a few myths exploded., page-4

Some local info re Malaysia, a few interesting comments.





13-02-2009: Hedge funds delay Lynas start-up plans

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KUALA LUMPUR: Construction work on Lynas Malaysia Sdn Bhd’s lanthanide plant at the Gebeng Industrial Estate near Kuantan, Pahang, will be suspended following a dispute with bondholders over financing.

Lynas Corporation Ltd, the parent company of Lynas Malaysia, said it had met all conditions for release of US$95 million (RM342 million) of bondholder funds, but the bondholders had refused to release the money.

“As a result of this dispute, the funding that is needed for the project could not be immediately released, necessitating the construction suspension,” Lynas said yesterday.

It said all efforts were being made to put the funding back in place, but in the short term it appeared that the global financial crisis had now impacted the lanthanide project and its start-up timing.

“We want to assure all stakeholders, including the Malaysian and Pahang governments, our vendors and business partners as well as the people of Pahang that Lynas is committed to proceeding with the project,” Lynas executive chairman Nicholas Curtis said.

“The project remains economically attractive and the fundamentals of lanthanide demand and pricing are robust.

“When completed this will be a modern, safe and environmentally friendly plant and is an exciting and important industry for Malaysia,” Curtis added in a statement.

Curtis described the suspension of work as a “temporary setback that Lynas expects will be resolved” and “in the meantime work continues with our Malaysian staff on preparations for start-up and we have not retrenched any of our permanent Malaysian staff”.

He added: “This work includes completion of training and recruitment plans, operating systems and community engagement activities.

“We are committed to proceed with the project and resume construction as soon as we have resolved this issue and our funding is back on track.”

Lynas plans to invest RM900 million to build the plant, which was originally scheduled for completion by year-end.

It plans to invest another RM300 million in Phase 2 to expand capacity at the plant, bringing its total investment in Gebeng to RM1.2 billion.

The plant will process lanthanides ore, to be shipped to Kuantan from Mount Weld, Western Australia, into purified lanthanides — elements that are essential in the development of green technologies and environmental sustainability.

The lanthanide products include green and energy-efficient products such as catalytic converters for cars and energy-saving light bulbs and are essential elements in hybrid cars.

The lanthanides are also essential in technologies that enable weight reduction in cars, higher yields from oil refining and in diesel additives.

They are also used in flat-panel displays, disk drives, iPods and MP3 players.

Initial production at the Gebeng plant is expected to reach 10,000 tonnes per annum and will hit a peak of 20,000 tonnes per annum when fully operational.

The Lynas Malaysia plant is expected to employ about 350 workers at full capacity.

The Malaysian operations are currently headed by Mashal Ahmad, who is based in Kuantan.