HONG KONG — Malaysian regulators granted an initial operating license late Wednesday for a giant rare earth metals refinery that has been at the center of a dispute over radioactive waste management.
The refinery is expected to open in this year’s second quarter. It is intended to offer an alternative for Western companies that now depend on Chinese producers.
China mines and processes more than 90 percent of the world’s rare earths, but has placed various restrictions on their export in recent years, causing price spikes and spot shortages. The metals are used in items as diverse as smartphones and smart bombs, in oil refining and in wind turbines.
The Malaysian Atomic Energy Licensing Board said in a statement late Wednesday that Lynas, the Australian company that is building the refinery, must specify within 10 months a location and submit detailed plans for a permanent disposal of the more than 1,000 tons a month of low-level radioactive waste that the refinery will produce.
Although the issue is not expected to delay the plant’s opening, it will put pressure on the company to find a solution to the waste problem.
Lynas for several years has been studying what to do with the waste and still has an active research effort under way. But it has encountered growing hostility from people living near the refinery, which is on the outskirts of Kuantan in eastern peninsular Malaysia.
The licensing board said that the waste “is the responsibility of the company including, if necessary, to return the residue to the original source.” That would refer to Australia.
The refinery will process concentrated rare earth ore from a Lynas mine deep in the desert in western Australia, using heat and thousands of tons a year of powerful sulfuric acid to separate the valuable minerals from dirt and radioactive contaminants.
Lynas has questioned whether it could be required to ship waste back to Australia, a task that would be extremely difficult because of international and Australian regulations on movements of waste with even very low levels of radioactive contamination.
Nicholas Curtis, the executive chairman of Lynas, has said that the company chose Malaysia for the refinery for cost reasons: Malaysian engineers earn considerably less than Australian engineers, and Malaysia’s natural gas industry produces very large quantities of sulfur that will be turned into the necessary processing acid at a separate factory adjacent to the refinery.
The Malaysian board announced its decision during the middle of the night in Australia, and Lynas executives could not be reached for immediate comment.
Mr. Curtis said in a conference call with investors and journalists on Tuesday that the first of two phases of the refinery project was more than 90 percent complete, and that 85 percent of the staff had already been hired.
Fuziah Salleh, an opposition member of Malaysian Parliament who represents downtown Kuantan but not the less affluent industrial area where the refinery is located, said that critics of the project had already retained lawyers to seek a judicial review of the initial license.
The legal challenge will be based on whether Lynas should file a more detailed environmental impact assessment for the refinery, in response to stricter assessment requirements written into Malaysian law last summer.
The International Atomic Energy Agency had suggested last summer that a plan for permanent waste disposal be approved before the refinery starts operations.
The Malaysian decision comes two days after the World Trade Organization’s highest tribunal ordered China to dismantle its taxes and quotas on exports of bauxite, zinc and seven other industrial minerals.
That W.T.O. decision did not include rare earths. But China has used the same legal arguments to defend its export taxes and quotas for rare earths — arguments that the trade organization has now rejected.
The United States and the European Union have been preparing to file a possible case with the World Trade Organization challenging China’s rare earth policies.
The Global Times, a newspaper directly controlled by the Chinese Communist Party, published a blistering editorial on Wednesday condemning the trade organization’s decision, saying it would wrongly force China to export a product that is environmentally dangerous to mine and process.
“Cheap exports of its resources such as rare earths will eventually undermine the domestic industry that relies on them,” the editorial said. “China has been alerted to the unsustainable practice, and export restrictions are inevitable.”
nytimes.com
The refinery is expected to open in this year’s second quarter. It is intended to offer an alternative for Western companies that now depend on Chinese producers.
China mines and processes more than 90 percent of the world’s rare earths, but has placed various restrictions on their export in recent years, causing price spikes and spot shortages. The metals are used in items as diverse as smartphones and smart bombs, in oil refining and in wind turbines.
The Malaysian Atomic Energy Licensing Board said in a statement late Wednesday that Lynas, the Australian company that is building the refinery, must specify within 10 months a location and submit detailed plans for a permanent disposal of the more than 1,000 tons a month of low-level radioactive waste that the refinery will produce.
Although the issue is not expected to delay the plant’s opening, it will put pressure on the company to find a solution to the waste problem.
Lynas for several years has been studying what to do with the waste and still has an active research effort under way. But it has encountered growing hostility from people living near the refinery, which is on the outskirts of Kuantan in eastern peninsular Malaysia.
The licensing board said that the waste “is the responsibility of the company including, if necessary, to return the residue to the original source.” That would refer to Australia.
The refinery will process concentrated rare earth ore from a Lynas mine deep in the desert in western Australia, using heat and thousands of tons a year of powerful sulfuric acid to separate the valuable minerals from dirt and radioactive contaminants.
Lynas has questioned whether it could be required to ship waste back to Australia, a task that would be extremely difficult because of international and Australian regulations on movements of waste with even very low levels of radioactive contamination.
Nicholas Curtis, the executive chairman of Lynas, has said that the company chose Malaysia for the refinery for cost reasons: Malaysian engineers earn considerably less than Australian engineers, and Malaysia’s natural gas industry produces very large quantities of sulfur that will be turned into the necessary processing acid at a separate factory adjacent to the refinery.
The Malaysian board announced its decision during the middle of the night in Australia, and Lynas executives could not be reached for immediate comment.
Mr. Curtis said in a conference call with investors and journalists on Tuesday that the first of two phases of the refinery project was more than 90 percent complete, and that 85 percent of the staff had already been hired.
Fuziah Salleh, an opposition member of Malaysian Parliament who represents downtown Kuantan but not the less affluent industrial area where the refinery is located, said that critics of the project had already retained lawyers to seek a judicial review of the initial license.
The legal challenge will be based on whether Lynas should file a more detailed environmental impact assessment for the refinery, in response to stricter assessment requirements written into Malaysian law last summer.
The International Atomic Energy Agency had suggested last summer that a plan for permanent waste disposal be approved before the refinery starts operations.
The Malaysian decision comes two days after the World Trade Organization’s highest tribunal ordered China to dismantle its taxes and quotas on exports of bauxite, zinc and seven other industrial minerals.
That W.T.O. decision did not include rare earths. But China has used the same legal arguments to defend its export taxes and quotas for rare earths — arguments that the trade organization has now rejected.
The United States and the European Union have been preparing to file a possible case with the World Trade Organization challenging China’s rare earth policies.
The Global Times, a newspaper directly controlled by the Chinese Communist Party, published a blistering editorial on Wednesday condemning the trade organization’s decision, saying it would wrongly force China to export a product that is environmentally dangerous to mine and process.
“Cheap exports of its resources such as rare earths will eventually undermine the domestic industry that relies on them,” the editorial said. “China has been alerted to the unsustainable practice, and export restrictions are inevitable.”
nytimes.com
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