Lynas treated as ‘political football’, says CEO

The Lynas plant at Gebeng, Kuantan. Lynas CEO, Nicholas Curtis, says Lynas is being used as a ‘a pure political football’ in the run-up to the 13th general elections in Malaysia. – Reuters pic

KUALA LUMPUR, Dec 12 – Malaysia is treating Lynas as a “political football” ahead of the country’s elections, the rare earths producer’s executive chairman said today as authorities threaten to revoke the Australian miner’s operating licence over a waste storage dispute.

Nicholas Curtis told business paper, Wall Street Journal (WSJ), that Lynas was being used as “a pure political football” in the run-up to the 13th general elections that must be called by next April when the Barisan Nasional (BN) government’s mandate expires.

He stressed that the company’s operating licence does not require it to ship out of Malaysia any residue produced from its refinery in coastal Gebeng, and that it would push on with plans to develop a permanent disposal facility (PDF) here despite an ongoing storm over its potential waste hazards.

“To appease the anxiety of the people, we have said we will voluntarily take it upon ourselves to export the material, at a cost to us.

“This is not a licence condition. I think in the heat of a political debate the position was exaggerated from what is actually the legal position,” Curtis told WSJ in an interview published today.

The Sydney-based company told the Australian Securities Exchange in a statement yesterday that it could export all the recycled waste from its RM2.5 billion refinery in Gebeng and insisted its operating licence remained valid.

Malaysian regulators however maintain they are empowered to yank Lynas’ licence is it fails to comply with conditions set.

“Lynas gave us a commitment to ship out the residue and it was based on that voluntary undertaking that we incorporated that as a condition into the temporary operating licence,” the WSJ quoted a senior science ministry official, who declined to be named, as saying.

“They have to ship the residue out of Malaysia regardless of the form.”

A spokesman for the Atomic Energy Licensing Board (AELB) told The Malaysian Insider yesterday that submission of the PDF plans is a legally binding condition of the Temporary Operating Licence (TOL) issued to Lynas in September.

He added that failure to do so within 10 months of its issuance date could lead to the company’s licence being suspended or revoked without compensation, under Section 22 of the Atomic Energy Licensing Act 1984 (Act 304).

The spokesman said that Lynas will still have to apply for a full licence, pointing out that the firm now only possessed a TOL.

A statement by AELB on February 1 and the February 22 joint ministerial statement, which have similar content, explicitly states five conditions, with three relating to the PDF.

The February 22 statement, written in the English language, said that Lynas has to submit details of the plans and location of a proposed PDF to AELB, and the submission must be made within 10 months of the date that the TOL is issued.

The third condition states: “This requirement must be complied with regardless of any alternative proposal Lynas may make for the management or disposal of the factory residue (eg. recycling, conversion into products that can be sold, etc)”.

Sydney-based Lynas Corp had on Monday repeated that it is committed to following the rules and regulations set by Malaysian regulators, including a condition to export residues produced out of Malaysia.

Unprecedented public anger towards the Lynas plant has turned it into campaign fodder for the general election that must be called by next April when the BN’s mandate expires.

Despite widespread opposition owing to environmental and health concerns, the government granted the Australian miner a temporary operating licence that allowed it to carry out a trial run earlier this month.

Anti-Lynas groups are still seeking to halt the project and have taken their case to court. Their challenge will be next heard on December 21.

LAMP is touted to be the world’s biggest rare earth plant outside China and aims to break the eastern giant’s 90 per cent chokehold on the material crucial to the manufacture of high-technology products like smartphones.