The Perak government has cancelled the memorandum of understanding (MoU) between its state investment arm Perak Development Corporation (PKNP) with a Hong Kong company on plans to mine for rare earth in Bukit Merah.

“On the MoU between PSDC and CVM Minerals Ltd for the proposed rare earth project, both parties have cancelled the MoU with immediate effect as the state government has decided not to issue any permit, licence or land approval for any rare earth project in Perak,” said PKNP executive director Samsudin Hashim.

kampung baru bukit merah Meanwhile, Perak Menteri Besar Dr Zambry Abdul Kadir has expressed his disappointment for not being informed about the signing of the MoU by the state agency.

"I would like to warn other agencies wishing to sign any form of MoU to notify the state government first... even though it is not a legal binding contract or just a mutual understanding.

"Matters that are sensitive, and involving government policies, should be relayed to the state government first," he was reported as saying by Bernama .

Radiation fears

He was commenting on a controversial report posted on a news portal which stated that the Hong Kong company and the Perak government had agreed to explore and mine for rare earth in Bukit Merah near Ipoh.

The report elicited protests from various quarters which had also strongly protested against the construction of Lynas Corp's rare earth plant in Gebeng, Pahang, over fears of radiation.

The news portal reported that a notice to the Hong Kong Bourse, dated April 18, showed that CVM Minerals Ltd had announced that it had signed an MoU with PKNP to implement the project in Bukit Merah.

The Hong Kong company, through its subsidiary, CVM Metal Recycle Sdn Bhd, had earlier submitted its application for a mining licence to the state land and mineral office to conduct rare earth exploration on an area of 250 hectares in Perak.

Previously, Bukit Merah was selected as a location for Malaysia's first rare earth plant before it was closed in 1992. The area is still undergoing a massive clean-up at a cost of over RM300 million.

- Bernama