Lynas, the Australian mining company known for its resourcing of rare earth metals, has confirmed that it is looking into legal options because Malaysia is set to impose tough new waste disposal conditions on all mining plants in the country.

This will affect one of Lynas’ biggest operations, its $720m processing plant, which deals with most of what the company mines in Australia. Its shares nosedived by 22% as a result of the recent news.

Lynas has come under fire from Malaysian locals and environmental activists who believe that the company is not appropriately dealing with its waste and that toxic and radioactive outputs are coming from the plant.

This has led to the Malaysian government cracking down on companies that are not following the intended frameworks for waste disposal. As this is affecting Lynas financially, it is now seeking legal advice to better determine its options.

The Malaysian government sent environmental investigators to the plant back in September and were concerned enough to ask Lynas to renew its licenses with a stricter set of regulations in place.

Part of this decision appears to stem from Malaysia’s change in government last May, when the opposition party that had been critical of Lynas’ work came into power unexpectedly. It has since followed up with its intent to try and shape the country in its image, and the mining and processing industry may be one of its targets.

Lynas has since said that it does not expect this to happen and voiced its surprise at the need to meet specific conditions before any licenses can renew. It called this ‘policy based on politics, not policy based on science.’

CEO Amanda Lacaze said that ‘legal options’ are still fully on the table and added that Lynas is looking at ‘all options available’ as it tries to negotiate the dispute and keep its operations running. Mining companies have had a difficult time in the last year as they come to terms with the changing face of the world and its expectations on how businesses can do their part to prevent climate change.

Rio Tinto has sought to reduce its dependence on mining fossil fuels such as coal and play up its sustainable credentials with the launch of a certified sustainable aluminum scheme that Nespresso is picking up.

This greater level of scrutiny means that there are now fewer margins for error in the eyes of the public, and some other governments have also adopted this mantle.

To get its latest license, Lynas will have to produce an action plan detailing how it is going to get rid of any radioactive waste, as the Malaysian Energy and Environment Ministry said that any water source that ‘contains radioactive materials must be removed from Malaysia.’ This is a much stricter stance than before, and it could pose serious problems for Lynas in the short term.

In order to renew its license, it will have to fulfil these obligations within the next year. Lynas’ current license expires in September 2019. The company insist that its plant’s radioactive materials are at low levels and disposed of safely.