By Esther Tanquintic-Misa | May 7, 2013 11:40 AM EST
Apart from re-elected Prime Minister Najib Razak, one of the big winners in Malaysia’s recently concluded national elections was Australian rare earths miner Lynas Corp and its’ processing plant in Kuantan.
On Tuesday at 10:35am in Sydney, shares of Lynas jumped as much as 13 per cent to A$0.54, the most since January 7, in what confirms the nervous jitters of investors prior to the announcement of the victory of National Front coalition, Prime Minister Razak’s ruling party. On Monday, its shares closed 16 per cent higher at A$0.58.
Investors nervously monitored not only the development of Malaysia’s elections but also how it can possibly affect Lynas’ US$800 million rare earths plant. Prime Minister Razak’s opponent, Anwar Ibrahim, had vowed to cancel the project and have the plant shut down.
”Now I think the market can focus on the underlying business of the company, which is the commissioning and ramp-up of phase one and two of the [Lynas Advanced Materials Plant] and the state of rare-earths markets,” Mark Busuttil, JPMorgan resources analyst, told Business Day.
“The market should rally strongly as Barisan National won more than expected,” Chris Eng, head of research at Etiqa Insurance & Takaful Bhd, told Reuters.
The rare earths plant, which opened in February, is the biggest outside China, the world’s stronghold of rare earths. China controls more than 95 per cent of the world’s supply of rare earth metals, essential components to manufacture a lot of the high tech gadgets and weaponry today.
Lynas said on April it was on schedule to meet its 11,000 tonnes a year production target by the end of the second quarter of this year.
But it took two years for Lynas to finally get to operate its plant, which happened only on November 2012, due to the lengthy environmental and safety disputes hurled by residents and the Save Malaysia Stop Lynas and Stop Lynas Coalition protest groups.
To report problems or to leave feedback about this article, e-mail: e.misa@ibtimes..com.au
To contact the editor, e-mail: firstname.lastname@example.org