Lynas Corp has raised the prospect of moving some of the upstream processing of its rare earths to Western Australia in a move that would further isolate the Malaysian sovereign risk that has threatened the future of the $1.6 billion group.

Lynas chief executive Amanda Lacaze said the company was considering whether to do some upstream processing at the proposed plant in Kalgoorlie rather than just the cracking and leaching process that it is required to remove from Malaysia if it wants to continue operating in the country.

“It is primarily an operating decision on what is the most efficient point for us to have a transport step, that may mean we are better off with the solvent extraction upstream in Kalgoorlie, before we send that to Malaysia for downstream (processing) and product finishing,” she told analysts and investors on a call for its December quarterly results.

Lynas Corp chief executive Amanda Lacaze says the rare earths group is considering moving more of its processing out of Malaysia. Credit:Bloomberg

Ms Lacaze acknowledged it would also allow the company to bypass Malaysia entirely in some cases and send rare earth material directly from Australia to the US operations currently under consideration.

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