Bloomberg News

Lynas Must Outline Plans Before Malaysia Rare Earth Refining

February 16, 2012

(Updates with Lynas CEO comment in fifth paragraph.)

Feb. 16 (Bloomberg) -- Lynas Corp., an Australian miner, needs to show how it will fulfill five remaining conditions before it can start importing rare earth into Malaysia, the head of the Southeast Asian nation’s regulator said.

Malaysia’s Atomic Energy Licensing Board decided Jan. 30 to grant the Sydney-based miner a temporary operating permit to begin refining rare earths under certain conditions, including a plan for permanent waste disposal, following public protests. Lynas must detail how it will meet outstanding clauses, including payment of a $50 million security deposit, before this will be issued, Raja Abdul Aziz Raja Adnan, the board’s director-general, said in Selangor, near Kuala Lumpur.

“Even if tomorrow, they can fulfill the conditions, I don’t see any problem,” Raja Abdul Aziz separately told reporters today. Lynas said on Feb. 14 that it hoped to start production in the second quarter. “We are not limited or tied down to Lynas’s second-quarter schedule,” he said.

The plant would be the world’s largest refinery of the minerals with total capacity of 22,000 tons per year should a second phase be approved and completed, the company said on Nov. 16. Its plan to start production in September was delayed after the government imposed extra safety standards recommended by an international review panel as residents expressed fears over possible radiation and contamination.

The company needs to meet conditions, including identifying a permanent waste repository and a detailed engineering study, within 10 months from Jan. 30, Nicholas Curtis, chief executive officer of Lynas, said in a telephone interview. It also needs to make a 200 ringgit ($65) payment. “That will be a matter of days,” he said.

The Australian company, which has rejected the health concerns, has been unable to start exporting ore to Malaysia for refining after opening its A$100 million ($107 million) Mount Weld mine in Western Australia in August.

--With assistance from Joe Schneider in Sydney. Editors: Barry Porter, Ryan Woo

To contact the reporter on this story: Manirajan Ramasamy in Kuala Lumpur at rmanirajan@bloomberg.net

To contact the editor responsible for this story: Barry Porter at bporter10@bloomberg.net


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