nuclear Model 5176 and Texas Nuclear Model 5197 source holders for fill level control for barrel filling operations. Evidence: Source file 19.License Condition 6.K: The licensee is authorized to possess and use the following sources for functional testing and quality assurance of radiation detection equipment: 1) 3 each, 239Pu planchet, not to exceed 110,000 dpm, 2) 31 each, 230Th planchet, not to exceed 28,000 dpm, 3) 2 each, 226Ra planchet, not to exceed 3.7 kbq (0.1 uci), 4) 20 each beta sources (Sr-90, Cl-36, and/or Tc-99), nominally 20,000 dpm. Satisfactory _X_ Concern Not Satisfactory Person Contacted: Mitch Abbate/ Mark Currey Evidence: Records: RADTRAK, SAR, AR, Mill Operation and Transportation Records License Condition 6.L.: The licensee is authorized to possess and use the following liquid standard source solutions for laboratory calibrations: Th-nat 1 mci Th mci Th mci Pb mci Ra mci Satisfactory _X_ Concern Not Satisfactory Person Contacted: Mitch Abatte Evidence: In laboratory Page 3 of 33 Date 6/28/2006

20 License Condition 6.M: The licensee is authorized to possess and use solid standard reference sources for use as laboratory control samples including but not limited to ore and/or tailings based materials with a total activity to not exceed 1 mci. Satisfactory _X_ Concern Not Satisfactory Person Contacted: Mitch Abatte Evidence: In laboratory License Condition 7: Location of Use: Radioactive materials may be received, stored, handled, processed and disposed in the ore storage, milling and mill tailings impoundment facilities located at the Cotter Canon City milling facility located at 0502 County Road 68, Canon City CO The Restricted Area is described in Annex A of this License. Evidence: Radiation Clerk Office License Condition 8.1: The licensee shall comply with the provisions of the State of Colorado Rules and Regulations Pertaining to Radiation Control: Part 3, Licensing of Radioactive Material ; Part 4, Standards for Protection Against Radiation ; Part 10, Notices, Instructions and Reports to Workers: Inspections ; Part 17, Transportation of Radioactive Material ; and Part 18, Licensing Requirements for Uranium and Thorium Processing. Evidence: Postings in Administration Office License Condition 8.2: The licensee will be authorized to process and dispose classified materials described in Item 6A upon written approval from the Department. This approval shall be based upon a readiness review report generated by the Mill Manager and RSO. The report shall be submitted to the Division prior to the planned commencement of full operations. The review shall address at a minimum: operational readiness (process changes and controls relative to the acid leach process, other mechanical systems, emission controls), radiation safety, training, and performance objectives. The licensee is authorized to test and operate on a limited basis (< 500 tons per day) as part of the readiness review process. Evidence: Sequoyah MAR/MAX License Condition 8.3: The licensee shall not operate the mill beyond a capacity of 1,500 tons (1,350 metric tons) of uranium ore processed per day or 1,200 tons (1,100 metric tons) per day on a yearly average. Evidence: Mill Operation Records/SAR/AR License Condition 8.4: The licensee shall not make any modification to an operating procedure, ongoing or proposed process without evaluating the occupational, environmental and Page 4 of 33 Date 6/28/2006

21 public health and safety or security impact of such change. The evaluations shall be documented with supporting information and be available for Department inspection. Satisfactory Concern _ X _ Not Satisfactory Person Contacted: Jim Cain, John Hamrick Evidence: Interviews and Records. NOV from Colorado DPHE dated 9 March Ineffective operating procedures and training (RWPs and procedures) for activity that resulted in an over exposure to worker during the week of 18 Oct License Condition 8.4.1: Changes that alter solubility of material from previous processes; increase airborne concentrations of radionuclides; introduce chemicals or radionuclides not previously present or evaluated at anticipated concentrations; or that otherwise change the work environment (required PPE, permanent posting of areas, chemical exposure), or increase public dose by greater than 10% shall not be implemented without prior written Department approval. The RSO shall provide thirty (30) days advanced notice prior to commencement of the modification for the Department review. Activities conducted under radiation work permits do not need Department approval. Evidence: Interview License Condition 8.5: Requests for authorization for additional materials other than those specified in Item 6 shall follow the requirements of Part 2 of The Radiation Control Act [CRS et seq.] (the Act). Evidence: Sequoyah/ AMAX License Condition 8.6: The Department does not permit, authorize, concur in, or otherwise approve of, the prohibited release or threatened release of a hazardous substance, pollutant, or contaminant into the environment. Evidence: Interview License Condition The licensee shall implement engineering controls to maintain all releases of radioactive materials into the environment to levels that are As Low As Reasonably Achievable (ALARA), and is prohibited from releasing radioactive materials into the environment above limits specifically authorized by the State of Colorado Rules and Regulations Pertaining to Radiation Control (the Regulations), the requirements of the site Air Emissions Construction Permit, or as established by the U.S. Environmental Protection Agency as reportable quantities at 40 CFR 302 or this license., Kristy Usnick Evidence: ALARA Records: SAR, AR Page 5 of 33 Date 6/28/2006

22 License Condition 8.7: The licensee s management and radiation safety officer shall take prompt and appropriate action to correct known deficiencies in the facility s procedures, processes, equipment, and site conditions. Satisfactory Concern Not Satisfactory _ X Person Contacted: Jim Cain Evidence: Interviews and Records. Procedures to correct NOV from Colorado DPHE dated 9 March 2005 not available. NOV comment: Ineffective operating procedures and training (RWPs and procedures) for activities that resulted in an over exposure to worker during the week of 18 Oct License Condition 8.8.1: Prior to beginning any new construction or operation, or any other activity authorized by this license, the licensee shall obtain all applicable permits and other authorizations of local, state and federal agencies having authority over health, safety, and environmental protection aspects of the activities authorized by Item 6, of this license. The licensee shall maintain in force such applicable permits. Satisfactory _X_ Concern Not Satisfactory Person Contacted: John Hamrick, Kristy Usnick Evidence: Ore pad construction License Condition 8.8.2: The licensee shall notify the Division in writing on, or prior to, the date of filing of any application to a permitting agency for modification or renewal of such permit or other required authorization. Evidence: Vanadium Furnace Shutdown License Condition 8.8.3: The licensee shall notify the Division in writing within thirty (30) days of receiving a violation of such permits. Evidence: Vanadium Permit Revocation License Condition 8.9: Severability: If any part of this license is held invalid, the remainder shall not be affected. Satisfactory _X_ Concern Not Satisfactory Person Contacted: John Hamrick Evidence: Interview License Condition : When required by a condition of this license, Division acceptance, approval, authorization, or concurrence shall be obtained in writing from the Division, unless otherwise provided in the Regulations, or Department or Division policy. Satisfactory _X_ Concern Not Satisfactory Person Contacted: John Hamrick Evidence: Interview Page 6 of 33 Date 6/28/2006

23 License Condition 8.11 Consultation: When the Department uses outside consultants, the licensee shall: Permit such consultant to inspect any Division-designated site, facility, or document; Submit Division-designated documents to the consultant for review; and As determined by the Division, confirm applications and supporting documents to such consultant s written guidelines applicable to the project. Evidence: Sentinel Subcontractor License Condition 8.12: Radiation Safety Officer (RSO): The designated Radiation Safety Officer is Jim Cain. Evidence: Organizational Chart License Condition 8.13: The designated assistant to the RSO is Mark Currey. Evidence: Organizational Chart License Condition : The licensee shall obtain from the Division written authorization for each user, based on documented training and experience. Evidence: Training Records License Condition : Radioactive material authorized in Item 6 shall only be received, stored, handled, processed, used or disposed by or under the supervision of the following authorized users: Jim Cain, Mark Currey, Pat Mutz, Phil Krauth, Richard Wooten, William Bowman, Forest Allphin, Robert Tennant, Howard Janin, John Hamrick, Jonnie Ray, Tim Montoya, A.C. Hill, Joe Arsenault, Joe Bosco, Craig Simpson or Jordan Rudel. Evidence: Training Records License Condition : One or more authorized users shall be physically present at the facility at all times when radioactive materials are being received, used, handled, processed, disposed, or analyzed. The number of authorized users present on site at any one time shall be sufficient to ensure adequate supervision of all persons within the restricted area. One or more authorized uses shall be immediately available at all other times. Evidence: Work Records and interviews Page 7 of 33 Date 6/28/2006