Govt has no plans for single REE entity to regulate industry

New Straits Times

11 hours ago

KUALA LUMPUR: The government has no plans to establish a single entity akin to Petronas to regulate the rare earth elements (REE) industry for now, says Datuk Seri Johari Ghani.
The acting natural resources and environmental sustainability minister said that during past discussions and stakeholder engagements, several states expressed objections to such a move.
"They viewed the proposal as an attempt at the nationalisation of mineral resources that belong to the states.
"As is well known, the management of petroleum resources beyond state waters is different from the management of land matters, which falls under state jurisdiction.
"This is clearly stated in the Federal Constitution, Ninth Schedule, List II (State List), which provides that the states have jurisdiction over permits and licences for prospecting, mining leases, mining, and mining certificates," he said in his winding-up speech for the 13th Malaysia Plan.
This comes after proposals by several members of parliament for the government to establish a regulatory agency, similar to Petronas, through the enactment of an REE Act to drive the development of the REE industry.
Johari assured that the Federal Government fully respects state jurisdiction over land and mineral matters, as enshrined in the Federal Constitution.
Accordingly, he said the government has formulated a clear long-term plan to develop the rare earth elements industry holistically, in line with the direction endorsed by the National Economic Action Council.
"Any policies or mechanisms on REE revenue distribution will be formulated and decided inclusively through the National Mineral Council, which serves as the main platform for engagement and coordination between the federal and producing state governments.
"This planning is based on the principle of close cooperation between the federal and state governments, to ensure that every initiative for the development of the REE industry takes into account state rights and jurisdiction as provided under the Constitution," he said.
Malaysia, he said, is also still in discussions with China on technology transfer of REE to Malaysia.
"We want to first see what they are doing. We will also conduct our own research, and only then sit down to decide what technologies we want to adopt.
"We cannot depend solely on China, as Russia also has expertise, although they have not approached us. China, on the other hand, has offered, and they want to prove themselves to us. We will assess the outcomes and then discuss further," he said.
When asked why the proof-of-concept phase in Kenering, Perak is taking up to five years, Johari clarified that big-scale mining usually takes more time to assess, especially on its impact towards the environment.
He said he would visit the site soon to get updates from the scientists.
He also clarified that Malaysia has never offered the export of raw REE as a concession or condition for tariff reduction in trade tariff negotiations with the United States.
This also comes after several queries from MPs to the government about negotiations with the United States involving REE, given that the raw export ban is still in force.
"NRES wishes to stress that, in trade tariff negotiations with the US government, Malaysia has never offered the export of raw REE as a concession or condition for tariff reduction.