LYC 0.16% $6.29 lynas rare earths limited

delay till after the malaysia elections?

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    http://www.asiasentinel.com/index.php?option=com_content&task=view&id=3250&Itemid=214

    Two decades ago, Mitsubishi Chemical established a rare earth plant in an area called Bukit Merah west of near Ipoh in Malaysia. And for the last two decades, both Mitsubishi and Malaysia have been paying the price.

    It has cost RM300 million (US$99.2 million) so far to clean up the closed plant, and the cleanup has not been completed yet. The deaths of eight plant workers from leukemia have been laid at the plant's door because thorium, a byproduct of the refining process, was allegedly thick in the air.
    Today a wholly-owned Australian company, Lynas Corp, which is seeking to open another rare earth plant in Malaysia near the east-coast city of Kuantan, is reaping the results of the mess left by Mitsubishi and its subsidiary, Asian Rare Earths. Environmentalists and Malaysia's opposition parties, particularly the Democratic Action Party, have been warning that Lynas has the potential to create the same kind of environmental and public health problems that the workers and residents of Bukit Merah endured.

    The fight over the plant has implications well beyond either Malaysia or its warring political parties in the expected run-up to an election sometime in the next year. China produces 97 percent of the world's rare earth metals, crucial for the manufacture of a wide variety of products including wind turbines, disk drives, cell phones, flat panel displays and many others.

    Now facing a rash of illegal mining and widespread environmental disasters, China said it has cut its first-half 2011 export quota by 35 percent year on year. Lynas says it will provide the first new source of supply to the world outside China, making Malaysia, if the plant goes ahead, a strategic player in the industry.

    Lynas Malaysia Sdn Bhd, a subsidiary of Lynas Australia, says it plans to import rare earth ore from Mount Weld in Western Australia, said to be the richest rare earth deposit on the planet. The company plans to truck the ore to Fremantle, send it by containership to Kuantan, then process it at a RM700 million (US$231.9 million) facility which is 40 percent completed at the Gebing Industrial Estate nearby in Pahang state.

    It is unlikely that the plant will go ahead before projected national elections late this year or early next, analysts say, because of the emotional impact of the waste byproducts of the plant, which contain the radioactive element thorium.
 
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