International Atomic Energy Agency panel has given Lynas the all clear sign but they would have to comply with the recommendations made by them.
The RM700 million rare earth plant will be allowed to proceed as long as they comply with recommendations made with by the nine-man International Atomic Energy Agency (IAEA) panel who reviewed the plant.
The IAEA panel recommended 11 improvements to be implemented before awarding Lynas further licences, including the one the miner needs to start pre-operations.
“The review team was not able to find any non-compliance with international radiation safety standards,” said Tero Varjoranta, the leader of the panel.
“However, we indentified 11 issues for which improvements are necessary,” he said.
Of the eleven issues, seven are technical and three are communications recommendations.
“We have to engage more – and we’ve done a lot already,” said Ministry of International Trade and Industry (MITI) secretary-general Rebecca Sta Maria.
The technical recommendations are submitting a plan to deal with long-term waste management, a plan for managing the waste from the decommissioning and dismantling of the plan at the end of its life
Constant exposure and environmental monitoring, the establishment of a fund by Lynas to cover the cost of waste management, controlling scheduled waste.
On the government’s side ,the Atomic Energy Licensing Board (AELB) will be able to serve as a Lynas watchdog, and establish a programme for regularly updating Lynas regulations to match the most recent international standards.
“There was no question about not meeting standards,” said AELB director-general Raja Abdul Aziz Raja Adnan. “If there are any indications of leakages or noncompliance, or failure of the plant, then we will be able to stop the operation.”
The panel’s recommendations call for the AELB to enhance transparency and visibility of its regulatory actions, and for Lynas to engage the public more to demonstrate how it will ensure radiological safety of the people and environment.
The final point demands that the Malaysian government to prepare an action plan to address the eleven previous recommendations, complete with time schedule.
“We will follow recommendations to the (letter) T,” said Sta Maria, saying the project would only continue when all requirements had been met.
She added that the project would draw business into Malaysia.“Not just employees, but value added to exports – we must consider the fact that this is a strategic industry which draws in other industries.”
Lynas gross profit
Sta Maria said that out of the Lynas gross profits, 1% would go to R&D, and that “half of that is for decommissioning”.
Decommissioning requires dismantling the plant with special precautions so that once the faculty is dismantled, there should no longer be any risk of radioactive accidents occurring.
Raja Aziz said that Lynas would have to provide a second radiological impact assessment, as the first one was incomplete.
The current RIA only covers the first two stages of siting and construction, and doesn’t take into account pre-operations, operations, or decommissioning.
Currently the Lynas plant, which is 40% complete, has only received licenses for the first two stages.
When asked if the government would have to compensate Lynas if the plant failed, Sta Maria merely said that there were “investment agreements”.
“The future will be decided by facts and reason, not emotions and politics. We will cross that bridge when we come to it.” she said.
She also refused to touch on the the New York Times report today, which claimed that the plant was plagued by environmentally hazardous construction and design problems, citing internal memos from current and former engineers on the project.
According to the NYT, the problems detailed were structural cracks, air pockets and leaks in many of the concrete shells for 70 containment tanks, some of which are larger than double-decker buses.
Engineers also accused Lynas of cutting corners by using products of a substandard quality, such as normal concrete instead of the costlier polymer concrete used in Western refineries.
An engineer involved in the project said that the blueprints called for the plastic waterproofing but that he was ordered to omit it, to save money. The plastic costs US$1.60 (RM4.80) a square foot, he said.
Lynas disputes that the design ever called for using the plastic. The RM700 million refinery is being constructed by Australia’s Lynas Corp, which plans to ship rare earth ore mined from Western Australia’s Mount Weld to the Gebeng plant in Kuantan.
Rare earth metals, crucial to high technology products such as Boeing airplanes, smart bombs, Apple’s iPhone and the Toyota Prius, have become increasingly vital.
However, the rare earth plant has evoked fears of radiation contamination. Following this the government had called for experts from the IAEA to form an independent panel to review the health, environmental and safety aspects of Lynas’ plant.
Lynas anticipates revenue of RM8 billion per year from 2013 onwards,and will enjoy a 12 year tax break – what MITI described as a standard investment agreement.