Snapshot
Serbian Prime Minister Ana Brnabic on Thursday (Jan 20) announced the cancellation of a plan to allow Anglo-Australian mining giant Rio Tinto to build a lithium mine.
The Jadar project in western Serbia near the town of Loznica, discovered in 2004, is Rio Tinto’s flagship project in the batteries minerals sector. The decision is a setback to Anglo-Australian miner’s ambition to become Europe’s largest supplier of the metal used in electric vehicles.
Serbian Prime Minister Ana Brnabic on Thursday (Jan 20) announced the cancellation of a plan to allow Anglo-Australian mining giant Rio Tinto to build a lithium mine.
The decision to scrap the project represents a volte-face for the government. The country’s president Aleksandar Vucic has been backing the project so far.
“We have fulfilled all the demands from the environmental protests and have put an end to Rio Tinto in the Republic of Serbia,” Brnabic said during a televised address.
The announcement to cancel the project comes in the backdrop of diplomatic spat between Belgrade and Canberra over deportation of tennis star Novak Djokovic from Australia. Incidentally Djokovic had opposed the project.
Setback to Rio Tinto
The decision is a setback to Anglo-Australian miner’s ambition to become Europe’s largest supplier of the metal used in electric vehicles.
The Jadar project in western Serbia near the town of Loznica, discovered in 2004, is Rio Tinto’s flagship project in the batteries minerals sector.
Rio Tinto committed to investing $2.4 billion to construct the mine. At full capacity, the Jadar mine was expected to produce 58,000 tonnes of refined battery-grade lithium carbonate a year, making it Europe’s biggest lithium mine by output. Jadar lithium project was planning to commence production in 2027.
Rio Tinto may have already spent US$450 million in pre-feasibility, feasibility and other studies in Jadar to understand the nature of the Jadar deposit.
Lithium is a critical component in battery making. Electric Vehicle(EV) batteries rely on a host of rare materials – from Lithium and Nickel, to Cobalt. With growth in EV industry, use of these rare elements are expected to increase, and therefore could lead to supply chain issues in future as availability of these rare elements is concentrated in few countries only.
Large-scale Protests
In December 2021, thousands of environmental protesters took to the streets in Belgrade demanding that the proposed project be scrapped. They blocked major roads, bringing traffic in the capital to a complete halt. The protesters also expressed concern over the ‘amount of pollution’ the mine would create.
The protests were organised by groups like Ecological Uprising, the Alliance of Environmental Organizations of Serbia (SEOS), civic platform Akcija, Don’t Let Belgrade Drown movement and others.
The local community has been opposed to project saying that it will destroy scenic landscape and will require acquiring farmlands.
Building Battery Ecosystem In Serbia
Serbian government was hoping to leverage its huge lithium deposits to build an integrated battery supply chain.
The government was hoping that the Jadar project will kickstart an investment cycle in the country and help develop a battery supply chain ecosystem
As the largest greenfield mining investment in Serbia, the project promised to make 1 per cent direct and 4 per cent indirect contribution to the country’s GDP, with many Serbian suppliers being involved in the construction of the mine. The project would had significant employment potential, creating 2,100 jobs during construction and 1,000 mining and processing jobs once in production.
Serbian battery developer ElevenEs had unveiled plans to build a $1.2 billion a factory to make and recycle EV batteries in Subotica. The company has reportedly developed its own technology to produce lithium iron phosphate (LFP) batteries for EV and energy storage applications.
Japan’s Nidec was also planning to spend about $1.9 billion to build an electric vehicle motor factory in Serbia.