By Manirajan Ramasamy and Gan Yen Kuan – Jun 30, 2011 9:36 AM GMT+0800
Lynas Corp. will only be granted a license for a Malaysian rare-earth refinery if it implements recommendations made by a panel of experts that may take a year to complete, an official familiar with the matter said.
The Sydney-based company will need to satisfy 11 conditions, including technical and safety measures as well as a decommissioning plan for the plant that’s nearing completion in Malaysia’s eastern Pahang state, said the person, who couldn’t be named as the information is confidential.
Lynas had planned to process ore from its Mount Weld mine in Western Australia at the plant from September. Delaying output may further tighten the rare earths market where prices have more than doubled as the biggest producer, China, cuts export quotas.
“Any project delays will just make the minerals more valuable and send prices higher,” Peter Strachan, who heads Perth-based independent advisory firm StockAnalysis, said by phone from Perth. “You would have expected Lynas to have ticked all the boxes and done all the appropriate feasibility, environmental and regulatory work.”
Lynas today halted its shares from trading pending an update on the plant review. Its shares have fallen 3.9 percent since the start of the year. Matthew James, a Lynas spokesman, declined to comment when contacted by e-mail today.
The International Trade and Industry Ministry will hold a briefing on the review in Kuala Lumpur today, following recommendations by a panel of experts appointed by the International Atomic Energy Agency, according to a media invitation.
Rebecca Fatima Sta Maria, the ministry’s secretary-general, declined to comment when contacted by Bloomberg News late yesterday.
Prices of rare earths, 17 chemically similar elements used in lasers, plasma televisions and hybrid cars, have more than doubled since the first quarter. China, which controls over 90 percent of the global market, further restricted rare-earth mining while cutting exports to conserve resources and protect the environment.
Local residents and non-governmental organizations have lobbied to stop Lynas from operating the plant over radiation fears. Risks arising from the project outweigh economic gains, Fuziah Salleh, a local member of parliament, said on April 22.
The Southeast Asian nation’s government asked the IAEA to appoint an independent international panel to look into public concerns before allowing the miner to import minerals.
Televisions, Hybrid Cars
Lynas wants to tap growing global demand for its minerals that are used in Apple Inc. (AAPL)’s iPod music players, flat-screen televisions and hybrid cars.
The company said in a statement on April 22 its refinery is safe and presents no hazard to the public and its workers.
Protests over the past three months, including a march on Parliament and the Australian High Commission in Kuala Lumpur, took place following leakages at Japan’s nuclear power plants after the March 11 earthquake and tsunami.
To contact the editor responsible for this story: Barry Porter in Kuala Lumpur at email@example.com.