Article by Isabel Vieira, courtesy of Business News
25.11.2025
Lynas Rare Earths has blasted “unpredictable” power supply and escalating disruptions in Kalgoorlie, saying they have stifled its quarterly production amid heightened demand for its product.
Lynas, backed by Gina Rinehart, said the increased frequency and duration of power outages in November led to significant lost production of its mixed rare earth carbonate (MREC) churned out of its $800 million Kalgoorlie Processing Facility.
It continues a pattern for Lynas and other Goldfields operators who have long struggled with clean power supply issues, with a study revealing an average of four outages a month.
Lynas – one of two rare earths producers outside of China – is now forecasting a shortfall in production for the quarter, equivalent to about a month’s production.
It said although the team was working hard to recover lost production, the MREC wouldn’t reach its Malaysian processing facility in time to be recognised for the quarter.
It added that the shortfall couldn’t be mitigated by bolstering production at its Malaysian plant due to a planned shutdown for major maintenance.
Lynas’ Malaysian processing facility further refines and carves up its MREC into separated rare earth materials to customers, namely in Asia, the US and Europe.
Its investing in expanding its heavy rare earths production capacity and product range to meet heighted demand for the product outside of China’s tight grasp on the market.
Lynas assured investors it would produce sufficient product to meet customer’s needs, and that lost production would likely be caught up within the full year.
The miner and refiner told the market it was “working constructively” with the state government and its utility Western Power to identify the causes and improve power availability to its Kalgoorlie Processing Facility, which has been running since late 2024.
Energy and Decarbonisation Minister Amber-Jade Sanderson said the state government was working closely with Lynas and other major users on potential solutions to improve reliability and reduce interruptions to supply.
“Western Power will complete local equipment upgrades in coming weeks, building on key upgrades to the transmission network that feeds the area,” she said in a statement.
“Lynas and other industrial users are being consulted on these improvements.
“At the same time, the development of a new, common-use electricity network, the Goldfield Regional Network, is being investigated to meet growing industry demand in the longer term.”
Lynas also told the market it was “urgently assessing” off-grid power solutions.
“Given the option to implement a short term off-grid power generation solution, it is expected that lost production can be recovered within the financial year,” it said.
Lynas has invested in a renewable energy system at its Goldfields operations, including a hybrid solar and gas renewable power station at its Mt Weld mine south of Laverton, alongside commissioning four wind turbines.
The Chamber of Minerals and Energy WA have previously urged action on South West Interconnected System (SWIS) reliability issues in the Goldfields, where a single transmission line connects Kalgoorlie to the main grid.
Its members have previously reported an average of four outages per month in surveys run by the lobby group, resulting in an estimated tens of millions of dollars in lost revenue in the past year.
Power security was a pressing issue raised by Lynas’ on-ground managers during a recent CME-organised press pack visit to a suite of Kalgoorlie mining operations.
Kalgoorlie Processing Facility production manager Marcelle Watson said “one second of a power outage can cost us an hour of recovery” in getting back up and running.
She said Lynas was looking at its own options to mitigate the impacts.
Lynas executive general manager Chris Torrisi called on the government to improve the reliability of its electricity supply.
“We’ve had blackouts in Kalgoorlie,” he said speaking at the Mt Weld mine site last week.
“We had a five-day blackout last summer for the entire City of Kalgoorlie-Boulder. I mean, really, we need to work on that.”
Mr Torrisi added that Australia “needs to face up to the challenge of high electricity prices”.
He said high electricity prices were stifling downstream manufacturing ambitions.
Resources players are increasingly opting to build renewable energy systems on-site, partly to curb electricity costs and partly to meet emission reduction targets.
Nothern Star Resources – operator of the Super Pit – owns a 50 per cent stake in the private Parkeston power station to underpin its power security and lower costs.
CME WA director of policy and advocacy Anita Logiudice said given the region’s local employment numbers and economic contributions, urgent work was needed on providing reliable energy supply.
She said they were seeing an increase in “behind the metre” renewable energy roll-out due to the slow pace of the grid connected transition in Western Australia.
“The feedback that we get is that members are actively investing in off-grid solutions” Ms Logiudice said speaking in Kalgoorlie last week.
“What we’d like to see in a place like the Goldfields is for the government to work with industry on near-term, industry-led solutions.
“[And] part of the key for that is to improve the Western Power grid connection process, to remove the delays that we experience throughout the south west of the state.”
Shares in Lynas closed down slightly to $15.02 a pop.