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Serbia is preparing to give Rio Tinto the green light to develop Europe’s largest lithium mine, two years after Belgrade canceled the project, paving the way for a significant boost to the continent’s electric car industry.
President Aleksandar Vučić said “new guarantees” from the Anglo-Australian miner and the EU appeared ready to address Serbia’s concerns over whether necessary environmental standards would be met at the Jadar site in the west of the country country.
In an interview with the Financial Times, Vučić indicated that he was confident that he would also secure the necessary commitments from EU leaders for related investments in Serbia, such as battery production and electric vehicle production.
As long as his demands on “the entire value chain plus perfect environmental protection” were met, Vučić said, he expected business and political leaders to come to Belgrade next month for a formal announcement of the project.
“If we make everything happen, [the mine] could be open in 2028,” he said, adding that it was expected to produce 58,000 tonnes of lithium per year – “enough for 17 percent of EV production in Europe – around 1.1 million cars”.
He added: “I really believe this can be a game changer for Serbia and the entire region.”
The government revoked Rio Tinto’s permits in January 2022 after protests led by environmental groups concerned about water pollution, displacement of residents and damage to the area after the mine was closed and highways and bridges across Serbia were blocked.
They came at a time when Vučić, who became prime minister in 2014 and president three years later, was facing elections and domestic political pressure. But after municipal polls on June 2, most of which were won by Vučić’s ruling SNS party, the government seems to believe that it is clear for the coast to go ahead with the project.
The planned revival of the Rio Tinto deal and EU involvement are seen by Western officials as an important signal of Serbia’s geopolitical alignment at a time when China, Russia and the Gulf states are being courted economically and politically.
Serbia has been an EU candidate country for more than a decade, but the accession process is getting off to a slow start amid concerns in Brussels over issues such as the rule of law and corruption. Belgrade has also closed ties with the EU over the status of its former province of Kosovo, becoming one of only two European countries not to impose sanctions on Russia over Moscow’s large-scale invasion of Ukraine.
EU officials “thought we were going to give [the mine] to the Chinese,” Vučić said. “We did not intend to do that, because we had promised that we would do business with the EU.”
Vučić, who insisted he would remain committed to Serbia joining the bloc, claimed some European states had tried to undermine the Jadar deal before coming on board. “They even took part in organizing protests here. . . I wondered: why do they do that? They are going to lose everything and the Chinese will take [their place].”
Europe currently has virtually no domestic lithium production and Jadar would generate enough to meet 13 percent of the continent’s forecast demand by 2030, according to Fastmarkets, a commodities research firm.
Jadar contained high-grade lithium and the mine’s deposits were large compared with others globally, said Martin Baker, senior analyst at Fastmarkets.
Siniša Mali, Serbia’s finance minister, said the project would provide a major boost to the Serbian economy and add between €10 billion and €12 billion to the annual gross domestic product, which totaled €64 billion in 2022 . He noted that Serbia planned to ban lithium exports and said the country wanted to “build a complete value chain.”
Belgrade always supported the mine as long as it met strict environmental standards, Mali said. Its cancellation had been partly “a political decision” to avoid unrest in the run-up to the elections.
Savo Manojlović, co-chair of Go Change, the environmental group that led the protests in late 2021, said opponents would not give up the fight if the deal was revived. “We will organize to defend our environmental standards and constitutional rights,” he said.
Chad Blewitt, Rio Tinto director for the Jadar project, said that since the deal was mothballed, Rio Tinto had organized 125 sessions with the local community to gain public support.
The miner, which released a draft environmental assessment on Thursday that includes estimates of potential impacts on water, air and soil, would be “radically transparent” in its operation of the site, he said.
Rio Tinto said it welcomed “an evidence-based public dialogue”, adding that the draft assessment indicated the project “could be developed safely and meet the highest Serbian and EU environmental standards”.