DRC-2010-006446 - 0901a068801ea8cd

DRC-2010-
Department of
Environmental Quality
Amanda Smith
ExetMtive Director
OrVISION OF RADIATION CONTROL
Rusty Lundberg
Director
State of Utah
GARY R. HERBERT
Governor
GREG BELL
Lieutenant Governor
December 21, 2010
CERTIFIED MAIL
(Return Receipt Requested)
Ms. Jo Ann Tischler
Director, Compliance and Permitting
Denison Mines (USA) Corp. (DUSA)
1050 Seventeenth St. Suite 950
Denver, Colorado, 80265
Subject: October 19, 2010 DUSA Response to the September 22, 2010 DRC Findings and Proposed
Civil Penalty and Settlement Agreement for the May 13, 2010 Notice of Violation and Cease
and Desist Compliance Order, Docket No. UGWlO-04
Dear Ms. Tischler:
On October 19, 2010 the Utah Division of Radiation Control (hereafter DRC) received your October 19,
2010 letter regarding the September 22, 2010 DRC Proposed Civil Penahy and Settlement Agreement
(Docket No. UGW10-04SA), which was written to resolve the May 13, 2010 Notice of Violation and
Cease and Desist Compliance Order, Docket No. UGWl0-04 (hereafter May 13,2010 NOV and Order).
We also acknowledge your original June 22, 2010 letter response (June 22, 2010 DUSA Letter) to the May
13, 2010 NOV and Order. After reviewing all of these letters we have the following findings:
DRC Findings
1. DUSA was sent the May 13, 2010 NOV and Order via Certified Mail (retum receipt requested). In
accordance with the Utah Administrative Procedures Act and Utah Admin. Code R-317-9-3(3) the
May 13, 2010 NOV and Order mandated that DUSA reply in writing within 30-days. DUSA was
informed that if it did not contest the NOV and Order within 30 days as required, the Order would
become final [UAC R.317-9-2(2)].
2. The June 22, 2010 DUSA Letter was received by the DRC on June 23, 2010 after the 30 day
deadline had passed. In this letter DUSA did not request any agency action to contest the May 13,
2010 NOV and Order nor did DUSA request that any of the five violations be rescinded or
reconsidered.
3. The Utah Water Quality Administrative Procedures Rule at UAC R317-9-2(b) mandates that all
notices of violation and orders:
a. Are effective on the date of issuance,
195 North 1950 West • Salt Lake City, in-
Mailing Address: P.O. Box 144850 • Sah Uke City, UT 84114-4850
Telephone [phone] • Fax [phone] • T.D.D. [phone]
www.deq.ulah.gov
Printed on 100% recycled paper
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b. Become final if not contested within 30 days after the date issued, and
c. The date of issuance of an initial notice of violation or order is the date that the document
is mailed. '
DUSA did not contest the May 13, 2010 NOV and Order, nor ask that any ofthe violations be
rescinded or reconsidered on or before the 30 day deadline. Therefore, the May 13, 2010 NOV
and Order is final and fully enforceable.
The proposed early settlement agreement penalty amount is based upon early resolution of this
matter. If this matter is not resolved through this Settlement Agreement, the DRC will ask for the
full penalty amount when the Order goes before the Utah Water Quality Board. If this matter is
taken to the Board, the only issue before the Board will be the penalty because the Order is final
and fiilly enforceable. Please see the enclosed revised penalty calculation that details the basis for
the fiill penalty.
4. Violation 1 - DUSA violated Part I.D.4 ofthe Permit for construction, and operation of a new
wastewater treatment or storage facility without submittal of engineering design plans and
specifications, and prior Executive Secretary review and approval.
September 22, 2010 DRC Finding: "In the June 22, 2010 DUSA root cause analysis, DUSA
states it was their understanding that this disagreement on the interpretation of Part I.D.4 arising
in 2008 was resolved in 2009 through the addition ofPartI.H.4 to the Pennit. This statement
would be true, if DUSA hadfollowed the requirements of Part I.H.4 of the Permit, and secured the
required approvals before operation of the New Decontamination Pad (NDP).
In light ofthe January 20, 2010 Permit modification that required DUSA to obtain Executive
Secretary approval of certain NDP design elements and construction before operation of the pad,
it is clear that the DUSA NDP facility has a potential to contaminate groundwater and is therefore
regulated under the Water Quality Act Therefore, we have determined that Violation No. 1 still
stands as cited. A proposed civil penalty has been calculated by DRC staff and is attached to this
letter. For details, see the DRC memorandum attached herewith. A proposed Settlement
Agreement (SA) is also attached for your consideration. "
DUSA October 19,2010 Response: "The State of Utah Division of Radiation Control ("DRC")
memorandum detailing the calculation of the proposed civil penalty was not included with your
September 22, 2010 letter. Please provide us with a copy of that memorandum so that we can
review the manner of calculation of the proposed penalty."
DRC Response: the DUSA October 19, 2010 response indicates the DRC penalty calculation
memorandum was not included in the September 22, 2010 DRC letter. To correct this problem,
the July 8, 2010 DRC Memorandum was e-mailed to you on October 20, 2010. In an email
response of October 21, 2010 you confirmed receipt ofthe July 8, 2010 DRC Memorandum. As of
this date, DUSA has provided no further comment on the penalty calculations of the DRC. As a
result, the Co- Executive Secretary has concluded that the proposed $12,500 penalty amount for
Violation No. 1 stands as calculated.
5. Violation 2 - DUSA failed to submit an updated DMT Monitoring Plan within 30 days of Permit
issuance, or by February 19, 2010, as required by Part I.H.4(a) of the Permit.
September 22, 2010 DRC Finding: "The DRC acknowledges that DUSA did submit letters
regarding NDP on June 29, 2009 and November 16, 2009 that included excerpts of proposed
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RE: 12/21/10: NOV & Cease&Desist / PRG
Jo Ann Tischler
Denison Mines (USA) Corp
1050 Seventeenth ST, STE 950
Denver, Co 80265
PSVbr m 3800, August 2006 ' • See Reverse forjnstructions
Page 3
language changes to the DMT Plan. We also acknowledge that DUSA submitted a revised and
stand-alone version of the DMT Plan dated March 12, 2010. After review ofthe Inarch 12, 2010
submittal the DRC sent DUSA a May 10, 2010 DRC RFI As of this date, DUSA has not responded
or resolved the issues presented. Therefore, we have determined that Violation No. 2 still stands
as cited. Because Violation No. 2 is a failure to comply with a requirement found in Part I.H.4 of
the Permit, the proposed penalty has been combined for Violations 2, 3, 4, and 5. Said civil
penalty has been calculated by DRC staff and is attached to this letter. A proposed SA is also
attached for your consideration."
DUSA October 19, 2010 Response: "Denison submits that the DRC's finding is based on
incorrect facts. In fact, Denison responded to the May 10, 2010 RFI on September 2. 2010.
That response included all information requested in the May 10, 2010 RFI, specifically:
• Redline revisions and clean copies ofRevision 10.1 to the DMT Plan,
• Redline revisions and clean copies ofRevision 3 of the Contingency Plan,
• ; 0-day notification to UDEQ ofthe September 13; 2010 hydrostatic test of the NDP,
• Information regarding engineering design of the steel liner and leak detection system,
• Response to questions regarding the previous hydrostatic testing, and o Response 'to
questions regarding the as-built drawings.
Denison's response was submitted electronically on September 2, 2010. A copy ofthe
Transmittal email is provided as Attachment 1 to this letter.
Two hard copies of Denison's response were submitted by Federal Express on September 3, 2010
and received by DRC on September 7, 2010. A copy of the confirmation of Detailed Results of
Delivery is provided as Attachment 2 to this letter.
The transmittal was recelvedby DRC. As indicated on the Detailed Results form, the submittal was
acknowledged to have been received by DRC at 9:26 AM on September 7,2010.
Denison believes that the September 2, 2010 submittal addressed and resolved all of the issues
presented in the May 10, 2010 RFI and all previous correspondence from DRC,
Denison therefore submits that Violation #2 should be rescinded or reconsidered. "
DRC Response: We agree that DUSA submitted a revised and stand alone version of the DMT
Plan on March 12, 2010, and other related submittals in September, 2010. However, none of these
DMT plan submittals were given to the DRC by the February 19, 2010 deadline set forth in Part
I.H.4(a) of the Pennit. Therefore, Violation No. 2 still stands as cited.
With regards to the October 19, 2010 DUSA request that Violation No. 2 be rescinded or
reconsidered, this request is denied. Reasons for this denial are found in DRC Finding No. 3,
above.
Violation 3 - DUSA failed to submit engineering drawings for the steel liner and leak detection
system and receive Executive Secretary approval before liner construction, as required by Part
I.H.4(b) ofthe Pennit.
September 22,2010 DRC Finding: "The facts remain that an October 8, 2009 DRC inspection
found the steel liner had already been constructed at the NDP. Further, the DRC has requested
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With regards to the October 19, 2010 DUSA request that Violation No. 5 be rescinded or
reconsidered, this request is denied. Reasons for this denial are found in DRC Finding No. 3,
above.
9. October 19, 2010 Closing DUSA Statement
"Because the violations and calculations ofproposed penalties do not take into account Denison's
September 2, 2010 submittal, we ask that the Executive Secretary consider that submission prior to
determining any proposed penalties. We also ask that the Executive Secretary provide Denison
with a memorandum detailing the calculation of any such penalties.
For these reasons, Denison has not included with this letter a signed Settlement Agreement or any
payments with respect to the penalties proposed in you September 22, 2010 letter."
DRC Response: DRC staff provided DUSA with the requested agency memorandum (dated July
8, 2010) that outlined the basis for penalties sought in this matter via email on October 20, 2010.
DUSA staff confirmed receipt ofthe July 8, 2010 DRC memorandum via email to DRC staff on
October 21,2010.
We recognize receipt of the September 2, 2010 DUSA submittal, and note that this letter was in
response to a DRC May 10, 2010 Request for Information (RFI) that outlined multiple unresolved
issues regarding design, operations, monitoring, and reporting requirements for the NDP facility.
Contrary to the DUSA statement above, the DRC has considered the September 2, 2010 DUSA
submittal and determined that one remaining open issue exists regarding compliance monitoring of
the leak detection system at the NDP facility. This unresolved issue was communicated to you via.
an October 11, 2010 DRC RFI letter (p. 2, Comments on DMT Plan, Item No. 1).
Should DUSA desire to discuss the proposed monetary penalty, we suggest you join us in an
enforcement conference in our offices and come prepared to explain and justify any mitigating
circumstances that would warrant such consideration by the Executive Secretary.
Please be advised, the Executive Secretary will not authorize use of the NDP until the May 13, 2010 NOV
and Order is resolved and closed out and the Settlement Agreement is agreed to and signed by both parties.
With regard to the September 22, 2010 proposed Settlement Agreement, if you wish to resolve the May 13,
2010 NOV based on the proposed early settlement calculations, please review the September 22, 2010 SA
and sign both originals (do not date them), and then retum them both to this office within 15 calendar days
of receipt of this letter (January 4, 2011). Thereafter, the Executive Secretary will sign and date the SA
and retum one original to you. Payment of the penalty will then be due within 30 calendar days ofthe date
the final SA document is signed by the Executive Secretary. If you do not chose to sign the proposed early
settlement agreement this matter will be refened to the Attomey Generals Office for enforcement ofthe
full penalty amount.
If you would like to discuss the proposed monetary penalty or the content of the SA fiirther, please contact
Phil Goble at [phone] to arrange for a settlement meeting in the DRC offices. Failure to respond to
this letter within 15 calendar days, or to complete and resolve this enforcement within 30 calendar days of
receipt of this letter will result in escalated action by the Utah Attomey Generals office.
Thank you for your continued cooperation.
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UTAH WATER QUALIIY BOARD
Rusty Lundberg
Co-Executive Secretary
RL/PRG:prg
enclosure