Lynas boosts sales, faces contract uncertainty

Perth-based Lynas Rare Earths has reported a bolstered sales revenue of $232.7 million in the December quarter, while its Malaysian operation hinges on a contract extension.

Lynas is waiting on a licence renewal for its Malaysian advanced materials plant and whether certain conditions, including cracking and leaching activities being moved to Western Australia, will remain in place.

The rare earths miner is expecting a decision on the licence renewal in April. 

Lynas's production and sales revenue increased after the company experienced water supply disruptions in Malaysia during the September quarter.   

Sales revenue of $232.7 million was up from $163.8 million in the previous quarter, representing a jump of 34 per cent.

The company produced a total 4,457 tonnes of rare earth oxide (REO) and 1,508t of REO of neodymium and praseodymium.  

Sales receipts were down 28 per cent at $168.4 million in the December quarter compared to $234.4 million in the previous quarter.

Lynas’s Mt Weld rare earths mine in the Goldfields achieved a record quarter after producing 5 per cent more REO concentrate than the previous quarter.

In August, Lynas announced it would invest $500 million at Mt Weld to accelerate and increase its expansion.

Progression of the proposed expansion continued as planned after the Environmental Protection Authority visited the site in November.

Mt Weld’s proposed boosted production would be expected to feed into its Kalgoorlie rare earths processing facility, which is under construction.

Last year, Lynas said the Kalgoorlie facility would be operational by July but that date has not been confirmed since.

The expansion projects have been designed to meet increased demand for rare earth elements, including neodymium and praseodymium, which are a key ingredient in the batteries used in electric vehicles and wind farms.

Lynas’s proposed rare earths separation facility in Texas is progressing after the company won several contracts to fund the project.

On the market, Lynas shares were up 6.83 per cent to trade at $9.70 at 3:38 AEDT.