Australia's Lynas Mining Corp. is seen getting its rare earths facility up and running by the first quarter of 2011, according to Malaysian authorities.

With nearly 85 percent completion rate on the construction side, Lynas and government authorities are still engaging the public to accept the project.

The controversial $400 million Lynas Advanced Materials Plant (LAMP) being built in Gebeng, Pahang, Malaysia has yet to be granted operational license because of some negative public perception.

This rare earths refinery will be the biggest in the world, if it succeeds to be operational and aims to break China's dominance of the minerals required to manufacture high-technology products needed for solar panels, hybrid cars, smart phones, and other gadgets requiring highly magnetic materials.

ASM chief executive Dr Ahmad Ibrahim said the Lynas plant was a key test case on how Malaysia handled public perception of "high-risk technologies".

"The government needs to have a different modus operandi, especially in engaging the public, because increasingly they are an important determinant of future high-risk business...

"Unless you get social acceptance, there will be problems," he told reporters at a press conference afterwards, saying that the outcome of this public engagement would impact on future foreign investments in Malaysia.

Australia's mining firm Lynas Corp.'s project has obtained support from the Academy of Sciences Malaysia and has been touted as a stepping stone crucial for the country's development of environment friendly technology.

ASM chief spokesman Datuk Dr Lee Yee Cheong said that with the careful planning and strategy now being undertaken by the government and the company Lynas, Malaysia stands to benefit from the downstream industries to be built and compliment the ore processing plant.

Dr. Lee said in a briefing that the Lynas rare earth plant located in Gebeng town in Malaysia can be a catalyst for the development of green technology in Malaysia.

"Malaysia had an opportunity to build downstream industries around the plant. And the country is strategically placed in the (global) race for green technology competitiveness in the next five to 10 years," he said when launching ASM's "Rare Earth Industries: Moving Malaysia's Green Economy Forward" report.

Lee said greater focus in the high value-added green industries would help the country realise its high-income goal at a time when worldwide demand for such products was on the rise.

"Countries that do not invest in green energy and technology will live to regret the day when others are seen extracting the dividends of their investments," he said.

But he warned this would not happen if Malaysia was content to only process rare earth ores without simultaneously promoting development of indigenous downstream industries.