By Jackson Graham and Nick Toscano
Rio Tinto chief executive Jakob Stausholm will seek to restart talks with the Serbian government about the miner’s stalled multibillion-dollar Jadar lithium mine after its permits were revoked ahead of last month’s elections in the Balkan nation.
“We have certainly not given up on Jadar - I think it’s a perfect project,” Stausholm told reporters after Rio Tinto’s annual shareholder meeting in Melbourne on Thursday.
Rio Tinto chief executive Jakob Stausholm said the company was ‘hopeful that common sense will prevail’ over its proposed Jadar lithium mine which had its licence revoked by the Serbian government.
“I’m very hopeful that common sense will prevail and we will enter a dialogue.”
Rio Tinto, the second-largest Australian mining company, is seeking to develop the $US2.4 billion ($3.3 billion) Jadar mine in western Serbia as part of its foray into lithium, a sought-after battery raw material that will be needed in increasingly vast quantities as carmakers roll out millions of electric vehicles in the coming years.
However, the Serbian government in January tore up the company’s licences following months of large-scale protests about the project’s potentially harmful impact on the agricultural region.
Relations between Serbia and Australia had also deteriorated because of the deportation of unvaccinated tennis star Novak Djokovic from the Australian Open.
Stausholm on Thursday said he believed the Jadar project had “impeccable” environmental, social and governance credentials.
“I cannot say it does not have an impact, but I think the impact has been very, very effectively minimised and it can create a lot of wealth for the Serbian nation,” he said.
“If we can get Jadar going, we will have 90 per cent of Europe’s lithium production.”
Rio Tinto has made a greater priority of community engagement and responding to concerns since blowing up the 46,000-year-old Juukan Gorge rock shelters in WA.
The destruction of the culturally significant Aboriginal heritage plunged the company into crisis, triggered a federal parliamentary inquiry and forced the resignations of former chief executive Jean-Sebastien Jacques and chair Simon Thompson, who officially stepped down after Thursday’s shareholder meeting.
Thompson said the world urgently needed more lithium, copper and rare earths to electrify transport and build out green energy infrastructure such as wind turbines. But resources companies walked a tightrope between “enabling public good” by sourcing those critical minerals and compensating communities affected by mine developments, he said.
“You cannot develop a mine anywhere and you can’t develop any industrial facility without having local impacts on the environment and on communities,” Thompson said.
Responding to a shareholder question about the threat of escalating geopolitical tensions between the West and China, incoming chair Dominic Barton, a former Beijing ambassador for Canada, warned the prospect of hitting China with sanctions similar to those being imposed on Russia would be a “devastating situation”.
“If the world ever got to that, if you think about the integration of the Chinese economy with the world economy, we [would be] in a devastating situation,” Barton said. “I don’t think we are anywhere near that type of situation.”
Shareholders also asked the board about the strength of the company’s ambitions to drive down greenhouse-gas emissions.
Rio Tinto last year more than tripled its 2030 carbon-reduction targets from 15 per cent to 50 per cent, and committed to spending $US7.5 billion ($10 billion) on decarbonisation investments by the end of the decade. However, the bulk of Rio Tinto’s emissions are generated from the end use of its iron ore in Asia’s carbon-intensive steel mills, known as Scope 3 emissions.
Thompson said Rio Tinto could not control the pace its steel mill customers chose to decarbonise their operations, and because Rio Tinto no longer extracted fossil fuels, the company faced greater challenges reducing Scope 3 emissions compared to coal, oil or gas producers that can reduce output or changing their product mix.
“If we were to put targets out there, that to me would be close to lying. It would be greenwashing because we would be setting hard quantifiable targets for something we don’t control,” he said.
“Ultimately, one of the ways the steel industry will decarbonise is if the customers … such as the automotive industry, insist upon the steel industry producing green steel.”
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