Rio Tinto has halted further development of its $2.95 billion Jadar lithium project in Serbia, shifting the site into “care and maintenance” as part of a strategic decision to streamline operations and prioritise projects with nearer-term potential.
The move was announced earlier this month and confirmed through an internal company memo circulated to staff, according to reports by Bloomberg and other sources.
Rio Tinto has refrained from providing detailed public comments beyond confirming the internal note.
The Jadar project, which has not yet commenced production, is located near Loznica in western Serbia and holds high-grade lithium deposits considered strategically significant, especially for European battery supply chains.
Despite this, the development has faced persistent setbacks in recent years.
These difficulties include prolonged permitting delays, fluctuating government support, and vigorous local opposition centred on environmental and social concerns.
The project site lies in Serbia’s fertile Mačva District, where residents and environmental groups have voiced worries about groundwater contamination, agricultural impacts, ecosystem disruption, and long-term waste management.
The local resistance intensified notably in 2021 and 2022, leading the Serbian government to suspend the mining licence in early 2022 amid mass protests.
Though the licence was reinstated in 2024, the permitting process stalled again, exacerbated by political controversies and widespread community dissent.
This opposition made the Jadar mine a focal point of broader public discontent, complicating efforts to advance the project despite support from the European Union as part of its broader green transition strategy.
Rio Tinto’s internal communication emphasised a lack of progress in permitting as the primary rationale for pausing further investment and resource allocation to Jadar.
The company stated it was “not in a position to sustain the same level of spend and resource allocation” under current conditions.
This decision aligns with CEO Simon Trott’s broader initiative to simplify Rio Tinto’s corporate structure and focus capital expenditure on its highest-priority growth opportunities.
The company has recently reorganised into three core divisions: iron ore, aluminium combined with lithium, and copper, reflecting a refined capital allocation strategy.
This mothballing of Jadar marks a significant shift for Rio Tinto, which remains the only major diversified miner with a substantial lithium investment.
Last year, the company made a landmark $6.7 billion acquisition of Arcadium Lithium, marking its largest deal in nearly two decades and adding three lithium projects under development, including the Rincon mine in Argentina.
However, the lithium market has since softened, with prices falling roughly 85 per cent from their 2022 highs, impacting the economics and timing of large-scale lithium projects like Jadar.
While the suspension is a setback for both Rio Tinto and Europe’s ambitions to bolster a local lithium supply chain, Rio Tinto continues to view Jadar as a significant resource that could play an important role once regulatory and political hurdles are resolved.
For now, the project will remain in care and maintenance as the company prioritises operational efficiency and near-term returns elsewhere.
