The Malaysian Insider – In bid to stop Lynas, group appeals to partner Siemens

By Debra Chong
August 05, 2011

KUALA LUMPUR, Aug 5 — A Pahang residents’ association has upped its game to stop Lynas Corp from building its controversial rare earths refinery in their backyard by approaching the Australian miner’s soon-to-be business partner Siemens.

Led by Kuantan MP Fuziah Salleh, the group which calls itself Badar said it was given an assurance today that the RM700 million Lynas Advanced Materials Plant (LAMP) being built in Gebeng will be delayed, if not called off, after meeting with the German tech giant.


Signboard showing the site of the Lynas plant in Gebeng. — File pic

Siemens recently announced it plans to partner Lynas and is considering setting up a high-powered magnet plant in Malaysia using the refined rare earths.However, the German firm refuted Badar’s claim it will be setting up a team to investigate Lynas’ practices over the LAMP construction, saying while it expects its suppliers to abide by their strict code of business practices it had nothing to do with the existing rare earths refinery that is 60 per cent completed.

“What we said was that we have an expert team and we will convey whatever was said to our headquarters. We have not used the word ‘investigation’ because who are we to investigate?” Siemens Malaysia CEO Prakash Chandran told reporters after meeting with Fuziah’s team which included representatives from the residents’ association in Balok, population 20,000.

“We have nothing to do with the existing plant of Lynas. That’s a Lynas plant and that’s for Lynas.

“We are not evaluating the existing plant. The existing plant is supplier for our plant. Siemens code of conduct for all suppliers will have to be implemented,” he stressed as he quickly distanced his company’s planned joint-venture (JV) project to produce super-strong magnets from the soon-to-be-complete factory that will supply the material to create them.

Siemens head of direct drives sales based in Germany, Alexander Pulkert, who was also present at the press conference, explained the company was committed to building a “green” permanent magnet plant to meet the increasing demand for energy-efficient products like smartphones and hybrid cars and was confident that Lynas would be able to meet the Siemens standards.

At a separate news conference earlier, Fuziah said her delegation had initially met Siemens to ask them to review its joint venture with Lynas, adding that the tech giant had assured them it will hold Lynas accountable.

“We are not against Siemens, we are not against their plant to produce magnets but that the joint venture will give a reason for LAMP to be in existence,” she said.

The PKR vice-president has been leading the charge to get the Lynas rare earths refinery out of Malaysia for the last two years, insisting the project is an environmental health and safety hazard due to the potential danger brought on by radiation leaks that could lead to a rise in cancer among the local population.

Fuziah said they had raised their concerns with Siemens and the company gave a briefing about its magnet plant and why it needed to continue with its JV project but added it was very particular about its suppliers.

“On that note, we said we want to hold Siemens responsible to their word. And they showed a very open attitude where they said they will have their own research team, they will set up their own experts and they will do their own investigation and they will ensure that Lynas complies with their standards, not with Malaysian standards or with other standards,” she said.

“And should Lynas fail to comply, then they will put Lynas to task. This is what Siemens promised us. And for us, that is assuring. We believe Siemens will keep to their word,” she added.

The German engineering giant is known to require all its business partners to sign strict contracts that comply with Siemens business practices based on the UN Global Compact of which it is a member.

The Code of Conduct for Siemens suppliers is based primarily on the 10 principles of the UN Global Compact that promote proactive environmental protection, anti-corruption measures, and compliance with international labour standards.

Prakash said Lynas has said it was committed to the Siemens code and that he expects the Sydney-based firm to follow through.

Badar chairman Andan Sura Rabu said the association was also planning to file for an interim court order to stop Lynas from continuing any further work on its Gebeng plant.

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