AMMONIUM NITRATE

Section 563 of the 2008 Consolidated Appropriations Act, Secure Handling of Ammonium Nitrate (Section 563) granted the Department of Homeland Security (DHS) the authority to regulate the sale and transfer of ammonium nitrate “to prevent the misappropriation or use of ammonium nitrate in an act of terrorism.”  In October 2008, DHS published an Advanced Notice of Proposed Rulemaking (ANPRM) detailing the activities expected to be covered under the ammonium nitrate regulations and seeking comment from interested parties.  An ammonium nitrate Notice of Proposed Rule Making (NPRM) is expected from DHS in Spring/Summer 2010.

In addition to the authority granted under Section 563, DHS has authority to regulate facilities that possess certain hazardous chemicals, including ammonium nitrate, under an earlier statute, Section 550 of the Department of Homeland Security Appropriations Act of 2007.  Under that authority, DHS promulgated an interim final rule known as the Chemical Facility Anti-Terrorism Standards (CFATS).  While both Section 563 and CFATS aim to reduce terrorist risks associated with ammonium nitrate, the scope and methods of regulation under the two programs are expected to be very different.  CFATS addresses hundreds of chemicals, including ammonium nitrate, and is directed at the security of high-risk facilities.  However, CFATS does not impose any limitation on the sale or transfer of ammonium nitrate.  Section 563 on the other hand, does not address the physical security of ammonium nitrate facilities, but rather imposes certain conditions on sale or other transfers of ammonium nitrate—without regard for the quantities involved.  In developing the regulations required by Section 563, DHS intends to draw on information gained under the CFATS program about ammonium nitrate so that CFATS and the new program under Section 563 complement each other.

While ammonium nitrate exists in various forms and concentrations, DHS is primarily concerned with the chemical when used an explosive (e.g., in the mining industry) or when used as fertilizer mixed with fuel oil to create an explosive mixture known as Ammonium Nitrate/Fuel Oil (ANFO).  Given the availability of small-scale packaging (e.g., 50-pound bags) of ammonium nitrate fertilizer for use in agriculture-related operations, the chemical is highly susceptible to theft and misuse in making an improvised explosive device (IED).  In the hands of terrorists, both forms have the potential to be detonated and create significant adverse consequences.

DHS would establish a threshold percentage of ammonium nitrate in a substance as a prerequisite for that substance to be considered ammonium nitrate for the purposes of complying with Section 563.  While pure or “straight” ammonium nitrate with a sufficient concentration of nitrates can be used as an explosives precursor, there is some scientific uncertainty regarding the specific detonability of pure ammonium nitrate, and experts in various governmental and non-governmental organizations continue to research the minimum quantity of straight ammonium nitrate required for detonation, the size of conventional explosive charge (i.e., booster) necessary to detonate straight ammonium nitrate, and the actual yield (i.e., the explosive energy) from a straight ammonium nitrate detonation.
Pursuant to Section 563, DHS expects to regulate the following categories of activities:

Registration Activities

  • Registration Applications – DHS would require ammonium nitrate facilities and prospective ammonium nitrate purchasers to apply for registration numbers from DHS and provide specific identifying information in order to sell, transfer, and/or purchase ammonium nitrate.
  • Terrorist Screening Database (TSDB) – DHS would conduct checks of identifying information of all prospective registrants against the TSDB.
  • Registration Numbers – DHS would issue or deny registration numbers within 72 hours of receipt of an ammonium nitrate facility or ammonium nitrate purchaser’s complete registration application

Point-of-Sale Activities

  • Seller Verification of Purchaser’s Registration and Identity – At points-of-sale, ammonium nitrate facilities would have to verify that potential ammonium nitrate purchasers are registered with DHS (including verifying each ammonium nitrate purchaser’s identity and registration number).
  • Recordkeeping – All ammonium nitrate facilities would be required to keep records of sales or transfers, including the name, address, phone number, ammonium nitrate purchaser’s registration number, date, and quantity of ammonium nitrate sold, for at least 2 years after each transaction, with penalties for failing to maintain records appropriately.

Additional Regulatory Activities/Requirements

  • Reporting Theft or Loss of Ammonium Nitrate – Ammonium nitrate facilities and purchasers would be required to report the theft or loss of ammonium nitrate to federal law enforcement authorities within one (1) calendar day of discovery of the theft or loss.
  • Inspections and Audits – DHS would conduct or oversee regulatory compliance inspections and audits of ammonium nitrate records to ensure that regulated facilities are properly maintaining records and to monitor compliance with the requirements of Section 563.
  • Guidance Materials and Posters – DHS would develop guidance materials that (1) set forth procedures for appealing a denial of an application for a registration number; and (2) help ammonium nitrate facilities identify suspicious ammonium nitrate purchases, attempted purchases, and transfers and determine the appropriate course of action.  DHS would also develop posters providing information on sellers’ record-keeping requirements and penalties for violating those requirements.

Administrative Activities

  • Appeals – DHS would establish an expedited appeals process for applicants denied a registration number which would resolve such an appeal within 72 hours of receiving the denied individual’s request for appeal.
  • Penalties – DHS has the authority to assess civil penalties up to $50,000 per violation of the regulations and will establish a process for managing both the assessment and potential appeal of those penalties.