MAC: Mines and Communities

Malaysian court delays controversial rare earths plant

Published by MAC on 2012-10-16
Source: PlanetArk, Business Spectator

Malaysia license for Lynas rare earth plant left on hold


11 October 2012

A Malaysian court has kept on hold a license granted to Lynas Corp Ltd's controversial rare earth plant, delaying until next month a decision on whether to consider judicial reviews aimed at permanently blocking production.

Australia's Lynas, which received a temporary operating license for the $800 million plant early in September, had aimed to start production this month. The firm confirmed in a statement that the launch would be delayed and gave no new timetable.

Protests in Malaysia over possible radioactive residue have drawn thousands of people and the project has become a hot topic ahead of an election that must be held by early next year.

Activists linked to the environmental group Save Malaysia Stop Lynas want the court to suspend the license until two judicial review cases challenging the government's decision allowing the plant to operate are heard.

Lynas says that its plant is safe and is not comparable to a rare-earths plant in Malaysia that was shut by a unit of Mitsubishi Chemicals in 1992, after residents there blamed the plant for birth defects and a high rate of leukemia cases.

Hon Kai Ping, a lawyer for the environmental group, said the decision had been delayed by the Kuantan High Court until November 8.

It was not immediately clear the reason for the delay, but the environmental group plans to bring in more expert witnesses.

"It is another month of relief but we won't be satisfied until Lynas is out of Malaysia," Jade Lee, a member of the Save Malaysia Stop Lynas group and a resident of the eastern city of Kuantan where the plant is located said after the court ruling.

Shares in Lynas had closed Wednesday's session 1.2 percent down ahead of the court decision.

The rare earth plant -- the biggest outside China -- has been ready to fire up since early May, but the company has been embroiled in environmental and safety disputes with local residents since construction began two years ago.

The plant is considered important to breaking China's grip on the processing of rare earths, which are used in products ranging from smartphones to hybrid cars.

(Reporting by Siva Sithraputhran and Sydney bureau; Editing by Ed Davies)

Lynas shares dive on fresh Malaysian court delay

Business Spectator

11 October 2012

Shares in rare earths miner Lynas have plummeted after a Malaysian Court
delayed the start of production at its plant to consider an application by

At 1215 AEDT, shares in Lynas fell 15.7 per cent to 72.5 cents, against a
benchmark index fall of 0.3 per cent.

Lynas had planned to finally begin operations at the rare earths processing
plant this month, following a long saga, but will now wait until at least
November after the Kuantan High Court extended an interim stay on the licence.

Environmental activists and local residents oppose the plant on the grounds
that it will produce radioactive pollution that will seep into ground and

Malaysia's Atomic Energy Licensing Board awarded a temporary operating licence
to Lynas last month.

However the Save Malaysia Stop Lynas opposition group are seeking a judicial
review of that decision by Malaysia's minister of innovation, science and

The court will decide whether to suspend the operating permit pending a
judicial review on November 8.

The plant on the country's east coast would be the biggest rare earth plant
outside China and is considered important to breaking that country's current
95 per cent monopoly on global supply.

Lynas insists that any radioactive waste would not be harmful to humans,
having chosen the site because it was cheaper and it had thought easier to
build politically than in Australia.

Mitsubishi is still cleaning up the site of a rare earth processing plant it
closed in Malaysia in 1992, which some residents say has caused health
problems including birth defects and cancer.

Lynas's Mt Weld mine in Western Australia is considered the world's richest
deposit of rare earth minerals, which have a range of hi-tech uses such as in
hybrid cars and computers.

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