Lynas may temporarily shut down Malaysian operations if licensing prohibitions continue

KUANTAN: Lynas is planning for either a temporary shutdown of its Malaysian operation or a period of very low production if licence conditions prohibiting the import and processing of lanthanide concentrate remain on July 1.

In its latest quarterly report, the rare earth materials producer said it had been planning for multiple scenarios if the Lynas Malaysia cracking and leaching plant closes or remains operational, and the ramp up speed of the Kalgoorlie facility in Western Australia.

"(With) absent feed from the continued operation of the Lynas Malaysia cracking and leaching plant, the whole Lynas Malaysia facility will be shut down in mid-July until receipt of mixed rare earth carbonate (MREC) from Kalgoorlie," it said.

Lynas added that achieving feed on at the Kalgoorlie Rare Earth Processing Facility in the fourth quarter of the 2023 financial year would mean the first MREC from Kalgoorlie would likely be received at Lynas Malaysia in about August 2023.

"The rate of supply of MREC to the Lynas Malaysia plant will depend on the speed of ramp up of the Kalgoorlie facility.

"Commissioning and ramp up of a plant of the nature of the Kalgoorlie Rare Earth Processing Facility remains inherently unpredictable and as a result, we are planning for either a complete shutdown or very low production at Lynas Malaysia for at least up to three months followed by a period of reduced production which will increase as the ramp up to capacity of the Kalgoorlie Rare Earths Processing Facility is achieved," said Lynas.

Consequently, Lynas expect sales to continue at normal rates in the fourth quarter of the 2023 financial year.

It added that if cracking and leaching in Lynas Malaysia is required to shut down from July 1, this will be followed by lower sales, consistent with ramp up rates in the first half of the 2024 financial year.

Science, Technology and Innovation Minister Chang Lih Kang announced in February that Lynas had been informed of the decision by the Atomic Energy Licensing Board (AELB), where its request to drop four conditions related to cracking and leaching activities, the generation of water leach purification (WLP) residues and the importation of lanthanide concentrates from Australia was not considered.

This meant that Lynas would no longer be allowed to carry out activities that would produce radioactive waste in Malaysia after July 2023.

It said appeals to the minister had been filed on Feb 16 and 24 and were listed for hearing on April 28.