On October 29, Lynas Corporation announced that it would invest 500 million Malaysian Ringgit (approximately 156 million Singapore Dollars) to expand its refinery located in Kebun, near the industrial park in Kuantan.

Lynas Corporation's investment of 500 million Malaysian Ringgit to expand its operations in Malaysia aims to increase rare earth production and collaborate with South Korean company JS Link to produce super magnets.

Malaysia's goal is to become a key player in the global rare earth supply chain by 2030 and to ban the export of raw materials to develop downstream industries.

Lynas Corporation expects to obtain license renewal by 2026, while the company is studying how to refine local ores in Malaysia and focusing on pollution and radioactive waste management issues.

Putrajaya - Australian mining company Lynas is expanding its business in Malaysia, not only to produce more rare earths but also to use these critical minerals, which are essential for high-tech applications such as electronics and green energy, to manufacture super magnets.

According to the government's plan, these projects will make Malaysia an important part of the global rare earth supply chain by 2030. At that time, the value of the global rare earth industry could reach up to 28 billion US Dollars (approximately 36.4 billion Singapore Dollars).

Lynas Corporation announced on October 29 that it would invest 500 million Malaysian Ringgit (approximately 156 million Singapore Dollars) to expand its refinery located in Kebun, an industrial park near Kuantan, the capital of Pahang. The company is also finalizing cooperation with South Korean company JS Link, planning to produce 3,000 tons of super magnets (a type of strong permanent magnet) at a nearby site.

These plans come at a time when critical mineral supplies are tight - a key aspect of the U.S.-China tech war in 2025.

On November 3, Malaysia's Minister of Science, Technology and Innovation, Zhang Likan, during an interview with The Straits Times at a rare earth trade event in Putrajaya, stated, "If everything goes smoothly," Lynas' license would be renewed in March 2026.

Minister Zhang, who oversees the Atomic Energy Licensing Board (AELB), said the government was "satisfied" with the progress of the company's research on extracting materials from waste.

Lynas' operations in Malaysia have raised concerns about pollution, and since the company started operating in 2012, regulatory authorities have imposed additional conditions on it. These conditions include building a permanent disposal facility and eventually transferring the leaching and dissolution processes (which produce low-level radioactive waste) to outside Malaysia.

In 2023, the government agreed that if Lynas could reduce the radiation level of its waste below the regulatory threshold set by the Australian Energy Laboratory (AELB), the company could continue to leach and dissolve the ore imported from Australia in Malaysia.

The expansion of Lynas' refinery in Malaysia is expected to increase its annual production by 5,000 tons, representing a 50% increase over the 10,000 tons of rare earths sold in its fiscal year 2024.

Hassan Zambri Ahmad, Secretary of the Ministry of Science, Technology and Innovation, stated that the rare earth industry contributes 9.5 billion Malaysian Ringgit (approximately 2.97 billion Singapore Dollars) annually to Malaysia's economy, and is expected to create 24,800 jobs by 2030 under the "Moon Landing Plan" rare earth industry, which includes the production of super magnets and electric motors.

Prime Minister Anwar Ibrahim of Malaysia stated on November 1, following the APEC Leaders' Meeting in South Korea, that JS Link had purchased land to build a rare earth processing plant estimated to cost 600 million Malaysian Ringgit.

Previously, the United States signed a series of rare earth supply trade agreements with several countries, including Malaysia, in October. Malaysia's goal is to establish downstream rare earth industries locally.

The expansion project of Lynas in Kebun aims to ultimately process local rare earth ores in Malaysia.

The refinery currently processes only raw materials from Lynas' Weld Range mine in Western Australia.

Lynas' Chief Executive Officer Amanda Raca told The Straits Times that the company has signed a memorandum of understanding with the state of Kelantan to jointly develop the state's rare earth deposits and may soon announce an agreement with another state.

However, before transporting ion clay to the Lynas refinery, research is needed to remove the usually present radioactive substances. The radiation levels in the ion clay where Malaysia's rare earth deposits are located are higher than those in the ores currently mined by Lynas in Australia.

At a rare earth event, former Director General of the Malaysian Atomic Energy Licensing Board (AELB), Raja Abdul Aziz Raja Adnan, stated that another way to obtain rare earth resources is to use tin tailings, referring to the residue after tin refining.

He was the head of a research project at Lynas in collaboration with several local universities, aimed at extracting radioactive materials from Lynas' waste.

"Tin tailings hold huge resources," he said.

Ms. Raca said, "Whether it's ion clay or tin tailings, Malaysia's raw materials are crucial for developing the local rare earth industry."

It is estimated that China currently dominates the global rare earth supply, accounting for as much as 90%, used to manufacture cars, smartphones, wind turbines, and even defense equipment.

Datuk Raja Aziz, who previously served as a special advisor to the Director General of the International Atomic Energy Agency, said, "People ask why Trump came to Malaysia. One reason is because of rare earths."

Mr. Zhang told reporters on November 3, "We have banned the export of raw materials, so we need to develop downstream industries. We cannot allow one country (China) to control all resources, which would cause vulnerability in the supply chain."

The Trade Minister stated that despite the agreement with the United States, Malaysia still bans the export of rare earth raw materials.

To date, only one pilot mine in Perak has been legally operating until 2024 after receiving special exemption from the export ban. The ion clay raw material sent to China for processing in 2023 brought in 40 million Malaysian Ringgit in revenue for Perak.

Trade data from Beijing shows that in 2023, Malaysia exported rare earths worth 975 million Malaysian Ringgit to China, making Malaysia the second largest source of rare earth imports for China after Myanmar.

But only 3,000 tons were legally exported, and another 16,000 tons were smuggled.

Source: The Straits Times

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