DRC-2011-007482 - 0901a0688027c72e

State of Utah
GARY R. HERBERT
Governor
GREG BELL
Lieutenant Governor
Department of
Environmental Quality
Amanda Smith
Executive Director
DIVISION OF RADIATION CONTROL
Rusty Lundberg
Director
MEMORANDUM
TO: File
THROUGH: Phil Goble, Compliance Section Manager
FROM: Tom Rushing, P.G. ^] ^ iO/^/l I
Octobers, 2011 DATE:
SUBJECT May 9, 2011 Notice of Violation and Order Docket No. UGWl 1-05 (NOV), Denison
Mines (USA) Corp. (DUSA) July 6, 2011 response to the NOV, Utah Division of
Radiation Control (DRC) Findings and Proposed Civil Penalty for Cited Violations
This memo is to provide 1. The DRC review findings regarding DUSA's July 6, 2011 letter response
(Response) to Notice of Violation and Order Docket No. UGWl 1-05 (NOV), and 2. A civil penalty
calculation for the NOV cited violations.
1. DRC Review of the Response
Per review of the Response, DUSA did not reserve their right to request a hearing before the Water
Quality Board.
The NOV Order requires DUSA to prepare a response with the following items:
a) The root cause of the noncompliance,
b) Corrective steps taken or to be taken to prevent re-occurrence of the noncompliance,
c) Date when compliance was or will be achieved.
Per the response, DUSA accepts all violations in the NOV (2 violations total). Table 1 below
summarizes the 2 violations cited in the NOV.
195 North 1950 West • Salt Lake City, UT
Mailing Address: P.O. Box 144850 • Salt Lake City, UT 84114-4850
Telephone [phone] • Fax [phone] • T.D.D. [phone]
www.deq.utah.gov
Printed on 100% recycled paper
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Table 1 - Summary of Violations NOV and Order Docket UGW 11-05, DUSA Responses and DRC Findings
Violation Summary DUSA July 6, 2011 Response DRC Findings
Violation 1 - NOV lists 1
violation of the White Mesa U-
Mill Groundwater Discharge
Permit UGW370004 (Permit) for
failure to provide at least a 14
calendar day written notice for the
installation of monitoring wells
MW-36 and MW-37 [Violation of
the Permit Part I.H.4(c)]
DUSA states that the drilling
program start date was unspecified at
the time the project schedule dates
were "diarized" and that as a result,
the Permit notice requirement was
"inadvertently overlooked." DUSA
does not contest the violation.
Violation Stands
Violation 2 - NOV lists 1
violation of the Permit for failure
to provide at least a 14 calendar
day written notice for the
installation of wells for the
Southwest Investigation
[Violation of the Permit Part
I.H.6(g)]
DUSA states that the root cause of
the violation was the same as
violation 1. DUSA does not contest
the violation
Violation Stands
2 violations cited 2 violations stand
Each DUSA response to the 2 NOV violations is listed below, followed by DRC findings.
VIOLATION 1
DUSA RESPONSE - VIOLATION 1
/. Part LH.4(c) of the Permit for failing to provide at least a 14 calendar written notice to allow the
Executive Secretary to observe all drilling and well installation activities for the Southwest
Investigation.
[The part ofthe Permit cited refers to the installation ofMW36 and MW37, not the Southwest
Investigation. DUSA assumed the violation was intended to refer to the MW36 and MW37
installation, and has answered accordingly.]
a) Root Cause of the Noncompliance
Part I.H.4(c) of the Permit required written notice 14 days prior to drilling to allow DEQ personnel
to observe the activities. Unlike the other requirements of this Part of the Permit which had fixed
dates for performance, the drilling program start date was unspecified. All other fixed dates and
requirements in this Part were diarized immediately upon DEQ approval ofthe Permit revision
containing the requirement for the monitor well drilling. The single requirement, drilling startup,
without a specified date was not electronically diarized while contracting and planning for drilling
was underway. The intention was to provide the 14-day notice one the drilling date had been
established. However, given the number of other simultaneous regulatory requirements and activities
underway during April and May 2011, this nondiarized requirement was inadvertently overlooked.
b) Steps That Have Been Taken to Correct the Violation
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The following steps have been taken to correct the violation:
See item c, below.
c) Date When Compliance Was or Will be Regained
DEQ personnel reviewed the locations ofthe installed wells and piezometers during a site visit during
the week of May 17, 2011. Subsequently, DUSA provided DEQ written documentation (a grid map) of
the locations ofthe new monitoring wells and all piez.ometers in an email on May 26,2011, in which
DUSA sought DEQ approval or further input on the locations. '
d) Steps Taken to Prevent Reoccurrence ofthe Noncompliance
Denver corporate environmental personnel review all permit revisions, notices, requests for
additional information letter responses, and other written commitments upon receipt or submittal, in
order to electronically diarize specific dates for required actions or reporting. To date, actions with
unspecified dates, such as drilling or construction, have not been consistently added to the electronic
-notification system. This process has now been modified such that upon receipt or submittal,
corporate personnel will also consistently diarize interim dates by which drilling or construction
schedule windows need to be established so that notification can be submitted timely to DEQ. DUSA
also recommends that the Permit be modified, in Parts which state a requirement for a 14-day written
notice, to state a requirement for "a written notice 14 days in advance or such lesser time as the
Executive Secretary may approve in advance. "
DRC FINDINGS - VIOLATION 1
DRC accepts that the violation was caused by an oversight of data entry on the part of DUSA and that
DUSA is correcring the process by insuring that the logging process will include the entry of "interim
dates." Per the DUSA response this modification should ensure compliance with the T4-day notice
requirements (or other notice requirements as the Executive Secretary may approve in a:dvance).
DUSA has previously been cited for failing to provide prior Written notice of drilling activities. On
December 14, 2009, DUSA was issued a 30 Day Payment Demand for failing to provide written
notice of two drilling activities and three monitoring events associated with the Nitrate Contamination
Investigation (CIR). DUSA was issued a $5,000 Civil Penalty for the problem, which was paid on
January 21, 2010. Therefore, Violation 1 stands and a penalty has been calculated as detailed in the
"Civil Penalty Calculation" section of this memo below. .
VIOLATION 2
DUSA RESPONSE - VIOLATION 2
2. Part I.H.6(g) of the Permit, DUSA failed to provide at least a 14 calendar written notice to allow
the Executive Secretary to observe all drilling and well installation activities for the Southwest
Investigation.
a) Root Cause of the Noncompliance
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Please see item 1 a, above. The same circumstances apply to this violation as to the violation
discussed above.
b) Steps That Have Been Taken to Correct the Violation
The following steps have been taken to correct the violation:
Please see item 1 b, above.
c) Date When Compliance Was or Will be Regained
Please see item 1 c, above.
d) Steps Taken to Prevent Reoccurrence of the Noncompliance
Please see item 1 d, above. '
DRC FINDINGS-VIOLATION 2
The DUSA report states that the cause of the noncompliance and corrective actions are the same as
those in Violation 1 above. As above, DRC accepts the stated cause and planned actions to resolve
the violation. DUSA has preciously been cited for failing to provide prior written notice of drilling
activities. On December 14, 2009, DUSA was issued a 30 Day Payment Demand for failing to
provide written notice of two drilling activities and three monitoring events associated with the
Nitrate Contamination Investigation (CIR). DUSA was issued a $5,000 Civil Penalty for the problem,
which was paid on January 21, 2010. Therefore, Violation 2 stands and a penalty has been Calculated
as detailed in the Civil Penalty Calculation section below.
2. Civil Penalty Calculation
WATER OUALITY PENALTY CRITERIA
According to R317-1-8 (Penalty Criteria for Civil Settlement Negotiations), the penalty calculation
methodology consists of the following formula:
CIVIL PENALTY = PENALTY + ADJUSTMENTS - ECONOMIC AND LEGAL
CONSIDERATIONS
L CategorySeiection(R317 1 8.3)
The table below describes the Water Quality penalty categories.
Water Quality Penalty Categories (UAC R317-1-8.3)
Category A - $7,000 to $10,000 per day. Violations with high impact on public health arid the
environment to include:
Category A.l - Discharges which result in documented public health effects and/or significant
environmental damage.
Category A.2 - Any type of violation not mentioned above severe enough to warrant a penalty
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assessment under category A.
Category B - $2,000 to $7,000 per day. Major violations of the Utah Water Pollution Control Act,
associated regulations, permits or orders to include:
Category B.l - Discharges which likely caused or would potentially cause (undocumented) public
health effects or significant environmental damage.
Category B.2 - Creation of a serious hazard to public health or the environment.
Category B.3 - Illegal discharges containing significant quantities of concentrations of toxic or
hazardous materials.
Category B.4 - Any type of violation not mentioned previously which warrants a penalty
assessment under category B. ' . - .
Category C - $500 to $2,000 per day. Violations of the Utah Water Pollution Control Act,
associated regulations, permits or orders to include:
Category C.l - Significant excursion of permit effluent limits.
Category C.2 - Substantial non-compliance with the requirements of a compliance schedule.
Category C.3 - Substantial non-compliance with monitoring and reporting requirements.
Category C.4 - Illegal discharge containing significant or concentrations of non toxic or non
hazardous materials.
Category C.5 - Any type of violation not mentioned previously which warrants a penalty
assessment under category C.
Category D - up to $500 per day. Minor violations of the Utah Water Pollution Control Act,
associated regulations, permits or orders to include:
Category D.l - Minor excursion of permit effluent limits.
Category D.2- Minor violations of compliance schedule requirements.
Category D.3 -Minor violations of reporting requirements.
Category D.4 - Illegal discharges not covered in Categories A, B and C.
Category D.5 - Any type of violations not mentioned previously which warrants a penalty
assessment under category D. , " • ••
Violation 1 -- Penalty Category and Dates of Noncompliance
Penalty Category: Penalties for Violation 1 will be calculated as Category D.3 Minor Violations of
Reporting Requirements with penalties up to $500 per day. DRC considers Category D to_be
conservative. DUSA failed to provide the 14 day notice of the drilling activities resulting in DRC
being unable to observe the installation of wells MW-36 and MW-37.
Calculation of violation days: Per a DUSA letter dated June 29, 2010 and titled State of Utah
Ground Water Discharge Permit ("the Permit")No., UGW370004 White Mesa Uranium Mill -
Installation Report Pursuant to Part IF.6 and LH.4 ofthe PemzzY, Monitoring Wells MW-36 and
MW-37 were installed on April 27, 2011 and April 26, 2011 respectively, therefore the 14 day notice
should have been provided to the DRC by April 12, 2011.
Per the DUSA July 6, 2011 response to the Order, compliance was achieved on the date that DUSA
provided DEQ written documentation of the new monitoring wells (May 26, 2011); therefore, the
number of days that DUSA is considered to be out of compliance is from the date that written
notification should have been provided (April 12, 2011) to the date DUSA provided written document
that monitoring wells MW-36 and MW-37 were installed, for a total of 44 days.
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The proposed maximum penalty, therefore, would be calculated for 44 days at $500 per day is
$22,000.
Violation 2 - Penalty Category and Dates of Noncompliance
Penalty Category: This is the same violation type as violation 1 above, therefore category D.3 will
also be used for this violation.
Calculation of violation days: The same period of non-compliance will apply to the Southwest
Investigation wells. DUSA has not provided the exact dates of installation of the monitoring wells
associated with the Southwest Investigation; therefore, the dates of non-compliance will also be
calculated from April 12, 2011 until May 26, 2011, for a total of 44 days
The proposed maximum penalty, therefore, would be calculated for 44 days at $500 per day is
$22,000.
VIOLATIONS 1 AND 2 STATUTORY MAXIMUM PENALTY CALCULATION
The statutory maximum penalty for Violations 1 and 2, Category D.3 would be calculated for 2
violations for 44 days at $500 per day is $44,000. <
ASSIGNED PENALTY AMOUNT WITHIN CATEGORY D.5
DRC consideration of credit as detailed in the Administrative Penalty Policy follows;
A. History of compliance or non-compliance:
Under UAC R317-1-8.3(A), two factors need to be considered, including previous violations
and degree of recidivism.
DRC Finding: According to DRC records, DUSA has failed to provide proper written
notification to the DRC, as required by the Permit or a Stipulated Consent Agreement at least
in nine different instances since 2007, as follows:
• In the 1^^ and 4* Quarter, 2007 Groundwater Reports DUSA failed to provide written
notification in accordance with Part I.G.I (a) of the Permit.
• In the December 14, 2009, DUSA was issued a 30 Day Payment Demand for failing to
provide written notice of two drilling activities and three monitoring events associated
with the Nitrate Contamination Investigation (CIR), which was in violation of the
January 28, 2009 Nitrate Stipulated Consent Agreement.
• On May 9, 2011 DUSA was issued a NOV (Violation 1) where DUSA failed to
provide 14 calendar day written notice to allow the Executive Secretary to observe all
drilling and well installation activities for monitoring wells MW-36 and MW-37,
which was in violation of Part I.H.4(c) of the Permit.
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• On May 9, 2011 DUSA was issued a NOV (Violation 1) where DUSA failed to .
provide 14 calendar day written notice to allow the Executive Secretary to observe all
drilling and well installation activities for the Southwest Investigation, which was in
violation of Part I.H.6(g) of the Permit.
Therefore, a credit of 50% was given in regard to providing written notification as required by
the Permit or other signed agreement between the DRC and DUSA.
B. Degree of willfulness and/or negligence:
Four factors need to be considered under the requirements of VAC R317-1-8.3(B), including:
'"'"••-. i •
1. How much control the violator had over and the foreseeability of the events constituting
the violation;
2. Whether the violator made or could have made reasonable efforts to prevent the violation;
3. Whether the violator knew of the legal requirements which were violated;
4. Degree of recalcitrance.
DRC finds that:
DUSA states in the Order response that the violation was the result of an oversight in the
reporting process. DUSA was aware of the legal (permit) requirements, however, DRC does
not see any company recalcitrance in taking responsibility for the violations. DUSA has
reported the cause of the violation and has proposed a corrective action. Therefore, 75%
credit was given for the "degree of willfulness or negligence" category to recognize the good
faith efforts to initiate a process to avoid future violations of this type.
C. Good faith efforts to comply:
Under UAC R317-1-8.3(C), this includes the Permittee's openness in dealing with the
violations, promptness in correction of problems, and degree of cooperation with the State.
Per the DUSA July 6, 2011 response to the Order, the violations'were caused by ari oversight
in the reporting process. DUSA has implemented a new process to avoid this type of violation
in the future. Considering that this is a first time violation, and that DUSA has provided
corrective action, DUSA was given 75% credit for "good faith efforts to comply" category.
Penalty Calculation
Because Violations 1 and 2 are similar in nature they have been combined info one single civil
penalty, as follows: ^
Category D, which is a maximum of $500 per day penalty = $ 500
Credits: 1/3 (max $166) History of Compliance: (50% credit) =$ 83
1/3 (max $166) Degree of Willfulness and/or Negligence: (75% credit) = $ 125
1/3 (max $166) Good Faith Efforts to Comply: (75% credit) = $125
Total credit = $ 333
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Penalty per day violation: = $167
Number of violation days: X 44
Total Category Penalty (Gravity Component) = $ 7,348
ADJUSTMENTS
According to R317-1-8.3, the civil penalty shall be calculated by adding the following adjustments to
the penalty amount:
a. Economic benefit - These include costs which were delayed or avoided due to the non-
compliance. No economic benefit was gained by not providing the required 14 day notice;
therefore, no economic benefit calculation will be included in the penalty calculation.
b. Investigative costs - No investigative costs are included for these violations. The
violations were the result of inspection findings by DRC. /
Proposed Total Civil Penalty for Docket No. UGWll-05 (2 Violations): $ 7,348