[Federal Register Volume 82, Number 46 (Friday, March 10, 2017)]
[Notices]
[Pages 13366-13369]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-04756]


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NUCLEAR REGULATORY COMMISSION

[Docket No. 50-228; License No. R-98; EA-17-002; NRC-2012-0286]


In the Matter of Aerotest Operations, Inc.; Aerotest Radiography 
and Research Reactor; Order Approving Indirect Transfer of Facility 
Operating License and Conforming Amendment

AGENCY: Nuclear Regulatory Commission.

ACTION: Indirect transfer of license; order.

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SUMMARY: The U.S. Nuclear Regulatory Commission (NRC) is issuing an 
order approving an application filed by Aerotest Operations, Inc. 
(Aerotest) and Nuclear Labyrinth LLC (Nuclear Labyrinth) on May 30, 
2012. The application sought NRC approval of the indirect transfer of 
Facility Operating License No. R-98 for the Aerotest Radiography and 
Research Reactor (ARRR), currently held by Aerotest, to Nuclear 
Labyrinth. The NRC's approval of the indirect license transfer is 
subject to certain conditions, which are described in the order. The 
order also approves an amendment to the license for administrative 
purposes to reflect the indirect license transfer. The order is 
effective upon issuance.

DATES: The order was issued on February 28, 2017, and is effective for 
one year.

ADDRESSES: Please refer to Docket ID NRC-2012-0286 when contacting the 
NRC about the availability of information regarding this document. You 
may obtain publicly-available information related to this document 
using any of the following methods:
     Federal Rulemaking Web site: Go to http://www.regulations.gov and search for Docket ID NRC-2012-0286. Address 
questions about NRC dockets to Carol Gallagher; telephone: 301-415-
3463; email: [email protected]. For technical questions, contact 
the individual listed in the FOR FURTHER INFORMATION CONTACT section of 
this document.
     NRC's Agencywide Documents Access and Management System 
(ADAMS): You may obtain publicly-available documents online in the 
ADAMS Public Documents collection at http://www.nrc.gov/reading-rm/adams.html. To begin the search, select ``ADAMS Public Documents'' and 
then select ``Begin Web-based ADAMS Search.'' For problems with ADAMS, 
please contact the NRC's Public Document Room (PDR) reference staff at 
1-800-397-4209, 301-415-4737, or by email to [email protected]. For 
the convenience of the reader, the ADAMS accession numbers for 
documents related to this action are provided in a table in the 
``Availability of Documents'' section of this document.
     NRC's PDR: You may examine and purchase copies of public 
documents at the NRC's PDR, Room OWFN-01F21, One White Flint North, 
11555 Rockville Pike, Rockville, Maryland 20852.

FOR FURTHER INFORMATION CONTACT: Edward Helvenston, Office of Nuclear 
Reactor Regulation, U.S. Nuclear Regulatory Commission, Washington, DC 
20555-0001; telephone: 301-415-4067; email: [email protected].

SUPPLEMENTARY INFORMATION: 

I. Order

    The text of the order is attached.

II. Availability of Documents

    Documents related to this action, including the indirect license 
transfer application and other supporting documentation, are available 
to interested persons as indicated.

[[Page 13367]]



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                 Document                      ADAMS accession No(s).
------------------------------------------------------------------------
Aerotest Operations, Inc. and Nuclear       ML12152A233, ML12180A384
 Labyrinth LLC, ``Application for Approval
 of Indirect Transfer of Control of
 License,'' May 30, 2012.
U.S. Nuclear Regulatory Commission,         ML121740317, ML121740343
 ``Request to Aerotest Operations, Inc.
 and Nuclear Labyrinth LLC to Supplement
 the License Transfer Application,'' July
 5, 2012.
Aerotest Operations, Inc. and Nuclear       ML122021201
 Labyrinth LLC, ``Response to Request to
 Aerotest Operations, Inc. and Nuclear
 Labyrinth LLC to Supplement the License
 Transfer Application (TAC No. ME8811),''
 July 19, 2012.
U.S. Nuclear Regulatory Commission,         ML12213A486
 ``Aerotest Operations, Inc.--Acceptance
 of Requested License Transfer Application
 (TAC No. ME8811),'' August 14, 2012.
U.S. Nuclear Regulatory Commission,         ML12242A460, ML12242A479
 ``Aerotest Operations, Inc., and Nuclear
 Labyrinth LLC--Request for Additional
 Information Re: Application for Approval
 of Indirect Transfer of Control of
 License of Aerotest Radiography and
 Research Reactor Pursuant to 10 CFR 50.80
 (TAC No. ME8811),'' September 14, 2012.
Aerotest Operations, Inc. and Nuclear       ML12291A508
 Labyrinth LLC, ``Response to Request for
 Additional Information Re: Application
 for Approval of Indirect Transfer of
 Control of License of Aerotest
 Radiography and Research Reactor Pursuant
 to 10 CFR 50.80 (TAC No. ME8811),''
 October 15, 2012.
U.S. Nuclear Regulatory Commission,         ML12339A181, ML12339A189
 ``Aerotest Operations, Inc., and Nuclear
 Labyrinth LLC--Request for Additional
 Information Re: Application for Approval
 of Indirect Transfer of Control of
 License of Aerotest Radiography and
 Research Reactor Pursuant to 10 CFR 50.80
 (TAC No. ME8811),'' December 10, 2012.
Aerotest Operations, Inc. and Nuclear       ML13015A395
 Labyrinth LLC, ``Response to Request for
 Additional Information Re: Application
 for Approval of Indirect Transfer of
 Control of License of Aerotest
 Radiography and Research Reactor Pursuant
 to 10 CFR 50.80 (TAC No. ME8811),''
 January 10, 2013.
U.S. Nuclear Regulatory Commission,         ML13018A003
 ``Summary of December 19, 2012, Meeting
 with Aerotest Operations, Inc., and
 Nuclear Labyrinth LLC, on the Request for
 Additional Information on the Proposed
 Indirect License Transfer Application of
 the Aerotest Radiography and Research
 Reactor,'' January 18, 2013.
U.S. Nuclear Regulatory Commission,         ML13120A598, ML13129A001,
 ``Denial of License Renewal, Denial of      ML13158A164
 License Transfer, and Issuance of Order
 to Modify License No. R-98 to Prohibit
 Operation of the Aerotest Radiography and
 Research Reactor, Facility Operating
 License No. R-98 (TAC Nos. ME8811 and
 MC9596),'' July 24, 2013.
U.S. Nuclear Regulatory Commission,         ML14100A094
 Memorandum and Order CLI-14-05, April 10,
 2014.
U.S. Nuclear Regulatory Commission,         ML14248A614
 Certification of Record to Commission
 (LBP-14-10), September 5, 2014.
U.S. Nuclear Regulatory Commission,         ML15357A201
 Memorandum and Order CLI-15-26, December
 23, 2015.
U.S. Nuclear Regulatory Commission,         ML16020A546
 ``Aerotest Operations Inc. and Nuclear
 Labyrinth LLC Request for Additional
 Information Re: Opportunity to Supplement
 2012 License Transfer Application (TAC
 No. MF7221),'' January 21, 2016.
Aerotest Operations, Inc. and Nuclear       ML16117A259
 Labyrinth LLC, ``Response to Request for
 Additional Information Re: Opportunity to
 Supplement 2012 License Transfer
 Application (TAC No. MF7221),'' April 21,
 2016.
Aerotest Operations, Inc. and Nuclear       ML16176A221
 Labyrinth LLC, ``Request for Proprietary
 Treatment for Supplemental Response to
 Request for Additional Information Re:
 Opportunity to Supplement 2012 License
 Transfer Application (TAC No. MF7221),''
 June 16, 2016.
U.S. Nuclear Regulatory Commission,         ML16182A397
 ``Aerotest Operations, Inc. and Nuclear
 Labyrinth LLC Request for Additional
 Information Re: Supplemented 2012
 Application for Approval of Indirect
 Transfer of Control of License of
 Aerotest Radiography and Research Reactor
 (TAC No. MF7221),'' July 20, 2016.
Aerotest Operations, Inc. and Nuclear       ML16245A230
 Labyrinth LLC, ``Response to Request for
 Additional Information Re: Opportunity to
 Supplement 2012 License Transfer
 Application (TAC No. MF7221),'' August
 22, 2016.
U.S. Nuclear Regulatory Commission,         ML16214A125, ML16214A121
 ``Aerotest Operations, Inc., Notice of
 Consideration of Approval of Application
 Regarding Proposed Indirect Transfer and
 Conforming Amendments, Opportunity for a
 Hearing, and Order Imposing Procedures
 for Access to Sensitive Unclassified Non-
 Safeguards Information,'' September 8,
 2016, published in the Federal Register
 on September 23, 2016 (81 FR 65677).
Aerotest Operations, Inc. and Nuclear       ML16294A250
 Labyrinth LLC, ``Response to Request for
 Additional Information Re: Opportunity to
 Supplement 2012 License Transfer
 Application (TAC No. MF7221),'' October
 10, 2016.
Aerotest Operations, Inc. and Nuclear       ML16294A549
 Labyrinth LLC, Electronic mail providing
 clarification on license transfer
 proposed technical specifications,
 October 19, 2016.
Aerotest Operations, Inc. and Nuclear       ML16312A345
 Labyrinth LLC, Electronic mail providing
 clarification on non-proprietary
 treatment of certain financial
 information, and a correction to license
 transfer proposed technical
 specifications, November 2, 2016.
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[[Page 13368]]

    Dated at Rockville, Maryland, this 28th day of February 2017.

    For the Nuclear Regulatory Commission.
Spyros A. Traiforos,
Project Manager, Research and Test Reactors Licensing Branch, Division 
of Policy and Rulemaking, Office of Nuclear Reactor Regulation.

ATTACHMENT--Order Approving Indirect Transfer of Facility Operating 
License and Conforming Amendment

In the Matter of Aerotest Operations, Inc.; Aerotest Radiography and 
Research Reactor; [Docket No. 50-228; License No. R-98; EA-17-002; NRC-
2012-0286] (EFFECTIVE UPON ISSUANCE)

I.

    Aerotest Operations, Inc. (Aerotest) is the holder of Facility 
Operating License No. R-98 for the Aerotest Radiography and Research 
Reactor (ARRR), located in San Ramon, Contra Costa County, 
California. Aerotest is a wholly owned subsidiary of OEA Aerospace, 
Inc., a wholly owned subsidiary of OEA, Inc., which, in turn, is a 
wholly owned subsidiary of Autoliv ASP, Inc. (Autoliv). The ultimate 
owner is Autoliv, Inc.

II.

    By application dated May 30, 2012, as supplemented by letters 
dated July 19, 2012; October 15, 2012; January 10, 2013; April 21, 
2016; June 16, 2016; August 22, 2016; and October 10, 2016, Aerotest 
and Nuclear Labyrinth LLC (Nuclear Labyrinth) (collectively, ``the 
applicants'') requested U.S. Nuclear Regulatory Commission (NRC) 
approval, pursuant to Title 10 of the Code of Federal Regulations 
(10 CFR), Section 50.80 (10 CFR 50.80), of the indirect transfer of 
control of the license for the ARRR. The indirect transfer of 
control would involve the transfer of ownership of Aerotest from OEA 
Aerospace, Inc. to Nuclear Labyrinth, and would result from the 
acquisition of Aerotest by Nuclear Labyrinth through a stock 
transfer. Nuclear Labyrinth would indirectly own 100 percent of the 
ARRR through its ownership of Aerotest. There would be no direct 
transfer of the license. Aerotest would continue to own and operate 
the facility and hold the license. Although the license would be 
amended for administrative purposes to reflect the transfer, no 
physical changes to the ARRR facility or operational changes were 
proposed in the application. Except for the installation of the 
Chief Executive Officer and sole owner of Nuclear Labyrinth, Dr. 
David Slaughter, as president of Aerotest, no management or 
organizational changes were proposed.
    By the application dated May 30, 2012, as supplemented by 
letters dated July 19, 2012, October 15, 2012, and January 10, 2013, 
the applicants originally requested NRC consent for the subject 
indirect license transfer. By letter dated July 24, 2013, the NRC 
staff denied the applicants' original indirect license transfer 
application on the grounds that the applicants had failed to satisfy 
the NRC's financial qualifications requirements and that the 
applicants had not shown that there would be sufficient funds to 
cover the annual cost of fuel storage until the U.S. Department of 
Energy accepts the fuel once the facility permanently ceases 
operations. The applicants filed a joint demand for a hearing on the 
denial and, on August 12, 2014, a hearing was conducted, at which 
the applicants presented new information, relevant to the indirect 
license transfer application, which had not previously been provided 
to the NRC staff. Based on the information presented by the 
applicants and the NRC staff at the hearing, the Commission issued 
an order, dated December 23, 2015, remanding the license transfer 
application to the NRC staff for further consideration. 
Subsequently, the applicants further supplemented the application by 
letters dated April 21, 2016, June 16, 2016, August 22, 2016, and 
October 10, 2016.
    A notice entitled ``Aerotest Operations, Inc.; Aerotest 
Radiography and Research Reactor; Consideration of Approval of 
Indirect License Transfer and Conforming Amendment'' was published 
in the Federal Register on September 23, 2016 (81 FR 65677). No 
comments or hearing requests were received.
    Under 10 CFR 50.80, no license, or any right thereunder, shall 
be transferred, directly or indirectly, through transfer of control 
of the license, unless the NRC gives its consent in writing. Upon 
review of the information in the application, as supplemented, and 
other information before the Commission, the NRC staff has 
determined that the indirect transfer of Facility Operating License 
No. R-98, as described above, is consistent with the applicable 
provisions of law, regulations, and orders issued by the NRC, 
pursuant thereto, subject to the conditions set forth below. The NRC 
staff has further found that the application for the proposed 
amendment to the license for administrative purposes to reflect the 
indirect license transfer complies with the standards and 
requirements of the Atomic Energy Act of 1954, as amended (the Act), 
and the Commission's rules and regulations set forth in 10 CFR 
Chapter I; the facility will operate in conformity with the 
application, the provisions of the Act, and the rules and 
regulations of the Commission; there is reasonable assurance that 
the activities authorized by the proposed license amendment can be 
conducted without endangering the health and safety of the public 
and that such activities will be conducted in compliance with the 
Commission's regulations; the issuance of the proposed license 
amendment will not be inimical to the common defense and security or 
to the health and safety of the public; and the issuance of the 
proposed amendment will be in accordance with 10 CFR part 51 of the 
Commission's regulations and all applicable requirements have been 
satisfied. The findings set forth above are supported by a safety 
evaluation dated February 28, 2017.

III.

    Accordingly, pursuant to Sections 161b, 161i, and 184 of the 
Act, 42 U.S.C. Sections 2201(b), 2201(i), and 2234; and 10 CFR 
50.80, it is hereby ordered that the application regarding the 
proposed indirect license transfer, as described herein, is 
approved, subject to the following conditions:
    1. A cash secured irrevocable standby letter of credit from a 
federally insured bank in the amount of $300,000 that conforms to 
the guidance provided in NRC Regulatory Guide 1.159 must be executed 
at the time of, or before, the transfer.
    2. A decommissioning trust fund for the Aerotest Radiography and 
Research Reactor (ARRR) that conforms to the guidance provided in 
NRC Regulatory Guide 1.159 must be established at the time of, or 
before, the transfer.
    3. Autoliv, Inc. shall enter into a Funding Agreement with 
Nuclear Labyrinth, LLC (Nuclear Labyrinth) at the time of, or 
before, the transfer. Written notice must be given to the NRC of any 
changes to the Funding Agreement.
    4. The Funding Agreement between Autoliv, Inc. and Nuclear 
Labyrinth shall provide that upon the closing of the transaction of 
the acquisition by Nuclear Labyrinth of all of the issued and 
outstanding shares of stock of Aerotest Operations, Inc. (Aerotest) 
from the previous ultimate owner of this stock, Autoliv, Inc., or 
its subsidiaries, will make the following transfers of funds:
    A. The sum of $943,225 to an account designated in writing by 
Nuclear Labyrinth for the benefit of Aerotest intended to fund the 
operations and maintenance costs of the ARRR for approximately 12 
months (Operating Funds). The Operating Funds may only be used as 
needed to fund the operations and maintenance costs of the ARRR and 
may not be used by Nuclear Labyrinth for any other purpose. Upon the 
written request of Aerotest, Nuclear Labyrinth shall distribute such 
funds from the Operating Funds as Aerotest determines to be 
necessary to operate and maintain the ARRR.
    B. The sum of $3,376,030 to the decommissioning trust fund for 
the ARRR.
    C. The sum of $742,410 (plus the interest on this sum to be 
calculated from October 1, 2010, to the date of acquisition based on 
the 13-week Treasury bill rate) and the sum of $625,000 to a 
segregated account in the decommissioning trust fund for the ARRR 
(Nuclear Fuel Disposal Funds). The Nuclear Fuel Disposal Funds may 
only be used to fund the disposal of the ARRR's nuclear fuel 
elements pursuant to U.S. Department of Energy Contract DE-CR01-
83NE44484, as amended, and to fund the acquisition of fuel element 
storage casks, respectively, and may not be used for any other 
purpose.
    D. The sum of $1,500,000 to the financial protection standby 
trust for the ARRR.
    E. The sum of $1,125,000 to a segregated account in the 
decommissioning trust fund for the ARRR (Spent Fuel Management 
Funds). The Spent Fuel Management Funds may only be used to fund the 
management of the ARRR's nuclear fuel elements after the permanent 
cessation of operations of the ARRR and before the acceptance of the 
fuel by the U.S. Department of Energy.
    It is further ordered that, consistent with 10 CFR 2.1315(b), 
the conforming license amendment that makes administrative changes 
to reflect the subject indirect license transfer is approved. The 
amendment shall be issued and made effective at the time the 
proposed indirect license transfer action is completed.
    It is further ordered that, after receipt of all required 
regulatory approvals of the

[[Page 13369]]

proposed indirect license transfer action, Aerotest shall inform the 
Director of the Division of Policy and Rulemaking in writing of such 
receipt and of the date of closing of the transfer no later than 7 
business days prior to the date of the closing of the transfer. 
Should the proposed indirect license transfer not be completed by 
February 28, 2018, this Order shall become null and void, provided, 
however, that upon written application and for good cause shown, 
such date may be extended by order.
    This Order is effective upon issuance.
    For further details with respect to this Order, see the 
application dated May 30, 2012, as supplemented by letters dated 
July 19, 2012, October 15, 2012, January 10, 2013, April 21, 2016, 
June 16, 2016, August 22, 2016, and October 10, 2016 (Agencywide 
Documents Access and Management System (ADAMS) Accession Nos. for 
these documents are listed in the ``Availability of Documents'' 
section of the Federal Register notice to which this order is 
attached); other documents listed in the ``Availability of 
Documents'' section of the Federal Register notice; and the NRC 
Safety Evaluation dated February 28, 2017, which are available for 
public inspection at the Commission's Public Document Room (PDR), 
located at One White Flint North, Public File Area 01 F21, 11555 
Rockville Pike (first floor), Rockville, Maryland. Publicly 
available documents are accessible electronically through ADAMS in 
the NRC Library at http://www.nrc.gov/reading-rm/adams.html. Persons 
who encounter problems with ADAMS should contact the NRC's PDR 
reference staff by telephone at 1-800-397-4209, or 301-415-4737, or 
by email at [email protected].
    Dated at Rockville, Maryland, this 28th day of February, 2017.

    For the Nuclear Regulatory Commission.

Louise Lund,

Director, Division of Policy and Rulemaking, Office of Nuclear 
Reactor Regulation.

[FR Doc. 2017-04756 Filed 3-9-17; 8:45 am]
 BILLING CODE 7590-01-P