Lynas Corporation has halted operations at its Malaysian plant following an escalation of coronavirus cases in the country.
The Malaysian Government announced that it was implementing tighter movement controls to contain the spread of the virus until at least March 31.
Lynas has retained work-in-progress inventory that will allow it to ramp up operations again quickly when the site restarts normal operations.
While the Malaysian plant is placed in a temporary suspension, Lynas’ Mount Weld mine in Western Australia remains active.
“As a responsible business, Lynas has taken the steps to ensure the health and safety of our people and our communities and we support the government’s actions to control the outbreak,” Lynas stated in an ASX announcement.
“Accordingly, we have initiated a safe temporary shutdown of our plant into care and maintenance mode.”
Due to a strong finish to the 2019 half financial year, Lynas has entered the shutdown period in a solid financial position, with the company being able to avoid a majority of costs under the shutdown scenario.
With a cash balance of $111.8 million, Lynas expects to receive positive cash flow from operations in the March quarter.
“This positions us well to quickly resume satisfying our customers’ needs upon restart of the plant,” Lynas stated.
The company has not confirmed when the plant will resume its operations.
Lynas Malaysia runs one of the largest and most modern rare earths separations plants in the world, employing more than 600 people from the local Kuantan community.