U.S. NUCLEAR REGULATORY COMMISSION December 1993

REGULATORY GUIDEOFFICE OF NUCLEAR REGULATORY RESEARCH

REGULATORY GUIDE 5.67(Draft was Issud as DG-5002)

MATERIAL CONTROL AND ACCOUNTINGFOR URANIUM ENRICHMENT FACILmES

AUTHORIZED TO PRODUCE SPECIALNUCLEAR MATERIAL OF LOW STRATEGIC SIGNIFICANCE

USNMC REGUIATORY GUIDESRegulatory Guides are Issued todescribe and make available to the pubilcmethods acceptable to the NRC staff of implementing specific parts ofthe Cormnmission's regulations, to delineate techniques used by the staffin evaluating specific problems or postulated accidents, or to provideguidance to applicants. Regulatory Guides are not substitutes for regula-tions. and compliance with them Is not required. Methods and solutionsdifferent from those set out In the guides will be acceptable If they providea basis for the findings requisite to the Issuance or continuance of a per-mit or license by the Commission.This guide was issued after consideration of comrnents received from thepublic. Comments and suggestions for Improvements In these guldes areencouraged at all times, and guldes will be revised, as appropriate, toaccommodate comnnents and to reflect naw information or experlence.Written comments may be submitted to the Rules Review and DirectivesBranch, DFIPS, ADM, U.S. Nuclear Regulatory Comnission, Washing-ton, DC 20668-0001.

The guldes are Issued In the following ten broad divisions:

1. Power Reactors2. Research and Test Reactors3. Fuels and Materials Facilities4. Environmental and Siting6. Materials and Plant Protection

6. Products7. Transportation8. Occupational Health9. Antitrust end Financial Review

10. General

Copies of issued guides may be purchased from the Government PrintingOffice at the current GPO price. inforrnation on current GPO prices maybe obtained by contacting the Superintendent of Documents, U.S.Government Printing Office, Mali Stop SSOP, Washington, DC20402-32, telephone (202)512-2249 or (202)512-2171.

Issued guides may also be purchased from the National Technical infor-mation Service on a standing order basis. Details on this service may beobtained by writing NTIS, 5285 Port Royal Road, Springfield, VA 22161.

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CONTENTS

Page

A. INTRODUCTION .................................................................. 1

B. DISCUSSION ....................................................................... 1

C. REGULATORY POSITION .......................................................... 2

1. Performance Objectives .......................................................... 22. Organization ................................................................... 43. MC&A Procedures .............................................................. 54. Measurements . ................................................................ 55. Measurement Control Program .................................................... 66. Statistics . ..................................................................... 9

7. Physical Inventories ............................................................. 108. Item Control . .................................................................. 129. Shipper-Receiver Comparisons .................................................... 1310. Assessment of the MC&A Program ................................................ 1411. Resolving Indications of Unauthorized Production of Enriched Uranium and Missing Uranium 1512. Program for Precluding and Detecting Unauthorized Production of Enriched Uranium .... ... 1713. Recordkeeping . ................................................................ 19

D. IMPLEMENTATION ............................................................... 20

REGULATORY ANALYSIS .............................. ................................ 21

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A. INTRODUCTION

Section 74.33, "Material Control and Accountinfor Uranium Enrichment Facilities Authorized TiProduce Special Nuclear Material of Low StrategiSignificance," of 10 CFR Part 74, 'Material Contrcand Accounting for Special Nuclear Material," contains the material control and accounting (MC&Arequirements applicable to enrichment facilitieauthorized to produce and possess more than 1 effective kilogram of special nuclear material (SNM) of loxstrategic significance.

Section 74.33 establishes MC&A performancobjectives to protect against, detect, and respond tithe use of uranium enrichment equipment for the unauthorized production of SNM of moderate or higistrategic significance or the introduction of undeclaredsource material (SM) into the process equipment fothe unauthorized production of uranium of low strategic significance. In addition, 10 CFR 74.33 requirelicensees to provide information that will aid in the investigation of missing uranium or unauthorized enrichment of uranium. Section 74.33 also specifies petformance objectives and required system features an'capabilities that are consistent with MC&A requirements applicable to other NRC-licensed activities involving the possession and use of more than 1 effectivkilogram of SNM of low strategic significance. Licensees and applicants are required by 10 CF]74.33(b) (1) to submit a fundamental nuclear materikcontrol plan describing how the performance objectives, system features and capabilities, and recordkeeping requirements will be met. The general petformance objectives, set forth in 10 CFR 74.33(a)that must be met by the licensee's MC&A prograrare:

1. Maintain accurate, current, and reliable infoimation of and periodically confirm the quantities and locations of source material and special nuclear material in the licensee'possession;

2. Protect against and detect production of uranium enriched to 10 percent* or more in thisotope U-235;

3. Protect against and detect unauthorized prcduction of uranium of low strategic significance;

4. Resolve indications of missing uranium;

5. Resolve indications of production of uraniurenriched'to 10 percent or more in the isotopU-235 (for centrifuge enrichment facilitiesthis requirement does not apply to each caicade during its start-up process, not to excee'the first 24 hours);

'AU enrichment levels specified in this guide should be treated aweight percent and not atom percent.

6. Resolve indications of unauthorized produc-tion of uranium of low strategic significance;

g 7. Provide information to aid in the investigationD of missing uranium;C

8. Provide information to aid in the investigationof the production of uranium enriched to 10

,) percent or more in the isotope U-235; and

S 9. Provide information to aid in the investigationof unauthorized production of uranium of low

IV strategic significance.

This regulatory guide describes methods accept-e able to the NRC staff for achieving the general per-o formance objectives in 10 CFR 74.33. This regulatoryL- guide discusses each important component of a licen-Fh see's MC&A program and describes methods that mayd be used to satisfy the rule.ir

Any information collection activities mentioned in,s this regulatory guide are contained as requirements in

10 CFR Part 74, which provides the regulatory basisfor this guide. The information collection require-

r- ments in 10 CFR Part 74 have been approved by thead Office of Management and Budget, Approval No.

3150-0123.

e B. DISCUSSION

R The MC&A requirements for uranium enrich-al ment facilities specified in 10 CFR 74.33 have been

established to provide adequate safeguards for NRC-I- licensed materials at such plants. The basis for suchr- requirements is that the safeguards must be at least

equivalent to those required for plants possessing ma-n terial of equivalent safeguards significance. Since the

requirements set forth in 10 CFR 74.33 are perform-ance-based, this regulatory guide has been developed

r- to describe one approach to meeting those require-ments. The rationale for the approach is that the en-richment levels that are authorized for NRC-licensed

S enrichment plants will be the same general level as forlicensees authorized to fabricate low enriched uraniumfuel. However, enrichment facilities differ from fabri-cation facilities in that they possess equipment that

e could be used to produce SNM of moderate or highstrategic significance. For this reason, the MC&A sys-tem for enrichment facilities must contain additionalsafeguards features to protect against and detect such

'~ activities.

Since 10 CFR 74.33 is a performance-based regu-lation, it is the objectives rather than the means forachieving them that are defined in 10 CFR 74.33(a).

n Thus, applicants or licensees are free to decide how toe design, manage, and operate their MC&A systems.

This regulatory guide is not intended to be an exhaus-s- tive description of all possible methods a licenseed might use to achieve the desired objectives. Instead,

this regulatory guide provides guidance on an accept-able approach for achieving the objectives in 10 CFR

LS 74.33(a). Other alternatives are acceptable providedthey satisfy the requirements of 10 CFR 74.33.

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C. REGULATORY POSITION

1. PERFORMANCE OBJECTIVES

Each licensee subject to 10 CFR 74.33 is requiredto implement and maintain an MC&A system that iscapable of achieving the performance objectives of 10CFR 74.33(a).

1.1 Maintain Accurate, Current, and ReliableInformation of and Periodically Confirmthe Quantities and Locations of SourceMaterial and Special Nuclear Material inthe Licensee's Possession

As used in this guide, accurate information meansthat the amounts and locations of the material in ques-tion are based on records and measurements; currentinformation means that the licensee knows, throughMC&A records, how much of this material is pos-sessed at any given time and its location (i.e., in proc-ess or in storage); and reliable information means thatthe quantities and locations of all classes of materialand items listed in the accounting records are, in fact,correct and verifiable.

1.1.1 Shipments and Receipts

The licensee must account for all $NM and SMreceived or shipped. This should be accomplished bymaintaining reliable records that are based on meas-ured values (10 CFR 74.33(c)(2)). Guidance- onshipper-receiver procedures and the analysis ofshipper-receiver data is provided in Regulatory Posi-tion 9 of this regulatory guide.

1.1.2 Monitoring Material Movements

The monitoring program must include the use ofitem control procedures to monitor the location andintegrity of items and ensure that all SM and SNMquantities of record associated with receipts, ship-ments, discards, and ending inventory are based onmeasurements (10 CFR 74.33(c) (6)). The monitoringprogram should also include process-monitoring pro-cedures to maintain current knowledge of the totaluranium and U-235 within the enrichment process.Guidance on the item control program is provided inRegulatory Position 8 of this regulatory guide, whileguidance on measurements and measurement controlprograms are in Regulatory Positions 4 and 5, respec-tively. Monitoring the quantity of material in processmay involve the use of production and quality controldata. A detailed and accurate recordkeeping systemfor MC&A and production data must be maintained toprovide knowledge of the quantity of material on atimely basis (10 CFR 74.33(d)).

1.1.3 Dynamic Physical Inventories

In order to verify that the controls descn1bed inRegulatory Position 1.1.2 have been effective, thelicensee must perform a dynamic physical inventory atintervals not to exceed 65 days (10 CFR

74.33(c) (4) (i)). This inventory provides a snapshot ofthe amount of material in process at a given time.Regulatory Position 7 provides guidance on the con-duct of dynamic physical inventories.

1.1.4 Yearly Plant Physical InventoryOnce a year, at intervals not to exceed 370 days

(10 CFR 74.33(c) (4) (i)), the licensee must conduct atotal plant inventory and must be able to detect, withat least a 90 percent power of detection, an actual lossor theft of a detection quantity (DQ) that may haveoccurred since the last yearly inventory. DQ is a site-specific parameter that depends upon the amount ofmaterial processed annually at each facility. To satisfythe requirement in 10 CFR 74.33(c) (4) (i) to confirmthe quantity and location of all SNM and SM currentlypossessed by the enrichment facility, the licensee mustconduct both a dynamic (nonshutdown) physical in-ventory of the uranium and U-235 contained withinthe enrichment processing equipment and a staticphysical inventory of all other uranium and U-235that is not within the processing equipment. Criteriapertaining to physical inventories are discussed inRegulatory Position 7. The performance of a totalplant inventory should include:

1. Measuring (or, when direct measurement isnot feasible, using indirect measurements) allSNM and SM quandties on hand that havenot previously been measured in their currentform,

2. Verifying the physical presence of all uniquelyidentified SNM and SM items that the ac-counting records indicate are on hand,

3. Measuring a sample of randomly selected un-encapsulated and unsealed items, based on astatistical sampling plan, to confirm the previ-ous measurements of SNM and SM containedin each of these items, which in turn will beused as the basis for accepting or rejecting thetotal SNM and SM contained in all suchitems, and

4. Verifying the integrity of all encapsulateditems and all tamper-safed' items.

1.2 Protect Against and Detect Production ofUranium Enriched to 10 Percent or Morein the Isotope U-235

The licensee should have a program for monitor-ing the isotopic composition of product and depleteduranium streams, independent of operations, that pro-vides high assurance of timely detection of productionof uranium enriched to 10 percent or more in the iso-tope U-235 before SNM of moderate strategic signifi-cance could be produced if such production could beachieved within 370 days. The licensee may also want

"Tamper-safing" Is defined in1O CFR 74.4 as the use of de-vices on containers or vaults In a manner and at a time thatensures a clear indication of any violation of the Integrity ofpreviously made measurements of SNM within the containeror vault.

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to consider monitoring other parameters besides enrichment levels and instituting a personnel monitorinprogram to observe activities in the process areas tiprotect against the production of uranium enriched ti10 percent or more in the isotope U-235. The enrichment technology used may determine the extent of thprogram. For example, a limited program for a gaseous diffusion technology plant would be appropriatbecause it is difficult for a few people to recon- figurthe equipment to produce higher enrichments inshort time, while a more extensive program for a centrifuge technology plant would be appropriate becausof the ease of reconfiguring the machines to produchigher enrichments in a short period of time. The program can use nondestructive assay with fixed detectors, portable detectors, or UFO samples taken antanalyzed for U-235 concentration.

The program must be managed and maintainedindependent of the operations (production) unit organization (10 CFR 74.33(c) (1) (ii)), but it may makuse of production and quality control data that arnormally generated and used by production personnel. Additional guidance for this program is provide'in Regulatory Position 12 of this regulatory guide.

The NRC Operations Center must be notifie'within 1 hour of discovery of any actual production curanium enriched to 10 percent or more in the isotopU-235 as required by 10 CFR 74.11. For centrifugenrichment facilities, this requirement does not appito each cascade during its start-up process, not to e),ceed the first 24 hours.

1.3 Protect Against and Detect UnauthorizedProduction of Uranium of Low StrategicSignificance

A program must be implemented that will, withigh assurance, protect against and detect the urauthorized production of uranium of low strategisignificance that is not included in the facility'accounting records (10 CFR 74.33(a)(3)). The prcgram should be capable of detecting the introductioof feed material not declared or recorded in the faciity MC&A records. The program must be manageand maintained independently of the production coperations organizational unit (10 CF.74.33(c) (1) (ii)), but should not be excluded from u!ing process monitoring or production control data anequipment. Additional guidance, for this programprovided in Regulatory Position 12.

Pursuant to 10 CFR 74.11, discovery of actual urauthorized production of uranium of low strategic silnificance must be reported to the NRC OperatiorCenter within 1 hour.

1.4 Resolve Indications of Missing Uranium

A formalized program to resolve any indicatiothat uranium SM or SNM is missing must be deveoped (10 CFR 74.33(a) (4)). Resolution of such ind

cators means that the licensee has investigated all in-g formation relevant to the cause of the indicator andD has concluded that a theft or loss of SNM or SM hasD not occurred. As stated in 10 CFR 74.33(c) (6), only

indications that suggest a possible loss of items or ofe material from items involving 500 grams or more of

U-235 need be investigated.ee The procedures that the licensee should under-a take to resolve an indication of missing uranium de-l- pend on the nature of the indicator. In some cases, thee resolution process would begin with a thorough reviewe of the MC&A records to locate blatant errors such as

omissions of entire items, data entry errors in com-puter programs or on records, incorrect entries, tran-

d scription errors, errors in estimating the amount of ma-terial holdup in equipment, or calculational errors. Adetailed examination of the MC&A records for the ap-

d plicable material type should identify gross errors. Ther- next stage in the resolution process could be to isolatee the storage area or the portions of the process that ap-e pear to be involved. Once this is accomplished, all theI- information that contributed to the determination ofd the SM and SNM quantities for that storage location

or process stream should be verified. If there is still noresolution, the licensee should consider sampling and

d remeasuring the applicable material in the applicableif storage area or process stream to verify the quantities.e If the investigation of an indication results in a deter-e mination that an actual loss or theft has occurred, they loss or theft must be reported to the NRC in accor-

dance with 10 CFR 74.11. Additional guidance onresolution of indications of missing uranium is pre-sented in Regulatory Position 11.

1.5 Resolve Indications of Production ofUranium Enriched to 10 Percent or More

h in the Isotope U-235

k- A formalized program designed to resolve indica-ic tions of the production of uranium enriched to 10 per-s cent or more in the isotope U-235 must be developedD- (10 CFR 74.33(a) (5)). Resolution of such indicationsn means that the licensee has investigated all informa-il- tion relevant to the cause of the indicator and has con-d cluded that enrichment of uranium to 10 percent oror more in the isotope U-235 has not occurred. SinceR unauthorized enrichment might not be detected on a5- timely basis through the conduct of the static physicald inventories or periodic dynamic physical inventories,is the resolution process should include investigating all

the information that contributed to the indication ofunauthorized enrichment. Upon receipt of an indica-

n- tion that uranium may have been or is being enrichedI~ to 10 percent or more, the licensee is required by 10's CFR 74.33(a) (5) to take appropriate actions to inves-

tigate and resolve the indicator. Material contained inany suspect process equipment or piping or in a sus-pect container should be measured to determine itsU-235 concentration. If the indication was generated

n by instrumentation or measurements, the instrumentsI- or measurement systems used for monitoring shouldi- be examined to determine whether they are calibrated

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and functioning properly. An examination of the proc-essing equipment should be performed to ensure thatunauthorized modifications have not been made. Thepresence of uranium enriched to 10 percent or moreshould be verified through remeasuring the materialin question, whether in item form or in processequipment.

If the resolution process results in a determinationthat unauthorized enrichment of uranium to 10 per-cent or more in the isotope U-235 has actually oc-curred, this condition must be reported to the NRCaccording to 10 CFR 74.11. For centrifuge enrich-ment facilities, this requirement does not apply to eachcascade during the start-up process, not to exceed thefirst 24 hours.

Guidance on resolution of indications of uraniumenriched to 10 percent or more is presented in Regula-tory Position 11.

1.6 Resolve Indications of UnauthorizedProduction of Uranium of Low StrategicSignificance

A formalized program designed to resolve indica-tions of the production of unauthorized uraniumenriched to less than 10 percent in the isotope U-235must be developed and followed (10 CFR 74.33(a) (6)). Resolution of such indicators means that thelicensee has investigated all information relevant to thecause of the indicator and has concluded that un-authorized (i.e., undeclared and clandestine) produc-tion of uranium enriched to less than 10 percent in theisotope U-235 has not occurred.

Indicators of unauthorized production of uraniumof low strategic significance can come from many dif-ferent sources, some of which are listed in RegulatoryPosition 11.2. Therefore, the resolution process willbe dictated by the type of indicator that occurs. Forexample, if an employee reports that there appears tobe an excess of UFe feed cylinders in a storage area,the resolution process might include verifying the re-port and making a detailed analysis of shipping andreceiving records as well as production records. On theother hand, if it is discovered that the rate of enricheduranium production differs from scheduled produc-tion, it may be appropriate to sample and measure de-pleted UFO containers to determine whether theU-235 concentration of the depleted uranium is con-sistent with the authorized and declared production ofenriched uranium.

In the event of any of these or other indications ofunauthorized production of uranium enriched to lessthan 10 percent in the isotope U-235, the licenseeshould determine the cause of the indicator and con-clude whether or not unauthorized production has oc-curred or is under way. A licensee determination thatunauthorized production of uranium of low strategicsignificance has taken place is reportable according to10 CFR 74.11. Additional guidance on resolution of

indications of unauthorized production of uranium oflow strategic significance is included in Regulatory Po-sition 11.

1.7 Provide Information To Aid in theInvestigation of Missing Uranium, theProduction of Uranium Enriched to 10Percent or More in the Isotope U-235, orthe Unauthorized Production of Uraniumof Low Strategic Significance

As previously noted, the detection of any actualloss or theft of SNM, or any actual unauthorized pro-duction of enriched uranium, is reportable under 10CFR 74.11. Such reports, depending upon the serious-ness of the material facts, may result in investigationsby the NRC or other government agencies. The pur-poses of such investigations would be to recover anylost or stolen material, to secure and control any unau-thorized material produced, and to identify and bringto justice the individuals involved. NRC licensees arerequired by 10 CFR 74.33(a)(7), (a)(8), and (a)(9)to provide any information, particularly the relevantinformation contained in the MC&A records, to assistthe NRC or other government agencies in their investi-gations.

2. ORGANIZATION

2.1 Corporate Organization

At least one corporate-level official should haveresponsibilities pertaining to the control and account-ing of all SM and SNM possessed by the licensee (10CFR 74.33(c)(1)(i)).

2.2 Facility Organization

A comprehensive facility management structureshould be developed (10 CFR 74.33(c)(1)). Thisstructure should clearly establish where the responsi-bility lies for the (1) overall MC&A program, (2) SMand SNM custodianship, (3) receiving and shipping ofSM and SNM, (4) analytical laboratories, (5) physicalinventories, (6) monitoring programs to protectagainst and detect unauthorized enrichment activities,and (7) onsite nuclear material handling operations.

The interrelationships of facility positions outsidethe MC&A organization that have responsibilities re-lating to MC&A activities (such as sampling, bulkmeasurements, analytical measurements) should beidentified within the management structure.

2.3 MC&A Organization

A single individual should be designated as theoverall manager of the MC&A program. In order toensure independence of action and objectivity of deci-sion making, the MC&A manager should either reportdirectly to the facility manager or report to an indi-vidual with no production responsibilities who reportsdirectly to the facility manager (10 CFR74.33(c)(1)(ii)).

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The responsibilities and authority of each supensor and manager should be established for the varioifunctions within the MC&A organization (10 CF74.33(c)(1)(iii)). Careful consideration should Igiven to how the activities of one functional unit iindividual serve as a control over or check the actihties of other units or individuals. The MC&A manageshould have the responsibility for reviewing and ajproving all written MC&A procedures, both withand outside his organization. MC&A managers shou.be appointed to oversee (1) the nuclear material acounting program, (2) the measurement control prigram, (3) the item control program, (4) the monitoing programs, and (5) the statistical program.

Whenever more than one key MC&A functionassigned to the same person, specific procedureshould be developed to preclude such things ,(1) performance of accounting or record control funtions by persons who also generate the associatesource data and (2) any person having sole authorito evaluate or audit information for which he or sheresponsible (10 CFR 74.33(c)(1)(iii)).

2.4 MC&A System

In order to maintain clear overall responsibility f<MC&A functions (10 CFR 74.33(c)(1)(i)), responsbility for the following MC&A activities should be etablished:

1. Overall MC&A program management,

2. Measurements,

3. Accountability records,

4. Measurement control and statistics,

5. Item control,

6. Physical inventories,

7. Custodial responsibilities (SM and SNM stoage and movement controls),

8. Monitoring program for detecting unauthoized enrichment activities,

9. Investigation and resolution of indicators (sulgesting possible loss or possible unauthorizeenrichment activities),

10. Receiving and shipping of SM and SNM,

11. Analytical laboratories, and

12. MC&A recordkeeping system and controls.

Policies, instructions, procedures, duties, resporsibilities, and delegations of authority should be deveoped to ensure that separation and overchecks a!built into the MC&A system (10 CF74.33(c) (1) (iii)).

vi- 3. MC&A PROCEDURESLIS Approved written MC&A procedures must be de-~R veloped and periodically reviewed (10 CFRbe 74.33(c) (1) (iv). These procedures should address theDr following topics:

er * Accountability record system,

in 0 Sampling and measurements,

Id 0 Measurement control program,

D- * Item control program,

* Static and dynamic physical inventories,

is * Investigation and resolution of loss indicators,Ds 0 Investigation and resolution of indicators sug-as gesting possible unauthorized enrichment ac-Lc- tivities,Idty 0 Monitoring program to detect unauthorizedis enrichment activities,

* Determination of the standard error of the in-ventory difference (SEID), active inventory,and inventory difference (ID),

or 0 MC&A recordkeeping system, and1i- * Independent assessment of the effectiveness:s- of the MC&A program.

4. MEASUREMENTS

4.1 Measurement Systems

Measurement systems and measurement proced-ures must be developed in order to meet the systemsfeatures and capabilities of 10 CFR 74.33(c)(2) and(3). A measurement system can be defined as any in-strument or device, or combination of devices, used toderive a mass, volume, uranium element concentra-tion, U-235 isotopic concentration, or U-235 con-tent. Parameters that are important to most measure-

r- ment systems include the measurement device orequipment used, standards used for calibration, andstandards used for control. For analytical laboratory

r- measurements, sampling equipment and techniqueused, sample aliquoting technique, and samplepretreatment methodology are often important pa-

9- rameters.d

4.1.1 Bulk Measurement Systems

For each mass (weight) measurement system, adecision should be made as to the weighing device, thetype of containers weighed, the material within thecontainers being weighed, the capacity of the weighingdevice, the range to be utilized, and the sensitivity ofthe device.

1- For each volume measurement system, the vesselre (tank, column, etc.) to which the measurementR applies, the capacity of the vessel, the material being

measured (including uranium and U-235

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concentrations), the volume-measuring devices, andthe sensitivity and range of operation of the systemshould be considered.

4.1.2 Analytical Measurement Systems

For each analytical (laboratory) measurement sys-tem to be used, the following should be considered:

1 . Type of material or chemical compound (e.g.,UF6, uranium alloy, U308 , uranyl nitrate solu-tion) being measured,

2. Characteristics to be measured (e.g., gramsuranium per gram sample, U-235 isotopicconcentration),

3. Analytical method used,

4. Sampling technique,

5. Sample handling (i.e., pre-analysis samplestorage and treatment),

6. Measurement interferences (e.g., impurities),and

7. Expected measurement uncertainty.

4.1.3 NDA Measurement Systems

For each nondestructive assay (NDA) measure-ment system to be used, the following should be con-sidered:

1. The NDA equipment package (detector andelectronics),

2. The type of container being measured,

3. SM or SNM material type within the con-tainer,

4. Characteristics being measured,

5. Measurement configuration (e.g., source todetector distance, collimation, and shielding),

6. Calculational method, and

7. Expected measurement uncertainty.

4.2 Measurement Uncertainties

Special attention should be given to the expectedmeasurement uncertainties for each measurement sys-tem, for example, the variance from calibration, thevariance from sampling, and the random error compo-nents. The smaller each of these components can bemade, the greater the likelihood that the performanceobjectives of 10 CFR 74.33 will be met. The units inwhich errors are expressed should be consistent withother sources of uncertainty.

4.3 Measurement Procedures

A set of approved written measurement proce-dures must be developed and followed (10 CFR

74.33(c) (1) (iv)). The organizational units responsiblefor the preparation, revision, and approval of themeasurement procedures should be clearly identified.A periodic review of the measurement proceduresmust be conducted (10 CFR 74.33(c)(1)(iv)). Meas-urement procedures should be approved by the overallMC&A manager and by the manager of the organiza-tional unit responsible for performing the measure-ment. Measurement procedures should also be ap-proved by the measurement control program manager.

5. MEASUREMENT CONTROL PROGRAM

5.1 Organization and Management

The organization and management of the meas-urement control program should contain a measure-ment quality assurance function. Independence fromthe analytical laboratory and from other units per-forming either sample taking or measurements shouldbe maintained (10 CPR 74.33(c)(1)(iii)). The meas-urement control program manager should be at a man-agement level that is sufficient to ensure objectivityand independence of action. Thus, the measurementcontrol program manager should either report directlyto the overall MC&A manager or, if in a different or-ganizational unit, be on the same level as the MC&Amanager.

The measurement control program must be man-aged to ensure adequate calibration frequencies, suffi-cient control of biases, and sufficient measurementprecision to achieve the capability required in 10 CFR74.33(c) (3).

5.1.1 Functional Relationship

The relationship and coordination among themeasurement control program manager, the analyticallaboratory, and any other groups performing measure-ments should be defined clearly (10 CFR74.33(c) (1)(i)). There should be adequate assurancethat the measurement control program manager hasthe authority to enforce all applicable measurementcontrol requirements.

5.1.2 Procedures

The measurement control program proceduresmust be established and maintained (10 CFR 74.33(c)(1) (iv)). All the currently applicable written proced-ures pertaining to measurement control and measure-ment quality assurance should be reviewed annually.Responsibility for preparation, revision, and approvalof the procedures should be assigned. Individualmeasurement control program procedures should bedocumented and approved by the measurement con-trol manager (10 CFR 74.33(c)(1)(iv)). At a mini-mum, the procedures should address:

1. Calibration frequencies and methods,

2. Standards used for calibration (descriptionand storage controls),

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3. Standards used for control (obtaining or pre.paring standards and traceability of stan-dards),

4. Control standard measurements,

5. Replicate sampling and replicate measure.ments,

6. Control limits and control responses,

7. Generation and collection of control data,and

8. Recordkeeping controls and requirements.

5.1.3 Contractor Program Reviews

If measurement services are provided by an out,side contractor or company offsite laboratory, a reviewprogram should be developed to monitor the offsittmeasurements (10 CFR 74.33(c) (3) (iii)). The purpose of such a program is to ensure that the contractoror offsite laboratory has an acceptable measuremencontrol program to the extent that use of the contractor's measurements will not compromise the licensee'ability to meet any measurement or measurement control requirement contained in 10 CFR 74.33(c). Arinitial review of the contractor's measurement controprogram should be conducted prior to licensee use omeasurements performed by the contractor or offsitAlaboratory.

All contractor or offsite laboratory review findingand recommendations should be documented an(submitted to both the measurement control progranmanager and the overall MC&A manager in a timeldfashion. The two managers should arrive at an agreement as to what corrective actions, if any, need to betaken, based on their evaluation of the report, an(transmit these findings to the contractor or offsitilaboratory in writing. Measurements performed b:such contractors or offsite laboratories should not beused until the licensee has verified that the correctiveactions have been instituted.

The persons who conduct a contractor revieineed not be employed by the licensee, but they shoul(not be employed by, or in any way be associated withthe contractor or offsite laboratory so that the independence of the conclusions may be maintained.

5.2 Calibrations

A calibration program that contains approved procedures for the following should be developed:

1. Calibration frequency for each measuremelndevice or system,

2. Identification of the reference standards use,for calibration of each measurement device osystem,

3. Protection and control of calibration stan-dards to maintain the validity of their certifiedor assigned values, and

4. The range of calibration for each measure-ment device or system and the minimum num-ber of calibration runs (observations) neededto establish a calibration.

In general, there are two types of measurementsystems-those that are recalibrated periodically andthose that are calibrated each time the system is used,based on one or a few measurements of representativestandards. The latter type of calibration is often re-ferred to as "point-calibration" and is regarded as be-ing bias-free. In the former case, the calibration stan-dards need not be representative because system biasis estimated from the periodic measurement of repre-sentative control standards. For point-calibratedmeasurement systems, the following calibration proce-dures should be followed.

1. The standard or set of standards used to cali-brate the measurement system should be rep-resentative of the process unknowns that aremeasured by the system. That is, the repre-

s sentative calibration standard should undergoall the measurement steps in the same mannerthat the unknowns do.

f 2. One or more calibration standards should beprocessed (measured) along with each un-known or set of unknowns measured. That is,both the standard and the unknown are meas-

,s ured at the same time with the same personmeasuring both the standard and the un-known.

3. The measurement values assigned to the proc-ess unknowns are derived from the measure-ment response observed for the standard thatwas measured along with the unknowns.

4. The measurement response for each unknownshould fail within plus or minus 10 percent ofthe response for a standard measured at thesame time as the unknown. For unknowns of

w very low concentration, the measurement re-d sponse should fall within plus or minus 4 stan-

dard deviations of the response for a standardmeasured at the same time as the unknown.

For systems that are range-calibrated, SM orSNM accountability values should not be based onmeasurements that fall outside the range of calibra-tion. The calibration standards for range-calibratedsystems need not be representative of the process ma-terial or items to be measured by the calibrated deviceor system. It is the primary measurement device, not

It necessarily the entire measurement system, that needsto be calibrated. This is particularly true when the pri-mary measurement device is common to two or more

d measurement systems. For example, the Davies &ir Gray titration method is often used to analyze samples

of different uranium materials to determine uranium

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concentration. In this case, two or more measurementsystems involving different sampling methods, differ-ent sample pretreatment methods, and different con-trol standards are being utilized. The potassium di-chromate titrant is, however, common to all systems,and it is the titrant that is calibrated (or standardized)with a reference standard such as certified U308 orcertified uranium metal.

In the case of nonconsumable calibration stan-dards such as weight standards, the frequency ofrecertification should be given special consideration.The recertification frequency should depend on howoften the standards are handled, the standards' stabil-ity, and the adequacy of the controls used to maintainthe integrity of the standards. Biannual recertificationof such standards is usually acceptable.

5.3 Control Standard Program

For those measurement systems that are notpoint-calibrated, a defined program for the periodicmeasurement of control standards should be estab-lished and followed. Control standard measurementsare performed to (1) monitor the stability of a previ-ously established calibration factor and (2) estimatethe bias of the measurement system over a specifiedperiod (e.g., an inventory period). The calibrationfactor is the numerical relationship between the ob-served output of a measurement system and the actualvalue of the characteristic being measured, as basedon a traceable standard. If there is a possibility of achange in the standard's true value from factors suchas evaporation, moisture pickup, or oxidation, thevalue of the standard should be checked periodically.

To be representative of the process materials be-ing measured, a control standard need not always beidentical to the process unknowns, but any constituentof the process material or any factor associated with aprocess item that potentially could produce a bias ef-fect on the measurement should be present to thesame degree in the control standards. For scales usedto weigh very large items such as UFO cylinders, thecontrol standard weights should be artifact cylinders(both empty and full) of certified mass to avoid a biaseffect caused by buoyancy or point loading.

In addition to material composition and matrixfactors, biases can be induced by changes in tempera-ture, humidity, line voltage, and background radia-tion, or they may be operator-induced. Therefore, inscheduling control standard measurements, the fol-lowing questions should be addressed:

* Does operator-to-operator variation need tobe considered and hence monitored?

* Is a particular bias likely to be long term, shortterm, or cyclic in nature?

* Is bias a function of the process measurementvalues over the range of calibration? That is,does the relative percent bias vary over therange of calibration?

* What controls or procedures are needed toensure that sampling or aliquoting of thecontrol standard is representative of the sam-pling or aliquoting of the process material?

* How similar, in terms of chemical composi-tion, uranium concentration, density, homo-geneity, and impurity content, should the con-trol standards be relative to the processunknowns?

5.4 Replicate Program

In order to estimate the combined analytical andsampling random error variance, measurements ofreplicate (duplicate) samples should be performed.Although it is not necessary to estimate how much ofthe total random error is due to sampling and howmuch is due to analysis, an estimate of the randomanalytical error variance can be obtained by perform-ing replicate measurements on single samples. Fornonsampling measurement systems such as NDA andweight-measurement systems, the random error vari-ance can be derived from either replicate measure-ments performed on the process items or the replicatedata generated from the measurement of control stan-dards.

For each measurement system involving samplingand analysis, the following should be considered: (a)the number of samples to be taken and measured and(b) the number of analyses to be performed on eachsample. Replicate samples should be independent ofone another. The minimum number of replicate sam-ples measured for each analytical measurement systemdepends upon the number of batches processed dur-ing the inventory period. If there are very few batchesprocessed during the inventory period, replicate sam-ple measurements on all the batches may be needed.If the process in question produces a large number ofbatches during an inventory period, each batch neednot be subjected to replicate sampling. If 14 or fewerbatches are processed during an inventory period, rep-licate samples from each batch should be measured.Otherwise, the minimum number of replicate samplesto be measured should be the greater of 15 or 15 per-cent of the batches generated, unless 15 percent ex-ceeds 50, in which case the measurement of more than50 replicate samples is not necessary.

* Can environmental or other variables contrib-ute to measurement bias?

* Is bias likely to vary with respect to the time ofday?

"Batch" is defined in 10 CFR 74.4 as a portion of source mate-rial or SNM handled as a unit for accounting purposes at a keymeasurement point and for which the composition and quantityare defined by a single set of measurements. A batch may be inbulk SM or SNM form or contained in a number of separateitems.

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5.5 Warning and Out-of-Control Limits

Both warning and out-of-control limits should beestablished and used for both control standard ancreplicate measurements for those measurement systems used for nuclear material accountability. Foipoint-calibrated systems, the assigned value of th(standards measured along with the unknowns is assumed to be valid. Control limits for the verificatiormeasurements associated with such standards shoulcbe established. This is particularly applicable to thosepoint-calibrated systems that use a single standard, o:aliquots from a single standard, over any extended period of time.

The warning and out-of-control limits are normaily set based on a tradeoff between the cost of investigating and resolving incidents when limits are exceeded and the consequences of acceptingmeasurements of poor quality. Warning limits shouhbe set at the 0.05 level of significance and out-ofcontrol limits should be set at the 0.00 1 level of significance. This means that 95 percent of the time th4measurement response of the standard is expected tobe within the warning limits and 99.9 percent of thitime it is expected to be within the out-of-control limits. When a measurement system generates a contromeasurement response that falls beyond an out-ofcontrol limit, the system should not be used for accounting purposes until it has been brought back int4control below the warning limit. At regular intervaldetermined in advance by the licensee, control standard measurements should be made and the dat-should be analyzed to determine whether control limits should be modified.

5.5.1 Control Charts

Measurement control data, such as control standard measurerinent results and the differences betweeimeasurement values of replicate pairs, may be analyzed by automated techniques but should be plotteron graphs. All control charts should be reviewed aleast once every 2 weeks unless the measurement syitem in question was not used during that period. Thpurpose of this review is to ensure that all occurrenceof standards measurements falling outside the warninand out-of-control limits are documented and apprcpriate action has been taken. This review is also irtended to detect situations in which the limits are ncexceeded but there are problems that would indicatthat recalibration or other corrective action should btaken. The review should address the frequency th.control data exceed either the warning or the out-o]control limits and should evaluate for any significartrends.

5.5.2 Response Actions

The analyst or operator performing a contrameasurement, or the applicable supervisor, shoulhave the responsibility for promptly reporting to thmeasurement control program manager or the desil

nee any control measurement that exceeds an out-of-control limit and for taking the system out of servicewith respect to accountability measurements. Re-

d sponse and corrective action requirements should bedeveloped and documented. As a minimum, response

r to a reported incident of a control measurement ex-ceeding an out-of-control limit should consist of:

1 1. Verifying that the measurement system inquestion has been taken out of service withrespect to accountability measurements,

r 2. Documenting the occurrence of the event,

3. Performing at least two additional controlstandard measurements, and

4. If results of 3, above, do not show the systemto be back in control, performing additional

g control measurements using a different con-d trol standard or different replicate sample (as

appropriate), recalibrating the measurementsystem, or, if necessary, making system re-pairs.

For those measurement systems that make a sig-e nificant contribution to the magnitude of the standard1 error of the inventory difference (SEID), the response*I to an out-of-control condition should also include

remeasurement of any samples (items) that weremeasured prior to the out-of-control condition but af-

° ter the last within-control measurement. The validityIs of the prior measurements can be established without

a complete remeasurement of all the samples (items)a involved if remeasurement on a "last in, first out" ba-

sis is used. That is, the last sample (item) measuredprior to the out-of-control measurement should be thefirst to be remeasured, and in reverse order continueduntil two consecutive remeasurements are found to benot statistically different from their initial measure-

n ments at the 95 percent confidence level. In otherwords, for two consecutive remeasurements, the statis-

d tical test of the null hypothesis that the difference be-tween the measured and remeasured value is zero is

Lt not rejected.

e 6. STATISTICS

g In order to achieve the objectives and capabilitiesI- of 10 CFR 74.33, a statistical program must be insti-k- tuted to evaluate the measurement control data, en-At sure that measurements are accurate and precise, en-e sure that measurement data are analyzed in a rigorouse manner, and ensure that hypotheses concerning theat status of the nuclear material possessed are appropri-f- ately tested. The NRC has sponsored the developmentit of a comprehensive reference that specifically ad-

dresses the statistical treatment of SM and SNM meas-urement data. The statistical methods described in'Statistical Methods for Nuclear Material Manage-ment," NUREG/CR-4604, are acceptable to the

d 'W. M. Bowen and C. A. Bennett, NUREG/CR-4604, De-cember 1988. Copies may be purchased from the U.S. Govern-

Le ment Printing Office, P.O. Box 37082, Washington, DC20013-7082.

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NRC staff for satisfying. the requirements of 10 CFR74.33.

At a minimum, the statistical program should ad-dress the following topics:

1. Procedures and methods for estimating meas-urement variance components,

2. Procedures and methods for determining andapplying bias correction, including:

* Frequency of bias estimates,

* Method of determining the effect of a biason the measured quantity of material in in-dividual SM or SNM items,

* Method for bias corrections to items andconditions under which they will be made,

* Method for determining the effect of biaseson inventory difference, and

* Method for applying bias corrections to theinventory difference and the conditions un-der which they will be applied,

3. Procedures and methods for determining ac-tive inventory,

4. Procedures and methods for determiningSEID,

5. Procedures and methods for determining theDQ,* and

6. Procedures and methods for determining thedetection threshold (DI) values to be used toprovide a 90 percent power of detecting a lossof a DQ amount of material, as required by 10CFR 74.33(c)(4).

At least two individuals should independently ver-ify the correctness of the SEID calculation for eachtotal plant material balance. If the SEID value is calcu-lated using a computer, verification may be accom-plished during each physical inventory reconciliationprocess by two or more persons checking for correct-ness of the input data used by the computer to calcu-late SEID and checking the correctness of a samplecalculation used to verify the computer program.

7. PHYSICAL INVENTORIES

7.1 General Description

Detailed procedures should be developed for theconduct of both dynamic physical inventories of theenrichment processing equipment and static physicalinventories of the balance of the plant (10 CFR74.33(c)(1)(iv)). The physical inventory functionsand responsibilities should be clearly defined and

'DQ should not exceed 1.3 percent of the annual U-235 quan-tiy introduced Into the enrichment process except when the1.3 percent Is less than 25 kg U-235, in which case the DOneed not be less than 25 kg U-235.

comprehensively reviewed with all persons involvedbefore the start of each dynamic and static physicalinventory.

For inventorying the SM and SNM that does notreside in the enrichment processing equipment, abook inventory listing derived from the MC&A re-cords should be generated just prior to the actual startof the inventory. This listing should include afl SM andSNM that the records indicate should be possessed bythe licensee at the cut-off time, except for material tobe covered by the dynamic physical inventory that is tobe conducted in conjunction with the static inventory.

For dynamic physical inventories, a book inven-tory quantity, to which the results of the dynamicphysical inventory will be compared, is needed. Oneapproach to estimating the in-process inventory is tocalculate a quantity known as the "running book in-process inventory" (RBIPI). Essentially, this calcula-tion is analogous to determining one's checkbook bal-ance. First, the amount of SM and SNM introducedinto the process since the last dynamic physical inven-tory is added to the amount that was in the process atthat time. Then the amount of material removed fromthe process in the same time span is subtracted. TheRBIPI is the quantity of uranium and U-235 calcu-lated as follows:

RBIPI = BI + CI - CO

Where: BI = Beginning in-process inventory (at thestart of the current inventory period)as determined from the previous dy-namic physical inventory.

CI = Cumulative measured input to the en-richment process for the current dy-namic physical inventory period.

CO = Cumulative measured output from theenrichment process for the currentdynamic physical inventory period.

Hence, the inventory difference associated withthe dynamic physical inventory is calculated as fol-lows:

ID = RBIPI - EI = (BI+CI) - (CO+EI)

Where: EI = Ending in-process inventory as deter-mined from the dynamic physical in-ventory.

7.2 Organization, Procedures, and Schedules

The composition and duties of the organizationfor the typical physical inventories, both dynamic andstatic, should be established in advance of the invento-ries. The individual having responsibility for thecoordination of the physical inventory effort shouli beidentified. Written procedures for both dynamic andstatic physical inventories should be developed andapproved by the MC&A manager and no revisionsshould be made to these procedures without his or herapproval (10 CFR 74.33(c) (1) (iv)). Specific inven-

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tory instructions should be prepared and issued foreach dynamic and static physical inventory.

7.3 Inventory Composition

The quantity of material within the enrichmentequipment for both uranium and U-235 at the time ofdynamic physical inventory should be accounted for.UFO cylinders connected (valved in) to the enrich-ment process system should be included as part of thedynamic physical inventory. For static physical inven-tories, the item composition should be categorized asdepleted uranium, natural uranium, or enriched ura-nium. If different size cylinders or other containers areused within one of the three UFO categories, theyshould be treated as different item strata.

7.4 Conducting Dynamic Physical Inventories

The licensee is required by 10 CFR 74.33(c) (4) toperform a dynamic physical inventory, which involvesstriking a material balance around the processingequipment as described in Regulatory Position 7.1. In-direct measurements and production parameters (aswell as the analysis of process samples) to determinethe quantity of material within the enrichment processmay be used. The estimate of the amount of materialwithin the process should be compared to that shownby the MC&A records to provide an indication as towhether or not a loss or theft has occurred. The lossdetection sensitivity associated with the bimonthly dy-namic inventories should be sufficient to detect a lossor theft of DQ or greater over a 12-month period withat least a 90 percent power of detection. A DQ is asite-specific quantity of U-235, the value of which isdiscussed in Regulatory Position 6 of this regulatoryguide.

7.5 Conducting Static Physical Inventories

Detailed written procedures and methods associ-ated with performing static physical inventories shouldbe developed (10 CFR 74.33(c)(1) (iv)). These proce-dures should address the following:

* The organization and independence of inven-tory functions,

* Assignment of inventory teams and the in-structions given to each team,

* The processes of obtaining, verifying, and re-cording source data,

* Control of inventory forms,

* The process for verifying the presence of eachitem while preventing multiple counting of anyitem, and

* The procedures for halting processing andmaterial movement after the physical inven-

tory has started for nonenrichment processessuch as scrap recovery.

Procedures should be developed for item storageand handling or tamper-indicating methods that areused to ensure that prior measurements are valid andmay be used for inventory purposes (10 CFR74.33(c)(1)(iv)). Also, inventory procedures shouldaddress how item identities are verified and how tam-pering with the contents of items will be detected.

For items that are not encapsulated, affixed with atamper-indicating seal, or otherwise protected to en-sure the validity of prior measurements, proceduresshould be developed for determining which items areto be measured at physical inventory time. Criteriashould be developed for the justification of any pro-posed alternatives to measurement of any SM andSNM included in the inventory. A statistical samplingplan for determining how many and which items are tobe randomly selected for remeasurement may be analternative method to 100 percent verification of priormeasurements. Such a plan should address the follow-ing:

* The method of classifying into several stratathe types of items to be sampled;:

* The method for calculating the sample size foreach stratum;

* The quality of the measurement methods usedto verify original measurement values;

* The procedure for reconciling discrepanciesbetween original and remeasured values, in-cluding when additional tests and remeasure-ments would be performed; and

* The basis for discarding the value of a previ-ous measurement of SM or SNM value andreplacing it with a remeasured value.

One acceptable means for establishing the numberof items to be randomly selected for remeasurementfrom a given material type is given by the followingequation, which calculates the number of items thatwould need to be remeasured to give a 90 percentprobability of detecting the loss of DQ kilograms ofU-235 from the given material stratum:*

n = N [1 -(0 .1 0 )x/g1

Where: n = number of items to be remeasured

N = total number of items in the stratum

x = maximum U-235 content per item(kilograms)

g = DO (kilograms U-235)

'G.F. Piepel and R. J. Brouns, Statistical Sampling Plans forPrior Measurement Verification and Determination of theSNM Content of Inventories,' prepared for the NRC by PacificNorthwest Laboratory, NUREG/CR-2466 (PNL-4057).March 1982.

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Any items on ending inventory that have not beenpreviously measured must be measured for inventorypurposes (10 CFR 74.33(c)(2)).

Procedures should be developed for determiningwhen the element and isotope factors for items, ob-jects, or containers will be measured directly for inven-tory and when they may be based on other measure-ments. These procedures should clarify the conditionsunder which it is permissible to apply an average en-richment factor to the measured uranium elementcontent and the method used to determine the factor.

If the content of items is established through priormeasurements and those items are tamper-safed or ac-cess to them is controlled, the current SM or SNMquantity in those items may be based on those meas-ured values. Otherwise, verification of SM or SNMcontent can be achieved by reweighing either (1) allthe items within a given stratum or (2) randomly se-lected items from the stratum based on a statisticalsampling plan. A statistical sampling plan will not beacceptable if there is any likelihood of a significantchange in the uranium concentration (or weight frac-tion) or in the uranium isotopic composition. For ex-ample, oxidation or change in moisture content willalter the uranium concentration.

7.6 Inventory Difference Limits and ResponseActions

A well-defined system for evaluating total plant in-ventory differences (IDs) and taking action when IDsexceed certain predetermined thresholds should be es-tablished and followed. As a minimum, there shouldbe a response level if the U-235 ID is equal to or ex-ceeds the detection threshold (DT). The DT for suchan ID problem (DT = DQ - 1.3 SEID) may be inter-preted in the following manner. If an actual loss ortheft of a DQ amount or more occurred since the laststatic physical inventory, there is at least a 90 percentprobability that the inventory difference will exceedthe detection threshold. The above limit is expressed.in terms of absolute values of ID (i.e., no regard foralgebraic sign).

For any unresolved ID that remains greater thanor equal to DT (even if the ID is negative), the licenseemay need to take steps for scheduling a plant-widereinventory and investigation. Intermediate-levelthresholds may be useful in order to provide a timelymechanism for detection of losses that are less than aDQ so that the occurrence of an ID greater than orequal to DT may be avoided in future physicalinventories.

The regulation in 10 CFR 74.33(c) (4) (i) requiresstatic and dynamic physical inventories for both ura-nium element and U-235, and 10 CFR 74.33(c)(4)(ii) requires the reconciliation and adjustmentof the book inventory for the results of the static physi-cal inventory for both uranium element and U-235.

8. ITEM CONTROL

8.1 Organization

The person to be responsible for overseeing theitem control program and the persons who have signifi-cant item control program responsibilities should beidentified in the applicable MC&A procedures.

8.2 General Description

The MC&A system must maintain records of allSM and SNM items, regardless of quantity or durationof existence (10 CFR 74.33 (c) (6) (i)). In addition, theitem control program should provide current informa-tion about the location, identity, and uranium andU-235 quantity of all nonexempt SM and SNM items(10 CFR 74.33(c)(6)(i)). Items that can be exemptfrom item control program coverage are:

1. Items that exist for less than 14 calendar days,and

2. Any licensee-identified items containing lessthan 500 grams U-235 provided the cumula-tive total of such exempted items does not ex-ceed 50 kilograms U-235.

All items, whether or not they are subject to theitem control program, should have a unique identity.For items subject to the item control program, the fol-lowing are acceptable means for providing a uniqueidentity:

* A unique alpha-numeric identification on atamper-safe seal that has been applied to acontainer of SM or SNM,

* A unique alpha-numeric identification perma-nently inscribed, embossed, or stamped onthe container or item itself, or

* A uniquely prenumbered (or bar coded) labelapplied to each item; the label has adhesivequalities such that its removal from an itemwould preclude its reuse.

Locations of items shown by the item control pro-gram records need not be unique, but location desig-nations should be specific enough so that any item canbe located in a timely fashion. The MC&A record sys-tem must be tamper-proof and controlled in such amanner that the record of an item's existence cannotbe destroyed or falsified without a high probability ofdetection (10 CFR 74.33(d)(3)).

Each nonexempt item should be stored and han-dled in a manner that enables detection of, and pro-vides protection against, unauthorized or unrecordedremovals of SM and SNM.

8.3 Item Identity Controls

Tamper-safe seals or other tamper-indicating de-vices may be used to provide unique item identity.Procedures should be developed for:

11

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1. The type of seals utilized for the various typesof containers stored,

2. The method of seal procurement and meas-ures taken to ensure that duplicate (counter-feit) seals are not manufactured,

3. Seal storage, control, distribution, destruc-tion, and accounting, and

4. Maintenance and control of seal usage anddisposal records.

8.4 Storage Controls

Storage areas and controls for items are importantelements in the item control program because theyform the basis for accepting prior measurements ofitems, as opposed to remeasuring the item at inventorytime. Any controls used to ensure the validity of priormeasurements should be equivalent to the protectionprovided by tamper-safing seals. Both administrativecontrols (such as custodian assignments and limitingauthorized access to storage areas) and physical con-trols (e.g., locked and alarmed doors) may be used.

8.5 Item-Monitoring Methodology andProcedures

As part of the item control program, a system ofitem monitoring that includes the following should bemaintained:

1. Verification that items shown in the MC&Arecords are actually stored and identified inthe manner indicated in the records,

2. Verification that generated items and changesin item locations are properly recorded in theMC&A record system in a timely manner, and

3. Detection, with high probability, of a real lossof items (or uranium from items) amountingto 500 grams or more of U-235.

The item-monitoring system should periodicallyinclude:

* Checking the actual storage status of a suffi-cient sample of randomly selected items fromthe item control program records from eachstratum to confirm that the recorded informa-tion is correct,

* Checking the accuracy of the item controlprogram records for a sufficient sample of ran-domly selected items from each storage areato ensure that all items are being properly en-tered into the records, and

* Checking the accuracy of a sufficient sampleof randomly selected production records ofcreated and consumed items.

The actual frequency of the above checks and thesize of the random sample should be a function of anexpected discrepancy rate based on prior observa-tions. Items that cannot be located are not discrepan-cies but indications of possible loss or theft. On thecontrary, discrepancies are inadvertent conditionssuch as items not in assigned locations and incorrectentries in item control program records.

8.6 Investigation and Resolution of LossIndicators

Procedures and controls should be developed toensure that all incidents involving missing or compro-mised items or falsified item records will be investi-gated. A compromised item is one with evidence oftampering or an unsealed and unencapsulated itemthat has been assigned to a limited access, controlledstorage area, but is found elsewhere. If any unencap-sulated and unsealed item is located after it has beendetermined that it is missing or if an item is found to becompromised, the contents should be verified bymeasurement. Additional guidance on resolution ofitem discrepancies is included in Regulatory Position11.

9. SHIPPER-RECEIVER COMPARISONS

9.1 Receiving Procedures

The first action to be taken by the licensee uponreceipt of SM or SNM should be verification of thecorrect number of items, the correct identity of theitems, and the integrity of the tamper-indicating seals.The maximum elapsed time for determining whetheror not a significant shipper-receiver difference (SRD)exists should be established by the licensee and shouldnot exceed 30 calendar days.

9.2 Determination of Receiver's Values

For natural UF6, the licensee may establish thereceiver's values by measuring U-235 concentration(either by NDA or by sampling and analysis), weighingeach cylinder, and using a nominal percent uraniumfactor. All SNM receipts, and any SM receipts not inthe form of UFO, should be measured for uranium andU-235 content.

9.3 Evaluation of SRDs

SRDs greater than 500 grams of U-235 are evalu-ated by testing the hypothesis that the SRD equalszero. NUREG/CR-4604, 'Statistical Methods for Nu-clear Material Management," * in the chapter on hy-pothesis testing, provides methods that are acceptableto the NRC.

W.M. Bowen and C. A. Bennett, NUREG/CR-4604, Decem-ber 1988. Copiesmay be purchased fromthe U.S. GovernmentPrinting Office, P. 0. Box 37082, Washington, DC20013-7082.

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9.4 Resolution of Significant SRDs

Resolution of a significant SRD usually involves anindependent measurement of retainer samples. A re-tainer sample is one taken prior to shipment of thematerial and kept until shipper-receiver comparisonsare resolved and it is determined that there is no dis-pute concerning the amount shipped. Resolution ofsuch SRDs could involve testing three hypotheses. Thefirst hypothesis is that the difference between the ship-per's weight and the receiver's weight is zero. Thesecond hypothesis is that the difference between theshipper's percent uranium element measurement andthe receiver's percent uranium element measurementis zero. The third hypothesis is that the difference be-tween the shipper's U-235 measurement value andthe receiver's U-235 measurement value is zero.

If an SRD is statistically significant and it is 500 ormore grams of U-235, it must be resolved (10 CFR74.33(c) (7)). In the event that such an SRD occurs,the first thing to resolve is any significant differencebetween the shipper's and receiver's net weights of thematerial shipped (e.g., kilograms UFO). Since theshipper will not be able to repeat the measurementsupon which his net weights will be based, the licensee'sresolution procedure should specify how the netweight value to which both the shipper and receiveragree is to be determined. When the shipper's and re-ceiver's net weights are in statistical agreement withone another, the receiver can proceed to resolve thedifferences in elemental and isotopic measurements ofthe material in question, including, if necessary,remeasurement by the shipper using the retainedsamples.

10. ASSESSMENT OF THE MC&A PROGRAM

10.1 General Description

The capabilities, performance, and overall effec-tiveness of the licensee's MC&A program must be in-dependently reviewed and assessed at least every 24months as required by 10 CFR 74.33(c) (8). This inde-pendence should be established by ensuring that theindividual responsible for assessing each portion of theMC&A program does not have routine responsibilitieswithin that program element. It is preferred that theentire MC&A program be reviewed and evaluatedduring each assessment. If so, intervals between as-sessments can be as long as 24 months. If individualassessments do not cover the entire MC&A system,the intervals should be no longer than 12 months. 'In-terval' means the elapsed time between either thestart of or termination of successive assessments.

The responsibility and authority in the licensee'sorganizational structure for the assessment programshould be at least one level higher than that of theMC&A manager. Such responsibility should includethe selection of the assessment team leader and theinitiation of corrective actions. Team members may beselected from the facility staff or from outside, but an

individual member should not participate in the assess-ment of the parts of the MC&A system for which thatperson has direct responsibility. Hence, the MC&Amanager can not be a team member. Also, to guardagainst collusion, no pair of team members should per-form assessments of each other's area of responsibil-ity. The leader of the assessment team should have noresponsibilities for managing any of the MC&A ele-ments being assessed.

The minimum number of individuals on any givenassessment team should depend on the knowledge andexpertise of the team relative to MC&A activities andon their experience in conducting reviews.

Personnel assigned to the assessment team shouldhave a good understanding of the objectives and therequirements of the MC&A program and should havesufficient knowledge and experience to be able tojudge the adequacy of the parts of the system they re-view. The team should have authority to investigate allaspects of the MC&A system and should be given ac-cess to all necessary information.

In order to provide a meaningful and timely as-sessment, the review and evaluation process shouldnot be protracted. The actual review and investigationactivities should be completed in 30 calendar days,with an additional 15 calendar days allowed for com-pleting and issuing a final team report.

10.2 Report of Findings and Recommendations

The areas to be reviewed must encompass the en-tire MC&A system, and the level of detail of the re-views should be sufficient to ensure that the assess-ment team has adequate information to makemeaningful judgments of the MC&A program's effec-tiveness (10 CFR 74.33(c)(8)(i)). The report shouldprovide findings pertaining to:

1. Organizational effectiveness to manage andexecute MC&A activities,

2. Management responsiveness to indications ofpossible losses of uranium and of possible un-authorized enrichment activities,

3. Staff training and competency to carry outMC&A functions,

4. Reliability and accuracy of accountabilitymeasurements made on SM and SNM,

5. Effectiveness of the measurement control pro-gram in monitoring measurement systems andits sufficiency to meet the requirements forcontrolling and estimating both bias andSEID,

6. Accuracy of the material accounting records,

7. Effectiveness of the item control program totrack and provide current knowledge of items,

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8. Capability to promptly locate items and effec-tiveness in doing so,

9. Timeliness and effectiveness of SRD evalu-ations and resolution of excessive SRDs,

10. Reliability and effectiveness of the inventory-taking procedures,

11. Capability to confirm the quantities and loca-tions of SM and SNM,

12. Capability to detect and resolve indications ofunauthorized enrichment activities and the ef-fectiveness of doing so, and

13. Capability to detect and resolve indications ofmissing uranium and the effectiveness of do-ing so.

On completion of each assessment, the findingsand recommendations for corrective action, if any,must be documented (10 CFR 74.33(c)(8)(ii)). Thewritten report should be distributed to the plant man-ager, the MC&A manager, and other managers af-fected by the assessment.

10.3 Management Review and Response toReport Findings and Recommendations

Management should review the assessment reportand take the necessary actions to correct any MC&Asystem deficiencies. The management review must bedocumented (10 CFR 74.33(c) (8) (iii)), and it shouldinclude a schedule for the correction of deficiencies.Corrective actions, if any, that pertain to daily orweekly activities should be initiated promptly after thesubmittal of the final assessment report.

11. RESOLVING INDICATIONS OFUNAUTHORIZED PRODUCTION OFENRICHED URANIUM AND MISSINGURANIUM

Procedures must be developed for resolving indi-cators of either missing uranium involving 500 or moregrams U-235 or of indicators of unauthorized enrich-ment (10 CFR 74.33(a)(4), (5), (6), and 10 CFR

* 74.33(c)(1) (iv) and (c)(5)). The three generic typesof indications are:

1. Indications that either uranium source mate-rial or enriched uranium is missing,

2. Indications that unauthorized production ofuranium of low strategic significance has beenor is occurring, and

3. Indications that the enrichment equipmenthas been or is being used to produce enricheduranium with an enrichment of 10 percent ormore in the isotope U-235.

The resolution program should address the possi-ble indicators of missing uranium. A determination ofpotential indicators that can be postulated for the

three types of indications above should be made, andappropriate resolution procedures for each postulatedindicator should be identified. In addition, the timelimits within which resolution of indicators must be ac-complished and the actions to be taken if resolutionhas not occurred within that time should be specified.

11.1 Indicators of Missing Uranium

Possible indicators of missing uranium include:

* Determination through the item control pro-gram that a specific item is not in its author-ized location and its actual location is notknown,

* Discovery of tampering with the MC&A re-cords,

* Discovery that an item's integrity or itstamper-indicating seal has been compro-mised,

* A significantly lower remeasured value on anyitem, batch, or lot of measured material inwhich the difference between the original andremeasured values exceeds twice the standarderror plus 500 grams or more U-235,

* Discovery of unauthorized feed or withdrawalequipment in the processing area,

* Information from the process control systemindicating a potential loss of material from theprocess system.

Resolution of an indication means that the licen-see has concluded that a loss or theft of more than 500grams of U-235 has not occurred. For each antici-pated type of loss indicator, a detailed resolution pro-cedure should be developed.

When appropriate, the resolution process may in-clude (1) a thorough check of the accountabilityrecords and source information, (2) locating and iso-lating the source of the problem, (3) isolating the exactreason for the problem within the area or processingunit, (4) determining the amounts of uranium andU-235 involved, and (5) making a determination thatthe indication is or is not resolved. The resolution pro-cedures should be implemented in such a manner thatno individual who could have been responsible for thepotential loss could also be responsible for resolution.

11.2 Indications of Unauthorized Production ofUranium Enriched to Less Than 10Percent in the Isotope U-235

Possible indicators of unauthorized production ofuranium enriched to less than 10 percent in the iso-tope U-235 include:

* Presence of unauthorized product, feed, ordepleted uranium cylinders in the processingarea,

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* Presence of UFO cylinders that have not beenentered into the MC&A record system,

* Variations from planned production sched-ules,

* A change in the enrichment assay of UFO tailsfrom that specified by production schedules,

e An excess amount of depleted uranium or anexcess rate of depleted uranium production,

* Incorrectly identified cylinders, such as de-pleted uranium or feed identified as enrichedproduct material,

* Discovery of tampering with the MC&A rec-ords,

* Discovery of unauthorized feed or withdrawalequipment in the processing area,

* An allegation that unauthorized enrichmentof uranium to 9.9 percent or less in the isotopeU-235 is or has been occurring, and

* Reconfiguration of the enrichment equipmentto permit unauthorized operation.

Resolution of an indication means that the licen-see has concluded that unauthorized production ofuranium enriched to less than 10 percent in the iso-tope U-235 has not occurred and is not occurring. Foreach anticipated type of indicator, detailed resolutionprocedures should be developed.

In the event of any of these or other indicators ofpossible unauthorized production of uranium enrichedto less than 10 percent in the isotope U-235, the licen-see should determine the indicator's cause and cometo a conclusion as to whether or not unauthorized pro-duction has occurred or is occurring. If an indicationof unauthorized production is determined to be true,the NRC must be notified within 1 hour pursuant to10 CFR 74.11.

11.3 Indications of Unauthorized Production ofUranium Enriched to 10 Percent or Morein the Isotope U-235

Possible indicators of unauthorized production ofuranium enriched to 10 percent or greater in the iso-tope U-235 include:

* Any measurement from a process streammonitoring program that indicates out-of-specification enrichment concentrations,

* Unauthorized withdrawal equipment in theenrichment processing area,

* Unauthorized reconfiguration of enrichmentequipment,

* Discovery that enrichment-level monitoringequipment has been compromised,

* An allegation that unauthorized production ofuranium enriched to 10 percent or more inthe isotope U-235 has occurred or is occur-ring, and

* Higher than normal nuclear signal, caused bythe presence of uranium enriched to 10 per-cent or more, from a container or processsystem.

Resolution of an indication means that the licen-see has concluded that unauthorized production ofuranium enriched to 10 percent or greater in the iso-tope U-235 has not occurred and is not occurring. Foreach anticipated type of indicator, detailed resolutionprocedures should be developed.

Since unauthorized enrichment might not be de-tected through the conduct of static physical invento-ries or dynamic physical inventories, the resolutionprocess should include the investigation of all the in-formation that contributed to the indication of un-authorized enrichment. On receipt of an indicationthat uranium enriched to 10 percent or more may havebeen or is taking place, the licensee should verify, byremeasuring, whether material enriched to greaterthan 9.99 percent is present in the process equipmentor items. Depending on the type of indicator, immedi-ate isolation of the process area or storage area fromwhich the indication was received may be needed untilthe indication is resolved. The instruments and meas-urement systems used for monitoring should be exam-ined to determine whether they are functioning prop-erly. The processing equipment should be thoroughlyexamined to ensure that unauthorized modificationshave not been made. The presence of uranium en-riched to 10 percent or more should be verified byremeasuring the material in question, whether in itemform or in the process equipment. If this investigationdetermines that an indication of unauthorized enrich-ment to 10 percent or more is true, the NRC must benotified within 1 hour of such determination pursuantto 10 CFR 74.11.

If the investigation conducted to resolve the indi-cation is inconclusive, further measures are neededbefore the licensee may conclude that the indication isresolved. To protect against the relocation and con-cealment of the enriched uranium, a thorough investi-gation of the entire facility should be performed bypersons independent of the processing organization.

12. PROGRAM FOR PRECLUDING ORDETECTING UNAUTHORIZED PRODUC-TION OF ENRICHED URANIUM

There are several alternative approaches availableto protect against and detect unauthorized productionof enriched uranium. The licensee may perform ananalysis to identify and evaluate all credible scenariosthrough which clandestine enrichment could occurand provide a monitoring program to protect againstand detect each scenario. One approach for detectingunauthorized production of uranium enriched to 10percent or more in the isotope U-235 would be a pro-

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gram to monitor the enrichment level of the uraniumin all process streams and all possible withdrawal pathsso that SNM of moderate strategic significance couldnot be produced within any period of 370 calendardays and any uranium enriched to 20 percent or morein the isotope U-235 would be detected. Detectingproduction from undeclared feed of enrichment levelsthat are within the limits authorized by license mustrely on measures other than monitoring of enrichmentlevels.

12.1 Organization

The person responsible for executing the programfor precluding or detecting unauthorized production ofenriched uranium should be identified by title or posi-tion in the organization. This person need not be partof the MC&A organization, but must be independentof the production organization. Personnel who are as-signed program responsibilities should also be inde-pendent of production supervision (10 CFR74.33 (c) (1) (ii)). This program should be well coordi-nated with both MC&A and production management.The program director should have the necessaryauthority to carry out all aspects of the program.

12.2 Monitoring Program for ClandestineEnrichment Scenarios

12.2.1 General Description of Program

The overall design of this program should bebased, at least in part, on a clandestine enrichmentpath analysis. That is, for each credible scenario forclandestine enrichment, there should be a monitoringsystem for the timely detection of that scenario.

With respect to the monitoring program for de-tecting unauthorized production of uranium enrichedto 10 percent or more, one acceptable approach wouldbe to monitor the enrichment level in all processstreams and all possible withdrawal paths, at adequatefrequencies, so that (1) 10,000 grams or more ofU-235 contained in uranium enriched between 10and 20 percent (which would be SNM of moderatelystrategic significance) could not be produced withinany period of 370 calendar days, and (2) any produc-tion of uranium enriched to 20 percent or more (i.e.,HEU) would be detected before the production ofHEU containing 1000 grams of U-235 could occur.That is to say, regardless of monitoring methodology,if unauthorized production of uranium enriched be-tween 10 and 20 percent in U-235 occurs at such aslow rate that production of a quantity representingSNM of moderate strategic significance (i.e., 10,000grams of U-235) would take more than 370 calendardays, it is not necessary that such production be de-tected by the monitoring program. However, if SNMof moderate strategic significance (involving uraniumenriched between 10 and 20 percent) can result fromunauthorized enrichment activities within 370 days orless, the monitoring is to detect such production be-

fore 10,000 grams of U-235 contained in such materi-al is produced. For unauthorized production of ura-nium enriched to 20 percent or more, regardless of theproduction rate, detection is to occur before 1000grams of U-235 contained in HEU is produced.

These scenarios for production of uranium en-riched to 10 percent or more in the isotope U-235should include process system adjustments, batch re-cycle processing, cascade interconnections, cascadeisolation, and cascade reconfiguration.

To preclude unauthorized production of uraniumenriched to 10 percent or more in the isotope U-235,the following types of measures should be considered:

* Process design features that preclude un-authorized enrichment to be conducted simul-taneously with normal (authorized) produc-tion,

* Personnel access controls that limit the num-ber of individuals who could gain access to theenrichment processing equipment or its con-trol mechanisms,

* Physical security controls such as locked andalarmed doors or TV monitors that would de-tect unauthorized access to processing equip-ment or product material,

* Process control systems that could detect un-authorized use of production equipment,

* Production control and process monitoringactivities that could contribute to the detec-tion of the unauthorized production of ura-nium enriched to 10 percent or more in theisotope U-235, and

* Use of tamper-indicating seals on processvalves and flanges.

For the program to protect against and detectunauthorized production of uranium enriched to lessthan 10 percent in the isotope U-235, the followingtopics should be considered:

* The type of monitoring and surveillance, andits frequency, to be applied to the processingareas;

* The type of monitoring and surveillance, andits frequency, to be applied to the process con-trol room and other areas where operation ofprocessing equipment can be controlled ormodified;

* The type of monitoring and surveillance, andits frequency, to be applied to potential feedand withdrawal areas;

* Process monitoring activities (e.g., radiationand flow metering) other than process sam-pling that could contribute to the detection ofunauthorized production;

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* Use of tamper-indicating seals on processvalves and flanges;

* Personnel access controls that limit the num-ber of individuals who could gain access to theenrichment processing equipment or its con-trol mechanisms;

* Physical security controls such as locked andalarmed doors, closed circuit television moni-tors, etc., that would detect unauthorized ac-cess to processing equipment or product mate-rial;

* Production control activities that could con-tribute to the detection of unauthorized pro-duction;

* Employee education to increase the probabil-ity of reporting of potential unauthorized ac-tivities by facility personnel; and

* Notification of appropriate MC&A personnelby operations organizations of the operatingstatus of the cascades, especially when a cas-cade is isolated from the process stream.

12.2.2 Program Sensitivity

While any actual enrichment of uranium to 10percent or more in the isotope U-235 is prohibited(except for cascade start-up in centrifuge facilities asnoted in Regulatory Position 1.2), the detection sensi-tivity need not be absolute. Since large quantities ofuranium enriched to between 10 and 20 percent in theisotope U-235 would be required for a meaningful ma-levolent activity, 10 CFR 74.33(c)(5) requires thatproduction of uranium in this enrichment range be de-tected before SNM of a moderate strategic signifi-cance could be produced within a 370 day period.That is to say, there should be a high assurance of de-tecting the production of 10,000 grams or more ofU-235 in the form of uranium enriched to between 10and 20 percent in the isotope U-235. Production ofuranium to greater than 20 percent in the isotopeU-235 should be .detected soon enough to precludethe actual production of 1 kilogram of U-235 con-tained in HEU.

12.2.3 Data, Information, and ActivitiesTo Be Monitored

The means for independently verifying that theactual enrichment levels in the various process streamsare consistent with design enrichment parametersshould be developed. In developing the monitoringprogram, activities such as the following should beconsidered:

* Independent weighing, sampling, and isotopicassay of material introduced at the feed addi-tion stations,

* Independent weighing, sampling, and isotopicassay of material withdrawn at the productand tails withdrawal stations,

* Independent sampling and isotopic assay ofin-process material at randomly selectedpoints, and

* Verification that the quantity of U-235 inde-pendently determined to be in the productand tails is consistent with the independentlydetermined feed input.

For gaseous diffusion and gas centrifuge facilities,the licensee or applicant should consider monitoringsuch process parameters as UFg gas pressures, flowrates, enrichments, valve positions, operating parame-ters, cascade configuration and connections, andtracking all potential UFP containers in the processarea. The purpose is to ensure that the amount of en-riched uranium being produced agrees with produc-tion schedules.

12.3 Program for Monitoring Output Streams

The overall design of the program should includeanalysis of all processing and product streams to deter-mine where uranium isotopic measurements should bemade and at what frequency to preclude clandestineenrichment activities. That is, for each identified sce-nario for clandestine enrichment, there should be amonitoring system for the timely detection of any im-plementation of that scenario. Since NDA measure-ment techniques can be useful for detecting the pres-ence of uranium enriched to unauthorized levels, theuse of such techniques, either by manual measure--ments using portable NDA instruments or instrumentsthat are permanently affixed to the process equip-ment, should be considered. In the former case, ad-ministrative controls should be used to detect or pre-clude collusion of the measurement personnel with apotential clandestine perpetrator. In the latter case,frequent inspection and testing of the instrumentsshould be performed to detect or preclude tamperingor disabling of the NDA measurement system.

The scenario analysis should address each prod-uct stream regardless of material type or compositionand should be conducted by persons that have a thor-ough knowledge of the processing equipment andenrichment technology. All conceptual means for pro-duction of uranium of enrichment levels equal to orgreater than 10 percent in the isotope U-235 shouldbe identified. These approaches should includeprocess system adjustments, batch recycle processing,cascade interconnections, and cascade reconfigura-tion (e.g., increasing the number of stages).

The extent of the monitoring program should de-pend on the same types of measures as those identifiedin Regulatory Position 12.2.1 for monitoring clandes-tine enrichment scenarios.

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12.4 Decision Criteria for DeclaringUnauthorized Production

An MC&A procedure that defines the basis for(a) declaring that unauthorized production of uraniumenriched to 10 percent or more in the isotope U-235has taken place and (b) declaring that unauthorizedproduction of uranium enriched to less than 10 per-cent in the isotope U-235 has taken place should bedeveloped.

Whenever there is an indication that unauthorizedenrichment is or may be occurring, that indicationmust be subject to the investigation and resolution re-quirements of 10 CFR 74.33(c)(5), which are dis-cussed in Regulatory Position 11 of this regulatoryguide. If actual unauthorized production of enricheduranium is discovered, that discovery must be re-ported to the NRC within one hour as required by 10CFR 74.11.

13. RECORDKEEPING

13.1 Description of Records

The MC&A program must utilize and retain allrecords, forms, reports, and standard operating proce-dures pursuant to 10 CFR 74.33(d). Such recordsshould include, but are not limited to, the following:

* Documents recording changes in the MC&Amanagement structure or changes in responsi-bilities relating to MC&A positions,

* Any procedures pertaining to accountabilitymeasurements (including sampling) andmeasurements related to the requirements of10 CFR 74.33(c)(5),

* Forms used to record or report measurementdata and measurement results, includingsource data,

* Forms (notebooks, etc.) used to record cali-bration data associated with any accountabil-ity measurement system,

* Forms (notebooks, etc.) used to record quan-tities, volumes, and other data associated withthe preparation of standards (both calibrationand control) used in connection with account-ability measurement systems,

* Forms used to record or report measurementcontrol program data, control limit calcula-tions, out-of-control investigations,

* Forms (listings, instructions, etc.) associatedwith a physical inventory (both dynamic andstatic),

* Forms (worksheets, etc.) used in the calcula-tion of SEID, ID, and active inventory values,

* Ledgers (journals, computer printout sheets,etc.) associated with the accountability sys-tem,

* Ledgers (journals, computer printout sheets,etc.) associated with the item control pro-gram, including seal usage and "attesting to"records,

* Completed DOE/NRC-742 and NRC-327Forms and incoming and outgoing DOE/NRC-741 Forms,

* Forms (memos, reports, etc.) associated withidentification of, investigation of, and resolu-tion of significant shipper-receiver differ-ences,

* Loss indication and alleged theft investigationreports,

* Investigation reports pertaining to indicationsof unauthorized enrichment activities,

* Investigation reports pertaining to excessiveinventory differences,

* Reports containing the findings and recom-mendations of MC&A system assessments aswell as any letters or memos pertaining to ac-tions in response to assessment team recom-mendations,

e Forms used for recording data associated withthe monitoring program,

* Records and forms used to document author-ized reconfiguration of enrichment equip-ment,

* Status reports or summary reports pertainingto the monitoring for unauthorized enrich-ment and item monitoring programs, and

* Training, qualification, and requalificationreports or records.

All retained records and reports must contain suf-ficient detail to enable NRC inspectors to determinethat the licensee has attained the system features andcapabilities and has met the general performance ob-jectives (10 CFR 74.33(d)(1)).

13.2 Program for Ensuring an Accurate andReliable Record System

Controls to ensure that records are highly accurateand reliable should be developed. Specific MC&Aprocedures dealing with record protection should bedeveloped and followed. The record system shouldalso provide a capability for easy traceability of all SMand SNM transactions from the point at which thedata is generated to the final accounting records.

This program should address the following topics:

* The auditing system or program to verify thecorrectness and completeness of records,

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* The procedures designed to prevent or detectthe falsification or destruction of data or re-cords by an individual.

* The plan for reconstructing lost or destroyedSM or SNM records,

* Access controls used to ensure that onlyauthorized persons can update and correct re-cords, and

* The protection and redundancy of the recordsystem so that any act of record alteration ordestruction will not eliminate the ability toprovide complete MC&A information.

D. IMPLEMENTATION

The purpose of this section is to provide informa-tion to applicants regarding the NRC staff's plans forusing this regulatory guide.

Except in those cases in which an applicant pro-poses an acceptable alternative method for complyingwith specified portions of the Commission's regula-tions, the methods described in this guide will be usedin the evaluation of Fundamental Nuclear MaterialControl Plans submitted by applicants or licensees pur-suant to 10 CFR 74.33.

K

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REGULATORY ANALYSIS

A separate regulatory analysis was not preparedfor this regulatory guide. The regulatory analysis pre-pared for 10 CFR 74.33, 'Nuclear Material Controland Accounting for Uranium Enrichment FacilitiesAuthorized To Produce Special Nuclear Material ofLow Strategic Significance," provides the regulatorybasis for this guide and examines the cost and benefitsof the rule as implemented by the guide. The rule setsforth the NRC staff position on MC&A at licensed en-richment plants and provides safeguards to protect thehealth and safety of the public. While the costs of

rulemaking in this instance are slightly higher than thecosts of imposing license conditions, the advantages ofpromulgation by rulemaking include the opportunityfor public comment, which better assures that all ap-propriate issues are raised prior to the imposition ofthese requirements.

A copy of the regulatory analysis is available forinspection and copying for a fee at the NRC PublicDocument Room, 2120 L Street NW., Washington,DC, as part of the file on the Federal Register Noticedated October 31, 1991 (56 FR 55991).

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