Lynas signs deal to secure rare earth feed in Malaysia

[Redator]

Lynas Rare Earths (ASX: LYC) has secured additional feedstock for its advanced materials plant in Malaysia by signing a memorandum of understanding (MoU) with Menteri Besar (MB), the strategic investment arm of Malaysia’s Kelantan state government.

MB currently focuses on the development of rare earth resources hosted in ionic clays within Kelantan, where the Lynas’s facility is located.

The Lynas Malaysia plant has been in operation since 2012, producing separated rare earth materials to customers in East Asia, the US and Europe from mixed rare earth carbonate (MREC) shipped from its Mt Weld’s mine in Australia.

Under this MoU, Lynas and MB will jointly seek to strengthen, promote and develop co-operation for the growth of the Malaysian rare earths industry in Kelantan, the Australian miner stated in a press release Friday.

It also provides a framework for the parties to negotiate a definitive agreement for the supply MREC feedstock to Lynas’s advanced materials plant in Kuantan once MB’s project commences production.

The MoU is non-binding and remains subject to the negotiation of definitive agreements, it noted.

Amanda Lacaze, Lynas’ CEO and managing director, said the MoU “is a significant step for Lynas and the Malaysian rare earths industry, bringing together Lynas Malaysia’s over a decade of rare earths industry expertise, and Kelantan state’s rare earth resources.”

Infographic: Rare earth spheres of control

“Malaysia’s ionic clay deposits have excellent potential as future feedstocks for Lynas Malaysia, particularly given their high proportion of heavy rare earths which are in demand for future-facing technologies including electric vehicles and electronics,” she added.

Lynas, backed by Australian mining magnate Gina Rinehart, recently became the world’s first producer of heavy rare earths outside China after producing its batch of dysprosium oxides from the Malaysian facility. The company is also eyeing terbium production as early as June.