April 4, 2002
The Honorable Richard Meserve
Dear Chairman Meserve,
We are writing with
regard to the request by Nordion, Inc. to amend its existing export license
(XSNM 03171/02, Federal Register,
March 7, 2002) to export an additional 10 kg of highly enriched uranium (HEU)
for the production of medical isotopes at its NRU reactor and associated
processing facility in Canada. This
would be the second amendment to the license, and comes on the heels of the
Commissions approval of both the original license and the first amendment,
each for the export of 10 kg of HEU for the same purpose. Nordion contends that its latest request is
motivated by the need to continue producing isotopes at its old NRU facilities
because of further unexpected delays in start-up of commercial isotope
production at its new Maple reactors and associated New Processing Facility.
As with the original license
and the first amendment, the Nuclear Control Institute does not oppose this new
request. However, we remain concerned
with how its approval could affect implementation of Nordions other existing
export license (XSNM 03060) for export of HEU targets for isotope production at
the Maple facilities, including Nordions pledge to convert such production to
LEU targets. As you know, implementation
of that pledge is a continuing requirement for further exports of HEU Maple
targets under the Schumer Amendment of the Energy Policy Act of 1992.
Specifically, we wish to
stress three points:
moratorium on exports of HEU Maple targets to Canada should be continued at
least until Nordion begins commercial isotope production at the Maple
facilities. This is essential to prevent
any growth in the existing surplus of U.S.-origin, nuclear weapons-grade
uranium in Canada, which would increase risks of nuclear terrorism and be
inconsistent with U.S. non-proliferation policy. Based on the latest rulings of the Canadian
Nuclear Safety Commission (CNSC), and the anticipated timetable for testing and
licensing of isotope production at the Maple facilities, such commercial
production will not begin until at least 2003, so the current moratorium should
continue at least through the end of 2002.
As the Commission
ruled with regard to the original NRU license (XSNM 03171) and the first
amendment to that license, the Commission initially should approve export of
only half the amount of HEU in the current request, requiring the applicant to
demonstrate need prior to exporting the balance.
There is no
reason that the continued delay in start-up of commercial operation at the
Maple facilities using HEU targets should delay significantly, if at all,
Nordions conversion of such production to LEU targets. In other words, the longer the delay
persists, the smaller the amount of HEU Maple targets that Nordion should
require prior to converting to LEU targets.
Accordingly, the Commission should reduce the total amount of HEU Maple
targets that Nordion can export under XSNM 03060 approximately in proportion to
the delay in the start-up of commercial operation at the Maple facilities. One straightforward way for the Commission to
accomplish this would be to enforce strictly the terms of the license, as it
has done so far, by insisting that any HEU licensed for export in a given
calendar year but not exported during that year may not be exported
subsequently. By hewing to this
principle, the Commission could reduce the total amount of HEU Maple targets
licensed for export simply by insisting that the current moratorium on such
exports be extended through the end of 2002.
Doing so would ensure that the applicant has continued incentive to
maintain its planned schedule for conversion to LEU targets. It is imperative that the applicant not be
permitted to use the delay in start-up of commercial operations at the Maple
facilities as an excuse for further delays in its conversion of production to
LEU targets. Accordingly, we urge the
Commission to make clear to the applicant that the Commission has no intention
to amend XSNM 03060 to increase the amount of HEU Maple targets licensed for
export, as the applicant has stated publicly and repeatedly that it intends to
These recommendations are
based on several important findings:
First, it is clear that
commercial isotope production at the Maple facilities will not begin until well
into 2003, at the earliest. In its
ruling of January 15, 2002, the CNSC denied Nordions requests to resume
low-power testing of the Maple 1 reactor and to load fuel in the Maple 2
reactor. That ruling also indicates that
Nordion may be granted approval for these activities prior to the expiration of
the ruling, on October 31, 2002, if a number of specific issues are addressed
to the satisfaction of the CNSC staff.
Thus, it is possible that the first of the Maple reactors will resume
low-power testing in 2002. However,
commercial isotope production at the Maple facilities cannot begin until
approximately one year following resumption of low-power testing of the first
reactor. This is because Nordion must
complete at least four additional steps prior to commencing commercial
production at the Maple facilities: it must obtain a full-power license for at
least one of the reactors, it must irradiate and process test targets, it must
submit the resulting data to Health Canada and the U.S. Food and Drug
Administration, and it must await consideration and approval by these
regulatory agencies for the medical use of isotopes produced with the
unprecedented Maple target and process.
Second, there are
strong grounds for the Commission to require that Nordion maintain its current
moratorium on exports of HEU Maple targets to Canada. We initially recommended such a moratorium in
our letter to you of July 19, 2001, urging the Commission to, Declare a
moratorium on further exports of HEU targets for the Maple reactors after the
end of 2001 by which time Nordion already will have acquired its desired
working inventory of 40 kg of such targets until the start of commercial
isotope production using these targets.
Subsequently, Nordion pledged to observe such a moratorium during the
first half of 2002, thereby confirming that it did not require any further surplus
of HEU targets. Until Nordions existing surplus of HEU Maple
targets begins to be drawn down, when and if commercial production starts at
the Maple facilities, there is no justification for any further export of such
Finally, the protracted
delays in starting commercial isotope production at the Maple facilities
vindicate our original contention that Nordion could have carried out its
conversion to LEU targets prior to start-up of the Maple facilities, if it had
pursued conversion aggressively. Had
Nordion done so, it would have obviated the need for any HEU commerce at the
Maple facilities and reduced the cost of conversion by enabling conversion of
the facilities prior to their becoming radioactive.
In testimony before the
Commission on June 16, 1999, NCI urged the Commission to deny Nordions request
to export to Canada a five-year supply of HEU Maple targets on grounds that
Nordion could convert to LEU targets prior to start up of the Maple facilities. At the time, Nordion contended that NCIs
proposed course was impossible because commercial production at the Maple
facilities had to start in 2000, because the NRU facilities would be required
to shut down by the end of that year due to a full waste tank. However, as we anticipated, Nordion has been
able to extend the life of the NRU facility by cementing some waste and
increasing the concentration in its waste tank.
Indeed, if the Maple facilities continue to face protracted delays in
the start-up of commercial isotope production, it still may be possible for
Nordion to convert to LEU targets prior to commencing such production while
relying on the NRU facilities in the interim.
This will be possible, however, only if Nordion pursues conversion
aggressively, rather than dragging its feet as it has done in the past. Accordingly, we again urge the Commission to
use its considerable influence to insist that Nordion pursue an aggressive
timetable for conversion to LEU targets.
Of course, we stand prepared
to discuss this important national security matter further, either in your
office or at a public meeting of the Commission. Thank you for your consideration of our views
cc: NRC Commissioners
 See, for example, Daniel Horner, MDS Nordion Defers Initial HEU Shipments for 2002, Inside NRC, August 27, 2001, which reports that, MDS is still considering the idea, raised in its 2001 annual report, of requesting an amendment to the Maple license to add 40 kg of HEU. The article also quotes Nordion vice-president David McInnes as saying, There still will be a need for that amount; its just that the timeline has changed.
 The second of two batches of 5 kg of HEU requested under the first amendment was intended to produce targets for use in the NRU from about September 2002 until approximately the end of that year, according to Jean-Pierre Labrie, AECL, Addendum to the Application of Transnuclear, Inc., August 8, 2001.
 This confirms the assertion in our letter to the Commission of July 19, 2001, which stated that, Even with the most optimistic assumption that the test irradiation could commence during the commissioning phase of the Maple reactors, Nordion could not begin actual commercial production of isotopes until around the beginning of 2003. At the time, we cited this as grounds for our recommendation that the Commission impose a moratorium on exports of HEU Maple targets to Canada in 2002. By contrast, at the time, Nordion insisted that it could commence such production in 2002. Apparently, this has proved not to be the case.
 Jean-Pierre Labrie, Addendum to the Application of Transnuclear, Inc., August 8, 2001, pp. 1-2, states that the 10 kg of HEU requested in the first amendment to XSNM 03171 was intended for production of isotopes from March 2002 through the end of 2002, or approximately nine months.
 Jean-Pierre Labrie, letter to Ronald D. Hauber, July 30, 2001, pp. 1-2, states that shipments of HEU targets for the Maple reactors scheduled in February 2002, March 2002, and May 2002, will be delayed to later in calendar year 2002, after the submission of the annual report to the Commission, in accordance with Condition 10 of export license XSNM 03060. In addition, the letter states that this moratorium will limit the inventory of HEU targets for the Maple reactors at Chalk River Laboratories to about a one-year reserve inventory of targets in addition to the one-year on-going production supply of targets. See also, Daniel Horner, MDS Nordion Defers Initial HEU Shipments for 2002, Inside NRC, August 27, 2001.
 At the Commissions public meeting of June 16, 1999, Dr. Iain Trevena, senior vice-president of Nordion, testified that: with respect to NRU we have a storage tank that's used to contain our high-level fission waste. That storage tank will be filled by the end of the year 2000. Commissioner McGaffigan later summed up Nordions claim: There is this physical limit that they talk about at the NRU and our Canadian regulator will not give them further permission on the waste tanks, and so that reactor it sounds like runs out of its life at the end of 2000. NCIs Paul Leventhal replied that the Commission should explore the accuracy of this claim: Is there a backup waste tank arrangement available if necessary? How full is full of the existing waste tank? Is there any wiggle room at all that would permit continued use of HEU targets in the NRU while the LEU targets are developed and tested and the new production facility modified to accommodate LEU as well as HEU targets? In our view that is the gut issue before the Commission in order to determine whether you are really impelled to act as applicant asks. We think there needs to be some additional fact-gathering by the Commission. NCIs Alan Kuperman added that: I just would remind the Commission that they approved last year an export of HEU for target material for the NRU, specifically so that the NRU could continue to produce isotopes in case there were any delay in the MAPLE reactor. So, presumably, there is some plan for accommodating extra waste at NRU if it is necessary for Nordion's commercial purposes. And we would just argue that the same fallback solution be used if the MAPLE [facilities are to be delayed further to enable conversion to LEU targets prior to start-up.]