Contradictions in Lynas rare earths company’s plans to deal with radioactive wastes

Lynas will be in court in Malaysia on 19 December. The Save Malaysia Stop Lynas (SMSL) campaignerswill be appealing against the Kuantan High Court decision to lift its stay on the company being able to exercise its rights to proceed under the temporary licence.

The toxic waste that’s not in Australia’s backyard  18 Dec 12, Australian-owned company Lynas is quietly shipping rare earth to a processing plant in Malaysia – without a firm plan in place to dispose of dangerous radioactive waste. Wendy Bacon reports.

If a manufacturing plant involving radioactive materials moved into your community, one of the first things you would ask is, “what’s going to happen to the waste?”

This is exactly how residents of Kuantan on Malaysia’s east coast reacted when the Australian company Lynas announced plans to build Lamp, the world’s biggest rare earth processing plant in their area.

Several years later, they have no clear answer. Indeed last week, while the plant that will use concentrate imported from Lynas’s rare earth mine at Mount Weld in Western Australia was finally ramping up for production, the Malaysian government and the company were in direct conflict about what would happen to the waste.

On 8 November, after two years of delays caused by court challenges
and inquiries, a halt on a temporary licence granted to protesting
citizens in September was lifted. Five days later, Lynas secretly
moved 100 containers of rare earth concentrate from a depot at Bilbra
Lake and quietly shipped them through Fremantle Port. The containers
were unloaded and delivered under police escort to the A$800m plant on
22 November.

But last week, four Malaysian government ministers backed by the
entire cabinet declared that Lynas’s temporary licence will be
cancelled if it does not fulfil a condition to export all radioactive
waste from Malaysia. Lynas was forced to call a share trading halt
claiming that there is no such condition in its licence, which at this
stage is not public. By the end of last week, Lynas’s share price fell
further to 55 cents, down from $1.21 this time last year.
The 17 rare earth elements are used in many products including mobile
phones, flatscreens, missiles and wind turbines. All environmental
experts agree that mining, refining and recycling rare earths can have
serious, long term consequences if not carefully managed, specifically
because the elements are found with thorium, which is mildly
radioactive. Ninety-six per cent of global production currently occurs
in China, where mines and plants have caused serious environmental

Lynas continually asserts that their plant is “absolutely safe”, but
confusion and insufficient planning for waste disposal has sparked
local opposition. The campaign includes grassroots campaigning group
Save Malaysia Stop Lynas (SMSL), local members of parliament, the
Malaysian Green movement, Australian Greens MPs and members and
Friends of the Earth Australia. Even the Malaysian Bar Council hosted
an event at which an engineering professor and lawyers opposing the
plant spoke. Opposition leader Anwar Ibrahim has pledged the
opposition would scrap the plant if it wins national polls next year.

For two years in a row, SMSL delegations from Kuantan have protested
outside Lynas’s annual general meeting, spoiling executive chairman
Nick Curtis’s attempts to soothe his anxious shareholders. The
delegation’s leader, Tan Bun Teet, recently spoke at a NSW
parliamentary reception hosted by Greens MP Jamie Parker held after
the 20 November meeting. He lives near the plant and told attendees he
was angry Curtis had led shareholders to believe the campaign against
the plant was small.

Any misunderstandings about the strength of opposition to the plant
were resolved when the delegation arrived home to join the last day of
a 300-kilometre protest walk from Kuantan to Kuala Lumpar, which by
the time it reached the capital had swelled to 20000 people. When SMSL
discovered Lynas had successfully smuggled the concentrate into the
plant while they were gone, they issued an angry press statement,

Lynas must be desperately worried to be doing this secretly. At its
AGM on Tuesday in Sydney I was there just to hear its executive
chairman Nick Curtis [tell] its shareholders that the Stop Lynas
campaign in Malaysia consist of just 10 people! If we are so weak and
ineffective, why try to gag us through a defamation action, why ship
its ore concentrate in such secrecy and at night using police escort?

(The company, which has already settled two defamation writs with
Malaysian media outlets, is suing members of the SMSL campaign.)
Lynas managing director Nick Curtis was not available for interview,
but a company spokesperson told New Matilda that the arrival of the
containers was kept secret because of threats by green groups to
blockade the shipment. Local authorities organised the police escort
without a request from Lynas, the spokesperson said.

In asserting the safety of its operations, Lynas continually relies on
a report by the International Atomic Energy Agency, commissioned by
the Malaysian government in 2011. The report confirmed that the plant
had complied with Malaysian regulations, which meet international
standards. But a closer examination of the report’s findings is not
reassuring. The agency found that the Malaysian government — which had
allowed the company to begin construction without long term, permanent
plans for its waste — needed to be strengthened so that it could
effectively regulate the industry.

It recommended that the company lodge its intended plans for long-term
storage of waste, waste disposal and for decommissioning the plant at
end of its life. This crucial information had been omitted from
previous company Radiation Impact Assessments compiled in 2008 and
2010. As the plant’s opponents were quick to point out, no company
would have been allowed to begin construction before this information
was lodged and independently assessed in Australia.

Shortly after the agency’s report came out, the New York Times
reported that documents supplied to them by Lynas engineers showed
structural cracks, air pockets and leaks in concrete shells for 70
containment tanks that would hold toxic plant materials. They were
also critical of the materials used to construct the tanks.

The Lynas spokesman dismissed the engineers’ complaints in the New
York Times article, saying: “The reality is that any concrete
construction will quite often have cracks when concrete dries, it’s
normal and those cracks will subsequently get filled in when concrete
dried. Any pockets would have been filled in before the leak proof
lining that is put into the concrete … These are guaranteed by an
independent contractor.”

Lynas company documents show that three weeks after the agency’s
report came out it, had filed the recommended plans with Malaysian
authorities. But it is unclear how detailed these plans were and what
exactly the company promised to do. Lynas told New Matilda that it has
filed a Permanent Disposal Facility plan but that it is “commercially
in confidence”. New Matilda asked for a copy but did not receive one.
Patersons Securities analyst Andrew Harrington was reported in The
Australian last week to have told his investor clients that the
licence did require a permanent disposal facility to be agreed between
Lynas and the government but that this was still being discussed.
Lynas’s spokesperson says the residue contains naturally occurring
radiation but this is much lower than the minimum level occurring
naturally in environment, and should not be described as hazardous

The company says it plans to transform the residue into synthetic
gypsum for road building and other projects, a process being used
successfully in the oil and gas industries, but yet to be done in the
rare earth industry. “Lots of work has been done by a whole bunch of
academic and commercial organisations as to whether this residual
material is capable of being used in this work,” the spokesperson
said. “They are all very confident it will work.” He said they have
already had expressions of interest but he could not “say one way or
the other … everything these guys say or do is blown up and is capable
of being taken out of context”.

The company had planned to sell at least some of the gypsum in
Malaysia, if the government gives permission. Failing this, Lynas will
pursue customers in Indonesia, the United States and Australia, but
the company’s spokesperson declined to give further details on this
matter. In any case, nothing more can be done until there is enough
residue for pilot production.

Asked whether there are plans for safely decommissioning the plant,
the spokesperson said this was really “academic” because there is
enough raw material to keep the plant operating for 50 years. But the
company has previously talked about a life of 20 years; if the plant
operates for longer than that, the amount of radioactive waste, which
can last for hundreds of years, will be much greater. Even if the plan
to process the waste into secondary products is successful, there is
no guarantee an export market for synthetic gypsum will be stable.
Given the company’s optimistic plans to produce gypsum, it is hard to
understand why in March this year it applied to the South Australian
government to import waste from the plant back into Australia. In
answer to a question by Greens Senator Scott Ludlum on 30 October this
year, senator Joe Ludwig, speaking on behalf of the Minister for
Health, said that an application from Lynas was currently under
consideration by the Australian Radiation Protection and Nuclear
Safety Agency (ARPANSA). “ARPANSA requested more information from
Lynas Corporation on 2 April 2012,” Ludwig said. “Lynas Corporation
has yet to respond and the application cannot progress until the
requested information is received.”

The South Australian government would also have to approve the import
of the waste. New Matilda has asked the company about this application
and will report its answer tomorrow.

The International Atomic Energy Agency report also found that the
Malaysian Atomic Energy Licensing Board should improve the
transparency, visibility and public understanding of its approach to
regulation and that Lynas should improve communication with residents
and stakeholders. The company admitted that it had fallen down in that
area and since the report was published, has done 15000 community
consultations and improved its information and monitoring plans.

Eighteen months later, as Malaysia’s burgeoning environmental movement
gains confidence and the country heads towards its national elections
in 2013, it is unlikely to win over its angry opponents. They remain
unsatisfied that an untested recycling process should replace firm
plans for safe permanent storage of waste for the life of the plant
and afterwards. Even if Lynas makes all its plans and contingencies
public it may be too late.

Lynas will be in court in Malaysia on 19 December. The SMSL campaigners will be appealing against the Kuantan High Court decision to lift its stay on the company being able to exercise its rights to proceed under the temporary licence.

Wendy Bacon is a Contributing Editor to New Matilda, a Professor with
the Australian Centre for Independent Journalism, an activist, media
researcher and blogger at She is on the board of the

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