Lynas Starts Concentration Plant in West Australia in February 2011 on Schedule

Lynas Corporation, rare earth miner in West Australia, will start operation of the concentration plant at Mount Weld in West Australia in February 2011 while start operation of Malaysian plant to separate and refine cerium, lanthanum and neodymium from concentrate for July-September 2011. Both constructions are on schedule. Lynas stocks concentrate delivered from Mt. Weld at Malaysian plant until July-September 2011. Mr. James Mathew, vice president of Lynas, said to Japan Metal Bulletin the concentration plant is scheduled to complete in January 2011 and become commissioned in February. Mr. Mathew also said rotary kilns are installed in Malaysian plant this week.

Lynas will establish rare earth supply system at 11,000 tonnes per year when Malaysian plant enters commercial operation for July-September 2011. In the second phase of the project, the capacity will double to 22,000 tonnes per year for July-September 2012.

Lynas agreed in strategic cooperation with Sojitz, Japanese major business house, in November to supply rare earth at above 9,000 tonnes per year to Japanese market for 10 years. Mr. Mathew explained the firm decides which rare earth element to produce in the second phase through cooperative marketing with Sojitz in Japanese market. Meanwhile, he referred to no intention to have capital tie with Sojitz.

Rare earth price rose rapidly when Chinese government reduced export of rare earth. Consequently, many rare earth developing projects started in Australia, Canada, U.S.A. and Vietnam. Mr. Mathew said huge oversupply may emerge if these development projects totally come off but the actual development requires large finance and time. Mr. Mathew took a dim view of oversupply a few years later.

As to Chinese government’s policy to decrease rare earth export, Mr. Mathew said the policy can contribute to sustainable rare earth production in China and higher market price can stimulate suppliers’ output increase. As a result, the supply and demand can be balanced.