Non-heme dioxygenase catalyzing the conversion of codeine to morphine. Catalyzes also, with lower efficiency, the 3-O-demethylation of thebaine to oripavine and of (S)-scoulerine to 3-O-demethylscoulerine. No activity with (S)-reticuline, salutaridine, papaverine, (S)-corytuberine, oripavine, pavine or noscapine. 2-oxoglutarate + codeine + O2 = CO2 + formaldehyde + morphine + succinate Binds 1 Fe(2+) ion per subunit. Moderate substrate inhibition. Not inhibited in vitro by acylcyclohexanediones. Alkaloid biosynthesis; morphine biosynthesis. Belongs to the iron/ascorbate-dependent oxidoreductase family.