Lynas faces environmental review decision in Malaysia
An environmental review into the Australian miner’s rare-earth processing facility in Malaysia will be handed down today.
An environmental review into the Malaysia-based rare-earth processing facility operated by Australian company Lynas, the world’s largest outside of China, will be handed down today in a decision which could affect the cost and availability of the critical hi-tech material used in everything from iPhones to satellites.
The report by a panel of six academics to Malaysian Environment Minister Yeo Bee Yin coincides with the ASX-listed Lynas Corporation’s annual general meeting in Sydney today, but it could be weeks before the company — or the public — is told of the findings and any recommendations. Ms Yeo has said there is no timeline for announcing a decision on the fate of the plant, though recommendations are widely expected by early next year, if not next month.
The review was announced in September amid popular anger at the corruption-tainted former government, which was unseated in May by a coalition of opposition parties led by 93-year-old Malaysian strongman Mahathir Mohamad.
But it also comes at a critical time for the industry, after China cut its rare-earth minerals domestic production quotas by 36 per cent for the second half of this year, a move likely to crimp exports.
China produces almost 90 per cent of the world’s 17 rare-earth elements — which are used in everything from electric vehicles to iPhones, computers, hairdryers, wind turbines and nuclear reactors — but consumes most of what it produces itself, forcing manufacturers to source alternative supplies.
Lynas is the largest producer of rare-earth minerals outside of China, with an estimated 12 per cent of world output last year coming from its $850 million processing plant in Pahang, on Malaysia’s east coast.
The plant takes on even greater geopolitical importance in the context of Beijing’s decision to cut its rare-earth production, and the currently escalating US-China trade war.
A recent Pentagon study called China’s near-monopoly of the rare-earths industry a “significant and growing risk”.
Local opposition to the Lynas plant in Malaysia stems from concerns over the way the waste is stored at the Kuantan plant, and the potential environmental and public health impacts of that waste, which includes radioactive thorium and uranium.
The International Atomic Energy Agency has said the minerals processed by Lynas at Kuantan are considerably less radioactive than other plants.
But public health concerns over the facility have also been shaped by damage caused by a Japanese-run rare-earth processing plant, which shut in 1994 amid claims by the local community that it had caused birth defects and cancer.
Lynas chief executive Amanda Lacaze told The Australian yesterday she did not want to pre-empt the findings of the report, but noted several Malaysian government agencies recently affirmed at public hearings into the plant’s practices that the company was complying with all of its licence conditions.
“The material is currently stored in Permanent Disposal Facility-compliant facilities and they comply with International Atomic Energy Agency best practice”, as well as Malaysian standards, she said.
“Our ethos is zero harm for our people, zero harm to the community and zero harm to the environment and we are confident science backs us.”
Ms Lacaze said the Malaysian plant was “very important to the industry outside China being the only non-Chinese producer. The material we produce underpins technologies which the world is asking for.”
In a statement to the ASX last month Ms Lacaze said its key customers were in Japan, Europe and North America.
But critics of the plant say Lynas has no long-term waste management plan in place for dealing with either the radioactive waste, or the high volume of tailings generated in extracting rare-earth materials, a process which involves repeatedly dissolving the raw material in acid solutions.
Local MP Fuzial Salleh, a long-term opponent of the plant, told The Australian yesterday the most acceptable outcome would be for Lynas to send all radioactive waste produced by the plant back to Western Australia, where rare earths are extracted from its Mount Weld Mine.