LYNAS PLANS TO SET UP TEXAS PLANT
Firm and partner Blue Line aim to tap US demand for raw materials critical to country’s electronics and energy industry
RARE earths producer Lynas Corp says it has signed a memorandum of understanding with Texas-based Blue Line Corp to set up a rare earths separation facility in the United States.
The move comes as the US, which is highly-reliant on the world’s biggest producer China for rare earths, is prioritising sourcing of its own minerals used in everything from consumer electronics to military equipment.
Lynas and Blue Line will cooperate
over the next year to develop the processing facility in Texas. The venture would be majority owned by Lynas, said the companies in a joint statement.
The deal has been struck as Lynas faces regulatory issues at its processing plant in Malaysia and fends off a US$1.1 billion (RM4.5 billion) takeover offer from Australian retail-to-chemicals conglomerate Wesfarmers Ltd.
Chief executive officer Amanda Lacaze, in a phone interview, said the US venture was a specific market opportunity and would complement its operations in Malaysia.
The venture would allow Lynas to close a “critical” supply chain gap for US manufacturers.
“It’s an important reflection of the fact that countries all around the world are keen to have rare earths processing capabilities,” said Lacaze.
“Electric vehicle manufacturers are looking for security of supply of the heavy rare earths as well as on the light rare earths and this provides the opportunity,” she said.
Lynas is the world’s only major producer of rare earth minerals outside China.
The materials produced by the company, such as neodymiumpraseodymium, are used in a variety of applications such as electrical components and high-power magnets.
The companies did not give any details on the cost of the proposed US facility.
Lacaze said the company was “absolutely committed” to Malaysia, where it has been required to remove years of accumulated waste at its plant in order to have its license renewed.
She was confident Lynas could meet a framework outlined by Prime Minister Tun Dr Mahathir Mohamad, who said in April that Lynas or any other company will need to clean raw materials coming to Malaysia in order to operate in the country.
Lynas has said it is considering initial ore processing near its Australian mine, given the situation in Malaysia.
The company last month reported a 33 per cent rise in thirdquarter production of rare earth oxides and has rejected the Wesfarmers bid as undervaluing its business.