BANGKOK, Nov 4 — Malaysia must tread carefully in deciding what whether or not to allow Australian miner Lynas Corp to continue its rare earths refinery in Pahang as the wrong decision could have a devastating effect on investments into the country.
Tun Dr Mahathir Mohamad said today that Australian government had asked him to lift the current restrictions on Lynas during bilateral talks at the 35th Asean Summit here.
“We are worried about radioactivity. We sent in a team of experts to examine operations. They reported that it is not dangerous but that the waste should be dealt with, if possible to send it back, but we can’t do it, nobody wants to accept it.
“The recommendation is to disperse the waste. You put it in many different places so the intensity of the radiation is not there,” the prime minister told Malaysian media right after the two-way talks, which he described as “very good”.
Dr Mahathir said the Lynas issue was raised during the bilateral meeting and that he expressed the general appreciation Malaysia has for Australian investment.
“Of course, Lynas wishes to invest more in Malaysia. And it’s a big investment running into billions. We can’t afford to ask them to go away,” he said.
He also said Canberra “understands” Malaysia’s past bad experience with refining rare earths in Perak.
“Their concern is that we do not ask this company to uproot itself,” he said.
The prime minister admitted that his Pakatan Harapan (PH) government is in a quandary as some members are adamant the government should keep its electoral pledge last year and eject Lynas.
“This is a problem. Because these conditions were made at a time where we were in the Opposition. In the first place, we did not know the exact situation.
We did not know how bad the situation was. We heard people say this is going to emanate a lot of radioactivity, radiation and all that.”
He admitted that the PH pledge to close down Lynas was “very easy” back then, but made “without full knowledge of the situation and the consequences”.
“Now that we are in the driving seat, we find that we do things that may be objected to, the reactions may be very costly. We have to rethink these things.
“In the case of Lynas, it is not as dangerous as it was made out to be. So we have to think again on the consequences.
“One of the consequences would be that direct foreign investment will be retarded because investors will feel that we don’t keep to our word,” he said.
Dr Mahathir said that the government must carefully think if it has Malaysians’ best interest by kicking Lynas out if it was catering to hazards that are “not real”.
He said Lynas has already agreed to build the permanent disposal facilities for the “minimal” radioactive wastes generated by its Pahang refinery, and that if the government continues to impose new, additional conditions, investors will stay away from Malaysia and that would hurt the country in the long run.
He said Australia is also upgrading its mining methods and that in future, the raw materials for its rare earths processing that will be shipped to Malaysia will be cleaner and less radioactive.
As for the advice from radioactivity experts to disperse the radioactive waste instead of burying them in one spot, the PM indicated that the government has not identified the locations.
“It could be in Pahang, it could be in other places. But the waste is not dangerous, the radiation is very minimal. But some people feel uncomfortable.”
Asked how the government will be able to convince a sceptical public, Dr Mahathir said: “We have to tell the public the truth. The problem is some people keep harping on something that is not real. There is no danger”.