Lynas confident of meeting conditions for licence renewal

Lynas Malaysia’s CEO Amanda Lacaze says the government’s decision to renew its operating licence will encourage other international businesses to invest in the country.

KUANTAN: Lynas Malaysia Sdn Bhd is confident of satisfying the Cabinet decision for it to build a permanent deposit facility (PDF) for the water leach purification (WLP) residue produced by its rare earths plant in Gebeng near here.

Its chief executive officer, Amanda Lacaze, said Lynas will accelerate the planning and construction of the PDF.

Lynas’ operating licence has been renewed for six months, subject to the company obtaining consent for the location of the PDF within the period.

“Lynas Malaysia’s PDF planning framework and site selection plan has previously been approved by the Atomic Energy Licensing Board (AELB). In addition, the Pahang state government has given written approval to locate a PDF in the state,” she said in a statement.

Lacaze said this was consistent with the recommendation of the Pakatan Harapan government’s executive review committee in December 2018 or, alternatively, Lynas can obtain consent from another country to receive the material.

She also noted that Lynas previously had deposited a total of US$42.2 million (RM176.5 million) with the AELB in cash and cash-backed bonds, and has been required to spend 0.5% of annual gross sales on research and development activities related to the use of WLP residue as condisoil in agriculture.

Condisoil is a soil conditioner derived from residue produced by the Lynas rare earths plant.

The renewal of Lynas’ licence comes with three conditions:

  • Lynas will have to move its cracking and leaching process, which is currently conducted at its plant in Gebeng, out of the country.
  • Lynas will have to identify a specific site to construct a PDF and to obtain written permission from the state government for the use of that site.
  • Lynas will have to end all research and development activities related to the use of the radioactive WLP residue as condisoil in the field of agriculture.

Lacaze said that under the new agreement, Lynas is no longer required to spend 0.5% of its annual gross profit on research and development but contribute the percentage sum to the government as additional security until cracking and leaching commences operations in Australia.

“The relevant portion of these security amounts is expected to be available for the PDF construction project. However, further information will be provided on costs and timetable as this project progresses,” she said.

Lacaze thanked the government for its decision and hoped it will encourage other international businesses to invest in downstream manufacturing in Malaysia.

“We reaffirm the company’s commitment to our people, 97 people of whom are Malaysian, and to further developing Malaysia’s position as a global rare earth centre of excellence.

“We are optimistic that this decision will bring an end to the politicisation of Lynas over the past year. Lynas will continue to make a positive contribution to the Malaysian economy and to Malaysia’s Industry 4.0 vision,” she said.

She said Lynas has demonstrated that its operations are safe and that it is an excellent foreign direct investor by creating over 1,000 direct jobs and spending more than RM600 million in the local economy each year.

Lynas will work closely with community members to ensure that they have up to date and accurate information about its operations, she said.