Rio Tinto (ASX: RIO) will halt its development of the long-delayed Jadar lithium project in Serbia as the Australian miner looks to tighten its purse strings and shift focus elsewhere, according to media reports.
On Thursday, Bloomberg reported that Rio intends to place the near $3 billion lithium project into “care and maintenance”, citing an internal memo that was later confirmed by a company spokesperson.
Rio Tinto did not respond to MINING.COM’s request for comment.
This move essentially ends Rio’s two-decade-long quest to tap into one of the world’s largest lithium resources. The company had estimated that Jadar could produce 58,000 tonnes of refined battery-grade lithium carbonate per year, starting as early as 2027.
Lack of progress
According to the memo seen by Bloomberg, Rio said it was “not in a position to sustain the same level of spend and resource allocation,” given the project’s lack of progress.
Since its initial discovery in 2004, the Jadar project has faced numerous regulatory setbacks, political uncertainty and community opposition. Rio’s licence was taken away in January 2022 over environmental concerns, and despite regaining it two and a half years later, the permitting process barely moved.
The decision to stop the project altogether comes five months after the Australian miner raised its cost estimates for Jadar, from $2.4 billion before to approximately $2.95 billion. The revision, the mine’s managing director previously said, reflects costs to meet “European Union environmental and human rights standards.”
Mothballing the Jadar project would deal a further setback to the EU’s hopes of building an independent battery metals supply chain. If built, it would be the largest lithium mine on the continent and is expected to meet approximately 90% of its current lithium demand.
Simplify operations
The decision to halt Jadar marks the latest cost-cutting measure under new chief executive Simon Trott, who replaced Jakob Stausholm earlier this year and has pledged to simplify operations and reduce management layers.
Rio has already cut about 480 jobs—roughly 3% of staff—at its Australian iron ore division since 2024, and is still trimming its workforce, according to the Australian Financial Review. More job cuts are expected in the coming months as the group implements a new organizational structure, AFR also said.
With Jadar out of the picture, Rio’s lithium focus would fall almost entirely on its South American assets, such as the $2.5 billion Rincon project that was approved by Argentina earlier this year and the two projects it is partnering with Chile.
Shift in priority
CEO Trott had foreshadowed the move to de-prioritize its non-Latin-American assets when he told investors at a recent Goldman Sachs event in London that not all of Rio’s lithium assets will advance simultaneously. “The bar is really high, and we can progress the very best of them,” he said.
His predecessor Stausholm said earlier this year that the Lithium Triangle area, which also includes Bolivia, “offer the best chance for the world to access low-cost, high-quality lithium.”
Barclays analyst Amos Fletcher told AFR that Jadar and the other hard rock lithium mines inherited from last year’s merger with Arcadium – namely Mt Cattlin in Western Australia and Galaxy in Canada – may be sold.
“The message is that we need to start living within our means,” Glyn Lawcock, head of metals and mining at Barrenjoey Markets, told Bloomberg on Thursday. “They’ve only got so much capital they can allocate and they’ve allocated quite a bit of capital to lithium already through the acquisition of Arcadium.”
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Rio Tinto (ASX: RIO) will halt its development of the long-delayed Jadar lithium project in Serbia as the Australian miner looks to tighten its purse strings and shift focus elsewhere, according to media reports.
On Thursday, Bloomberg reported that Rio intends to place the near $3 billion lithium project into “care and maintenance”, citing an internal memo that was later confirmed by a company spokesperson.
Rio Tinto did not respond to MINING.COM’s request for comment.
This move essentially ends Rio’s two-decade-long quest to tap into one of the world’s largest lithium resources. The company had estimated that Jadar could produce 58,000 tonnes of refined battery-grade lithium carbonate per year, starting as early as 2027.
Lack of progress
According to the memo seen by Bloomberg, Rio said it was “not in a position to sustain the same level of spend and resource allocation,” given the project’s lack of progress.
Since its initial discovery in 2004, the Jadar project has faced numerous regulatory setbacks, political uncertainty and community opposition. Rio’s licence was taken away in January 2022 over environmental concerns, and despite regaining it two and a half years later, the permitting process barely moved.
The decision to stop the project altogether comes five months after the Australian miner raised its cost estimates for Jadar, from $2.4 billion before to approximately $2.95 billion. The revision, the mine’s managing director previously said, reflects costs to meet “European Union environmental and human rights standards.”
Mothballing the Jadar project would deal a further setback to the EU’s hopes of building an independent battery metals supply chain. If built, it would be the largest lithium mine on the continent and is expected to meet approximately 90% of its current lithium demand.
Simplify operations
The decision to halt Jadar marks the latest cost-cutting measure under new chief executive Simon Trott, who replaced Jakob Stausholm earlier this year and has pledged to simplify operations and reduce management layers.
Rio has already cut about 480 jobs—roughly 3% of staff—at its Australian iron ore division since 2024, and is still trimming its workforce, according to the Australian Financial Review. More job cuts are expected in the coming months as the group implements a new organizational structure, AFR also said.
With Jadar out of the picture, Rio’s lithium focus would fall almost entirely on its South American assets, such as the $2.5 billion Rincon project that was approved by Argentina earlier this year and the two projects it is partnering with Chile.
Shift in priority
CEO Trott had foreshadowed the move to de-prioritize its non-Latin-American assets when he told investors at a recent Goldman Sachs event in London that not all of Rio’s lithium assets will advance simultaneously. “The bar is really high, and we can progress the very best of them,” he said.
His predecessor Stausholm said earlier this year that the Lithium Triangle area, which also includes Bolivia, “offer the best chance for the world to access low-cost, high-quality lithium.”
Barclays analyst Amos Fletcher told AFR that Jadar and the other hard rock lithium mines inherited from last year’s merger with Arcadium – namely Mt Cattlin in Western Australia and Galaxy in Canada – may be sold.
“The message is that we need to start living within our means,” Glyn Lawcock, head of metals and mining at Barrenjoey Markets, told Bloomberg on Thursday. “They’ve only got so much capital they can allocate and they’ve allocated quite a bit of capital to lithium already through the acquisition of Arcadium.”