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NRC lays down terms for Honeywell before Ill. uranium plant opening

By Scott DiSavino

(Reuters) - Honeywell International Inc said Tuesday it could take nine to 12 months to upgrade the Metropolis Works uranium conversion facility in Southern Illinois to ensure it could withstand a strong earthquake or tornados.

On Tuesday, the U.S. Nuclear Regulatory Commission (NRC) issued a Confirmatory Order telling Honeywell what actions the company must take before it can resume operations at Metropolis.

The facility has been shut since May 9 following an NRC inspection that determined a major earthquake or tornado could result in a higher risk to the public than originally assumed, the NRC said in a release.

That inspection was part of the NRC's assessment of all U.S. nuclear related facilities in the wake of last year's Fukushima disaster in Japan.

There were no safety concerns at the facility currently since the plant is shut, the NRC said.

"This agreement with the NRC gives Honeywell clarity about the type and extent of necessary upgrades to the facility, allowing us to continue the scoping, planning and design work," Larry Smith, plant manager for the facility, said in a release.

"Thanks to this agreement, we are closer to being able to estimate the required investment and schedule of work needed for the facility to resume full production," Smith said.

A spokesman at Honeywell told Reuters the company has not publicly announced the estimated cost of the needed upgrades.

The Honeywell Metropolis Works is the only facility in the United States that takes milled uranium and converts it into uranium hexafluoride gas (UF6), which is then enriched at other facilities like USEC Inc's Paducah Gaseous Diffusion Plant in Kentucky to make fuel for commercial power reactors.

USEC's Paducah uranium enrichment facility is located across the Ohio River from the Metropolis plant in Paducah, Kentucky.

The Honeywell spokesman said the company does not comment on how the plant's shutdown was affecting the nation's supply of uranium hexafluoride.

UF6 is not a widely traded product but since May when the Metropolis facility shut, cash prices have declined from about $140 kilograms of uranium (kgU) to about $130 in September. See Ux Consulting Co LLC (UxC) Uranium UF6 North American price monthly contracts and

NO RESTART UNTIL WORK DONE

The NRC said it will not allow the Metropolis plant to resume operations until Honeywell satisfies the provisions outlined in the NRC's order.

"These measures ensure the continued safety of the people who work at Honeywell as well as those who live nearby," Victor McCree, the NRC's Region II Administrator, said in the release.

The inspection in May said process equipment in the facility lacks seismic restraints, support and bracing that would assure integrity during a significant seismic or wind event.

Specifically, the NRC said the amount of uranium hexafluoride that could be released into the environment should the process equipment be damaged by such an event could be significantly larger than assumed in the facility's Emergency Response Plan.

The material that could be released poses more of a chemical hazard than a radiation hazard, the NRC said.

But with the facility shut, the NRC said a seismic event or a tornado would not result in a significant release of material.

The NRC said it identified two apparent violations associated with the inspection findings.

Honeywell's Emergency Response Plan, submitted in May 2005, failed to identify accident sequences related to credible seismic and tornado events and the plant's Integrated Safety Analysis Summary erroneously states that "the plant is designed to withstand earthquake with no safety implications," the NRC said.

Due, in part, to Honeywell's cooperation and stated commitment to protect workers and public safety, the NRC said it decided to issue a Confirmatory Order in lieu of a Notice of Violation and consideration of civil penalties.

The NRC wants the company to revise its Emergency Response Plan and its Integrated Safety Analysis, ensuring that both define and provide the safety bases for its improved seismic and wind design.

The NRC also wants Honeywell to implement proposed modifications to ensure the facility can safely withstand such events.

(Reporting By Scott DiSavino;Editing by Sofina Mirza-Reid)

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