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Lynas downplays radioactive fears

Australian miner Lynas has gone into its fourth trading halt in five weeks as Malaysian government ministers ordered it to export waste from its local rare earths plant.

Lynas began processing rare earths, which are used in hi-tech equipment ranging from missiles to mobile phones, at the plant in eastern Pahang state in November after a delay of more than a year due to opposition over health fears.

Four Malaysian cabinet ministers on Monday said in a joint statement that a temporary licence granted to Lynas required it to remove "all the residue" from the plant out of Malaysia.

"The obligation imposed on Lynas in this matter is very clear," the ministers said.

"The government will not compromise the health and safety of the people and the environment in dealing with the issue of Lynas."

However, Lynas executive chairman Nicholas Curtis said there was no change in the plant's legal status.

"We continue to commission the plant, we expect the plant in continuous operation in the month of December," he said.

"Nothing that has been said in this statement has any affect on the prior legal approvals that we've had.

"However, given the intensity of commentary, we felt we should put out a release to clarify precisely what the position is in respect to the temporary operating licence."

If Lynas fails to comply, the government can suspend or revoke the licence and order it "to immediately cease operation", the ministers warned.

It is also required to draw up plans for a permanent disposal facility before mid 2013.

Mr Curtis said the residue materials are safe.

"These are non-hazardous and not radioactive to levels that require any concern to the public," he said.

"We demonstrated that theoretically and we've now demonstrated that practically.

"We have conditions in the licence relating principally to us undertaking R&D on the commercialisation, recycling and reuse of residue materials and the limits by which that material when recycled can be used," Mr Curtis said.

Mr Curtis said Lynas has built the Malaysian plant to take residue material and convert it into a commercial product.

"That commercial product has specific market applications. That market application is one which we've explored, we know is there but until we have real product we are unable to get long term contracts for that," he said.

"We believe we will have a product that will be suitable for the Malaysian market and suitable for the international market.

"We have simply undertaken that if we do not get permission to put it into the Malaysian market will export that product.

Lynas was given the go-ahead by a Malaysian court in November to begin operating the plant.

However environmentalists have lodged an application to have work at the plant stopped, with a hearing date set for December 19 in the Malaysian Court of Appeal.

The appeal is against the Kuantan High Court's earlier refusal to grant a stay against Lynas' temporary operating licence.

The Lynas Advanced Materials Plant is set to become one of few sites outside China to process rare earths. The metals, imported from Australia, are used in high-tech equipment.

Residents, activists and opposition leaders have staged numerous protests against the plant, saying it would release radioactive gases and solid waste such as radium and lead, and small amounts of uranium, into the environment.

Mr Curtis said he expect Lynas share to resume trading on the ASX on Wednesday, they last traded at 60.5 cents.