Lynas Corp. Ltd.'s ASX stock received some support in late morning trading on Oct. 16 after Malaysian media released the names on the committee reviewing its Gebeng rare earths processing plant, void of environmental activists, which analysts say is another positive sign that the process will be scientific, independent and transparent. After closing at A$1.75 on Oct. 15, shares were trading at 1.82 just before midday.
While Lynas told the ASX on Oct. 16 that it would "continue to engage with the Malaysian government to seek details of the reported review committee," Malaysian media reported that the six specialists on the committee were experts in their respective fields of environmental management, public health and radioactive safety; and drawn from national universities and the United Nations.
The committee members comprise of chemical environmental analysis, environmental assessment, natural resources and sustainable environmental management expert Mazlin Mokhtar; environmental and occupational health expert Jamal Hisham Hashim; water quality and environmental health assessment expert Maketab Mohamed; Radiation EPR, public and occupational health expert Anita Abdul Rahman; geotechnical engineering expert Muzamir Hasan; and Asmah Ibrahim, an expert in solid waste and hazardous material management plus environmental policy and law.
Politician Wong Tack, the environmentalist previously reported to be leading the committee, was nowhere to be seen among those names; while another long-time Lynas opponent Fuziah Salleh has now resigned as committee chair.
While Energy, Science, technology, Environment and Climate Change Minister Yeo Bee Yin said in making the announcement on Oct. 15 that the new government wants to ensure Malaysia is not turned into a dumping ground of tainted materials by foreign companies, it had decided to appoint committee members "who have not openly stated whether they were for or against Lynas' operation."
"This is to prevent any quarters from questioning the credibility of the executive committee based on its members' personal opinions," she said.
"The executive committee is tasked to assess the matter objectively, transparently and openly for the sake of everyone. Its proceeding will also be open to the public who can attend as observers."
Importantly, the government also gave the committee six weeks to conduct its task, which Foster Stockbroking equities analyst Matthew Chen said was the first time he had seen any clarity in time frames for the committee, beyond Fuziah previously being given a six-month tenure to chair the committee.
While the Financial Times reported earlier in the week that Lynas had started its search for alternative locations in case it is forced to close its rare earths processing operations in Malaysia following a government review, Chen said the company's future plans needed to be put into proper context.
"In the past Lynas has said pretty consistently that the alternative location potential is something that they would contemplate further down the track, but they've probably got a couple of different options first, and first and foremost it's getting through the review," Chen told S&P Global Market Intelligence.
CLSA resources analyst Dylan Kelly said in an Oct. 16 note that the naming of the committee was "an ideal outcome as the company has little to fear from a scientific review as the United Nations International Atomic Energy Agency cited the plant to be 'intrinsically low risk.'"
"This update supports our view that the review is an opportunity to set the record straight in a high profile transparent manner," Kelly said.