LYNAS MULLS AUSSIE OP
Company feels the heat following Malaysian govt’s pressure to remove accumulated waste
RARE earths miner Lynas Corp said yesterday it was considering initial ore processing near its Australian mine, as Malaysia stepped up pressure on the company already in the midst of a takeover struggle.
Lynas, the world’s only major producer of rare earths outside China, has been locked in a dispute with Malaysia, which has told it to remove years of accumulated waste at its local processing plant in order to have its licence renewed.
Prime Minister Tun Dr Mahathir Mohamad said on Friday companies interested in acquiring Lynas had pledged to decontaminate low-level radioactivity from mined ore before shipping it to the country.
He did not identify any company. Lynas last month rejected a US$1.1 billion (RM4.5 billion) takeover approach by Australian retail-to-chemicals conglomerate
Wesfarmers.
Lynas chief executive Amanda Lacaze said yesterday that Lynas had been considering building new processing facilities for months in addition to its Malaysian operations as part of expansion plans and as a way to mitigate risk from any regulatory changes in Malaysia.
Initial ore processing to reduce levels of radioactivity would mean building a cracking and leaching plant at a cost of about A$100 million (RM292 million) over three years, according to a research report by brokerage CLSA. Lynas was considering five locations, Lacaze said, but gave no details on cost or timing.
“We have been giving great consideration to ... our future industrial footprint,” she told an analyst and investor call. “We remain confident that we can agree a path forward with the Malaysian government which is good for Malaysia and good for our business.”
Lynas mines rare earths at Mount Weld in Western Australia and ships the concentrated material to a US$800 million processing plant in Kuantan, Pahang, where it stores thousands of tonnes of waste.