KUALA LUMPUR (Nov 19): Acting Natural Resources, Energy and Climate Change Minister Datuk Seri Johari Abdul Ghani said operations at two mining firms in the upper reaches of Sungai Perak have been suspended for three weeks following the recent water discolouration incident.

The two companies — MCRE Resources Sdn Bhd and Rahman Hydraulic Tin Sdn Bhd — were ordered to halt operations after the Cabinet approved the suspension last Friday, Johari said in the Dewan Rakyat’s special chambers on Wednesday.

MCRE Resources, which specialises in the exploration and mining of rare earth elements (REEs) in Kenering, Hulu Perak, is the only company in Malaysia authorised to export raw REEs. Singapore-listed Southern Alliance Mining Ltd holds a 40% stake in the firm.

Meanwhile, Rahman Hydraulic Tin Sdn Bhd, 80%-owned by Malaysia Smelting Corp Bhd (KL:MSC), operates the country’s largest open-pit eluvial tin mine in Klian Intan, Perak.

On Oct 21, photos of Sungai Perak near the Kampung Sungai Papan bridge — about 5km north of Kampung Air Ganda in Gerik — went viral after the river appeared blue.

The Department of Environment (DOE) subsequently identified three mining operations in the upper reaches of Sungai Perak as being within the affected area: one REE mining site and two tin mining sites.

Addressing the issue, Johari said initial checks showed that the colour of discharge at the MCRE facility matched the blueish tint observed in the river.

He added that waste generated from the in-situ leaching process at the MCRE site recorded readings of up to 13 becquerels — far exceeding the one becquerel limit approved under the environmental impact assessment.

“Therefore, investigators are examining the types of chemicals used in the extraction process and whether they correspond to what was previously declared to the authorities,” he said.

Separately, Johari said the Forest Research Institute Malaysia (FRIM) has been tasked with studying the ecological impact of mining in permanent forest reserves, which hold 94% of Malaysia’s 16.1 million tonnes of REE deposits.

He stressed the need for caution in developing the REE mining sector, noting that Malaysia must also build its downstream and midstream industries to maximise economic returns.

Failure to do so, he warned, would leave the government collecting only limited revenue. He cited MCRE’s production of 23,000 tonnes of rare earth carbonate (REC) over the past three and a half years, valued at an estimated RM580 million.

“After further processing, its value rises to billions. Yet the state only received RM100 million [in revenue],” he said.

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