On Thursday, the Serbian government revoked the licenses of the Anglo-Australian mining company Rio Tinto for lithium exploration and mining after months of protests, ending a project the Balkan nation once hoped would help boost a weak economy.
The project, a potential $ 2.4 billion investment by Rio, would catapult the company and the country to one of the world’s largest producers of metal, which is key to battery production and is in high demand as the world switches to electric vehicles.
But the government in Belgrade, which is facing elections on April 3rd, has succumbed to growing resistance to the project’s potential environmental costs. They said they would hold a referendum on the issue after election day.
“All decisions [linked to the lithium project] and all permits have been revoked, “said Ana Brnabic, the prime minister in Belgrade. She added that the government listened to the requests of environmental organizations to stop the project.
The decision came as a bit of a surprise after Brnabic said the decision would come only after the election. Rio recorded a one-year delay project, but stayed with the plans.
Planned mine, in the Jadar Valley, Serbia, was perceived as a threat to the way of life of dozens of communities in the picturesque region and has attracted increasing attention to the country’s environmental pollution, which is among the worst in Europe.
“As for the Jadar project, this is the end,” Brnabic said. “Rio Tinto has not provided enough information to both the local community and the government [about the impact of the project]. ”
Environmentalists hailed the decision as progress, but said they would also insist on another request to ban the exploitation of any lithium miner and some other minerals in the country for the next two decades.
“One more step! We are close… We are handing Rio Tinto and the associates of these criminals a one-way ticket to Australia tonight,” Savo Manojlovic, leader of the Go to Change protest, wrote on Twitter and Facebook. “Serbia is not for sale!”
The revocation of existing project permits comes amid strained relations between Serbia and Australia, where Rio earns most of its money and is also listed on the stock exchange, due to the decision to deport tennis star Novak Djokovic.
However, a person close to Aleksandar Vučić, the President of Serbia, said that the decision in Rio was in no way connected with the saga about Djokovic. Vučić condemned the Australian authorities for “harassing” Đoković and called the court verdict deporting the world’s number one “farce”.
Earlier this week, Rio moved the deadlines for the first production from Jadra by at least a year to 2027 due to slow progress in obtaining the permits needed to complete an important environmental assessment.
Lithium is a key material used in batteries that power smartphones and electric vehicles, and demand is expected to rise over the next decade. Prices have risen sharply in recent months, especially due to high demand from China.
Jadar would be one of the largest lithium mines in the world if the project continued.
Rio has the potential to expand into lithium. The company agreed last month to pay $ 825 million for the Salar del Rincón lithium project in Argentina’s Salta province, its first major acquisition in a decade.
However, if she is forced to leave Jadar, it would be a blow to Jakob Stausholm, the CEO, who signaled a desire to increase in metals for electrification. The company currently generates most of its revenue from iron ore, a steel goods.
Rio said on Thursday night that he was extremely worried about Brnabic’s statement. It is added: “In our work on the Jadar project, we have always operated in accordance with the laws of the Republic of Serbia. Rio Tinto is reviewing the legal basis of this decision and the implications for our activities and our people in Serbia. ”