Malaysia will likely withdraw a demand for the controversial but highly strategic Lynas rare earth plant to export half a million tonnes of feared radioactive waste as a condition for renewing its licence, and instead direct it to build a permanent disposal facility (PDF) at the Australian miner's cost.

The Straits Times understands that the Cabinet discussed the proposed compromise earlier this month. The government said previously that it would announce its decision next month, before Lynas' licence expires on Sept 2.