DRC-2010-003703 - 0901a06880199269

DENISO
MINES
June 21, 2010
C-20in-00370
Denison Mines (USA) Corp.
105017th Street Suite 9S0
Denver, CO 80265
USA
Tei: 303 628-7798
Fax: [phone]
www.denl3onmines.coin
VIA PDF AND EXPRESS DELIVERY
Dane L. Finerfrock, Co-Executive Secretary
Utah Water Quality Board
Utah Department of Environmental Quality
195 North 1950 West
P.O. Box 144810
Salt Lake City, UT 84114-4810
Dear Mr. Finerfrock:
Re: State of Utah Ground Water Discharge Permit No. UGW370004 White Mesa
Uranium Mill - Notice Pursuant to Part I.G.3 of the Permit and UAC R317-6-6.16(C)
Please take notice pursuant to Part I.G.3 ofthe White Mesa Mill's (the "Mill's") State ofUtah
Groundwater Discharge Permit No. UGW370004 (the "Permit") and Utah Administrative Code
("UAC") R313-6-6.16(C) that Denison Mines (USA) Corp. ("Denison"), as operator ofthe Mill
and holder of the Permit, failed to meet the discharge minimization technology ("DMT")
standards in Part I.D.2 of the Permit, by allowing the wastewater elevation in the Mill's tailings
Cell 3 to exceed the freeboard limit for that Cell by approximately 5.5 inches, as described in
more detail below.
This exceedance was discovered at 8:50am on Friday June 18, 2010. Initial notice of this failure
to maintain DMT was given by telephone to the Utah Department of Environmental Quality
("DEQ") Duty Officer at 3:55pm on Friday June 18, 2010 at 801-536-4123 (within 24 hours of
the discovery).
1. Facts and Background Information
a) Condition 10.3 of the Mill's State of Utah Radioactive Materials License No.
UTI900479 (the "License") provides that freeboard limits for Cells 1 and 3 shall be set
in accordance with procedures that have been approved by the U.S. Nuclear Regulatory
Commission ("NRC"). Under those procedures:
(i) The freeboard limits are set as per the January 10, 1990 Drainage Report for Cell
1 at a liquid maximum elevation of 5,615.4 feet above mean sea level ("frnsl");
(ii) The freeboard limit for Cell 3 is determined annually using a formula set out in
the procedure. The current freeboard limit for Cell 3 was previously calculated
under this procedure at 5,601.6 frnsl. However, in State of Utah Department of
Environmental Quality ("UDEQ") correspondence dated November 20, 2008 an
interim variance and limit was established at 5,602.5 ftnsl for Cell 3;
(iii) In conjunction with the variance established under (ii) above, an interim
maximum elevation for Cell 4A was also established at 5,593.74 ftnsl;
(iv) The maximum elevation of 5,593.74 ftnsl for Cell 4A has been set assuming that
the total probable maximum precipitation ("PMP") volume for Cells 2, 3 and 4A
will be accommodated in Cell 4A. By letter dated December 11, 2008, Denison
applied for an amendment to the License to set the freeboard limit for Cell 4A at
5,593.74 frnsl and to eliminate the need to set a freeboard limit for Cell 3, given
that the freeboard limit of 5,593.74 ftnsl for Cell 4A is adequate to accommodate
the total PMP volume for Cells 2, 3 and 4A; and
(v) In addition. Part I.D.2 of the Permit provides that under no circumstances shall the
freeboard of any tailings cell be less than three feet, as measured from the top of
the flexible membrane liner ("FML"). The top ofthe FML in Cell 1 is at 5,618.5
ftnsl, and the top of the FML in Cell 3 is at 5,608.5 ftnsl. This means that Part
I.D.2 of the Permit provides a secondary requirement that the maximum
wastewater pool elevations in Cells 1 and 3 cannot exceed 5,615.5 and 5,605.5
ftnsl, respectively.
b) In a letter to Denison dated April 29, 2010, UDEQ has indicated their agreement with
Denison's position that the freeboard limit is not applicable to Cell 3, since Cell 3 is in
pre-closure stages, and the PMP flood volume of Cell 3 can be attributed to, and
managed in. Cell 4A. The April 29 letter indicated that to formalize this removal of
freeboard limit, three documents needed to be revised, specifically the Mill's
Radioactive Materials License ("RML"), the Discharge Minimization Technology
("DMT") Plan, and the Cell 4A Operations and Maintenance ("O&M") Plan. Denison
is currently in the process of preparing revisions to each of those documents for UDEQ
approval.
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c) During the tailings survey measurement performed at approximately 8:50am on June
18, 2010, the wastewater pool elevation in Cell 3 was measured to be 5,602.96 ftnsl,
compared to the current freeboard limit for Cell 3 of 5,602.50 ftnsl, representing an
exceedance of 0.46 feet, or 5.5 inches.
d) It should be noted that the current fteeboard limit in Cell 3 of 5,602.5 ftnsl is 6 feet
below the top of the FML in Cell 3, so the exceedance of the current freeboard limit by
5.5 inches resulted in a wastewater pool elevation that was still over five feet below the
top of the FML and over two feet below the secondary freeboard limit of 5,605.5 feet
set out in Part I.D.2 of the Permit. As a result, there was no risk of the wastewater in
Cell 3 overflowing over the top of the Cell 3 FML. Also, as mentioned above, since
the freeboard limit in Cell 4A has been set to accommodate the PMP event for Cells 2,
3, and 4A, there was also no risk that even if a PMP event were to occur there would
not have been adequate freeboard available in Cell 4A. The wastewater elevation
survey for Cell 4A performed on June 18, 2010 indicated a wastewater elevation 95
inches (7.9 feet) below the freeboard limit of 5,593.74 ftnsl for Cell 4A.
e) The Mill has been running on a 10-day on and 4-day off operating cycle.
f) During the previous week's inspection and survey on June 11, 2010, the survey of the
liquid pool elevation indicated that Cell 3 had 19 inches of freeboard capacity (was 19
inches below the freeboard limit).
g) As part of the plan to fill Cell 3 with tailings solids and to close Cell 3, the Mill has
been alternating between periods of pumping Cell 3 liquids into Cell 4A and
discharging CCD solids into Cell 3.
h) The intention was to discharge tailings solids into Cell 3 at a rate that, given the rate
solutions were being pumped from Cell 3 to Cell 4A, would not result in an
exceedence of the freeboard limit in Cell 3. Earlier in 2010, the Mill staff had replaced
the existing pump in Cell 3 with a new pump to increase the flow rate of solutions from
Cell 3 to Cell 4A during the liquid transfer cycle.
i) The Mill completed a cycle of removing liquids from Cell 3, and was in a cycle of
operating and discharging CCD solids into Cell 3 at the time of the exceedence.
j) Cell 3 was receiving only CCD solids and solutions from the Cell 2 slimes drain, and
Cell 4A was receiving all other tailings liquids, at the time of the exceedence.
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2. Action Taken
Upon receipt of the initial survey results, the Mill's Environmental Coordinator notified the Mill
Manager at 11:55am that day. The following plan of action was immediately put into place in
accordance with section 5.1 of the Mill's Contingency Plan:
a) The Mill Manager had operafions crews stop the discharge of CCD solids into Cell 3;
b) The Mill Manager had the new transfer pump from Cell 3 to Cell 4A tumed on;
c) This plan was implemented by noon on Friday June 18, 2010;
d) Verbal notification was given to the Executive Secretary at 3:55pm on June 18, 2010,
within 24 hours of discovery. This verbal notificafion was followed by this written
notification within five days of discovery;
e) Solufions continued to be pumped from Cell 3 to Cell 4A in order to reduce the
solution in Cell 3; and
0 Compliance was achieved on June 21, 2010. A survey of Cell 3 at 10:00am on June
21, 2010 indicated a solufion elevafion of 5601.28 ftnsl.
3. Root Cause
The root cause analysis is as follows
a) The Mill has been alternating between periods of pumping Cell 3 liquids into Cell 4A
and discharging CCD solids into Cell 3.
b) Cell 3 was receiving only CCD solids, and Cell 4A was receiving all tailings liquids at
the time of the exceedence. The Mill continues to pump solutions from Cell 3 to Cell
4A before solids are introduced into Cell 3, in an effort to maintain the solution level in
Cell 3 below the freeboard limit during this process.
c) As a result of following the planned program of filling Cell 3 for closure, the remaining
pond area in Cell 3 is small, approximately 7 to 10 acres, and is confinually being
reduced by the planned expansion of the solids beach as Cell 3 approaches its final
tailings capacity.
d) As a result of the ever-decreasing pond area, the ability to manage the freeboard level
has become increasingly difficult.
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MINES
e) Upon review of the circumstances, after the discovery of the exceedance, it is again
evident that it is no longer possible to manage the Cell 3 freeboard to achieve the
calculated freeboard limit during the final stages of filling Cell 3 with solids and
closing Cell 3. The exceedence occurred despite the fact that monitoring and surveying
were performed at the required frequency, all pumping equipment was operating
properly, and the liquid transfer from Cell 3 to Cell 4A was occurring as planned.
4. Actions That Will be Taken to Prevent a Reoccurrence of this Incident
The following actions will be taken to prevent a reoccurrence of this incident:
a) The Mill will continue to pump liquids from Cell 3 to Cell 4A, in preparation for
dewatering and closure of Cell 3; and
b) Denison will complete and submit draft revisions to the documents identified in
UDEQ's April 19, 2010 letter by July 15, 2010.
5. Affirmative Defense
Denison believes that the affirmative defense in Part I.G.3.c) of the Permit should be applicable
to this incident, for the following reasons:
a) Notification
By virtue ofthe initial oral notification given to the UDEQ Duty Officer at 3:55pm on Friday
June 18, 2010 (within 24 hours of the discovery) and this written nofice, Denison has submitted
nofification according to UAC R317-6-6.13.
b) Failure was not Intentional or Caused by the Permittee's Negligence
The exceedance of the freeboard limit was not intenfional or caused by Denison's negligence,
either in acfion or in failure to act. The Mill was taking actions to manage the freeboard
requirements of all of its active tailings cells while filling Cell 3 to its final tailings solids
capacity in preparation for closure. Based on a survey of the wastewater elevation in Cell 3 taken
the previous week, it appeared that there was ample freeboard in Cell 3, and, based on past Mill
experience it was not unreasonable for Mill staff to come to that conclusion. The fact that the
water level in Cell 3 increased at an unexpectedly fast rate was due to the planned discharge of
CCD solids into Cell 3 coupled with the issue of managing liquids in a pool of ever-decreasing
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MINES
size as the solids fill the cell. This discharge, and the pool's size reduction, are necessary to
complete the filling and closure ofthe Cell.
c) The Permittee has Taken Adequate Measures to Meet Permit Conditions
Denison has taken adequate measures to meet Permit conditions in a timely manner. The
provisions of the Mill's Confingency Plan were implemented immediately, and the wastewater
levels have been brought back to within the freeboard limits.
d) The Provisions of UCA 19-5-107 Have Not Been Violated
The provisions of Utah Code 19-5-107 have not been violated. There has been no discharge of a
pollutant into waters of the state. Denison has not caused pollufion which constitutes a menace
to public health and welfare, or is harmftil to wildlife, fish or aquatic life, or impairs domestic,
agricultural, industrial, recreational, or other beneficial uses of water, nor has Denison placed or
caused to be placed any waste in a locafion where there is probable cause to believe it will cause
pollufion.
There was no discharge of solutions from the Mill's tailings impoundments, and there was ample
freeboard in Cell 4A to accommodate the PMP for Cells 2, 3, and 4A.
Please contact the undersigned if you have any quesfions or require any further informafion.
Yours truly,
//
^ Jo Ann Tischler
Director, Compliance and Permitting
cc: Rich Bartlett
David C, Frydenlund
Ron F. Hochstein
Ryan Palmer
Harold R. Roberts
David E. Turk
DENISO
MINES
^^^^^^^^