Serbia ends Rio Tinto’s $2.4 billion lithium project

Shares in Rio Tinto fell in London and Australia on Friday, after Serbia revoked the miner’s lithium exploration licenses.

The surprise decision, which coincides with a cooling of relations between Belgrade and Canberra over Serbian tennis player Novak Djokovic, is a blow for the Anglo-Australian miner. It is looking to become Europe’s biggest supplier of the metal, a key ingredient in batteries used in electric vehicles.

It first discovered lithium reserves in the Loznica region in 2004. But the $2.4 billion Jadar project has long been controversial, with thousands of Serbs protesting the project last year and the government support.

In a televised address announcing the decision, Serbian Prime Minister Ana Brnabic acknowledged the protests: “We have responded to all the demands of the environmental protests and put an end to Rio Tino in the Republic of Serbia,” she said. declared.

“Everything about Project Jadar is over.”

Earlier this month, Djokovic – a national hero in Serbia – was expelled from Australia and banned from playing at the Australian Open in a dispute over Covid-19 entry rules. Djokovic has also shown his support for environmental issues on social media.

The announcement also comes just before the country’s next general election in April.

As of 10:15 GMT, blue chip shares were down 2% in London at 5,456.82, after hitting 5,406 pence earlier. They closed down 4% in Australia.

Rio Tinto – which is believed to have already spent around $450 million on feasibility studies for the project – said it was “extremely concerned” and that it was reviewing the legal basis for the decision. The project was expected to start production in 2027.

The Australian government said Reuters he regretted the decision, adding: “We note the strong economic benefits of Rio Tinto’s significant investment in Serbia. Australian resource companies enjoy an excellent reputation around the world. »

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