Lynas plant safe by world standards, says review panel

Posted on June 30, 2011. Filed under: Pollution |

KUALA LUMPUR, June 30 — Australian rare earths miner Lynas Corp won today international approval for its RM700 million plant being built in Malaysia’s east coast after a UN review panel said it posed no radioactive risks to the thousands who live and work there.

But International Atomic Energy Agency-appointed (IAEA) panel recommended 11 improvements for Putrajaya to implement before awarding Lynas further licences, including the one the miner needs to start pre-operations.

The federal government has also pledged it will adopt all the suggestions.

The Sydney-based company had previously hoped to fire up its plant by September; it will be announcing its next step later today.

It had earlier requested a halt to trading on its shares.

The ministers’ statement was read by Sta Maria (centre). — Picture by Jack Ooi

Putrajaya, under pressure to show that the plant does not pose any radioactive risk, had called for experts from the IAEA to form an independent panel to review the health, environmental and safety aspects of Lynas’ rare earths plant in Pahang.

“The IAEA report concluded that it did not find any instance of ‘any non-compliance with international radiation safety standards’ in the Lynas project,” said Datuk Seri Mustapa Mohamed and Datuk Maximus Ongkili in a joint statement today.

 

Mustapa heads the International Trade and Industry Ministry (MITI) while Ongkili is the Minister for Science, Technology and Innovation (Mosti). Both were absent from today’s news conference but their prepared statement was read aloud by MITI secretary-general Datuk Dr Rebecca Sta Maria.

But the government and the Atomic Energy Licensing Board (AELB) declined to comment on a New York Times report today claiming Lynas’ Gebeng plant is being plagued by design problems and hazardous construction issues.

When asked, Sta Maria said she had read the article and would leave it for Lynas to comment.

The nine-man expert panel found Lynas to have complied with international health and safety standards, after a month-long review.

The full 55-page report deals with radiation protection, waste management, decommissioning an environmental can be read online at the IAEA website which is also linked to the Trade Ministry and Science and Technology Ministry websites.

Among the panel’s recommendations are for the federal government and its agency, AELB, to require Lynas, before the start of operations, to submit a plan detailing its waste management in the long run.

The review panel highlighted the need for the miner to address the management of the water leach purification (WLP) solids after it shutters the Gebeng plant, together with a safety case supporting its plan, which it listed as follows:

• Future land use (determined in consultation with stakeholders)

• The dose criterion for protection of the public

• The time frame for the assessment

• Safety functions (example containment, isolation, retardation)

• The methodology for identification and selection of scenarios, saying “this must include the scenario in which the residue storage facility at the Lynas site becomes the disposal facility for the WLP solids”

• Any necessary measures for active and/or passive institutional control.

It noted that as the safety case develops, there will be a need to update the plant’s overall radiological impact assessment (RIA).

The review also recommended Lynas ready a fund to cover the cost of the long-term waste management and decommissioning and remediation of the plant.

IAEA’s nuclear fuel cycle and waste technology chief Tero Varjoranta, who headed the review team, also urged the federal government to prepare a clear action plan and set a timeframe for the measures to be carried out within the next one to two years — in a short video clip timed to coincide with the public release of its report.

Lynas has said that its plant — which will extract rare earth metals crucial for high-technology products such as smartphones, hybrid cars and wind turbines — will create a RM4 billion multiplier effect annually and will hire 350 skilled workers, 99 per cent of whom will be Malaysians.

Although reports say the plant may earn RM8 billion for Lynas, more than one per cent of the Malaysian GDP, critics have questioned the real economic benefit of the project, pointing to the 12-year tax break the Australian company will enjoy due to its pioneer status.

The federal government defended the Lynas project was a “strategic industry” for Malaysia in spite of the controversy it has attracted .

Sta Maria said the government expects Lynas to spend RM4 million a year, in addition to the RM700 million it has already poured into the rare earths plant.

It had previously estimated investment spinoffs of RM2.3 billion from the plant, including the RM300 million already poured into two factories in the Gebeng industrial zone that will produce hydrochloric and sulphuric acid needed to extract the rare earth metals.

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