Rio Tinto mothballs $2.95bn Jadar lithium project in Serbia
Rio Tinto has halted further development of the $2.95bn (£2.24bn) Jadar project in Serbia as part of a broader effort to streamline operations and prioritise near-term opportunities.
The decision to mothball the project was confirmed earlier this week following an internal memo circulated to staff outlining the move to place the project into “care and maintenance”, reported Bloomberg.
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A spokesperson for Rio Tinto confirmed the contents of the internal note but declined to comment further.
The Jadar project has not yet begun production and has encountered multiple setbacks in recent years, including permitting delays and major local opposition.
Although the site hosts high-grade lithium resources, progress has been hindered by fluctuating government support and widespread community resistance.
The mine became a focal point during a period of broader public discontent, further complicating progress.
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By GlobalDataRio Tinto was cited by Bloomberg in the internal communication saying: “Given the lack of progress in permitting, we are not in a position to sustain the same level of spend and resource allocation.”
The decision to mothball Jadar aligns with CEO Simon Trott’s push to simplify Rio Tinto’s structure and focus capital on growth opportunities.
Under Trott’s guidance, the company has been reorganised into three core divisions: iron ore, aluminium combined with lithium, and copper.
This move forms a part of the wider effort to optimise the company’s portfolio and improve operational efficiency.
Rio Tinto remains the only large, diversified mining company to have made a substantial investment in lithium, prompting investors and analysts to closely monitor the company’s strategy regarding the battery metal.
Last year, Rio Tinto acquired Arcadium Lithium in a $6.7bn cash transaction, its first large-scale acquisition in 17 years.
The acquisition brought three lithium projects already under development into Rio Tinto’s portfolio, complementing its ongoing investment in the Rincon lithium mine in Argentina.
However, the lithium market has experienced a significant downturn, with prices down roughly 85% from their 2022 peak.
This year, Rio Tinto plans to increase its capital expenditure to the highest level in over a decade.
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