Rio Tinto to give up on mining lithium in Serbia for now – New CEO focusing on faster, more profitable projects

Rio Tinto will suspend work on a USD 2.4 billion lithium project it has been trying to develop in Serbia for years, as the mining giant’s new CEO seeks to streamline operations and focus on faster, more profitable projects, the Wall Street Journal writes, as reported by American and Australian media.

Rio Tinto, the world’s second-largest mining company by market value, has long touted the Jadar project in western Serbia, which its geologists discovered in 2004, as an important future source of lithium for the European market. The project was declared a strategic project of the European Union this year.

However, the company has faced constant obstacles in advancing the project, due to resistance from the local community and, as it is reported, “suspicions of Russian disinformation campaigns.”

The decision to suspend work on the Jadar project came after former iron ore division director Simon Trott took over as CEO, succeeding Jakob Stausholm, the WSJ reported. Trott took office in August, promising to cut costs and remove distractions from the business.

– As part of our focus on simplifying our entire portfolio and prioritizing near-term opportunities, the decision has been made to move the Jadar project into maintenance mode – says an internal memo sent to employees this week, which was seen by the Wall Street Journal, according to the American Morningstar.

The memo adds that Rio Tinto still sees Jadar as a significant lithium deposit, which could play an important role in Serbia’s and Europe’s energy transition.

– However, given the lack of progress in the permitting process, we are unable to maintain the same level of investment and resource commitment – the message states.

Bloomberg News also reports that the world’s second-largest mining giant has confirmed that the project’s development has been put on hold, citing a lack of progress in obtaining permits needed to start production at the high-quality lithium deposit.

– Given the lack of progress in the permitting process, we are unable to maintain the same level of investment and resource allocation – the company said in an internal memo, which the agency has seen, as reported by foreign media outlets dealing with the mining sector.

Shortly after taking office, Trott announced that the company would review its smaller business units, particularly its borate operations in California and its iron and titanium operations in northern Quebec.

Investors have been looking for hints about Trott’s plans for the company’s lithium business for some time. In one of his first moves as CEO, Trott merged the lithium division with Rio Tinto’s large aluminum division.

Earlier this year, Rio Tinto acquired Arcadium Lithium for USD 6.7 billion, making it one of the world’s leading lithium producers overnight. The move into lithium has set Rio Tinto apart from other major mining companies, which have largely shunned the metal and focused on expanding into copper.

Trott is scheduled to give his first major strategy presentation to investors as CEO on December 4, Morningstar reported.

B. P.

Rio Sava Exploration d.o.o. Beograd

Rio Tinto

Simon Trott

Jadar project

lithium project in Serbia

project abandonment

project put on hold