Applying for a construction license has been a long-sought but out-of-reach milestone for DOE at Yucca Mountain. The department has encountered legal and budget problems, and a number of internal missteps in recent years.

Speaking at a conference organized by the Nuclear Regulatory Commission, Sproat expressed confidence the application will pass initial muster to be docketed by the NRC for more thorough safety reviews and hearings.

Cutbacks will reduce the work force from 2,600 to 1,500-1,700. The Energy Department has singled out key scientists and engineers within DOE, the U.S. Geological Survey, the national laboratories and contract firm Bechtel SAIC who will be needed to defend the license.

"We have identified who those people are to make sure they know their jobs are not in jeopardy," Sproat said. "We have an army of national lab PhDs and engineers on our defense team."

Sproat's upbeat assessment came minutes after a lawyer who represents Nevada in its ongoing battle against Yucca Mountain declared the program is on a "death watch" and is destined for failure.

Martin Malsch, of the firm Egan, Fitzpatrick & Malsch, said DOE will continue to face increasingly severe budget problems. He said DOE's application will be rushed and incomplete and predicted a "huge dispute" over whether it should be accepted for review by regulators.

Beyond that, Nevada is poised to challenge DOE's qualifications and other key aspects of the project, he said. On top of that, both Democratic presidential candidates have pledged to stop the program if elected.

"Yucca Mountain's breaths are short and its heartbeat is faint," Malsch said. "I really don't think it has very long to continue."

In response, Sproat said: "The death watch is going to continue for a very long time because I see this program being very alive and well."

The Energy Department was sent back to the drawing boards late last year when Congress cut the 2008 Yucca Mountain budget by $108 million, a 22 percent reduction.

Sproat initially expressed doubt DOE would meet its deadline, but he said managers deferred work on all but the most pressing tasks. For instance, work on a proposed Nevada rail line to the site has been pushed back.

To save money further, technical specialists were rotated in for short periods to perform specific tasks and then let go, Sproat said.

Questions remain about the repository, which would need billions of dollars to be built. Sproat confirmed the Bush administration is considering a proposal to reorganize the Yucca project and other nuclear waste programs into a government-chartered corporation similar to the Tennessee Valley Authority or the Bonneville Power Administration.

Promoters contend such an organization would have the advantages of a private business to hire and fire managers, set salaries to attract talent and promote accountability. Sproat said it would stop a revolving door that has seen numerous top managers trying to run the Yucca program for short terms.

But such a big change would require a number of fundamental changes and approval by Congress, which might not be willing to give up control.

The Energy Daily in a Feb. 26 story quoted sources saying the DOE proposal has been at the White House for consideration since at least December. Sproat could not confirm that, saying he understood the concept still was being mulled within DOE.

"I personally don't expect we are going to make anything significant happen on this over the next three to six months," he said.

Steve Kraft, senior director for used fuel management at the Nuclear Energy Institute, said a "move like that would greatly enhance the chances of success of the Yucca Mountain project and recently Congress is not inclined to enhance the success of the Yucca Mountain project."

Sen. Harry Reid, D-Nev., long has been declaring Yucca Mountain dead and his spokesman said no new plan would change that.

The Associated Press contributed to this report. Contact Stephens Washington Bureau Chief Steve Tetreault at stetreault@stephensmedia.com or (202) 783-1760.