Trading in Lynas Corporation shares was halted late Tuesday until Thursday morning following a query from the ASX about data released as part of an investor day update presentation yesterday.
The shares had been the biggest riser on the market, jumping 14.4% to $2.26 thanks to a bullish update, especially about the future involvement in Western Australia and plans to develop a major processing operation as well as one announced for the US on Monday and the existing operation in Malaysia.
Trading in the shares was paused then halted after the ASX query was released. the ASX letter wasn’t released, only a letter from Lynas to the market asking for the halt.
The halt came after Lynas Corp left more confusion (for the second day in a row) after an investor update yesterday that failed to provide clarity on the future of its existing processing operations in Malaysia.
On Monday the company revealed plans for a processing joint venture in the US, but left the future of its Malaysian business unstated and didn’t mention talks with the WA government on a processing operation.
The WA question seems to have been answered by Lynas revealing plans to make sure that radioactive waste from its rare earths processing is extracted in Western Australia before being shipped to Malaysia.
But there was no clarity on whether this will means the Malaysian operations will be able to continue operating when its current licence expires in September, or what happens to the waste already stored there.
CEO Amanda Lacaze unveiled the changes at the investor briefing as part of a half a billion dollar investment plan to be funded by its Japanese financiers rather than shareholders.
The aim of the plan is to lift production of rare earths at its Mt Weld mine in WA, as well as add value to downstream products.
“Our plan is to invest in upstream processing close to our source (Mt Weld), with downstream processing close to our customers,” said Ms. Lacaze with reference to the Malaysian plant and expansion plans in the US announced on Monday.
Moving of the group’s cracking and leaching operations from Malaysia to WA will remove the guts of its current operation, but Lynas reaffirmed its future in Malaysia with investment in downstream value-added processing.
“This is a sound strategy. It is a sound strategy independent of any other external pressures, but in executing this strategy which includes the relocation of cracking and leaching from Malaysia, we will also satisfy the Malaysian government requirements,” said Ms. Lacaze at an investor briefing on Tuesday.
The government has yet to provide any clarity on an earlier condition stating that Lynas had to remove 450,000 tonnes of this waste from the country before the current licence expires in September.
Ms. Lacaze said she was confident the regulatory issues would be resolved in its favour.
“It is very clear this is a whole of government decision, not a ministerial decision and that is what gives us confidence,” she said yesterday.
“Transitioning cracking and leaching to Western Australia does not reflect any lessening of our commitment to Malaysia, in 2025 we will have a dynamic operation in Gebeng.
“We will have made additional investments in our downstream processing, we expect to be producing new products in new facilities,” she said.
