**NRC INSPECTION MANUAL** NMSS

MANUAL CHAPTER 2696

LOUISIANA ENERGY SERVICES GAS CENTRIFUGE FACILITY CONSTRUCTION AND
PRE‑OPERATIONAL READINESS REVIEW INSPECTION PROGRAMS

2696‑01 PURPOSE

Under the provisions of 10 CFR 40.41(g) and 10 CFR 70.32(k) and their
license, prior to the Louisiana Energy Services (LES) National
Enrichment Facility (NEF) Gas Centrifuge being allowed to operate under
their license, the Commission must verify that the facility was
constructed in accordance with the requirements of the license.

The purpose of this Inspection Manual Chapter (IMC) is to define the
Construction Inspection Program (CIP) for the LES NEF. Specifically, the
CIP will (1) provide reasonable assurance that the design, construction,
and implementation of items relied on for safety (IROFS) will protect
against natural phenomena and the consequences of potential accidents,
(2) verify the Quality Assurance (QA) Program was adequately implemented
during construction; and (3) verify that the construction of the IROFS
was completed in accordance with the documents comprising the license
application (Safety Analysis Report (SAR), etc.); the Integrated Safety
Analysis (ISA), the Integrated Safety Analysis Summary (ISAS), and the
Safety Evaluation Report (SER).

The LES CIP applies to all construction activities, including, design,
procurement, fabrication, construction, and pre-operational testing
activities. Implementation of this IMC will begin at an applicable time
as determined by the NRC and will continue through facility construction
activities as noted above.

2696‑02 OBJECTIVES

The primary objective of this manual chapter is to establish a CIP for
inspecting IROFS and inspecting associated activities that are conducted
by the licensee and their consultants, contractors, and suppliers, to
support the decision to allow operation of the NEF. The following
objectives are included in the CIP:

02.01 Provide reasonable assurance that regulatory requirements and
licensee commitments for quality assurance and management measures are
adequately included in the design, procurement, and construction of the
NEF.

02.02 Provide reasonable assurance that the NEF and associated IROFS
were constructed in accordance with the quality assurance program, the
license application, the ISA, the ISAS, and the SER.

02.03 Verify the effective implementation of a safety program that
includes the following elements: process safety information, the ISA,
and management measures.

02.04 Verify the effective implementation of the quality assurance
program as specified in the LES Quality Assurance Program Description
(QAPD). Verify that this includes timely implementation of
organizational staffing, procedures, instructions, QA activities, and
administrative controls necessary to achieve quality objectives
important to safety

02.05 Identify conditions that may adversely affect public and worker
safety so that appropriate corrective actions can be taken.

02.06 Conduct risk-informed and performance-based inspections across key
functional areas (see Appendix B for a listing of these areas) to
support the decision to allow operations at the NEF.

2696-03 DEFINITIONS

03.01 [IROFS Boundary Packages]{.underline}: The IROFS boundary packages
identify the specific functions to be performed by an IROFS, and
identify any items that may affect the function of the IROFS. The
boundary packages include information on planned and preventive
maintenance, functional testing and inspection, calibration, and support
systems (including instrumentation, cooling, etc.). They also include
information on applicable management measures and records requirements
for the IROFS.

03.02 [In-Office (or Field) Review]{.underline}: Assessments, audits, or
reviews conducted to assess licensing related activities.

03.03 [Inspection]{.underline}: Measures consisting of examinations,
observations, or measurements

to determine the conformance of materials, parts, structures, systems,
components (SSCs), services, or processes to predetermined quality
requirements. Activities include performing audits, inspections,
surveillances, and observations.

03.04 [Inspection Types]{.underline}: Inspections are classified as
compliance-based or performance-based and are defined below.

v.  Compliance-based inspections emphasize inspection of compliance with
    prescriptive NRC requirements or regulatory commitments that specify
    IROFS, features, actions, or programmatic elements.

```{=html}
<!-- -->
```
a.  Performance-based inspections emphasize inspection of actual
    activity performance and results. Performance-based inspections
    require measurable or calculable parameters and objective
    performance assessment criteria. Note that a performance-based
    approach does not change the need for compliance with NRC
    requirements. In addition, a performance-based approach is typically
    more applicable to an operating facility and may not be appropriate
    to perform certain construction or pre-operational inspections.

03.05 [Items Relied on for Safety (IROFS)]{.underline}: SSCs, equipment,
and activities of personnel that are relied on to prevent potential
accidents at a facility that could exceed the performance requirements
in 10 CFR 70.61 or to mitigate their potential consequences. This does
not limit the licensee from identifying additional SSCs, equipment, or
activities of personnel (i.e., beyond those in the minimum set necessary
for compliance with the performance requirements) as items relied on for
safety.

03.06 [The License Application:]{.underline} The license application
comprises a set of documents submitted by the licensee as listed in the
license under Section 10. These documents include the SAR, the
Environmental Report, the QAPD, and the Emergency Plan.

03.07 [Management Measures]{.underline}: The functions performed by the
licensee, generally on a continuing basis, that are applied to items
relied on for safety, to ensure the items are available and reliable to
perform their functions when needed. Management measures include
configuration management, maintenance, training and qualifications,
procedures, audits and assessments, incident investigations, records
management, and other quality assurance elements.

03.08 [NEF Start-up]{.underline}: Activities associated with the cold
start-up or hot start-up of the NEF as defined below.

r.  [Cold Start-up]{.underline}: Pre-operational inspection, testing, or
    measurement activities not involving the use of licensed material in
    NEF process systems or components.

```{=html}
<!-- -->
```
a.  [Hot Start-up]{.underline}: Pre-operational inspection, testing, or
    measurement activities involving the use of NRC licensed material in
    NEF systems or components. This would include centrifuge testing
    using uranium hexafluoride.

03.09 [NEF Quality Assurance Program Description (QAPD)]{.underline}:
The licensee=s plan that defines the actions to be taken by licensee
management and personnel during the performance of activities affecting
quality, to ensure that quality assurance requirements are consistently
met.

03.10 [Operational Readiness Review (ORR)]{.underline}: An assessment
review inspection performed by a multi disciplined inspection team to
assure that a facility, or a major modification to a previously approved
facility, can be operated safely within the intended safety basis. In
order to support a decision to allow operation of the facility, the NRC
will review and assess the state of readiness of facility operation
based on the results of the ORR inspection. The regulations in 10 CFR
40.41(g) and 10 CFR 70.32(k) require that ANo person may commence
operation of a uranium enrichment facility until the Commission verifies
through inspection that the facility has been constructed in accordance
with the requirements of the license. The Commission shall publish
notice of the inspection results in the Federal Register.@

03.11 [Quality Assurance (QA) Program]{.underline}: The licensee=s
overall QA program to be applied to the design, fabrication,
construction, testing, and operation of the SSCs. This includes the NEF
QAPD, QA procedures, and all supporting procedures and program
activities. The quality assurance program also provides a management
control system to assure the attainment of quality objectives.

2696-04 RESPONSIBILITIES AND AUTHORITIES

04.01 [Office of Nuclear Material Safety and Safeguards
(NMSS)]{.underline}

> a\. Responsible for regulatory oversight of the LES NEF.
>
> b\. Responsible for the overall safety inspection program policy,
> guidance, and approval.
>
> c\. Responsible for the planning, performance, documentation, and
> enforcement associated with the Headquarters criticality safety
> inspection program.

d.  Concurs on the approval of this IMC.

04.02 [Region II Office]{.underline}

j.  Ensures that adequate resources necessary to carry out the
    inspection process described in this IMC are provided to the staff.

```{=html}
<!-- -->
```
b.  Responsible for the planning, performance, documentation, and
    enforcement associated with the construction inspection program that
    are performed by Region II.

> c\. Concurs on the approval of this IMC.

04.03 [Office of Nuclear Security and Incident Response
(NSIR)]{.underline}

> a\. Responsible for policy, guidance, and approval for the physical
> security, classified material security, transportation security, and
> material control and accounting inspection programs.
>
> b\. Responsible for the planning, performance, documentation, and
> enforcement associated with the Headquarters physical security,
> classified material security, transportation security, and material
> control and accounting inspection programs. Inspection of the
> transportation security inspections of classified centrifuge
> components will be developed and coordinated by NSIR.
>
> c\. Concurs on the approval of this IMC.

2696-05 BASIC REQUIREMENTS

05.01 [General]{.underline}. The NEF Construction Inspection Program
provides the inspection requirements for selectively assessing the
adequacy of the IROFS, and regulatory and safety-related programs. This
includes the implementation of the licensee=s QA program and other
management measures used to ensure the availability and reliability of
safety and safeguards IROFS. Substantial emphasis is to be placed on the
inspection of the IROFS that are most important for reducing the
likelihood of high- and intermediate- consequence accidents through the
implementation of commitments made by the licensee in the SAR, the
Environmental Report, the NEF QAPD, and other documents that comprise
the license application. Other documents to be referenced include the
SER, the ISA, the ISAS.

Emphasis is also to be placed on the licensee=s oversight that assure
principal contractors who are delegated authority to conduct activities
related to safety are implementing an acceptable QA program in
accordance with the licensee=s QA program. The inspection program should
include direct inspections as necessary to determine whether the
elements of the license=s QA program are being effectively implemented
throughout all stages of construction, including equipment fabrication,
assembly and installation, and structural construction activities.

05.02 [Inspection Planning and Scheduling Considerations]{.underline}.
The NEF construction phase inspection schedule should be based on the
licensee=s construction schedule and should be modified and updated
periodically during the entire construction period.

Program inspections should be announced, coordinated, and scheduled with
the licensee such that the efficiency and effectiveness of the
inspection effort are enhanced and unnecessary burden to the licensee is
minimized. To the extent practicable, the construction and
pre-operational inspections should be coordinated with the licensee to
ensure that key construction activities are in accordance with the site
construction project schedule. As appropriate, inspections of various
construction activities may be scheduled as unannounced inspections.

Emphasis should be placed on early identification of problems.
Inspections will be conducted periodically throughout construction.
Inspections will be scheduled early in the process during implementation
of individual construction activities to develop confidence that the
specific construction activities have been adequately accomplished at
all stages of construction. Comprehensive construction program reviews
aimed at determining underlying causes and extent of problem areas
should be conducted if NRC management concludes significant deficiencies
are occurring. Inspection depth and frequencies may be expanded to
assure problem areas have been corrected. Corrective action programs are
essential to effective resolution of individual deficiencies and
programmatic issues. Inspection effort should be planned to specifically
evaluate program effectiveness.

NRC Region II will develop, maintain and implement a Master Inspection
Plan (MIP) and a schedule for the LES NEF construction inspection
project. The MIP will be developed in coordination with the Special
Projects Branch and NSIR, and for specific time frames related to
licensing or construction milestones for the project. The MIP will
include the scope and the inspection procedures that will be used for
the inspections. The list of procedures for conducting inspections is
provided in Appendix A of this IMC. The MIP will provide flexibility to
address emerging issues that require additional inspection efforts,
receipt of allegations, or changes in scheduling activities by the
licensee.

It should be noted that the NRC has entered into a protocol agreement
with the State of New Mexico=s Environmental Department (NM). This
agreement allows NM to send state representatives to observe the NRC=s
inspections at the NEF. Effective implementation of the agreement will
require advance coordination by the NRC and NM, of the inspection
schedule and inspections. It is imperative that this agreement is
reviewed and understood by NRC inspectors and schedulers.

05.03 [Inspection and Technical Personnel Considerations]{.underline}.
Qualified inspectors will be assigned responsibility for the conduct of
applicable inspection requirements consistent with their experience. In
conducting this inspection program, it is necessary that inspectors be
trained and/or experienced in the areas of QA, engineering, procurement,
and construction activities applicable to the activities they are to
inspect. Specialists may accompany or assist inspectors to provide
expertise in specific areas to enhance or expand the inspection effort.
To this aim, the inspectors may be regional, headquarters, Office of
Nuclear Security and Incident Response, or the Office of Nuclear
Material Safety and Safeguards inspectors.

2696-06 GUIDANCE

06.01 [General]{.underline}. The licensee is ultimately responsible for
the safety of the nuclear facility. The NRC ensures through a sampling
type of inspection program that the responsibility is carried out in an
effective manner during the activities of facility construction. The
construction inspection program presented in this manual chapter is
considered the minimum necessary to achieve an acceptable level of
confidence as to the adequacy of construction at the facility.

This IMC emphasizes a systematic evaluation of the adequacy and
effectiveness of the licensee=s QA and construction programs and their
implementation. NRC will perform inspections of selected activities at
the licensee=s project offices at the NEF site and other project
facilities. Inspections will also be performed, as necessary, at the
facilities of the licensee=s consultants, contractors, and suppliers.
This IMC establishes priorities for inspection by planned sampling of
IROFS and related activities consistent with their importance to safety
and should consider the performance of the licensee in the areas
inspected.

06.02 [Program Areas]{.underline}. The specific areas to be inspected
will include a sampling of the licensee=s IROFS and of regulatory and
safety commitments as identified in the approved SAR, ISA, ISAS, and in
the latest revision of the approved NEF QAPD. IROFS for inspection will
be chosen based on safety significance and evaluated with respect to
multiple safety disciplines (criticality, fire, chemical, radiological,
environmental) and engineering disciplines (civil, mechanical,
electrical). The NEF=s IROFS boundary packages should be used as a
resource for these inspections.

The NRC will periodically inspect the licensee=s programs for adequate
assurance that IROFS are designed, procured, fabricated, and installed
in accordance with the ISAS and IROFS boundary packages. The inspections
will also verify that as-built construction meets the approved design.
In addition, the licensee=s design change and design control process
will be reviewed to verify that the design process effectively
implements NRC requirements and other licensing design commitments made
by the licensee. These reviews may be accomplished by multi disciplinary
technical review and/or inspection teams to verify the quality of design
products and, inferentially, the entire facility design. Inspections
will verify that the environmental protection programs are consistent
with the license application documentation (SAR, ER, etc.), the SER, the
ISA, the ISAS, and design specifications and drawings.

06.03 [Inspection Procedures]{.underline}. The NEF CIP will use the
Mixed Oxide QA and construction inspection procedures (IPs), as
applicable. These IPs are listed in Appendix A. Some IPs may cover more
than one program area and additional IPs may be used as necessary.

06.04 [Implementation]{.underline}. Region II is responsible for
managing and implementing the inspection program described in this IMC.
The scheduling and conduct of inspections will be coordinated with
Region II, the NMSS Division of Fuel Cycle Safety and Safeguards (FCSS),
and NSIR, as appropriate, to ensure the effective and efficient
completion of the inspection program.

This IMC is intended to provide the framework for managing the
inspection effort. Where needed, sample sizes, frequencies of periodic
inspections, and the time frame when certain inspection activities are
to be performed, are provided in the appropriate inspection procedure
and/or inspection plan.

The inspection staff is expected to plan and conduct inspections based
on safety considerations, current activities, and performance. Region II
staff should develop, on at least an annual basis, a schedule of
inspections to be conducted, based on the anticipated site activities
that are to be performed in the upcoming year. Region II staff should
review and revise the schedule as needed to account for changes in site
activities. The schedule will be maintained on a common drive, allowing
FCSS and NSIR access to the schedule. Any changes in the schedule
directly impacting inspections coordinated with FCSS and/or NSIR
personnel should be communicated to the affected individuals in as
timely a manner as possible. The activities for conducting inspections
should include the following:

b.  Developing and documenting detailed inspection plans.

```{=html}
<!-- -->
```
a.  Scheduling and coordinating inspection activities in accordance with
    this IMC, including coordination of inspections with the State of
    New Mexico=s Environmental Department (see Sections 05.02 and 06.11
    for more details).

b.  Communicating inspection results, findings, and open items to
    appropriate NRC and licensee management.

c.  Documenting completed inspections, findings, and open items.

Inspection issues related to occupational health and safety should be
evaluated in accordance with IMC 1007, AInteraction Activities Between
Regional Offices and OSHA.@

06.05 [Inspection and Technical Personnel Considerations]{.underline}.
Inspectors and technical representatives will be assigned responsibility
for performing inspections consistent with their qualifications. In
addition, inspectors performing NEF inspection activities will either be
provided familiarization training on this IMC and related procedures
and/or become familiar with the requirements of this IMC and the
applicable requirements of 10 CFR Parts 30, 40, 70, and 95, as
appropriate.

06.06 [Inspection Requirements]{.underline}. Inspections will be based
on 10 CFR Part 30, 10 CFR Part 40, 10 CFR Part 70, and other applicable
regulations, commitments, and license conditions, including the
documents included as part of the license application (the SAR, etc.).
Other documents to be referenced include the applicable SER, and the
ISA. Inspections will confirm that applicable regulations, requirements,
and commitments have been met. Selection of inspection attributes will
be based on safety considerations, status of work activities, and
performance.

06.07 [Focus of Inspections]{.underline}. In order to effectively and
efficiently allocate inspection resources, the NRC will perform
sampling-type inspections to verify that the licensee is in compliance
with NRC regulations. A combination of IROFS sample selection,
risk-based approaches, and inspections of the quality assurance program,
will be used to help determine the necessary level of inspection effort.

Inspectors should use applicable risk-based information from the license
submittals, process hazard analyses, and ISA to identify those IROFS
whose failure would most greatly impact the NEF=s risk profile. This
approach would allow the more risk significant IROFS to be identified so
that the construction and pre-operational inspection samples could be
focused on those IROFS. The amount of inspection and activities selected
for inspection should be consistent with the importance to safety of the
IROFS, and the performance of the licensee in those areas.

It should be noted that a performance-based approach is more directly
applicable to an operating facility and may not be readily applied to
construction or pre-operational inspections. In the early stages of the
project, the majority of inspections may be compliance-based and will
focus on QA program implementation. Inspection activities should
emphasize the early identification of problem areas. It is important
that inspectors evaluate whether noted problems represent isolated cases
or are symptomatic of more systemic problems. To provide the perspective
to perform this evaluation, inspectors should:

a.  Determine the extent and the effectiveness of licensee oversight of
    quality related activities.

b.  Determine compliance of previously identified problem areas and/or
    on recurring problems.

c.  Focus inspection efforts on problems that indicate programmatic
    weaknesses.

d.  Periodically, verify the adequacy of the licensee=s corrective
    action program to identify, track, trend, resolve, and prevent
    problem recurrence.

e.  Review deficiencies, audit findings, and problems identified by the
    licensee or by its consultants, contractors, or suppliers to
    identify trends and/or problem areas; and

f.  Ascertain whether additional NRC inspection effort is merited in the
    areas of concern.

06.08 [Management Entrance and Exit Meetings]{.underline}. Inspectors
are required to meet with licensee management as part of every
inspection. Inspectors should hold an entrance meeting with the senior
licensee representative who has responsibility for the areas to be
inspected. Each inspection must include the discussion of inspection
results with licensee management. At the conclusion of an inspection,
inspectors must discuss their preliminary findings with the licensee=s
management at a scheduled exit meeting. Management entrance and exit
meetings with licensee personnel should be scheduled to minimize the
impact on other licensee activities necessary to assure the safe and
proper construction of the facility.

06.09 [Inspection Reports]{.underline}. Inspection findings shall be
documented in inspection reports in accordance with the applicable
revision to IMC 0610, ANuclear Material Safety and Safeguards Inspection
Reports.@ When possible, inspection findings should be integrated into a
single inspection report to encompass findings from in-office reviews,
and/or one or more visits by regional or headquarters inspectors.
Special inspections may be documented in a separate inspection report.
Inspection issues that cannot be resolved at the time of the inspection
will be documented as open items, inspection follow-up items, or
unresolved items, in accordance with IMC 0610, Nuclear Material Safety
and Safeguards Inspection Reports. Region II will track open items in an
inspection program information management system and subsequent
inspections will include resolution of these issues.

06.10 [Findings Outside of Inspector=s Qualifications]{.underline}.
Inspectors sometimes identify issues or violations outside of the
inspector=s qualifications or expertise. In these cases, the inspector
is responsible for (1) determining if an immediate threat to the public
or worker health or safety exists, and if one does exist to notify
licensee management immediately; and (2) determining if the issue is
better addressed by an inspector with different qualifications (i.e., a
specialist inspector). Inspectors may follow issues outside of their
qualifications or expertise with the concurrence of a regional manager
responsible for the area associated with the issue and the inspector=s
supervisor.

06.11 [Communication With Local Public Officials]{.underline}. As a
matter of NRC philosophy, the NRC maintains an Aopen door@ policy with
regard to access by the public or federal, state and local officials to
the NRC staff and to publicly available electronic documentation
concerning a licensee\'s performance. The degree of interaction that is
considered necessary to enhance public confidence in the NRC is expected
to vary widely dependant upon the situation at each facility. Guidance
pertaining to communication with stakeholders external to the NRC can be
found in the latest revision of the Communication Plan for the NEF and
applicable regional office procedures. The NRC has entered into a
protocol agreement with the State of New Mexico=s Environmental
Department (NM). This agreement allows NM to send state representatives
to observe the NRC=s inspections at the NEF. Effective implementation of
the agreement will require advance coordination by the NRC and NM, of
the inspection schedule and inspections. It is imperative that this
agreement is reviewed and understood by NRC inspectors and schedulers.

06.12 [Inspection Findings and Enforcement]{.underline}. All inspection
findings identified during the construction and pre-operational periods
will be documented in accordance with the applicable revision to IMC
0610, ANuclear Material Safety and Safeguards Inspection Reports,@ after
they have been placed in context and assessed for safety significance.
Potential violations from inspection activities will be processed in
accordance with the ANRC Enforcement PolicyA (available on the NRC
public web site at [http://www.nrc.gov]{.underline} ), using traditional
enforcement tools. During construction and pre-operational activities,
the guidance in Supplement II - Part 50 Facility Construction, will
apply, along with other applicable supplements, for determining the
appropriate severity level for quality assurance violations. The
inspection findings (or open items) will then be categorized as
violations, non-cited violations, apparent violations, deviations,
non-conformances, unresolved items, or inspector follow-up items. This
includes the use of notices of violations for violations of severity
level IV and above and civil penalties, as appropriate. Please note
that, although IMC 0610 references IMC 0612, Power Reactor Inspection
Reports, this reference is not applicable to construction projects, and
IMC 0612 should not be used for determination of what constitutes a
minor violation.

It is important to note that if the NRC determines that the construction
is not in accordance with the licensee\'s commitments, then permission
to operate may be denied (see 10 CFR 40.41(g), 10 CFR 70.32 (k), and NEF
License Condition 11). The failure of the licensee to meet commitments
specified in the license application (including the SAR and QAPD) or
other ancillary documents (the SER, ISA, ISAS), shall be documented in
the inspection report(s) as noted above. It is imperative that open
items are appropriately documented in the inspection reports so that
subsequent inspections can verify whether or not the licensee took the
appropriate corrective actions. The failure of the licensee to take the
appropriate corrective actions to address the open items by the end of
the construction phase could result in a denial by the NRC to allow
operations.

06.13 [Assessment of Licensee Performance (ALP)]{.underline}. Different
types of construction activities may require certain levels of
inspection effort to provide the same degree of assurance of quality
work. Increases or decreases in inspection oversight will be based on an
assessment of licensee performance. Periodic reviews of the licensee=s
performance of construction and pre-operational activities may be
warranted to provide NRC management with an overview of the licensee=s
performance, and provide feedback of NRC management=s conclusions
regarding the quality of the licensee=s programs for protecting the
public health and safety. An objective of the program is to provide a
body of information that will be used as guidance to NRC management on
changes that may be required in the NEF construction and pre-operational
inspection programs. IMC 2604, ALicensee Performance Review@ describes
the program for conducting and documenting evaluations of licensee
performance for operating fuel cycle facilities. Appendix B provides
guidance to assess the licensee=s performance in the construction phase
of the NEF. The responsibilities and authorities, performance review
scheduling, review process, and documentation guidelines, specified in
IMC 2604 should be used in conducting the ALP. Region II is responsible
for adjusting the scope and frequency of the review during the
construction and pre-operational phases, as needed, based on NEF
construction schedules and inspection findings. An initial recommended
frequency for this assessment is once per year, with the initial
assessment occurring approximately one year after the start of
construction activities.

06.14 [Operational Readiness Reviews]{.underline}. As stated earlier, 10
CFR 40.41(g) and 10 CFR 70.32 (k) does not allow operation of a uranium
enrichment facility until the Commission verifies through inspection
that the facility has been constructed in accordance with the
requirements of the license. The NRC verifies that this requirement is
met by performing operational readiness reviews. The NRC may consider
the use of phased operational readiness review (ORR) inspections as a
tool to provide input for NRC decisions regarding the operational
readiness of NEF areas or processes. In order to support a decision to
allow operations, NRC senior management reviews and assesses the state
of readiness of facility operation based on the results of the ORR
inspection(s). The status of previously identified inspection findings
are also considered during the decision-making process.

END

Appendix A

LES NEF GAS CENTRIFUGE INSPECTION PROGRAM

CONSTRUCTION AND PRE‑OPERATIONAL INSPECTION PROCEDURES

See IMC 2683 for a complete list of material control and accounting IPs.

Inspection procedures may be added or deleted as required. Portions of
these inspection procedures will not apply to the LES NEF.

See appropriate IMCs for a list of physical security and information
security IPs.

+---------+------------------------------------------------------------+
| QA      |                                                            |
| Ins     |                                                            |
| pection |                                                            |
| Pro     |                                                            |
| cedures |                                                            |
+---------+------------------------------------------------------------+
| IP      | Quality Assurance: Program Development and Implementation  |
| 88106   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Quality Assurance: Design and Documentation Control        |
| 88107   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Quality Assurance: Control of Materials, Equipment, and    |
| 88108   | Services                                                   |
+---------+------------------------------------------------------------+
| IP      | Quality Assurance: Inspection, Test Control, and Control   |
| 88109   | of Measuring and Test Equipment                            |
+---------+------------------------------------------------------------+
| IP      | Quality Assurance: Problem Identification, Resolution, and |
| 88110   | Corrective Action                                          |
+---------+------------------------------------------------------------+
| IP      | 10 CFR Part 21 Inspection-Facility Construction            |
| 88111   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Software Validation                                        |
| 88112   |                                                            |
+---------+------------------------------------------------------------+
| IP88113 | Control of the Electronic Management of Data               |
+---------+------------------------------------------------------------+
| IP      | Quality Affecting Item Procurement (10 CFR Part 21) and    |
| 88114   |                                                            |
|         | Commercial Grade Item Dedication Process (Reactive)        |
+---------+------------------------------------------------------------+
| IP      | Supplier/Vendor Inspection                                 |
| 88115   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Inspection of Safety Function Interfaces                   |
| 88116   |                                                            |
+---------+------------------------------------------------------------+
| Const   |                                                            |
| ruction |                                                            |
| Ins     |                                                            |
| pection |                                                            |
| Pro     |                                                            |
| cedures |                                                            |
+---------+------------------------------------------------------------+
| IP      | Geotechnical/Foundation Activities                         |
| 88131   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Structural Concrete                                        |
| 88132   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Structural Steel and Supports                              |
| 88133   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Mechanical Components                                      |
| 88136   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Electric Cable                                             |
| 88137   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Electrical Components and Systems                          |
| 88138   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Ventilation and Confinement Systems                        |
| 88139   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Instrumentation and Control Systems                        |
| 88140   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Structural Welding General Inspection Procedure            |
| 55100   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Procedures- Fire Prevention/Protection                     |
| 88141   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Underground Fire Water Loop and Equipment Installation     |
| 88142   |                                                            |
+---------+------------------------------------------------------------+
| P       |                                                            |
| re-Oper |                                                            |
| ational |                                                            |
| Ins     |                                                            |
| pection |                                                            |
| Pro     |                                                            |
| cedures |                                                            |
+---------+------------------------------------------------------------+
| IP      | Radiation Protection                                       |
| 83030   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Inspection of Transportation Activities                    |
| 86740   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Management Organization and Controls                       |
| 88005   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Operator Training/Retraining                               |
| 88010   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Nuclear Criticality Safety Program                         |
| 88015   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Nuclear Criticality Evaluations and Analyses               |
| 88016   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Criticality Alarm Systems                                  |
| 88017   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Operational Safety                                         |
| 88020   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Maintenance and Surveillance Testing                       |
| 88025   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Radioactive Waste Management                               |
| 88035   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Environmental Protection and Effluent Control              |
| 88045   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Emergency Preparedness                                     |
| 88050   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Evaluation of Exercises and Drills                         |
| 88051   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Fire Protection                                            |
| 88055   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Process Safety Information                                 |
| 88056   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Permanent Plant Modifications                              |
| 88070   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Training and Qualification of Plant Personnel              |
| 88150   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Facility Changes and Change Process (10 CFR 70.72)         |
| 88151   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Physical Protection Equipment and Barriers                 |
| 88152   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Material Control and Accounting                            |
| 88153   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Fire Safety and Protection Systems                         |
| 88154   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Functional Verification of IROFS                           |
| 88155   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Integrated Safety Analysis Implementation                  |
| 88156   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Waste Management Equipment and Systems                     |
| 88157   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Environmental Protection-Initial and Periodic Inspections  |
| 88158   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Process Enclosures and Vessels                             |
| 88159   |                                                            |
+---------+------------------------------------------------------------+
| IP      | Utilities and Bulk Chemicals                               |
| 88160   |                                                            |
+---------+------------------------------------------------------------+

Appendix B

LOUISIANA ENERGY SERVICES (LES) NATIONAL ENRICHMENT FACILITY (NEF)

GAS CENTRIFUGE INSPECTION PROGRAM

ASSESSMENT OF LICENSEE PERFORMANCE (ALP) PROCESS

1\. PURPOSE

> This appendix provides guidance for assessing the licensee=s
> performance in the construction and pre-operational phases of the LES
> NEF gas centrifuge and to provide feedback of NRC management=s
> conclusions regarding the quality of the licensee=s construction and
> pre-operational programs. The responsibilities and authorities,
> performance review scheduling, review process, and documentation
> guidelines, specified in IMC 2604, Licensee Performance Review, should
> be used in conducting the ALP. The results of such a review should:
>
> 1.1 Provide an assessment of licensee performance to NRC management.
>
> 1.2 Inform the licensee and the public how the NRC assesses facility
> performance.
>
> 1.3 Provide a basis for adjusting the construction and pre-operational
> inspection program, including such areas as focus, frequency, and
> resources.

2\. OBJECTIVES

> 2.1. To describe the processes for assessing the NEF=s performance.
>
> 2.2. To ensure that the assessments are performed in a timely,
> effective, and efficient manner.
>
> 2.3. To ensure that the assessments are focused on determining whether
> safety has been adequately and effectively maintained.

3\. DEFINITIONS

> 3.1 [Functional Areas]{.underline}: The following definitions describe
> the program and functional areas that form the basis for the
> Assessment of Licensee Performance (ALP). It should be noted that
> depending on the stage of the construction project, not all functional
> areas would be applicable during a given assessment period. Each
> functional area comprises two or more inspection program areas.
>
> a\. [Management Measures:]{.underline} This includes activities
> involving implementation of the applicable management measures as
> described in the licensee=s Quality Assurance Program Description and
> in Chapter 11 of the Safety Analysis Report.
>
> 1\. [Quality Assurance]{.underline}: Evaluate the effectiveness of the
> licensee implementation of the controls as established in the NEF
> Quality Assurance Program Description (QAPD).
>
> 2\. [Design Control:]{.underline} Evaluate the control of the designs
> for items relied on for safety (IROFS), and the control of activities
> associated with the preparation, review, approval, and verification of
> documents used for design, procurement, and fabrication.
>
> 3\. [Categorization of IROFS:]{.underline} Evaluate the implementation
> of a graded quality assurance approach to the categorization of IROFS,
> based on safety significance, if applicable. Note that all of the
> IROFS at the NEF are rated as NQA Category I, however, some of these
> IROFS are Asole@ IROFS.
>
> 4\. [Configuration Management:]{.underline} Evaluate whether the
> licensee=s configuration management system documented an established
> baseline configuration; that changes to IROFS were in conformance with
> 10 CFR 70.72 and controlled to preclude inadvertent degradation of
> safety; and that a system was established and implemented to evaluate,
> implement, document, and track changes to the site, IROFS, processes,
> equipment, computer programs, and activities of personnel.
>
> 5\. [Procedures:]{.underline} Evaluate the control of management
> procedures with regard to distribution, version control, management
> review and approval.
>
> 6\. [Audits and Assessments:]{.underline} Evaluate the performance of
> audits and assessments required during construction.
>
> 7\. [Records Management:]{.underline} Evaluate the records management
> system for the handling and storing of records generated or required
> in the design, construction, and operation phases of the facility.
>
> b\. [Facility Construction and Pre-Operation:]{.underline} This
> includes activities involving construction and pre-operational
> activities.
>
> 1\. [Construction Activities:]{.underline} Evaluate construction
> activities (foundation, structural concrete and steel, mechanical,
> electrical, and instrument components). Evaluate whether the
> activities were conducted in accordance with the license application,
> the Safety Evaluation Report, the Integrated Safety Analysis, and the
> Integrated Safety Analysis Summary. Evaluate whether the licensee
> recognized non routine events affecting safety, used an internal
> reporting system, and identified and executed corrective actions to
> resolve deviations from commitments made in the NEF QAPD.
>
> 2\. [Pre-Operational Activities:]{.underline} Evaluate whether the
> licensee=s management measures provided for the safe startup testing
> of the facility during both routine and upset conditions, recognized
> non routine events affecting safety, used an internal reporting
> system, and identified and executed corrective actions to return the
> facility to a safe and secure pre-operational condition after possible
> upsets. Evaluate pre-operational activities, including whether the
> licensee has implemented an acceptable safety operations program
> (including chemical safety, criticality safety, operational safety,
> fire protection, and radiological controls programs).
>
> c\. [Facility Support]{.underline}: This includes management measures
> and systems, including training, emergency preparedness, and
> maintenance.
>
> 1\. [Training and Qualification of Plant Personnel:]{.underline}
> Evaluate the training and qualification of facility personnel for
> activities relied on for the development of safety controls; including
> the training, testing, retesting, and qualification of managers,
> designers, technical staff, construction personnel, technicians, and
> other personnel whose actions are relied on for safety.
>
> 2\. [Emergency Preparedness]{.underline}: Evaluate the effectiveness
> of the licensee=s emergency management program in to protect the
> workers, public, and the environment during reasonably postulated
> events that could threaten the facility.
>
> 3\. [Maintenance:]{.underline} Evaluate the effectiveness of the
> licensee=s maintenance program to ensure the functionality and
> operability of IROFS during reasonably postulated events that could
> threaten the facility and surrounding population.
>
> d\. [Safeguards and Security:]{.underline} Evaluate activities
> involving implementation of the applicable safeguards and security
> measures to assure adequate accounting and protection of special
> nuclear material during receipt and transfer operations.
>
> e\. [Special Topics:]{.underline} These are issues that may arise on
> an occasional basis, but are not included in the review on a routine
> basis unless the significance of the issue rises to a level that is
> perceived to affect the quality of licensee performance. Examples
> include the quality of application and licensing submittals,
> labor-management issues, and contractor difficulties.
>
> 3.2 [Areas Needing Improvement:]{.underline} Actual and/or potential
> risk-significant recurring performance (root causes or events)
> requiring resolution or corrective action. If a number of deficiencies
> occurred early in the period and the licensee=s management corrected
> the problems as evidenced by no events for the last half of the cycle,
> then less weight should be given to those issues when evaluating the
> licensee=s performance. On the other hand, more weight should be given
> to issues that are identified late in the assessment period.

4\. EVALUATION FACTORS

> 4.1 The ALP should review the licensee=s performance in each of the
> applicable functional areas, using a common set of evaluation
> criteria. A suggested set of evaluation factors are provided below:
>
> a\. Management involvement and control;
>
> b\. Approach to identification and resolution of technical issues from
> a safety and safeguards perspective;
>
> c\. Approach to (operational) events (including timeliness, analysis,
> reporting, effectiveness of corrective actions, and recognition of
> generic issues within the facility);
>
> d\. Staffing (considering experience, expertise, and availability of
> staff and management);
>
> e\. Aspects of performance that may reflect on the effectiveness of
> training and qualification programs relative to the specific
> functional area; and
>
> f\. Evidence of positive or negative performance trends.
>
> 4.2 NMSS and the Region II Branch Chiefs may confer occasionally to
> consider the suitability of the current evaluation factors and
> recommend any necessary changes.

5.  IMPLEMENTATION

> 5.1 The responsibilities and authorities, performance review
> scheduling, review process, and documentation guidelines, specified in
> IMC 2604, Licensee Performance Review, should be used in conducting
> the ALP.

Attachment 1

[Revision History of IMC 2696]{.underline}

+---------+-------+---------------------+------+---------+-------------+
| Com     | Issue | Description of      | Trai | T       | Comment     |
| mitment | Date  | Change              | ning | raining | Resolution  |
| T       |       |                     | Requ | Com     | Accession   |
| racking |       |                     | ired | pletion | Number      |
| Number  |       |                     |      | Date    |             |
+=========+=======+=====================+======+=========+=============+
| N/A     | 10/   | Document created to | None | N/A     | ML062620225 |
|         | 19/06 | implement the       |      |         |             |
|         |       | construction and    |      |         |             |
|         | CN    | operational         |      |         |             |
|         | 0     | readiness review    |      |         |             |
|         | 6-028 | inspection program  |      |         |             |
|         |       | at LES NEF          |      |         |             |
+---------+-------+---------------------+------+---------+-------------+
|         |       |                     |      |         |             |
+---------+-------+---------------------+------+---------+-------------+
|         |       |                     |      |         |             |
+---------+-------+---------------------+------+---------+-------------+