Before the
Washington, D.C. 20555

In the Matter of    )
TRANSNUCLEAR, INC.    )Docket No. 11005267
(Export of 93.34% Enriched Uranium)  )License No. XSNM 03192


Pursuant to Section 189a. of the Atomic Energy Act of 1954, as amended, 42 U.S.C. 2239(a), and Section 304(b) of the Nuclear Non-Proliferation Act of 1978, 42 U.S.C. 2155a. (the NNPA"), and the applicable rules and regulations of the United States Nuclear Regulatory Commission (the Commission"), including 10 C.F.R. Part 110, Subparts H and I, the Nuclear Control Institute (NCI" or Petitioner") hereby respectfully petitions the Commission for leave to intervene as a party in connection with the application of Transnuclear, Inc. (Applicant"), dated May 7, 2001, for a license to export 32.36 kilograms (kgs) of 93.34% enriched uranium to Belgium for use in the BR-2 research reactor, as published in the Federal Register on May 24, 2001 (66 Fed. Reg. 28762).

In addition, Petitioner requests that the Commission order a full and open public hearing at which interested parties may present oral and written testimony concerning the factual and legal issues relevant to the Commission's determinations with respect to the pending license application. Such a hearing would be in the public interest and assist the Commission in making its statutory determinations under the Atomic Energy Act, as provided for by Section 304(b) of the NNPA, 42 U.S.C. 2155a., and 10 C.F.R.  110.84.

I. Petitioner's Interests.

Petitioner is a nonprofit, educational corporation, organized and existing under the laws of the District of Columbia, whose principal place of business is also in the District of Columbia. Its address and telephone/FAX numbers are: l000 Connecticut Avenue, N.W., Suite 410, Washington, D.C. 20036; tel.: (202) 822-8444; FAX: (202) 452-0892. It is actively engaged in disseminating information to the public concerning the proliferation, terrorism, safety and environmental risks attendant upon the use of weapons-useable nuclear materials, equipment and technology. It develops strategies for halting the further spread of nuclear weapons and is deeply concerned with the inadequacies of present national and international systems for minimizing the use of such nuclear materials and safeguarding them against theft, diversion and other unauthorized uses.

NCI has undertaken special efforts to educate the public about the feasibility and desirability of eliminating bomb-grade (or highly enriched") uranium (HEU") from commerce in general and research reactors in particular and has strongly advocated the completion and full implementation of the Reduced Enrichment for Research and Test Reactors (RERTR") program. Examples of its publications in the area include the January, 1991, Issue Paper, Eliminating Bomb-Grade Uranium From Research Reactors"; its June 23, 1991, Washington Post Outpost" article, Politicians in the Lab . . . and Scuttling an Easy Way to Stop Nuclear Proliferation"; its September 1995 Issue Paper, RERTR at the Crossroads: Success or Demise", circulated at the International Meeting on the RERTR Program in Paris, France; its October 1997 Issue Paper, RERTR End-Game: A Win-Win Framework", presented to the International Meeting on the RERTR Program in Jackson Hole, Wyoming, October 5-10, 1997; its October 1998 paper, HEU Core Conversion of Russian Production Reactors: A Major Threat to the International RERTR Regime, presented to the 21st Annual International Meeting on the RERTR Program in So Paulo, Brazil, October 19, 1998; its October 1999 paper, A Level Playing Field for Medical Isotope Production---How to Phase Out Reliance on Highly Enriched Uranium, presented to the 22nd Annual International Meeting of the RERTR Program in Budapest, Hungary, October 7, 1999; and its October 2000 position paper, Forging Consensus to Phase Out HEU for Medical Isotope Production: A Proposed Path Forward, presented to the 23rd Annual International Meeting of the RERTR Program in Las Vegas, Nevada, October 2, 2000.

NCI has been a constant supporter of the RERTR program in testimony presented before the Advisory Committee on Reactor Safeguards and Congressional appropriations and authorization committees, as well as in testimony before the Commission at the Commissions invitation. It participated in the Department of Energy's proceedings to take back and dispose of U.S.-origin HEU spent fuel from foreign research reactors and in the Commission's own rulemaking to require conversion of licensed, domestic research reactors to non-weapons-useable fuel. It has been active in prior proceedings before the Commission relating to the export of HEU, specifically the proposed export of HEU to the HFR/Petten Reactor in the Netherlands (Dkt. No. 11004440, Lic. No. XSNM 02611), the proposed export of HEU from the Fort St. Vrain reactor to France for reprocessing (Dkt. No. 11004649, Lic. No. XSNM 02748) and the proposed export of HEU to Canada for the production of medical isotopes (Dkt. Nos. 11004997, 11004998, 11005070, 11005236, Lic. Nos. XSNM 03012, XSNM 03013, XSNM 03060, XSNM 03171). NCIs activities regarding export of HEU are described in greater detail in the attached declaration of Paul L. Leventhal, dated June 25, 2001 (the Leventhal Declaration).

Petitioner has important institutional interests which would be directly affected by the outcome of this proceeding. As noted above, and as set out in the Leventhal Declaration, it is actively involved in public information and education programs concerning arms control, the spread of nuclear weapons, and the risks of proliferation and nuclear terrorism in general and the use of HEU in particular. Its interest and ability to carry out these functions would be significantly and adversely impaired by the absence of a full, open and independent review by the Commission of the issues raised under the Atomic Energy Act and the NNPA by the pending license application.

Petitioner has no other means to protect its interests in this proceeding, and those interests are not now represented by the existing parties. This Petition, moreover, is not interposed for delay or to broaden the proper scope of the proceeding. It is timely filed, within 30 days of the publication of notice of the license application in the FederalRegister, as required by 10 C.F.R.  110.82(c)(1). Finally, Petitioner's contentions raise important questions concerning the appropriateness of continued commerce in and use of HEU, which is directly useable in nuclear bombs, and Petitioner submits that its participation will assist the Commission in developing a sound record. [1]

II. Background.

A. HEU and its Risks.

For many years, HEU has been used in the civil sector primarily to fuel research and test reactors around the world. However, its risks have likewise long been recognized. There have therefore been substantial efforts to curtail its use by substituting low-enriched uranium (LEU"), which is not weapons-useable, capable of providing the same civilian benefits without significant economic penalty.

The risks associated with the circulation of HEU in commerce are self-evident. HEU was the material used in the Hiroshima bomb (Little Boy). According to the late J. Carson Mark, former head of weapons design at Los Alamos National Laboratory and a consultant to NCI, a competent group" could build an implosion weapon with as little as about twelve kgs of this material. [2]

Consequently, HEU is an attractive target for national diversion or seizure by terrorists. Indeed, the late Manhattan Project physicist Luis Alvarez once noted, [W]ith modern weapons-grade uranium ... terrorists, if they had such materials, would have a good chance of setting off a high-yield explosion, simply by dropping one-half of the material on the other half." [3] Furthermore, the possession of this material in the hands of a Saddam Hussein or in a country such as Romania or the former Yugoslavia during a breakdown of civil order, or by terrorists who steal such material, would present a grave international threat. Unless quantities of HEU in commerce are substantially reduced and eventually eliminated, such risks are only likely to grow.

B. The RERTR Program.

In recognition of the problems associated with continued reliance on HEU in research reactors, the United States instituted the RERTR program in 1978. Under the leadership of Argonne National Laboratory, this program has been developing high density, LEU fuels and targets -- material not suitable for fabrication into weapons but suitable for use in research reactors -- thereby allowing conversion to LEU and much reducing the amount of HEU in commerce. [4]

The results of the RERTR program have been impressive: by 1990, the RERTR program had developed, tested, and qualified four types of LEU fuel which make it technically possible to convert to LEU use some 95 percent of the 118 research reactors in 34 countries (36 in the United States and 82 in other countries)." [5] Of the 42 research reactors with power of at least one megawatt that were originally supplied with HEU fuel by the United States, 38 either have converted to LEU, are in the process of converting, or have no further need for fuel. [6]

Following the lead of the RERTR program, a number of large new research reactors constructed abroad since 1978 have been designed to use LEU fuel, including reactors in Japan, South Korea and Indonesia. China recently joined this international consensus by designing its next research reactor to use LEU fuel. [7] All told, 31 research reactors have already been fully converted from HEU to LEU fuel under the RERTR program -- including 20 foreign reactors and 11 domestic reactors. Seven more foreign reactors have been partially converted, meaning they introduce only fresh LEU fuel and remove the old spent HEU fuel as it is burned up. In addition, 21 new research reactors built after establishment of the RERTR program are operating or plan to operate on LEU fuels developed by the RERTR program. Further, there are currently another six foreign and two domestic reactors that are performing feasibility studies or working on the safety documentation that is a prerequisite for conversion. Finally, another four domestic TRIGA reactors are scheduled for conversion by the end of this decade. Thus, in total, at least 71 reactors around the world eventually will operate on LEU rather than HEU fuel thanks to the accomplishments of the RERTR program. [8]

C. U.S. Policy, Law and Regulation.

U.S. policy has also been strongly in favor of reducing use of HEU. Thus, the Commission itself for almost twenty years has sought to reduc[e], to the maximum extent possible, the use of HEU in ... foreign research reactors." See 47 Fed. Reg. 37007 (August 24, 1982). The same Policy Statement affirms that any reduction in the potential for access to these [HEU] inventories would constitute a reduction in the proliferation risk." Moreover, domestically, the Commission has since 1986 been requiring all licensed research reactors to convert to LEU. See 51 Fed. Reg. 6514 (February 25, 1986). In taking this action, the Commission asserted that the domestic conversions are intended to be put on solid footing by setting a strong, resolute and sensible example, consistent with U.S. national policy, to encourage foreign operators of non-power reactors to convert to the use of LEU fuel." Id. at 6516. [9] In recognition of such policies, in 1995 the United States abandoned plans for a new HEU-fueled research reactor, the Advanced Neutron Source, at least partly because the bomb-grade fuel presented a non-proliferation policy concern." [10]

In 1986, Congress first acted specifically to curb the risks associated with commerce in HEU. It passed the Omnibus Diplomatic Security and Anti-Terrorism Act, calling upon the President to take, in concert with United States allies and other countries, such steps as necessary to keep to a minimum the amount of weapons-grade nuclear material in international transit."See Omnibus Diplomatic Security and Anti-Terrorism Act of 1986, Pub. L. No. 99-399, Sec. 601(a)(3)(A) (August 27, 1986). [11] Under this legislation, HEU exports were limited only to those countries ... which have cooperated closely with the U.S. in the Reduced Enrichment for Research and Test Reactors (RERTR) Program. Exports have further been limited to supply of only those research reactors which either cannot be converted at present to LEU fuel or which need additional HEU fuel while in process of conversion to LEU." 1991 Annual Report Under Section 601 of the NNPA, 22 U.S.C. 3281 (July 2, 1992), at 77. Finally, Section 603 of the 1986 law added a new Section 133 to the Atomic Energy Act, 42 U.S.C. 2160c., specifically requiring Commission consultation with the Secretary of Defense concerning the adequacy of physical security in connection with any proposed export or transfer of HEU.

Congress again dealt with commerce in HEU in Title IX, Section 903, of the Comprehensive National Energy Policy Act, Pub. L. No. 102-486, 106 Stat. 2944, enacted October 24, 1992 (the Schumer Amendment"). The Schumer Amendment added a new Section 134 to the Atomic Energy Act, 42 U.S.C.  2160d., which limits the circumstances in which any HEU can be exported for use as a fuel or target in a research or test reactor. As its principal author stated, [T]his bill codifies once and for all that bomb grade uranium is simply too dangerous to continue indefinitely shipping it overseas for non-military purposes". 138 Cong. Rec. H. 11440 (daily ed., Oct. 5, 1992). Under the Schumer Amendment, no HEU exports are permitted for use in a research or test reactor unless three conditions are met:

          (1) there is no alternative nuclear reactor fuel or target enriched in the isotope 235 to a lesser percent than the proposed export, that can be used in that reactor;

          (2) the proposed recipient of that uranium has provided assurances that, whenever an alternative nuclear reactor fuel or target can be used in that reactor, it will use that alternative in lieu of highly enriched uranium; and

(3) the United States Government is actively developing an alternative nuclear reactor fuel or target that can be used in that reactor.

42 U.S.C. 2160d.(a)(1)-(3). It was expected that, under the Schumer Amendment, all HEU exports could be phased out within 5 years," assuming the RERTR fuel/target development program were restarted. In the absence of continued funding for the RERTR program, the only option would be to cut off the bomb-grade exports immediately." See 138 Cong.Rec. at H. 11440 (Statement of Rep. Schumer).

The Commission's regulations fully incorporate the requirements of the Schumer Amendment. They provide that no HEU may be exported unless the Commission determines that:

(A) There is no alternative nuclear fuel or target enriched to less than 20 percent in the isotope U-235 that can be used in the reactor;

(B) The proposed recipient of the uranium has provided assurances that, whenever an alternative nuclear reactor fuel or target can be used in that reactor, it will use that alternative fuel or target in lieu of highly-enriched uranium; and

(C) The United States Government is actively developing an alternative nuclear reactor fuel or target that can be used in that reactor.

10 C.F.R. 110.42(a)(9)(i). In accordance with 42 U.S.C. 2160d.(b)(3), the Commission's regulations further define the phrase can be used" to mean that (A) the fuel or target has been "qualified" by the RERTR program and (B) Use of the fuel or target will permit the large majority of ongoing and planned experiments and isotope production to be conducted in the reactor without a large percentage increase in the total cost of operating the reactor." 10 C.F.R. 110.42(a)(9)(ii).

D. The BR-2 Reactor and the Pending Application.

(1) The Reactor.

The HEU at issue in this proceeding is intended to be used as reactor fuel in the 60 megawatt BR-2 research reactor located in Mol, Belgium. The BR-2 performs at least four basic functions: (1) fuel testing; (2) material testing; (3) medical isotope production; and (4) doping of silicon ingots. In March 2001, it received approval from its board of directors for operation for another five years, or apparently until March 2006. This may be extended for another year pending the necessary scientific and economic justifications. [12] The reactor may in the future receive authorization for further operation or it may be shut down.

Currently, the reactor annually uses fresh HEU fuel containing approximately 13 kgs of U-235, equivalent to approximately 15 kgs of 93.3%-enriched HEU. Previously, the reactor has used fuel fabricated from both fresh HEU (93.3%-enriched) and recycled HEU (74%-enriched on average) recovered by reprocessing from spent fuel. The operator, in an exchange of notes with the United States, has reportedly pledged to convert to LEU fuel as soon as fuel of sufficient density (approximately 7 g/cc) has been qualified, as required under the Schumer Amendment as a condition for exports of HEU. This exchange of notes has not been made public. To date, LEU fuel of sufficient density for this reactor is still under development and has not yet been qualified. Thus, upon the assumption that the operator has made the requisite Schumer pledge, all of the requirements of the Schumer Amendment would appear to be satisfied for exports of HEU to the reactor at this time.

(2) The BR-2s Existing Fuel Supply.

The operator has sufficient fuel on site to operate until the end of 2002. In addition, the reactor already has contracted for fabrication of additional fuel at the French fabricator CERCA, using HEU that it has stored at CERCA, sufficient to last until the end of 2004. [13] In addition to these existing stocks of HEU already fabricated or in the process of being fabricated into fuel, sufficient to last until the end of 2004, the operator has at least three other significant stocks of HEU:

1.  30 kgs of fresh HEU (93.3% enriched) in storage with CERCA (Justification, p. 3);

2.  39.4 kgs of recovered HEU (74%-enriched) in storage in oxide form at the British firm AEA Dounreay (Justification, p. 2); and

3.  14.9 kgs of HEU (90%-enriched, approximately) in cooled spent fuel from old BR02 elements, in storage at the French fuel firm COGEMA, but not yet recovered through hot or cold reprocessing (Justification, p. 3; Checklist, p. 6).

The first batch of 30 kgs, at CERCA, is ready immediately for fabrication into fuel. The second batch of 39.4 kgs, at Dounreay, would have to be converted to uranium metal before it could be fabricated into fuel. The Dounreay facility does not presently have a license for such operations, so this material would have to be transferred to another facility for conversion into metal prior to its being fabricated into fuel. However, Applicant expresses no intention to pursue such a transfer. The third batch of 14.9 kgs is still too radioactive for cold reprocessing, according to Applicant. However, this HEU eventually can be recovered by COGEMA, as demonstrated by the fact that COGEMA previously recovered 7 kgs of HEU from such Belgian fuel by cold reprocessing (Justification, p. 3).

To summarize, Applicant currently has an additional 30 kgs of HEU that are immediately ready for fabrication into fuel beyond that which is being fabricated use through the end of 2004. By transferring further stocks from Dounreay for conversion, it could have a total of 69.4 kgs of HEU. In a few years, when the old BR02 spent fuel has cooled sufficiently to be cold reprocessed at COGEMA, Applicant could have a total of 84.3 kgs of HEU suitable for fabrication into fuel.

(3) Future Fuel Requirements.

Applicant expresses the desire to contract with CERCA by May 2002 for fabrication of additional fuel sufficient to last two more years beyond its existing contracts that already provide fuel through 2004, in order to enable the reactor to run until ~ end of 2006 (Justification, p. 3). Applicant offers no explanation as to why it seeks to contract for the fabrication of fuel to last until the end of 2006 even though its current operating authorization expires in March 2006. In any case, this additional two years of fuel would contain 29.7 kgs of HEU (93.3%-enriched). [14] Applicant also cites the need for 8 kgs of working stock at the fabricator, and 1 kg for losses, concluding that it requires 29.7 +8 +1 = 38.7 kgs of HEU to fabricate sufficient fuel to last until the end of 2006 (Justification, p. 3).

As noted above, Applicant already has 30 kgs of extra HEU in storage at CERCA that is immediately ready for fabrication, beyond that which is being fabricated for use through the end of 2004. Thus, at most, Applicant requires only 8.7 kgs of additional HEU to meet its needs until the end of 2006. Despite this, Applicant requests export of 32.36 kgs of HEU from the United States. Applicants explanation is that it would use this entire new amount of HEU to fabricate the fuel for 2005-6, while retaining its existing stock of 30 kgs of HEU at CERCA for future contingencies. The remaining HEU in storage with CERCA can be used for any supplementary orders of standard and non-standard fuel elements (Justification, p. 3).

Thus, belying any real need for fresh HEU exports, the reality is that Applicant already has enough HEU on hand to fabricate sufficient fuel to last until 2006. It simply would prefer to save this stock of HEU for future contingencies and instead import fresh HEU fuel from the United States to meet its current requirements.

Applicant also appears to contradict its own contention about the need for an additional 8 kgs of HEU for working stock in the fuel fabrication process. Applicant states that its requested 32.36 kgs of HEU would be sufficient for fabrication of fuel containing 29.7 kgs of HEU. Assuming 1 kg of process loss, that would leave only 1.5 kgs of surplus, far less than the supposedly required 8 kgs. The obvious explanation is that the fabricator CERCA already possesses 8 kgs of working stock, because it is currently fabricating fuel for Applicant. Such working stock presumably can be rolled over from one fabrication campaign to the next, and so does not have to be replaced. [15] Thus, Applicants true HEU need until the end of 2006 appears to be 29.7 kgs for fuel plus 1 kg. for process loss, or a total of 30.7 kgs of HEU. It is noteworthy that this is almost identical to the amount of surplus HEU Applicant says it already has stored at CERCA, beyond that which is being fabricated for use through the end of 2004. In sum, Applicant has not demonstrated any need for additional HEU exports from the United States to meet its fuel requirements through the end of 2006.

E. Risks of Supplying Excess HEU to Applicant.

Approving export of HEU for the BR-2 reactor in excess of its demonstrated needs raises at least two serious risks. As noted, the reactor operator currently has sufficient HEU to meet its fuel needs through 2006, the year when its current operating authorization expires. Thus, if the current application were approved, it would enable the reactor to meet its fuel needs through 2006 while also retaining a surplus of HEU. Applicant states that this surplus can be used for any supplementary orders of standard and non-standard fuel elements, without explaining why such supplementary orders might be necessary. One possibility is that the operators operating authorization will be extended beyond 2006, but the operator will decide not to convert to LEU even though suitable LEU fuel is available. In such a contingency, the Commission would be required under the Schumer Amendment to block any further exports of HEU to the reactor. However, if the operator were now provided a surplus stock of HEU, it would be able to continue operating in the future even if it so violated its Schumer pledge to convert to LEU.

This scenario is not merely hypothetical. There is currently a research reactor in Germany, the FRJ-2, which uses fresh HEU fuel but has failed to convert even though suitable LEU fuel for the reactor has been qualified for well over a decade; it is able to do so because it possesses surplus stocks of U.S.-origin HEU on which it can rely. [16] This experience shows clearly that providing a reactor with surplus HEU raises the risk of undermining the influence that the United States has, by virtue of its effective monopoly on HEU supply, to persuade operators to convert to LEU.

Another risk would arise if the requested exports were to go forward and subsequently the reactor shut down at the end of its current operating authorization. If that were to occur, the operator would be left after shutdown with surplus HEU of U.S.-origin that it could and likely would market within EURATOM outside of U.S. export controls. [17] This situation would undermine U.S. nonproliferation policy, if the HEU were sold to an end-user that did not meet the requirements for fresh exports of HEU from the United States.

Again, this scenario is not merely hypothetical. The United States previously approved the export of surplus HEU to the German THTR reactor, a unique power reactor that relied on HEU fuel. When the THTR shut down, the operator retained several hundred kgs of U.S.-origin HEU. Subsequently, a substantial portion of that HEU was sold to the operator of the German FRM-II reactor -- a controversial facility that is the first high-power (greater than one megawatt) research reactor in the West built to use HEU since establishment of the RERTR program in 1978. [18] The United States refused on nonproliferation grounds to supply this new reactor with HEU, [19] but the reactor nevertheless was able to obtain U.S.-origin HEU from the surplus that had previously been provided to the THTR. As a result, the FRM-II is scheduled to start operation with HEU next year, undermining the international nonproliferation norm and the RERTR program. Had it not been for the availability of surplus U.S.-origin HEU in Europe, the United States might well have prevailed on the operator of the FRM-II to convert to LEU prior to start-up. Thus, providing surplus HEU to Applicant could undermine U.S. efforts to persuade other operators to convert their fuel or targets to LEU.

In short, regardless of whether or not the BR-2 reactor shuts down in 2006, to supply Applicant today with HEU in excess of its demonstrated need would raise grave risks of undermining the U.S. nonproliferation goal and policy of phasing out international HEU commerce as quickly as possible. This issue deserves in-depth consideration by the Commission before any licensing decision is made.

III. Petitioner's Contentions.

In accordance with Section 53 of the Atomic Energy Act of 1954, as amended, 42 U.S.C.  2073, and 110 C.F.R.  110.42(a)(8) and 110.45(a), the Commission may not issue a license for the export of special nuclear material, such as the HEU at issue in this proceeding, unless it determines that [t]he proposed export would not be inimical to the common defense and security." Petitioner does not necessarily oppose the granting of the license applicationfor some portion of the HEU sought, assuming that the requisite need can be demonstrated. However, Petitioner submits that two issues must be resolved in this proceeding in order to ensure compliance with the Commissions statutory and regulatory obligations:

    A. The Commission Must Fully Document Compliance with the Schumer Amendment and its implementing Regulations.

One element of the Schumer Amendment and the Commissions implementing regulations is that the proposed recipient . . . has provided assurances that . . . it will use . . . [an] alternative nuclear reactor fuel . . . in lieu of highly enriched uranium." Section 134a.(2) of the Atomic Energy Act, 42 U.S.C.

2160d.(a)(2); 10 C.F.R. 110.42(a)(9)(i)(B). To Petitioners knowledge, neither the U.S. agreement with the reactor operator nor any conversion plan for the BR-2 reactor has been submitted to the Commission. As in Transnuclear, Inc., CLI-00-16, 52 NRC 68 (2000), the Commission must not just rely on Executive Branch representations. Rather, before any export license can be issued, the Commission must examine the agreement and plan and satisfy itself as to the nature and scope of the assurances actually made by the reactor operator.

B. The Commission Must Not Approve Export of HEU in Excess of Applicants Demonstrated Needs.

As noted, Applicants current operating authorization expires in March 2006. In order to contract for fabrication of fuel sufficient to last until the end of 2006, Applicant apparently requires a minimum of 30.7 kgs of HEU (if it can rely on its existing 8 kgs of working stock) or a maximum of 38.7 kgs (if it demonstrably must replenish this working stock). Applicant, according to its own application, already possesses some 30 kgs of HEU immediately ready for fabrication, beyond that which is being fabricated for use through the end of 2004, and another 54.3 kgs that could be further processed to be made suitable for fuel fabrication. Thus, Applicants need for new HEU to satisfy its demonstrated fuel requirements through the end of 2006 is between 0 and 9 kilograms.

Failure to limit the export would entail unacceptable proliferation and terrorism risks and would undermine the U.S. common defense and security. First, to the extent positive Commission licensing action could imply U.S. government approval of either domestic or foreign use of substantial amounts of HEU in research or test reactors in excess of demonstrated need, this would undercut the RERTR program, exacerbating the risk that operators who have not yet converted their reactors would refuse to do so and that operators who have converted would revert to HEU use, contrary to the United States' non-proliferation interests. Second, approval of the pending application in full would lead to unnecessary, increased international transport of weapons-useable material, aggravating the risk of interception by rogue states, criminals or terrorists. Third, the nuclear proliferation and terrorism risks associated with increasing amounts of HEU in international commerce necessarily outweigh any hypothetical benefits to Applicant or others from the proposed export of any amount of HEU in excess of demonstrated need. In a world in which major efforts are underway to eliminate HEU surpluses, putting more than is needed into circulation makes little sense. [20] Certainly, the United States should not help create a situation that may potentially free up more HEU for use in a reactor like the FRM-II, to which it is opposed.

    IV. The Need for a Full Oral Hearing.

A full oral hearing to examine Petitioner's contentions is essential both to serve the public interest and to assist the Commission in making its statutory determinations. Such a hearing would fulfill the Commission's mandate to explore fully the facts and issues raised by export license applications, where appropriate through full and open public hearings in which (a) all pertinent information and data are made available for public inspection and analysis and (b) the public is afforded a reasonable opportunity to present oral and written testimony on these questions to the Commission. See 42 U.S.C. 2155a. and 10 C.F.R. 110.40(c), 110.80-110.91, 110.100. [21]

There is substantial controversy surrounding any continued use of bomb-grade uranium, but especially commerce in excess of demonstrated need. Indeed, the questionable wisdom of permitting unnecessary commerce in HEU has been sharply illustrated by disclosures that Iraq had begun to divert safeguarded HEU for the purpose of converting it to weapons-use prior to the Gulf War and by the actions of the United States, its allies and the International Atomic Energy Agency to remove the HEU in the possession of Iraq after the conclusion of the War. Similarly, after the fall of Romania's Communist government, the U.S. sought and won in 1991 permission to convert all unirradiated HEU fuel elements owned by the Romanian government to LEU. Only a public hearing in which issues related to the appropriateness of exporting HEU are fully aired and subjected to public scrutiny will serve to resolve legitimate public questions concerning both the need for granting this license application and the risks associated with such action. Certainly, the unchallenged assertions of Applicant and/or the Executive Branch are not enough to satisfy the public interest in the case.

Petitioner includes among its directors, staff and supporters individuals with broad experience and expertise in technical and policy matters directly relevant to the risks and implications of the proposed export. Additionally, it has expert consultants fully familiar with all aspects of the RERTR program. These individuals would bring to the instant proceeding perspectives that are presently lacking and are pivotal to an understanding and resolution of the factual and legal issues raised by the pending license application.See Leventhal Declaration, 4, 10-12, 14-22, 25-36.

V. Relief Requested.

For the reasons set forth above, Petitioner respectfully requests that the Commission:

1. Grant this Petition for Leave to Intervene;

2. Order that an oral hearing be held in connection with the pending license application; and

3. Act to ensure that all pertinent data and information regarding the issues addressed by Petitioner be made available for public inspection at the earliest possible date.

Respectfully submitted,


Eldon V.C. Greenberg
1000 Potomac Street, N.W.
Suite 500
Washington, D.C. 20007
Tel.: (202) 965-7880
FAX: (202) 965-1729
Attorney for Petitioner

Dated: June 25, 2001
Washington, D.C.


I affirm that I am duly authorized counsel for Petitioner in this proceeding, that I have consulted with Petitioner concerning the statements contained in the Petition, that such statements are true and correct to the best of my personal knowledge, information and belief and that the Petition is not being interposed for delay.


Eldon V.C. Greenberg

Subscribed and sworn to before
me this 25th day of June, 2001.


                        Notary Public


I hereby certify that I caused the foregoing Petition of the Nuclear Control Institute for Leave to Intervene, together with the attached Declaration of Paul L. Leventhal and counsel's Notice of Appearance, to be served by having copies thereof mailed, first class, postage prepaid, on the 25th day of June, 2001, to the following:

Mathew George Executive Secretary
Traffic Coordinator U.S. Department of State
Transnuclear, Inc. Washington, D.C. 20520
Four Skyline Drive
Hawthorne, New York 10532-2176
and by having copies thereof hand-delivered on such date to the following:
Docketing and Service Branch General Counsel
Office of the Secretary U.S. Nuclear Regulatory
U.S. Nuclear Regulatory   Commission
Commission One White Flint North
One White Flint North 11555 Rockville Pike
11555 Rockville Pike Rockville, Maryland 20852
Rockville, Maryland 20852
(original and two copies)


Eldon V.C. Greenberg

     Dated: June 25, 2001
Washington, D.C.

Before the
Washington, D.C. 20555

In the Matter of                    )
TRANSNUCLEAR, INC.                  )  Docket No. 11005267
(Export of 93.34% Enriched Uranium) )  License No. XSNM 03192


Notice is hereby given that the undersigned attorney herewith enters an appearance in the above-captioned matter. In accordance with 2.713(b), 10 C.F.R. Part 2, the following information is provided:

Name: Eldon V.C. Greenberg
1000 Potomac Street, N.W.
Suite 500
Washington, D.C. 20007
Telephone:  (202) 965-7880
FAX:  (202) 965-1729
Admission:  Member of D.C. Bar
Name of Party: Nuclear Control Institute
1000 Connecticut Avenue, N.W.
Suite 410
Washington, D.C. 20036
Tel.: (202) 822-8444
FAX: (202) 452-0892


Eldon V.C. Greenberg

Attorney for Petitioner

Dated: June 25, 2001
Washington, D.C.

    [1] NCI is mindful that the Commission has denied it intervention as of right in prior proceedings and that, in each of those cases, it has also declined to order a discretionary hearing. It does not now claim it is entitled to intervention as of right under Commission precedent. However, the circumstances of each such prior hearing denial are instructive and serve to demonstrate that discretionary intervention is warranted here. Thus, for example, in Transnuclear, Inc., CLI-94-1, 39 NRC 1 (1994), following the filing of NCIs intervention petition, the applicant entered into extensive discussions with the Executive Branch and subsequently modified the transaction as originally proposed in order to meet NCIs objections. In Transnuclear, Inc., CLI-98-10, 47 NRC 333 (1998), the Commission went out of its way to note that NCI has, in effect, obtained the end result . . . that it appears ultimately to be seeking, and it noted that its review was significantly aided by NCIs participation. 47 NRC at 340. In Transnuclear, Inc., CLI-99-15, 49 NRC 366 (1999),and CLI-99-20, 49 NRC 469 (1999), the Commission in fact ordered a public meeting at which NCI was invited to make an oral presentation, and the order ultimately issued by the Commission was substantially responsive to concerns raised by NCI. Finally, in Transnuclear, Inc., CLI-00-16, 52 NRC 68 (2000), while the Commission declined to hold a hearing, it considered a number of written submissions of NCI and the Executive Branch concerning the application at issue and dealt with each of NCIs contentions extensively in its decision, ultimately recognizing the validity of NCIs contention that it should exercise its licensing authority to avoid the accumulation of excess HEU.

     [2] Mark, Some Remarks on Iraq's Possible Nuclear Weapon Capability In Light of Some Known Facts Concerning Nuclear Weapons" (Nuclear Control Institute, May 16, 1991), at 2.

     [3] Alvarez, Adventures of a Physicist 125 (Basic Books 1987).

[4] See generally A. Travelli, Status and Progress of the RERTR Program in the Year 2000, presented to the 23rd Annual International Meeting of the RERTR Program, Las Vegas, Nevada, October 1-6, 2000.

     [5] ERC Environmental and Energy Services Co., Review of the RERTR Program (Report submitted to the U.S. Department of Energy, May 15, 1990), at 3-3.

     [6] Three of the remaining reactors, two in France and the BR-2 in Belgium, cannot yet convert. The fourth, the Safari I reactor in South Africa, has completed a new LEU conversion feasibility study jointly with the RERTR program and is reconsidering its stance on conversion.

     [7] Shi Yongkang, et al., The China Advanced Research Reactor Project", and Yuan Luzheng, et al., Preliminary Study of Core Characteristics for the Scheduled CARR", presented at the Fifth Meeting of the Asian Symposium on Research Reactors, Taejon, Korea, May 29-31, 1996.

[8] See generally A. Travelli, supra note 4, at p. 7.

     [9] Commission policy, it should be noted, has reflected the consistent views of the Executive Branch that it is important to U.S. non-proliferation policy to minimize the amount of HEU in international commerce. See Presidential Non-Proliferation Policy Statement of April 7, 1977, 13 Weekly Comp. Pres. Doc. 507 (April 11, 1977); U.S. Nuclear Non-Proliferation and Cooperation Policy (July 16, 1981), 17 Weekly Comp. Pres. Doc. 769 (July 20, 1981); Nonproliferation and Export Control Policy Statement, 29 Weekly Comp. Pres. Doc. 1901 (September 27, 1993).

     [10] U.S. Department of Energy, DOE Facts: A New Neutron Source for the Nation" (February 1995).

     [11] Congress had previously passed resolutions supportive of Executive Branch efforts to reduce HEU use. See S.J. Res. 179, 97th Cong., 1st Sess. (July 27, 1981); S. Con. Res. 96, 97th Cong., 2d Sess. (May 27, 1982).

    [12] The quotes are from the Justification for the proposed export, as submitted by Applicant to the Commission, at p. 1. There is a typographical error on p. 3 of the Justification, where Applicant states: The operation of the BR2 reactor is confirmed with the present operation regime until at least 1996. The correct date is presumably March 2006. With its Justification, Applicant also submitted a Checklist, which is cited below.

    [13] With the present fabrication order with CERCA (60 elements VIn and 10 elements Vn), the reactor can be runned [SIC] at the latest until end of 2004, assuming the delivery by the UKAEA Dounreay of 18 elements now under fabrication (Justification, p. 3).

    [14] (60 elements VIn) X (400 g U-235 each) + (10 elements Vn) X (360 g U-235 each) = 27.6 kgs U-235 = 29.7 kgs HEU (93%-enriched)(Justification, p. 3; Checklist, p. 2).

    [15] Applicants comment on this point is highly ambiguous. It states, The manufactures [SIC] working stocks are not included in this request (Checklist, p. 3).

    [16] Discussions on conversion of the FRJ-2 reactor to LEU fuel were initiated in 1984 between the operator, German authorities, and the RERTR program, and a schedule for conversion was established as early as 1987. However, in the mid-1980s, the operator acquired sufficient U.S.-origin HEU from surplus stocks in Europe to continue operating without conversion. The reactor has now agreed to convert or shut down by 2006 in exchange for the right to return its spent fuel to the United States under the Department of Energys off-site fuels program. However, even if the reactor does eventually convert, the fact remains that the existence of surplus overseas stocks of U.S.-origin HEU will have unnecessarily delayed this conversion, and perpetuated risky international commerce in bomb-grade uranium, for nearly two decades.

    [17] Under the Agreement for Cooperation in the Peaceful Uses of Nuclear Energy between the United States and EURATOM, the movement of U.S.-origin materials from one country to another within EURATOM is not subject to any prior U.S. consent on retransfers under Sections 123a.(5) and 127(4) of the Atomic Energy Act, 42 U.S.C. 2153a.(5), 2156(4). See H.R. Rep. No. 138, 104th Cong., 1st Sess. 101 (November 29, 1995); Transnuclear, Inc., CLI-00-16, 52 NRC 68 (2000).

    [18] See A. Cowell, Germans Rebuff U.S. on Plans for Nuclear Research Reactor, New York Times, July 22, 1995, at 3, col. 1.

    [19] The U.S. State Department stated in 1994, In accordance with USG policy, reinforced by the 1992 Energy Policy Act, the United States will not supply highly-enriched uranium (HEU) for any new foreign research reactor, such as the Garching facility [the FRM-II] that may be built at the University of Munich. U.S. Department of State, EUR (Voluntary) Press Guidance, Germany: Garching Research Reactor (May 10, 1994).

     [20] The United States has already committed, at an estimated cost of several billion dollars, to purchase 500 tons of Russian HEU, all of which is to be blended down to LEU to remove the bomb-grade material from international commerce and eliminate any risk of diversion to weapons. See, e.g., M. Hamilton, Approaching Critical Mass? Privatized Uranium Processor USEC Has Disappointed Both Shareholders and Capitol Hill, The Washington Post, January 31, 2000, at F.8; T. L. Neff, Decision Time for the HEU Deal, Arms Control Today, Vol. 31, No. 5, June, 2001. Approving the proposed export would be at cross-purposes with this major U.S. post-Cold War initiative.

     [21] The Commission's regulations, it should be noted, include specific recognition that public participation and input are encouraged. 10 C.F.R. 110.81(a).