Australia-headquartered Lynas Rare Earths on Wednesday announced plans to build a new heavy rare earths (HRE) separation facility at its Malaysian operation, significantly expanding its capacity to meet growing global demand for non-China sources of HRE products.

The new facility will be capable of processing up to 5 000 t/y of HRE feedstock and will build on Lynas’ existing capability to produce separated dysprosium and terbium oxides in commercial quantities – a capability unique outside China.

Feedstock will be sourced from the company’s high-grade Mt Weld deposit in Western Australia and potentially from ionic clay deposits in Malaysia and other future sources.

The A$180-million project will be self-funded using proceeds from the equity raising completed in September. Construction will be phased, with first production of samarium from Mt Weld feedstock expected in April. Processing capacity for the initial suite of separated products, including samarium, gadolinium, dysprosium, terbium, yttrium, and lutetium, will follow within two years, while the production of additional HREs such as europium, holmium, ytterbium, and erbium will be considered subject to commercial returns.

CEO and MD Amanda Lacaze said the project was a key pillar of Lynas’ 'Towards 2030' growth strategy and strengthened its position as the only producer outside China capable of supplying both light and heavy rare earth products.

“The new HRE processing facility at Lynas Malaysia is a key element of our 'Towards 2030' growth strategy and contributes to the strength of our multi-product offering. Market demand for HRE is high and Lynas can be selective in where, and at what price, we sell HRE oxides,” she said.

She added that Lynas had already concluded contracts for its existing dysprosium and terbium production on favourable terms reflecting the strategic value of its materials. “Offtake agreements for the new HRE production will be negotiated on a price floor basis and priority will be given to customers where Lynas is servicing 100% of their requirements,” Lacaze noted. “Lynas will prioritise market segments where pricing is more favourable, such as the electronics industry.”

Lynas said discussions were under way with a range of potential offtake partners to secure sales of the expanded product range at fair prices. 

“Lynas is part of a current functioning and reliable outside China supply chain,” Lacaze said. “In 2025, we have proven our ability to separate the two in-demand HRE oxides, dysprosium and terbium, alongside our proven ability to produce light rare earths at scale. Our plan to produce samarium by April 2026 further demonstrates our ability to move quickly and efficiently in line with customer needs.”