April 22, 2011 / 10:24 AM / 8 years ago

UPDATE 1-Lynas: Malaysia's review on rare earths plant will not delay project

* Move comes after growing public pressure to scrap plant

* Lynas says confident review will show plant is not a risk

* Malaysia plant to supply one third of demand outside China (Releads with Lynas reaction)

KUALA LUMPUR, April 22 (Reuters) - Australian miner Lynas said Malaysia’s one-month review of its rare earths processor in the country for radioactive pollution risks will not pose a delay for the project’s completion.

“Lynas is confident the review will reconfirm that the plant is safe and presents no hazard to the community or Lynas workers,” the company said in a statement on Friday.

“Lynas trusts that this independent review will help to address public concerns expressed in recent times about the health, safety and environmental aspects of this important project,” the firm added.

State news agency Bernama reported Trade Minister Mustapa Mohamed as saying an independent panel will be set up to review the health and safety aspects of the Lynas rare earths plant in the central Malaysian state of Pahang, potentially delaying output outside of top producer China.

The move comes after growing public pressure to scrap the plant with environment activists saying the plant could make Malaysia a dumping ground for radioactive by-products from the refining process, creating health risks.

Rare earths are crucial to production of high-tech goods from fibreoptic cables to smartphones and electric cars.

Big buyers such as Japan, the United States and Europe rely on these metals and have been looking to cut their reliance on China that accounts for around 95 percent of global output.

A senior Lynas official told Reuters last month that the firm expected to get the pre-operation licence by September and that it adhered to all government regulations. [ID:nL3E7EI1DY]

Malaysia’s Department of Environment (DOE) approved the Lynas project in 2008.

Lynas’ Malaysia plant was supposed to process rare earth concentrate shipped in from the firm’s Mount Weld site in Western Australia. The site is scheduled to produce its first feed of ore in late March. [ID:nL3E7EG3GK]

The strategy would make Lynas a key global supplier after top rare earths producer China last year imposed export quotas to retain resources.

Company officials said annual output from the Malaysian plant would hit 22,000 tonnes, meeting roughly a third of total global demand outside China by 2013. (Reporting by Niluksi Koswanage; Editing by Anshuman Daga)

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