On Tuesday, local time, mining giant Rio Tinto Group (Rio Tinto) announced that it had approved an investment of US $2.4 billion in the Jadar lithium borate project in Serbia, which still needs further approval from the local government.
Rio Tinto said the Jadar project would produce battery-grade lithium carbonate, a key material for mass production of batteries for electric vehicles and energy storage devices, and that the capacity of the project would make Rio the largest lithium supplier in Europe for at least the next 15 years. In addition to lithium, the project will also produce borates, which can be used to produce solar panels and wind turbines.
The company expects the project to be put into production on a large scale in 2026 and to reach its maximum capacity in 2029, with an estimated annual capacity of 58000 tons of lithium carbonate, 160000 tons of boric acid and 255000 tons of sodium sulfate, which will also make Rio Tinto one of the top 10 lithium suppliers in the world.
Jakob Stausholm, the company's chief executive, said in a statement that Serbia and Rio Tinto were in an excellent position to take advantage of rising demand for lithium, a project capable of supplying about 1 million electric car batteries a year.
The Jadar project will be one of the largest industrial investments in Serbia, with a direct contribution of about 1 per cent of the country's GDP, in the future and an indirect contribution of 4 per cent to GDP, taking into account the participation of a large number of local suppliers during construction. Rio Tinto expects to create 2100 local jobs during the construction period, while 1000 miners and processing jobs will be needed when it goes into operation.
For Rio Tinto, which relies heavily on iron ore for revenue, the investment will further help the company reduce its share of the fossil fuel business. With the shift in global policy winds, traditional mining companies are accelerating the deployment of "future-oriented" industrial metals such as copper, nickel and lithium.
The potential obstacle for the Jadar project is that the Serbian government has promised voters a referendum on the project. While recognizing the role of the launch project in boosting the economy, Serbia is not willing to be merely an exporter of raw materials, preferring to build lithium batteries or even electric cars at home.
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