ALOR STAR: Kedah will pursue the exploration of rare earth elements (REE) as a new source of revenue for the benefit of the people.

Menteri Besar Datuk Seri Muhammad Sanusi Md Nor said REE exploration has been identified as one of the resources to strengthen the state's financial position, in line with aims to increase state revenue to RM1 billion by 2028.

Therefore, he urged the Federal Government to expedite the implementation of a proper standard operating procedure (SOP) for REE extraction.

"REE is categorised as the most viable revenue source for the coming years. The REE reserves in Kedah are estimated at 1.196 million metric tonnes.

"This represents a new revenue source expected to be extracted over the next 10 years. We hope the potential of REE will have a significant impact on Kedah's economy," he said while presenting the Kedah 2025 Budget at the State Legislative Assembly in Wisma Darul Aman today.

Sanusi added that there will be other measures to enhance state revenue, including a review of land assessment rates, which will take effect by 2026.

He said the review aims to align revenue rates with current property market values.

"It is also a step to increase consistent and well-planned revenue collection over the next decade.

"A strong financial position is crucial for the state government to address the growing needs of the people," he said.

Sanusi also highlighted a plan to explore new revenue sources, such as carbon credits, which is another key initiative to achieve the RM1 billion revenue target.

He noted the potential income from selling carbon credits to domestic and international companies seeking to meet eco-friendly standards could generate substantial revenue for the government.

"With the dedicated efforts and commitment of all government agencies and local authorities, we are confident that the RM1 billion state revenue target can be achieved within the next two years," he said.

Later in a press conference, Sanusi reiterated his call for the Natural Resources and Environmental Sustainability Ministry to release the Standard Operating Procedure (SOP) for REE mineral mining as soon as possible.

"There is high demand for REE minerals especially in producing batteries for EV (electric vehicles) but unfortunately, we don't have the SOP yet.

"That is why I have been urging the ministry to expedite releasing the SOP.

"Most of the mineral sites are in forest reserves, but without the SOP we can't proceed, although the exploration licence falls under the state's jurisdiction.

"Once we obtain approval for exploration, we (the state government) will issue a Mining Licence (ML) but to do that, we need the EIA (Environmental Impact Assessment), which falls under the Department of Environment (DoE), a department under the ministry," he said.

However, he claimed that the matter is being derailed by the ministry's policy of not being supportive of any mining activity in forest reserves.

"Last year during the National Mineral Council and the National Land Council meetings, I proposed for policy number 12 to be revoked. Only by doing so, then the DoE can process the EIA.

"I think the Prime Minister (Datuk Seri Anwar Ibrahim) has given serious attention to this matter, but the ministry is dragging its feet. We hope the ministry will expedite the process," he said.