The Politics of Lynas

lynas sagaMalaysian opposition leader Anwar Ibrahim passed a note last November to Australia’s Foreign Minister Bob Carr asking for help in their general elections due in 2013. Carr responded: “The Malaysian elections are a matter for the Malaysian people. We’re not the election authority for Malaysia.”

The Australian Government’s position is that they cannot interfere in the politics of another country.  However, Australia’s Greens are taking an active role in Malaysia’s internal politics by supporting the “Stop Lynas” campaign to halt the operations of rare earth miner Lynas Corporation.

Universiti Malaysia Pahang’s Prof Aziz said “Through Lynas, Malaysia can meet up to 20% of the global demand.”  Lynas will account for approx. 1% of the entire Malaysian GDP according to the International Islamic University Malaysia.

The Lynas mine is located in Western Australia and it’s processing plant, called Lynas Advanced Minerals Plant (LAMP), is located in the industrial area of Gebeng in Malaysia.  Fuziah Salleh is the local PKR MP in the Pakatan Rakyat (PR) opposition coalition in Malaysia. She gained political traction with the Lynas issue after she showed the locals 20 year old photos of alleged casualties from a Mitsubishi rare earth plant built more than 25 years ago.

The Lynas ore has only a small fraction of the radioactive thorium compared to the Mitsubishi ore.  Regardless, thorium is considered a valuable resource and is being sold by Lynas.  A Lynas corporate video shows that their waste is no more harmful than table salt.

Fuziah co-founded the political activist group called “Save Malaysia Stop Lynas” (SMSL) which has presented it’s environmental case in numerous court actions to halt the Lynas operation. To date the Malaysian courts have found in favour of Lynas which has started operations under a TOL (Temporary Operating License).

Lynas’ safety was verified by six independent bodies, including the United Nations’ International Atomic Energy Agency (IAEA). The environmental concerns raised by SMSL have either been found to be baseless in the Malaysian courts, or are being addressed by Lynas as they meet their obligations under the Malaysian government’s Atomic Energy Licensing Board. Various options for the waste management are being explored by Lynas as they go through the stages of the multi-tiered approval process to gain a full operating license.

With their environmental concerns failing to stand up in court, PKR’s campaign has turned from an environmental to a political campaign in the lead-up to the Malaysian general election in 2013.

Anwar Ibrahim has pledged the opposition would scrap the plant if it wins the election. PAS (part of the PKR coalition) warned Dr Che Rosli Che Mat, a PAS MP with a PhD in nuclear science, not to comment on Lynas after he assured the public that LAMP poses no health risk.

Dr Looi Hoong Wah, a Malaysian nuclear physicist, has defended Lynas saying “the allegations being spread by its opponents are fabricated lies that bear relations to the country’s upcoming general election”.

Former Prime Minister of Malaysia, Dr Mahathir Mohamad writes about Lynas: “It would be a great loss to Malaysia if misguided people prevent us from” using rare earth, and “the mining and extracting of rare earth from Malaysian earth will not harm us in any way.”

Wong Tack from SMSL says “bringing down the regime” will be their focus in 2013.  In Malaysia, there are numerous calls for Fuziah Salleh to apologise to Lynas.

In their effort to assist the Malaysian opposition, the Greens have joined the Stop Lynas campaign.  Greens Senator Lee Rhiannon said: “The Australian Greens support Save Malaysia – Stop Lynas in their efforts.”  NSW Greens MP David Shoebridge sent the following twitter on 18 Dec: “Lynas – using classic Australian resource company tactic of sh**ing in someone else’s nest”

Australian Greens Leader Bob Brown moved a motion in the Senate in 2012, which was defeated:
That the Senate-
(a) notes:
(i) the public protests in Malaysia against the establishment of a rare earth processing plant by the Australian company Lynas Corporation Ltd,
(ii) the protests are supported by the Malaysian Opposition leader Anwar Ibrahim
etc.

The actions of The Greens raises a few questions:
* Why has an Australian political party joined a foreign political campaign seeking to “Stop Lynas” – a law abiding Australian company?
* Why are the Greens seeking to destroy 20% of the global rare earth industry, which is essential to green technology?
* Why are the Greens interferring in the internal politics of Malaysia?

The Greens claim that Lynas has “no social licence” to operate in Malaysia – meaning that a company must have the support of the citizens before conducting it’s business. Ironically, Australian Greens negotiated with the ALP to form a minority government with a condition that they implement an Emission Trading Scheme despite more than 80% of Australians voting for parties that had a ‘no carbon tax’ policy and 2/3 of Australians opposing the ETS.

According to social activist Wendy Bacon’s website, she was invited by Greens MP Jamie Parker to support the “Stop Lynas” campaign last December. She has written a couple of stories containing numerous factual errors and has quoted sources questioned by experts to back up her claims. Despite claiming on her website: “If you see any factual errors in my work please contact me. I welcome comments” Bacon has failed to correct any of the errors brought to her attention.

Bacon’s twitter profile lists her interests as: “social activism, investigative reporting”. Can an investigative reporter maintain their objectivity whilst having a ‘social activism’ agenda? Surely the writings of the activist are better classed as ‘propaganda’.

Bacon writes that Lynas “successfully smuggled the concentrate into the plant” even though it was given a police escort from the Gebeng port to LAMP which was provided after threats by SMSL.

Bacon claims “20,000 people” during a recent protest. However, other media reports between 5,000-10,000 people. Channel NewsAsia estimated a 5,000-strong crowd and Malaysian TV reported “Some 5,000 activists”.  The Malaysian Bar which is providing legal assistance to SMSL said “10,000 protestors” and a live report said: “a crowd of about 10,000 people”.

At best, Bacon has doubled the number of people given by SMSL supporters, and she has quadrupled the number given by the Malaysian media who would undoubtedly base their figure on eye witness accounts.

Bacon bases her stories on a report by Lee Bell BA MA which she claims is written by a “qualified environmental scientist”. There are no other qualifications given other than the two arts degrees.  Bell’s report is questioned by Nick Tsurikov of WA’s Radiological Council: “It appears to me that yet again in some cases the data and regulations have been misquoted and/or misinterpreted, which effectively negates the conclusions made in the report.”

If a manufacturing plant involving radioactive materials moved into your community, one of the first things you would ask is, “what’s going to happen to the waste?” Bacon writes. Protestors have only recently mentioned the waste issue; they have been focused on the hazards, real or imagined, of the operating plant. Bacon’s claim of “insufficient planning for waste disposal has sparked local opposition” is actually an after-thought by SMSL, and has only recently been the subject of The Greens statements about Lynas.

A problem for Bacon when she wears her ‘social activist’ hat whilst claiming to be an ‘investigative reporter’ is that her leftist writings are just as guilty of bias as the journalism of some mainstream media that she regularly criticises.

Bacon writes “Discrediting sources is a familiar public relations tactic used by companies …” and “Lynas badmouths its critics for exaggerating LAMP safety risks” and in the same story gives little time to a Lynas spokesman, and then only to criticise them.

Bacon wrote on her website: “As a reporter, this was the first time I had experienced hate messages via twitter. These were posted by Lynas supporters. I can understand why shareholders and employees could be anxious but that doesn’t mean that the truth should not come out about the LAMP project.” Despite her stories’ errors she continues to claim ownership of the ‘truth’ about LAMP. In the world of the social activist, ‘the truth’ is subjective.

Bacon declined an invitation to join the shareholder’s forum where portions of this article were published to discuss the issue with the Australian shareholders of Lynas. Bacon’s audience is predominantly Australians unfamiliar with what is happening in Malaysia. Certainly Wendy Bacon has done some good work in the past but this is not her finest hour.

* Mark Anning is an MBA qualified 38 year media veteran including nearly 15 years as an editor with the wire services.  He currently owns Lynas shares.

  1. Hi Mark,
    thanks for a well balanced and interesting article.
    One error needs to be pointed out.
    It’s not correct that “thorium is considered a valuable resource and is being sold by Lynas”.
    The radioactive thorium in the ore concentrate ends up (mainly) in a waste/residue called the WLP that comprises about 20% of the residues. The plan is to dilute this very low level radioactive matter to the point where it can be used for (say) road aggregate.
    If a commercial source of thorium was desired it would be much smarter to look at the Malaysian tin mining or mineral sands industries where the concentrations are far higher.

    • Thanks Jan, I stand corrected. It is true that is difficult getting information from Lynas, especially about their propriety operation. I am aware that they have found markets for almost everything in the ore (apparently) and they have been looking at markets for their waste.

  2. The Australian Greens bring to Rare Earths the same hypocrisy they apply to gas as a transitionary fuel, paying Chinese owned brown coal generators $550M “compensation” from the Carbon Tax rather than developing Bass Strait gas as an alternative.
    Lynas have developed a “state of the art” rare earth processing facility with a view to sustainable production for 25+ years. It is the first such plant developed with all the modern environmental controls built in from the outset, including a gas scrubber of similar value to a complete, smaller RE plant. In contrast the Australian Greens have not issued a word of criticism on the vast environmental degradation caused by RE production in China, in fact they sanction it every time they spruik wind or solar power, switch on a laptop, TV or mobile phone, etc, etc.
    Not hard to spot the common theme and where their true allegiances lie.

  3. It’s always about character……….

    Lynas have played by the rules of a foreign country. They have supported and complied with all the Malaysian government’s request.

    I know there has been some criticism of Nick Curtis and his lack of defending Lynas, but I would think that saying nothing was a very effective strategy.

    There are plenty of others (experts included) who has defended Lynas.

    Wendy Bacon on the other hand lacks any character. As was pointed out by this article’s author on another site, Bacon was rejected by the NSW Bar Association because they deemed her deficient and lacking in the character (read objectivity) required for a lawyer.

    There is a wonderful irony in all this. The Greens trying to stop a company which is crucial to producing a cleaner environment.

  4. Mr Anning: fine article, but I bet you that, if a reaction follows, it will be about the fact that you own shares in Lynas….
    My experiences with the adressees are alike:
    After reading her article about Lynas (the ‘backyardstory’) I have sent a tweet to Wendy Bacon if she knew how many bequerel was in the waste of Lynas ‘LAMP’. No answer, even my remark that her article was another fearcreating one, (alike all SMSL messages) didn’t trigger an answer.
    I also have sent an email to Fremantle-based Greens MP, Lynn MacLaren, after her remarks about Lynas (http://sg.finance.yahoo.com/news/australian-mp-lynas-prohibited-importing-022124021.html), again no decency to answer my questions to back up her remarks with facts. Throwing allegations into the world is easy, but backing up by facts is a art they don’t master!

    • Indeed that is true – I have bought and sold Lynas shares in the past, and am currently a shareholder.

      I have always considered myself an ‘ethical investor’ which is one of my motivations for investing in technology vital for a ‘green’ future.

      I find it strange that some ‘environmental’ activists consider that making money from shares is bad, but asking for donations and ‘crowd funding’ their cause is good.

      Another Australian example of this extreme activism aimed at the mum & dad shareholders is this week’s fake press release that wiped out $314 million off Whitehaven Coal. http://www.miningaustralia.com.au/news/fake-press-release-wipes-$314-million-off-whitehav

      Ironically, many of the committees and authorities that I sat on was as ‘environment representative’ and I have an organic farming business – so they can’t question my ‘green’ credentials.

      Unfortunately the extremists have scored an ‘own goal’ in trying to ‘Stop Lynas’.

      The main thrust of the activist’s current argument is that Lynas doesn’t have a permanent Waste Management Plan – even though their application for a full Operating License is ongoing under the ‘multi-tiered approval process’ set out by the Malaysian authorities.

  5. i just dont get the arrogance of these politicians

    to think that they think that they know more about these issues than the no less than 6 experts in the area (IAEA, AELB etc etc) is really understanding the politicians brain.

    This simply proves that these politicians are over paid for the input.

    The pollution foot print of these politicians is off the chart.

    And so take away there toys – mobile phones, computers, internet and then tell them in a load voice to STFU.

  6. News out of Australia is Lynas should have product within several weeks. The fist non-Chinese in a long time. As of 9:35 EST stock is up %9.60. Can this be the break out we have all been waiting for?

    • John, I think you’ll find Moly’s been producing quite a bit of REO from their original plant for the past year or so. That’s located in California and last time I visited 4 months ago I didn’t need a Chinese visa.

      • Oh, I didn’t realise that about Moloy but I did know one does not need a Chinese visa to visit California. Thanks for the info.

    • LYC finished up 14.40% yesterday.

      Now that Lynas is operating safely and with the Malaysian activists stating they are now shifting focus from stopping Lynas to “bringing down the regime” – there are only two hurdles on the horizon, the Judicial Review hearing on Feb 5 and the Malaysian general election.

      The Judicial Review should be a formality.

      Anwar Ibrahim has apparently stated that he will close LAMP, although with Lynas having a very strong case for legal compensation it is doubtful he will do that.

      When I tweeted the issue of “who will pay the compensation?” Lim Guan Eng, the DAP secretary-general and MP for Bagan countered with his opinion about compensation.
      http://www.freemalaysiatoday.com/category/opinion/2012/12/09/pakatan-will-shut-down-lynas/

      With China’s Batou taking an active role in stabilising the rare earth basket price, it does appear that the worst is over for Lynas.

      • Lim Guan Eng’s electorate of Penang is the heart of Malaysia’s electronics industry. Doubt his constituents would be terribly thrilled with his threats to shut a local source of non Chinese REO. Note that Anwar has backed away from his earlier threat with some watered down statements. In the unlikely event these clowns did win Govt. there would most likely be some huff & puff but I doubt they’d be stupid enough to shut down a legitimate foreign company.

  7. Buy Lynas because you want to make money. Any other motivation is nonsense.

    Politicians always think they know more than everybody else. The truth is the exact opposite. Some of the dimmest people I have ever seen hold public office.

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