.....UPDATE 2-Malaysia court lifts suspension on Lynas licence, shares jump
Reuters – 4 hours ago
....Email
Share0Print.....Companies:...Invesco Municipal Premium IncomLYNAS FPO . ..RELATED QUOTES.
.Symbol Price Change
PIA 9.74
LYC.AX 0.805 +0.085
......
* No court barriers to starting operations - Lynas
* Hearing into judicial review expected in a few months
* Lynas shares rise 13 pct after coming off trading halt
* Protestors say to appeal decision against interim stay (Adds detail, analyst comment, market reaction)
By Siva Sithraputhran and Lincoln Feast
KUALA LUMPUR/SYDNEY, Nov 8 (Reuters) - A Malaysian court lifted the suspension on Lynas Corp Ltd's licence to operate a controversial rare earth plant, sending shares in the Australian company surging, although it remained unclear when the plant would start.
The $800 million rare earth plant - the world's biggest outside China - has been ready to fire up since early May, but Lynas has been embroiled in lengthy environmental and safety disputes with local residents since construction began two years ago.
Shares in Lynas jumped 12 percent after coming off a trading halt. The stock has been on a rollercoaster due to the fight over the plant, with some investors concerned the company would have to raise funds if operations were delayed much longer.
While the news was a positive, it was not yet certain when Lynas would start the plant, said Mark Busuttil, an analyst at JP Morgan.
"At this point it feels like it's still a little early to say they're definitively going to be able to operate the plant," he said.
"We think ... that without a definitive start date it's been difficult for the company to finalise a working capital facility, so that's where the two are connected."
A spokesman for Lynas declined to comment when asked when the plant would begin processing material from its Mt Weld mine in Western Australia. Shipping the raw material would take four-six weeks, Lynas said last week.
SUPPLY BOOST
The plant near the eastern city of Kuantan is considered important to breaking China's grip on the processing of rare earths, which are used in products ranging from smartphones to hybrid cars.
But protests over possible radioactive residue have drawn thousands of people and the project has become a hot topic ahead of an election that must be held by early next year.
The company says its plant is safe and is not comparable to a rare-earths plant in Malaysia that was shut by a unit of Mitsubishi Chemicals in 1992, after residents there blamed the plant for birth defects and a high rate of leukaemia cases.
Activists linked to the environmental group Save Malaysia Stop Lynas wanted the court to suspend the licence for the Australian firm until two judicial review cases challenging the government's decision to grant the licence are decided.
The court refused to put a temporary stay on the licence until the judicial reviews start at a date which hasn't been set yet, Hon Kai Ping, a lawyer for the activists, told Reuters.
"We'll be formally appealing the decision not to grant the interim stay," Hon said.
Lynas said it expected a hearing on the judicial review "in a few months".
Lynas has previously said it expects the plant to be producing at an annual rate of about 11,000 tonnes within the first three months of operation, building up to 22,000 per annum a year later.
At that level of production, the plant will add significantly to global supply. China, which accounts for the vast majority of world output of the 17 rare earth metals, exported just 18,600 tonnes in 2011.
Last month Baotou Steel Rare-Earth (Group) Hi-Tech Co , China's top rare earths producer, said it will halt some of its smelting and separation operations for a month in an effort to stabilise slumping prices. (Additional reporting by Miranda Maxwell in Melbourne; Editing by Stuart Grudgings and Michael Urquhart)
..
AI
