Construction delays reported at Lynas’ Malaysia plant

PERTH (miningweekly.com) − Rare earths developer Lynas on Monday reported construction delays at its Lynas Advanced Materials Plant (LAMP), in Malaysia.

The Australia-headquartered company said that delays in final procurement packages and associated delays in construction and contractor sourcing had delayed the first feed into the kiln until the first quarter of next year.

Lynas initially scheduled the first ore feed for September, but in July this was pushed back to the end of the year, after the Malaysian government imposed a number of recommendations to address fears over health and radioactive concerns.

The company said that it expects the LAMP to be in commercial production in the first half of 2012, subject to the receipt of the preoperational licence.

Lynas reported that equipment installation across the whole plant was progressing well, and piping and electrical wiring works were ongoing. At the end of September, construction of the plant was 78% complete.

The Malaysian plant will be fed ore sourced from Lynas’ Mount Weld mine and concentrator in Western Australia.

Lynas reported an increase in the forecast final cost for the first phase of the project, from $569.5-million to $598.7-million, mainly owing to additional costs associated with the procurement and construction delays, as well as contractor resourcing.

Phase 1 would produce 11 000 t/y of ore, which would be doubled in Phase 2 by 2013.

Subject to the receipt of all relevant approvals, Phase 2 construction would be completed in the fourth quarter of 2012, increasing the plant’s capacity to 22 000 t/y of rare-earth ores.

The detailed feasibility study for the planned expansion of the concentrator plant during Phase 2 was now complete and the invitation to bid document for an engineering, procurement and construction contract for the expansion of the concentration plant at Mount Weld was issued to interested bidders during the quarter under review.

Lynas said that it expected to award the contract later this year.

Work for the required regulatory approvals associated with the plant expansion also continued.

The cost for the Phase 2 expansion remained at $248-million.