Key contractor pulled out of Lynas plant due to safety concerns, says NYT

Key contractor pulled out of Lynas plant due to safety concerns, says NYT

By Shannon Teoh

February 01, 2012
Malaysian Insider

File photo of a banner put up by Kuantan folk protesting against the building of the Lynas rare earths plant in Gebeng.

KUALA LUMPUR, Feb 1 – A Dutch chemical firm refused to supply crucial resins for Lynas Corp’s controversial RM2.5 billion rare earth plant in Kuantan due to safety concerns, according to the New York Times.

The influential newspaper cited engineers working for the Australian miner at the Gebeng industrial zone site and internal company e-mails as saying that AkzoNobel withdrew after it was told that the fibreglass liners using its resin would be installed in concrete-walled tanks that have a problem with rising dampness in the floors and cracks in the walls.

“AkzoNobel had been in discussions about the problem of rising dampness, but only became aware of the cracks this autumn,” the daily reported.

The resins were to be used to glue together dozens of fibreglass liners for concrete-walled tanks the size of double-decker buses where hundreds of tons of rare earths with low levels of radiation will be mixed with extremely corrosive acids at more than 93 degrees Celcius.

The company had said early last year it would supply chemicals for the Lynas project, which has raised fears of radiation pollution among local residents and environmentalists, only if it were certain that it would be safe.

In a report last June, the NYT had said that there were critical flaws in the design of the refinery, including the installation of the watertight fibreglass liners.

It said that memos showed Lynas pressed a Malaysian contractor, Cradotex, to proceed with the installation of watertight fibreglass liners designed for the containment tanks without fixing the moisture problem and with limited fixes to the walls.

“These issues have the potential to cause the plant’s critical failure in operation,” Peter Wan, the general manager of Cradotex, said in a June 20 memo obtained by the newspaper.

“More critically, the toxic, corrosive and radioactive nature of the materials being leached in these tanks, should they leak, will most definitely create a contamination issue.”

The NYT also reported today that AkzoNobel confirmed it was no longer supplying the project “due to changes in the project specification, AkzoNobel would only recommend the use of its linings on the project subject to the successful results of longer-term testing.

“That testing cannot be completed within the current project time scale,” the multinational said in an email.

But Lynas executive chairman Nicholas Curtis denied that AkzoNobel had pulled out due to safety reasons and added Lynas had found a new supplier for the resins, according to the newspaper.

The Australian miner said last week it expects the start of operations to be delayed to the second quarter from the first quarter of this year.

The plant was due to start operations in September last year but Putrajaya bowed to public pressure last April after sustained opposition from local residents and environmentalists and put the project on ice pending the review by the International Atomic Energy Agency (IAEA).

In July 2011, the government agency adopted 11 recommendations set out by the review of the refinery and said it would not allow Lynas to begin operations or import rare earth ore until all conditions, which include a comprehensive, long-term and detailed plan for managing radioactive waste, are met.

However, AELB has said Lynas Corp failed to meet any of the conditions in its first proposals.

Lynas’s local subsidiary has insisted that it can begin operations within six weeks of being given the go-ahead for the plant, which it hopes will provide a windfall of RM8 billion annually from 2013.