FCIX 2013 Presentation: New Construction at LES/URENCO USA

Presented by:

Jay Laughlin Chief Nuclear Officer LES/URENCO USA June 12, 2013

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Objectives

Share UUSA lessons learned with the licensing, design, construction, start up, and operations of a multi-billion dollar nuclear facility under the COL process

Understand the most significant risks and challenges with new Nuclear Construction in the US today and some of the value add mitigation strategies.

Agenda

• Who is LES (URENCO USA)? – Our Vision, Mission and Technology – Brief Overview of Centrifuge Enrichment Operations – Project History

• URENCO USA Lessons Learned

– License – Design – Configuration Control – Procurement & Contracts – Project Controls – Industrial Safety – Vendor Oversight – Nuclear Safety Culture – Turnover to Operations and NRC Readiness Review – Initial Operations – Leadership Actions

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06/17/2013 Urenco Proprietary and Confidential Information

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Vision, Mission and Values

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• Developed by URENCO, a consortium of British, Dutch, and German governments – 1970 Treaty of Almelo – 1992 Quadripartite Treaty

• Proven to be world’s most

advanced, energy-efficient, and cost-effective technology for enriching uranium

• Deployed successfully in

Europe for more than 40 years

Centrifuge Technology

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Who is LES (URENCO USA)?

• URENCO USA is a subsidiary of URENCO, a world leader in enrichment services

• Approximately 320 full time URENCO USA employees through construction period

• Peak construction period Spring 2008 with 1,800 construction workers – now level at around 800

• Diverse workforce with team members from all over the US, Canada, Mexico, and several European countries

• NRC approval to operate the first Centrifuge Cascade (Cascade 1.1) was received on June 10, 2010

• 36 cascades now in operation ~2.7M SWU (expanding to 5.7M SWU or ~50% of current US demand)

• Over 17.6 million work hours to date without a construction loss time accident

Uranium Enrichment Process

Cooling

Cooling

Hot box with UF6 transport container

Separation in Centrifuge Cascades

Compressor

Depleted UF6

Cooling box with transport container with

enriched UF6

Compressor

Enriched UF6

UF6

Sub-atmospheric Pressure

Heating

Cooling box with transport container with

depleted UF6

Operations

Current Operating Cascade Status 24 Cascades (TC12) in operation in SBM 1001 11 Cascades (TC21) in operation in SBM 1003 2.6M SWU Capacity in May 2013 Future Capacity 2013 3.1M SWU/ 41 Cascades

2014 3.7M SWU/ 48 Cascades 2015 4.8M SWU/ 61 Cascades 2016 5.7M SWU/ 72 Cascades

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Phase One – 1.65 M SWU

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Phase Two – 3.7 M SWU

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Phase III – 5.7M SWU

Phase IV

Phase III

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URENCO USA - Spring 2012

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Phase III - January 2013

Quality Assurance and Quality Control Audits & Surveillances

• Through the Construction and Commissioning Process: In 2009:

– 30 Internal Audits – 38 External Audits – 4 Commercial Surveys – 183 Evaluations – 391 Surveillances (Internal and External)

In 2010:

– 6 Internal Audits – 8 External Audits – 11 Commercial Surveys – 69 Evaluations – 230 Surveillances (Internal and External) In 2011: – 22 Internal Audits – 36 External Audits – 34 Commercial Surveys – 244 Surveillances (Internal and External)

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Nuclear Regulatory Commission Oversight and Inspections

• The NRC Operational Readiness Review process (leading up to June 2010 approval): – 22 Calendar Weeks – 92 Inspector Weeks – 3700 Man-Hours – Over 41 NRC Inspection Procedures

• Additionally:

– Multiple In-Office Reviews – Multiple Construction Inspections – Approval of 92 License Amendment Requests More than the rest of the fuel cycle facilities-combined

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New Mexico Construction Industries Division Support

• To mid-2012, the New Mexico Construction Industries Division has performed 12,100 individual inspections:

– 5,213 Civil / Structural Inspections

– 4,569 Electrical

Inspections – 2,318 Mechanical Inspections

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• Risk

– Incomplete, inadequate or inflexible designs (no margin) restrict/slow construction, require rework or expedited procurements

• Value Added Risk Mitigation Strategies

– Complete, detailed, designs early and upfront

– Establish flexible Design construction

tools (CLSM, time to remove form walls, etc.)

– 3-D modeling is critical to coordinate multiple

vendors – Field engineers with “graded” design change

authority – Define your approach to

“Americanization”

Design Implications

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• Risk

– Design is not properly followed in the field & changes are not supported in a timely manner

• Value Added Risk Mitigation Strategies

– Establish an experienced Field Engineering organization

– Establish “graded” controls

based on quality level and significance. Use “red lines”

– Onsite design authority to support

quick turnaround – Minimize controlled drawing sets,

maximize work plan sets – “As-build” as you go, eliminates need

for later reconciliation – Operationally control completed work –

don’t undo!

Configuration Control Requirements

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• Risk

– Because it is nuclear it should cost more and take longer

• Value Added Risk Mitigation Strategies

– Provide complete design packages and details when bidding – Use competitive bid process – Incentivize bidders to finish

early/under cost – Shift contractual risk to

vendors - use fixed price contracts with LDs for schedule slippage/rework, withhold final 10%

– Establish an independent

cost engineering function

– Implement a rigorous Commercial Grade Dedication process with Quality controls

Procurement & Contracts

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Leadership Actions Addressing the Challenges • Oversight

– Challenge the status quo – Be seen in the field and model the correct behaviors and

priorities – seek to understand – Frequent challenge meetings to true up works scope, schedule

and cost – Develop methodology/forums for assessing schedule challenges

• Innovation and Flexibility – Shift the Paradigm

– Design and license can provide construction flexibility – find it and use it

– Graded process controls relative to significance of the activity

• Safety Culture – Keep the terms simple and usable for the construction staff – Demonstrate importance daily and reward behaviors

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2013 – Path Forward

• Going Forward URENCO USA Energy Services will: – Maintain Design Authority and General Contractor

responsibilities with regulatory authorities – Outsource major initial designs and then control in-

house during construction and final turnover – Develop stronger partnerships with proven vendors – Transition work planning, QA and other functions to

vendors while maintaining critical oversight – Perform intrusive and strategic inspections to confirm

work is performed correctly prior to major undertakings

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Questions?

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