U.S. Markets closed

Lynas says lawsuit filed challenging Malaysian rare earths plant renewal

A general view of the Lynas Advanced Materials Plant in Gebeng, Pahang.

(Reuters) - Australia's Lynas Corp Ltd said on Friday that three individuals had filed a court case in Malaysia challenging the local government's decision to renew the rare earths miner's operating licence last year.

Lynas, Malaysian Prime Minister Mahathir Mohamed, 27 other ministers and cabinet members, and the country's Atomic Energy Licensing Board were among those named as respondents in the lawsuit, Lynas said.

The judicial review proceedings question the processes followed by the government in reaching its August decision to allow the miner to continue operating in the country.

For months, concerns persisted about the storage of radioactive waste produced during the processing of rare earths at the plant, casting doubts on whether Lynas would successfully secure a renewal.

Dinesh Athinarayanan, who is representing the individuals who filed the lawsuit, said his clients argue that the powers to approve the extension lie solely with the energy minister as stated in the country's Atomic Energy Licensing Act, and not with the cabinet.

"To allow the cabinet to make a decision or delegate powers to cabinet is unlawful, as per the Act," Dinesh told Reuters.

The prime minister's office did not immediately respond to a request for comment.

The court has set case management for Jan. 21.

(Reporting by Rashmi Ashok in Bengaluru and Joseph Sipalan in Kuala Lumpur; Editing by Himani Sarkar and Christian Schmollinger)