AMID controversies and opposition by civil society groups, Lynas Malaysia has been given a six-month conditional extension to its operating licence, with three conditions imposed by the Atomic Energy Licensing Board (AELB).

The announcement for the extension was made by the AELB on August 15.

Opposition groups have continuously flagged the adverse effect of the Australian rare earth processor’s operations on public health and environment.

Kuantan MP Fuziah Salleh, who has been a strong critic of Lynas, said the people of Kuantan are facing health risks from the waste generated by the Lynas plant in Gebeng, while the company and its suppliers enjoy the profits.

However, the government has only granted the company an operating licence for six months, compared to previous years where licences were valid for a period of two to three years.

Its current licence will expire on September 2, 2019, with the extension coming into effect the following day with three conditions:

Condition 1: Construction of a cracking and leaching facility overseas.

“They said facility must be built and operational within four years from the date of the licence. 

“Once the facility is operational overseas, Lynas will no longer be allowed to produce radioactive residue above 1Bq/g at its refinery in Gebeng, Kuantan,” the AELB said in a statement on August 15.

Meanwhile, on June 24, Lynas Malaysia Sdn Bhd managing director and vice-president Mashal Ahmad said the rare earth processor is looking to relocate the process to Australia within five years.

Mashal added that two potential sites had been identified and the local government there was supportive of the move. 

“Once the new plant is operational, the material shipped to Malaysia for processing would not include naturally occurring radioactive material,” he said.

To recap, exporting the water leach purification residue out of Malaysia was among the new conditions laid down by the AELB in a letter dated November 4, 2018, to Lynas for its operating licence renewal.

The terms of the existing licence state that residue should be recycled, and if that fails, stored in a permanent disposal facility.

Condition 2: Building a permanent disposal facility.

Under the new conditions, Lynas has also been tasked with identifying a place to build a permanent disposal facility and seek the approval of the state government for that.

Alternatively, it is required to obtain approval from the authorities of the place outside of Malaysia to where it will ship its residue.

The AELB requires Lynas to submit its construction and financing plans for the disposal facility operations.

“Work on the building of a permanent disposal facility must commence immediately to minimise the risks arising from a natural disaster, such as flooding, because residue (at the Lynas advanced materials plant) has already breached 580,000 tonnes,” the AELB said.

Lynas Corp chief executive officer Amanda Lacaze said, in the wake of the licence extension, the company will have to obtain approval to build a disposal facility within six months or alternatively receive the approval of another country to accept its waste.

“Lynas Malaysia’s permanent disposal facility planning framework and site selection plan have previously been approved by the AELB.

“In addition, the Pahang state government has given written approval to locate a disposal facility in the state,” she said in the wake of the extension. 

According to the government commissioned executive review committee report on the operations of the Lynas advanced materials plant in Gebeng released late last year, Lynas was issued a Class G licence by the AELB, allowing it to temporarily store its residue in the plant while it looked to construct a disposal facility.

The provision was for the issuance of a temporary operating licence, valid from September 3, 2012, to September 2, 2014, and the full operating licence for between September 3, 2014, and September 2, 2016, with the current licence expiring on September 2.

The advanced materials plant supplied the AELB with documents of its plans and location for the disposal facility within 10 months of the temporary licence’s issue on March 13, 2013.

However, the report said the documents were only on the company’s plans to manage its waste and were not an application to build a disposal facility.

Condition 3: Stop R&D work on Condisoil.

This condition requires Lynas to stop all its research and development work on turning its radioactive residue into a soil conditioner called Condisoil, which can be used in agriculture.

The Ministry of Energy, Science, Technology, Environment and Climate Change said in a statement on December 4 that Lynas had been conducting research on recycling residues like Condisoil. 

“The Ministry notes that Lynas Malaysia is conducting research into the potential recycling of residues as a soil conditioner named Condisoil.

“However, having received expert opinions, the review committee reports that the duration of the studies were insufficient to conclude the safety of using Condisoil,” it said.

“The ministry agrees with the review committee’s recommendation that long-term studies can be conducted without the use of residue,” it added.

In August 2017, Lynas said in a statement that it has submitted to the Standard and Industrial Research Institute of Malaysia (Sirim) a sample of Condisoil in 2015.

The company said it has received reports from Sirim confirming the safety of the product before it commenced its pilot field trials in 2015.

It also claimed to have received the approval of the Department of Environment.

“Lynas is correct in stating that Sirim has confirmed in its reports that Condisoil is non-toxic, non-carcinogenic and compliant with all test parameters including heavy metals.

Based on the Sirim reports and on the pilot field trial results, Lynas stated that Condisoil is safe for people, the environment, animals, crops and produce,” the company said.

The third condition also required the company to contribute 0.5% of its annual gross sales to the federal government as additional indemnity until its overseas cracking and leaching facility was operational.

Lynas was previously required to pay the government a security deposit of US$50million (RM209 million).

Lacaze recently said that US$42million has been deposited in cash and cash backed bonds. – August 19, 2019.