Lynas wins battle against activists, gears up to start rare earths production in Malaysia

On Thursday Australia's Lynas Corp (ASX:LYC) won the latest of a series of long-dragged legal battles against activists, which took the company to court for allegedly causing major health and environmental damages to the Malaysian population.

Today’s decision will allow the company to finally start production at its $800 million rare earths plant —LAMP— in the South East Asian country.

The Australian miner secured its licence to operate in early September, but the High Court of Pahang state —where the plant is located— put production on hold after an appeal by environmental and human rights advocates.

Last August analysts from Foster Stockbroking told investors to get rid of their shares in the company, as they didn’t see an end in sight for the ongoing problems that have forced the company to halt its the LAMP operations.

Critics of the project believe that allowing the refinery to operate represents a high risk for Malaysians’ well being and the environment. Supporters argue that the plant will help stabilize rare earth prices, as it will be the first in years outside China. The Asian superpower not only supplies nearly 95% of the world’s rare earths, but it has imposed severe restrictions on the exports of these elements, widely used in high-tech equipment.

Thursday’s decision may not be the last news we hear about Lynas and its polemic plant in Malaysia, as a recent report exposed that opposition political parties had announced their plan to close down the plant if they win the upcoming election in April 2013.

And environmental group “Save Malaysia Stop Lynas,” which has been spearheading the case against the mining company, said they would appeal against the verdict.

LAMP was originally scheduled to start processing rare earths in the third quarter of 2011.

Image: Bayonet fighting instruction, Texas, 1917. By The U.S. National Archives.

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