June 30, 2011
KUALA LUMPUR, June 30 — Australian rare earths miner Lynas Corp won today international approval for its RM700 million plant being built in Malaysia’s east coast after a UN review panel said it posed no radioactive risks to the thousands who live and work there.
But International Atomic Energy Agency-appointed (IAEA) panel recommended 11 improvements for Putrajaya to implement before awarding Lynas further licences, including the one the miner needs to start pre-operations.
The federal government has also pledged it will adopt all the suggestions.
The Sydney-based company had previously hoped to fire up its plant by September; it will be announcing its next step later today.
It had earlier requested a halt to trading on its shares.
Putrajaya, under pressure to show that the plant does not pose any radioactive risk, had called for experts from the IAEA to form an independent panel to review the health, environmental and safety aspects of Lynas’ rare earths plant in Pahang.
“The IAEA report concluded that it did not find any instance of ‘any non-compliance with international radiation safety standards’ in the Lynas project,” said Datuk Seri Mustapa Mohamed (picture) and Datuk Maximus Ongkili in a joint statement today.
The nine-man expert panel found Lynas to have complied with international health and safety standards, after a month-long review.
Mustapa, who is International Trade and Industry Minister, previously said although Lynas was given a manufacturing licence to build its plant, for economic reasons “issues of safety and health, and environment were also” considered.
Lynas has said that its plant — which will extract rare earth metals crucial for high-technology products such as smartphones, hybrid cars and wind turbines — will create a RM4 billion multiplier effect annually and will hire 350 skilled workers, 99 per cent of whom will be Malaysians.
Although reports say the plant may earn RM8 billion for Lynas, more than one per cent of the Malaysian GDP, critics have questioned the real economic benefit of the project, pointing to the 12-year tax break the Australian company will enjoy due to its pioneer status.
The government estimates investment spinoffs of RM2.3 billion from the plant, including the RM300 million already poured into two factories in the Gebeng industrial zone that will produce hydrochloric and sulphuric acid needed to extract the rare earth metals.