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DIGGeRs & DeALeRs
Comprehensive Supply Chain Solutions

Lynas is ‘go’ in Kalgoorlie

here is unlikely to be anyone more dis- for another three years amid the removal
Tappointed at not being able to attend of the problematic Pakatan Harapan coali-
this year’s Diggers & Dealers in Kalgoorlie tion government.
than Lynas Corporation Ltd managing di- Lacaze said the new administration led
rector Amanda Lacaze. by Muhyiddin Yassin – Malaysia’s eighth
Due to Western Australia’s hard border Prime Minister – had sent a clear message
closure, Lacaze – a popular fixture on the to the rest of the country about the value it
annual Diggers programme – will instead saw in the Lynas Malaysia plant.
present the Lynas story via video link from “It was a difficult 18 months…but we are
the east coast where she has been isolat- moving forward and are confident we can
ing since the onset of the global COVID-19 meet all of the conditions of the licence,”
pandemic. she said.
While catching up with old friends and “Our operations in Malaysia are a signifi-
mingling with potential new investors can cant portion of our business and our peo-
still occur by remote means during the ple there are now highly skilled with the IP
three-day conference, Lacaze said her necessary to do what is quite a challeng-
biggest regret was missing out on the ing process.
chance to meet with local members of the “The new government has shown them-
community who are set to benefit from the selves to be active and supportive and
Kalgoorlie rare earths processing facility the new minister, who has more account-
which Lynas plans to have operational by ability in the area that licences Lynas, has
July 2023. been quite public about the need to make
“It’s really frustrating, but it is what it is,” science-based decisions – and that’s very
Lacaze told Paydirt, adding that her WA- Amanda Lacaze helpful for us because the science is very
based team was more than capable of ex- clear. A lot of the other issues [of the past]
plaining the finer details of the company’s 50% increase in overall production capa- have been primarily political.”
downstream vision for the Goldfields. bility, the Kalgoorlie facility is set to take If Lacaze and the rest of the Lynas team
Lynas confirmed Kalgoorlie as the pre- rare earth concentrate from Mt Weld and thought the worst was over at that point in
ferred location for an Australian-based process it into a mixed carbonate product time, they were in for a rude awakening
rare earths processing facility late last which will undergo further refinement in when the current global health and finan-
year, citing proximity to its Mt Weld mine Malaysia. cial crisis began to unfold from late Febru-
– 35km south of Laverton – and the avail- A project team for the Kalgoorlie facility ary onwards.
ability of a skilled workforce from a long- was established shortly after its proposed In accordance with the Malaysian Gov-
standing mining town as the main reasons location was announced. Since then, ernment’s COVID-19 movement control
behind its ultimate decision. FEED work on critical areas of the future order, Lynas was forced to shut down
Construction of the facility on an in- operation has been completed and an or- operations for six weeks. This temporary
dustrial-zoned property within the City of der placed for the rotary kiln considered to production halt significantly impacted the
Kalgoorlie-Boulder is expected to begin be the most crucial long-lead item in the company’s FY2020 results with revenue
mid-next year, subject to obtaining all of construction process. ($305.1 million) down 16% and EBITDA
the required approvals. Lynas ticked off a key milestone last ($59.8 million) down 41% on the previous
Underpinning development of the month when it opened a pop-up office in financial year.
Kalgoorlie facility is a $425 million equity Kalgoorlie for members of the commu- Cash flow remained positive at $32.1
raising which Lynas unveiled in August. nity to express interest in being part of the million but suffered a huge drop from the
The company successfully collected $311 upcoming construction window and/or its $104.1 million recorded in FY2019.
million via an oversubscribed placement eventual operation. “We were on track for a very good year,
and institutional offer within 48 hours of the “We think that this is an excellent oppor- but of course the COVID shutdowns af-
announcement and pulled in the remaining tunity for small and medium businesses fected us in Malaysia and that certainly
$114 million from a fully-underwritten retail in Kalgoorlie, and WA more broadly, to be changed the complexion of our results
entitlement offer early last month. engaged,” Lacaze said. quite significantly,” Lacaze said.
Lacaze said having a fully-funded pure “We do have a policy where we will seek “We have had a successful restart. We
equity solution was preferred over a mix to preference local suppliers and as we actually restarted our operations in Malay-
of debt and equity. An undisclosed portion move forward we’re also seeking to have sia at about 75% of our new nameplate
of the raising will also be directed towards our permanent staff, as much as possible, capacity. It’s actually now the same as our
upgrades at the existing Lynas Malaysia living residentially in Kalgoorlie.” original nameplate from before our signifi-
plant which has been the cornerstone of One of the other catalysts for the cant debottlenecking project we complet-
the business for many years. Kalgoorlie facility was uncertainty over ed in 2018/19 and we plan to keep working
According to the company’s “Lynas the future of the Lynas Malaysia plant as towards that new target in accordance with
2025” vision which will strengthen its po- political turmoil in the country spilled over. the guidelines.”
sition as the world’s leading rare earths However, the company’s Malaysian op-
producer outside of China via a proposed erating licence was renewed in February – Michael Washbourne

Page 40 OCTOBeR 2020 aUSTRaLIa’S PaYDIRT