LONDON/MELBOURNE, Oct 9 (Reuters) – Rio Tinto (RIO.AX), opens new tab, (RIO.L), opens new tab has agreed to buy U.S. based Arcadium Lithium (ALTM.N), opens new tab for $6.7 billion, it said on Wednesday, a deal that will catapult it to become the world’s third largest miner of the metal used in electric vehicle batteries.

Already the world’s largest producer of iron ore, Rio is transforming itself into a processor of high end, low carbon raw materials essential for the energy transition. The market is currently oversupplied with lithium, but CEO Jakob Stausholm said Rio is confident that long-term demand will be strong.

Rio said it would pay $5.85 per share in cash for Arcadium, an almost 90% premium to its closing price of $3.08 per share on Oct. 4, the day Reuters exclusively reported a potential deal.

Rio’s London-listed shares were down 0.4% by 1054 GMT. Shares in U.S.-listed Arcadium jumped around 40% on Monday, after the companies confirmed negotiations.

Rio would gain access to lithium mines, processing facilities and deposits in Argentina, Australia, Canada and the United States to fuel decades of growth, as well as customers that include Tesla (TSLA.O), opens new tab, BMW (BMWG.DE), opens new tab and General Motors (GM.N)

Lithium prices have floundered due to Chinese oversupply and a slowdown in electric vehicle sales, resulting in miners of the metal emerging as attractive takeover targets.

Rio’s Stausholm told investors that by the end of the decade the company expects a shortfall in supply, with a more than 10% compound annual growth rate in demand through to 2040, boosted by electric vehicles and energy storage.

The current weak market was an opportunity to pick up top quality assets at the right price, Stausholm told Reuters.

“We really want battery-grade lithium, i.e. the processing as well. And then, of course, we like to be an operator, and if you take those criteria, you very quickly come to Arcadium,” he said.

“The way you should think about it is kind of a reverse takeover. This is not a case about cutting costs. This is a case about building faster and better,” he added.

The deal won’t make a material difference to Rio’s current capex plans of up to $10 billion in 2025 and 2026, Stausholm said.

For the whole article go to Reuters.

Jose Fernandez, under secretary for economic growth, energy and the environment at the U.S. Department of State, told a briefing late on Monday that China was producing much more lithium “than the world needs today, by far”.

“That is an intentional response by the People’s Republic of China to what we are trying to do” with the Inflation Reduction Act – the largest climate and energy investment package in U.S. history valued at over $400 billion, Fernandez said, adding:

“They engage in predatory pricing… (they) lower the price until competition disappears. That is what is happening.”

China accounts for about two-thirds of the world’s lithium chemical output, which is mainly used in battery technologies including for electric cars. Prices of lithium have fallen more than 80% in the past year largely due to overproduction from China and a drop in demand for electric vehicles.

However, the price collapse is also affecting China as it has forced Chinese companies like battery giant CATL (300750.SZ), to suspend production at certain mines.

For the whole article go to Reuters.

What do the pop star, the academic and the environmentalists have in common? Like the tens of thousands of people who’ve rallied across Serbia in recent weeks, they’ve all spoken out against the Anglo Australian mining firm Rio Tinto’s $2.4 billion plan to mine and process lithium in that country’s verdant Jadar Valley, near the town of Loznica. The company has said that the site could eventually produce 58,000 tons of lithium per day—enough to meet 90 percent of European lithium demand and power some one million electric vehicles. The Serbian government has eagerly backed the project. It’s also garnered the enthusiastic support of the European Union and the United States, which on Wednesday signed an agreement with Serbia for strategic cooperation in energy. The EU, especially, hopes it can help diversify a supply chain now heavily concentrated in China and secure the bloc easier access to a mineral that’s central to its electric vehicle–centric green industrial policy goals.

Many Serbians, though—including those who’d live closest to the project—worry it will devastate the region’s agricultural production and poison the drinking water for millions. Critics argue it promises few upsides for either local residents or the majority of Serbians. Demonstrators want the project canceled. It wouldn’t be the first time that’s happened: After mass protests in 2022 shut down cities and railways, Serbia’s government revoked its approval of Rio Tinto’s plan for the Jadar Valley site in advance of federal elections that April, blocking further development. On July 11, 2024, Serbia’s Constitutional Court ruled that the decision was unconstitutional, laying the groundwork for the government to let Rio Tinto move forward.

Alongside a new wave of protests has come a new, more intensive wave of repression. Once news broke that Severina had been stopped at the border—she was eventually allowed to pass—Serbian Interior Secretary Ivica Dačić said that she and other regional celebrities would be removed from “lists” of people whose public stances the government considers problematic. People who’ve participated in protests further report being questioned by police over Instagram posts, and might face criminal charges that could mean they spend years in prison. Rio Tinto is now attempting to have peer-reviewed research on the environmental impact of the Jadar project substantially changed or redacted, insisting—alongside high-ranking members of Serbia’s ruling party—that its authors are spreading “disinformation.”

Bojan Simiśić is the founder of Eko Straža, although his home wasn’t among those searched by police in August. Members of that group are now waiting to see whether the government will build a case against them for calling for a “violent change in the constitutional order,” a felony charge. Such serious charges are a new development since the last round of protests, Simiśić says. “In 2021 there were police at my door. They came just to warn me” not to organize or participate in protests, he said. More often, demonstrators were issued tickets fining them around 50 euros for minor infractions. “Now they’re getting more aggressive,” Simiśić added. “It’s not just about the mine. We have to fight for basic liberties to protest.” In response, Simiśić helped organize a protest that drew tens of thousands of people to the grounds of state-run media outlet RTS on September 1, opposing the mine, the government’s treatment of protesters, and the silence around both from Serbia’s tightly controlled media environment. Serbian officials did not respond to multiple requests for comment on this story.

At the end of last month, a website run by an “independent citizens’” group calling itself “Kopacemo” (We Will Dig) appeared, claiming to fight “misinformation.” The page features a registry of so-called “ecological terrorists,” including Matković and Simiśić. Profiles of several dozen alleged ecoterrorists feature stylized black and white pictures set against cyberpunk-ish green and black backgrounds. Descriptions list whether they’ve been arrested and take personal pot shots. Matković’s listing starts off by saying he “has a speech impediment and tics” and “can’t pronounce his Rs and Ls properly.” A profile for another anti-mining activist states that he “wears a bandanna over his head in a militant style,” which is “actually to cover the loss of his hair.” Vladimir Štimac, a former basketball player featured on the site, has now filed a criminal complaint against its anonymous creators. Though it’s still unclear who exactly is behind the site, the group did indicate on X that it would give power of attorney to fight Štimac’s charge to Vladimir Đukanović, a lawyer and member of the Serbian National Assembly with Serbian President Aleksandar Vučić’s’s ruling Serbian Progressive Party, or SNS.

The powerful governments backing the Jadar Valley project have been relatively quiet about the protests against lithium development in Serbia; the government’s crackdown on dissent; and ominous, anonymous threats to mining critics. That may be because of just how anxious they are to unlock sources lithium, a critical component in the batteries that power electric vehicles, cell phones, and other technologies. The Eurozone’s largest economy, Germany, is facing persistently high levels of unemployment. Its industrial sector has struggled amid low demand and high interest rates.

For the whole article go to The New Republic.

An official trade partnership to source critical raw materials from Serbia is looming with negotiations at the final stages of legal wrangling, Commissioner Maroš Šefčovič told Euronews during a high-level event in Brussels.

The trade deal between the EU and Serbia has been cooking for a while with the signing of a letter of intent last September — to strengthen and expand cooperation on critical raw materials and electric vehicles value chains — a clear signal that the EU executive and Belgrade were keen to join forces, provided that environmental and social acceptance challenges around the prospective mining region were sorted out.

On the sidelines of the EIT Raw Materials Summit held in Brussels this week Šefčovič referred to Serbia’s “unique position” in relation minerals listed in the EU’s Critical Raw Materials Act (CRMA), such as high-quality lithium, which he referred to as “one of the best in the world”.

“I hope that in a short period of time we will be able to finalise the text of the Memorandum of Understanding (MoU),” Šefčovič told Euronews, adding that current discussions with the Serbian government are focused on extraction, processing, refining and use of lithium.

Original news published on Euronews website. Read the full article

Belgrade revoked licences for Rio’s $2.4 billion Jadar lithium project in Western Serbia in January 2022 after massive environmental protests. If completed, the project could supply 90% of Europe’s current lithium needs and help to make the company a leading lithium producer.

Regarded as a critical material by the European Union and the United States, lithium is largely used in batteries for electric vehicles (EV) and mobile devices.

Speaking on the sidelines of the World Economic Forum in Davos, Vucic said he had “a difficult conversation” with representatives of Rio Tinto earlier on Wednesday.

“We are facing the question of whether the company will file a lawsuit against us or not,” Vucic told Serbian reporters. “I asked them not to take measures to protect their interests.”

For the whole article go to Reuters.

What happened?

Serbia has signed a letter of intent with the European Commission on a strategic partnership in the areas of batteries and critical raw materials, including lithium. The letter was signed in New York on September 22nd, when Serbia’s president, Aleksandar Vucic, met Maros Sefcovic, a vice-president of the Commission, but the agreement became public only after an investigation by the Danas newspaper.

Why does it matter?

The agreement suggests that the government has not given up on a plan to allow the mining of lithium at Jadar in western Serbia, despite having cancelled an agreement with the Anglo-Australian company Rio Tinto in January 2022 in the face of mass public protests about potential damage to the local environment. The letter of intent adds to existing circumstantial evidence of the government’s intention to press on. In September the government signed an agreement with the Slovak company Inobat, a partner of Rio Tinto, on construction of a battery factory in Cuprija.

The exploitation of lithium could potentially be highly lucrative for Serbia. The country contains 1.3% of the world’s known reserves of the metal, which is essential for the production of batteries for electric vehicles. The estimated value of Serbia’s lithium of €4bn and its extraction over the course of a decade could potentially provide hundreds of jobs and a steady stream of revenue for the government. The EU could also benefit from the development of the Jadar mine, which would allow a reshoring of a vital resource at a time of growing geopolitical tensions and competition for minerals access.

In pressing ahead, however, the government risks a political backlash. Environmental groups and residents of Jadar have come out in opposition to the letter of intent. They have accused Mr Vucic and the prime minister, Ana Brnabic, of being traitors to Serbia and lackeys of the EU and Rio Tinto. The public debate over the agreement could be damaging for the government ahead of the parliamentary election in December. The government has denied that it has concrete plans to exploit the Jadar mine and insists that the letter amounts to no more than a statement.

What next?

The likelihood is that the mining project will eventually go ahead, given the backing that it has from the government, the EU and Anglo-Australian interests. However, in a replay of the dynamics seen ahead of the April 2022 election, the government is likely to stall the plans, reviving them only once the December election is over.

The analysis and forecasts featured in this piece can be found in EIU’s Country Analysis service. This integrated solution provides unmatched global insights covering the political and economic outlook for nearly 200 countries, enabling organisations to identify prospective opportunities and potential risks.

Signatories reject the proposed legislation because of its disregard for environmental and human rights, endorsement of social engineering, and failure to address Europe’s obsolete mining regulations and the urgency of reducing demand. If approved, the Act will fast-track permitting procedures, water down environmental laws and set the floor to inject billions of euros into socially and environmentally irresponsible mining corporations.

“The European Parliament and the Commission had the opportunity to meet the needs of local communities with this law and they failed miserably,” says Bojana Novakovic from the movement against lithium mining “Marš sa Drine” in Serbia. “We are tired of begging, pleading and negotiating. The EU has failed us, so we are sending a clear message – withdraw the law or you will see us on the streets and in court.”

The announcement earlier this week of a political agreement between the European Parliament and the European Council to push forward with the Critical Raw Materials Act (CRMA) has brought about an immediate reaction among civil society organizations, local communities as well as experts and academics across the world. Recalling the ongoing political crisis in Portugal and its connection with two lithium mining projects, the letter warns that the regulation will extend the influence of the mining lobby and spread even more corruption due to less regulation. 

It also exposes how EU policymakers have failed to see beyond the Brussels ‘bubble’, disregarding the potentially catastrophic impacts of a new mining boom. Signatories condemn the proposed legislation’s endorsement of ‘social acceptance’ activities aimed at changing public opposition to mining projects into passive tolerance or active support. The letter also exposes 25 projects funded by the EU at a total cost of €181M with deliverables that seek out to build public acceptance for extractive projects.

“It’s simple for us,” says a representant from MiningWatch Romania: “Approval of the CRMA will lead to legal action as the proposed legislation would breach rights of public participation in environmental decision making, enshrined by the Aarhus Convention which the European Union ratified.”

On the situation in Portugal, the founder of MiningWatch Portugal, Nik Völker, adds: “Unfortunately, non-compliance seems to be the norm in Portugal, even in well-documented cases known to the authorities. The Borba tragedy, the tailings from the Panasqueira mine and, since last week, the acid waters in Aljustrel, also testify to a precarious state of the competent authorities. The Brussels ‘bubble’ that envisages permitting in two years seems a long way from our reality of projects that are already half a decade in the process, for example for Lithium in the Barroso area.”

Letter to the Commission: https://miningwatch.pt/public/OpenLetter-CSO-CRMA_2023-11-16.pdf

FEAR OF A RETURN OF THE MINES: Brussels is preparing a new law — the Critical Raw Materials Act — to facilitate mining in Europe. But activists are now mobilizing against it, warning the law would steamroll over local environmental opposition and even allow the construction of mines in protected natural reserves.

There’s always a news hook: “In Portugal the prime minister resigned over a probe into corruption over lithium mining,” Bojana Novakovic, a Serbian-Australian actor-turned-activist who is campaigning against mining projects, told Playbook. “Communities on the ground … have been expressing grave concerns about lack of transparency relating to this project for years.”

Corruption warning: “Corruption is endemic to mining, and the Critical Raw Materials [Act] is a law which would simply make more of that corruption legal,” Novakovic said. “It would make the lives of local communities, the lands we care for and the nature we live with even more difficult than it is now.”

Background: The law — currently in negotiations — establishes a benchmark that at least 10 percent of the “strategic raw materials” consumed by the EU should be extracted in domestic mines. As part of the measures to speed up mining projects, the regulation would reduce opportunities for local opposition groups to delay permits for new mines.

‘Overriding public interest’: The act currently sets a deadline for authorities of a maximum of 24 months to grant extraction permits. It also limits the public consultation period for environmental impact assessments to 90 days, pointing to an “overriding public interest” that such projects move forward.

Activists gear up: “The Critical Raw Materials Act is set to take a wrecking ball to human rights and environmental protection,” Laura Sullivan from the WeMove Europe activist network told Playbook. Together with Novakovic and other local organizations, WeMove is launching an online petition to scrap the act.

Re-shoring pollution: “Supplying Europe used to be a Global South problem and was arguably easier to hide,” Sullivan argued. “But the Critical Raw Materials Act will bring the mining scale up to European countries like Portugal, Spain, Ireland … it’s about to become a major problem for people in Europe.”

The Regulatory Institute for Renewable Energy and the Environment (RERI) has said that the Ministry of Mining and Energy is unjustifiably extending the deadline for Rio Tinto to obtain a license for lithium mining in Serbia.

Rio Tinto has been trying for more than two years to obtain approval to open a lithium exploration mine in Serbia and it needs a document that allows it to start mining lithium in Serbia, despite the fact that it did not attach the necessary documentation to the relevant application, RERI added.

The Serbian government did say that the Rio Tinto lithium project in Serbia had been stopped and that all line authorities would immediately suspend all relevant procedures.

Nevertheless, the Ministry of Mining and Energy has not stopped the procedure for issuing the permit for lithium exploitation, but over the course of two years, without giving clear reasons, extended the deadline for the company to complete the documentation 11 times.

“Rio Tinto does not have the document on determining the scope and content of the environmental impact assessment study, because it was canceled in January of last year,” says Hristina Vojvodić, RERI’s legal advisor.

Although the company filed a lawsuit with the Administrative Court against the annulment decision, this does not constitute a justified reason for extending the deadline for supplementing the relevant documentation, the statement added.

(Nova Ekonomija) Full article at Serbian Monitor

Environmental organizations have sent a clear message to Rio Tinto’s shareholders: the company’s insistence to carry on with the formally canceled project will only strengthen the opposition to it and the possibility of social unrest, carrying with it financial and political risk, the Marš sa Drine initiative and Earth Thrive said.

The protest was joined by the WeMove Europe and London Mining Network, which organized the arrival of activists from Arizona, Madagascar, and Serbia. A titanium mine is planned in Arizona, while in the island country Rio Tinto is operating a copper mine.

Of note, in 2023 Rio Tinto marks 150 years of operation.

Rio Tinto is not welcome in Serbia, activists said during the protest, which is part of a campaign called Rio Tinto: Against People, Climate and Nature and the International Day of Action against Rio Tinto.

The environmentalists also took 500,000 signatures to the door of Rio Tinto’s headquarters in London.

The representative of Serbian activists in London, Nebojša Petrović, a resident of the affected village of Gornje Nedeljice in the country’s west and a member of the Ne damo Jadar association, took the opportunity to ask the company’s officials why it hasn’t left Serbia after the spatial plan for a lithium mine and processing plant was annulled, and why it keeps buying land from private owners.

“The Ne damo Jadar association will fight Rio Tinto together with all other environmental organizations until it drives you out of Serbia,” Petković said.

He later explained he didn’t get any straightforward answer and that he also asked why the company insists on the project after the Serbian experts said that its implementation is the path to an ecological disaster.

They just said it was not true, Petković added.

Full article on Balkan Green Energy News