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VIENNA, May 3 (Reuters) - The U.N. nuclear agency will organise an expert panel to advise the government of Malaysia on the potential radiation risks of a rare earths facility planned by Australian miner Lynas (LYC.AX), the agency said on Tuesday.
The move comes after Malaysia asked the Vienna-based International Atomic Energy Agency (IAEA) for assistance in addressing public concerns about the project by forming an panel to review radiation heath and safety factors.
It reflects growing public pressure to scrap the plant as environmental activists say it could make Malaysia a dumping ground for radioactive by-products from the refining process, creating health risks.
"Through the IAEA Technical Cooperation Programme, the agency will support the international expert mission to review the Lynas project's compliance with relevant international safety standards and good practices and to provide an independent expert opinion on the radiological safety aspects of the Lynas Project," the IAEA said in a statement.
"This mission is scheduled to depart by May 29, 2011."
Lynas last month said a one-month Malaysian review of its rare earths processor for radioactive pollution risks would not pose a delay for the project's completion. [ID:nL3E7FM0KH]
State news agency Bernama had reported Trade Minister Mustapa Mohamed as saying at the time that an independent panel would be set up to review the health and safety aspects of the Lynas plant in the central state of Pahang, potentially delaying output outside of top producer China.
Lynas's Malaysia plant was supposed to process rare earth concentrate shipped in from the firm's Mount Weld site in western Australia. [ID:nL3E7EG3GK]
Rare earths are crucial to production of high-tech goods from fibre optic cables to smartphones and electric cars.
Big buyers such as Japan, the United States and Europe rely on these metals and have been looking to cut their reliance on China, which accounts for around 95 percent of global output.
The strategy would make Lynas a key global supplier after top rare earths producer China last year imposed export quotas to retain resources.
Company officials have said annual output from the Malaysian plant would hit 22,000 tonnes, meeting roughly a third of total global demand outside China by 2013. (Reporting by Michael Shields; Additional reporting by Niluksi Koswanage in Kuala Lumpur, editing by Jane Baird)