Written by / Ma Xiaolei
Edit/Windsor
Design / Shi Yuchao
Source/Bloomberg, by Thomas Biesheuvel, Misha Savic
As the basic material for electric vehicle batteries, the price of lithium hit a record high in 2021, and people's concerns about the shortage of raw materials for the transformation of electric vehicles have intensified. In this case, now should be the best time to build a mine.
The world's second-largest miner, Australian mining giant Rio Tinto, found that this was not the case.
In western Serbia, Rio Tinto unveiled a $2.4 billion mining project, Jadar. Just months after the plan was announced, local opponents organized a campaign that shook the government, bringing the city to a standstill and thousands of protesters marching through the streets. The local government subsequently suspended the proposed mine land use plan, and the project is currently at a standstill.
On December 11, in Belgrade, people blocked roads to protest Rio Tinto's plans to open a lithium mine
Slavisa Miletic, an event participant who lives near the planned mine, said: "The entire Jadar project is just another way for multinational companies to cause damage to the Serbian people with the help of our government in order to make a profit. ”
The protests Rio Tinto faces are replicating around the world, with industry executives seeing it as the biggest challenge they will face in the future.
Southern Copper Corp., a controversial $1.4 billion project in Peru, is struggling to win government support; Lithium Americas Corp., which has sued in federal court for its planned mining in Nevada.
Historically, the mining industry provided employment opportunities and economic development for poor areas, and taxes and royalties enriched the government's treasury. But people living nearby often have to pay for environmental degradation and occasional disasters.
That's changing, and locals are fighting back. They argue that economic gain cannot come at the expense of the quality of life of the local people. The government has also had to start paying attention to these opposing voices.
Ben Davis, a mining analyst at Liberum, said: "It's harder to build a mine today than it used to be. It's easy to solicit objections, especially in rural and isolated communities. ”
To appease protesters, the Serbian government has proposed a referendum on the mine's whereabouts, but that has sparked controversy, with the opposition saying recent legal changes have tipped the balance in favor of the government and Rio Tinto.
Protesters also slammed the government's haste-up of ownership changes in state-owned and private projects, forcing President Aleksandar Vucic to send the proposal back to parliament for revision.
Bojan Klacar, director of the Centre for Free Elections and Democracy (CESID), based in belgrade, Serbia, said: "Environmental issues have long been neglected in Serbia because the economy and living standards have dominated for many years. Priorities have changed. ”
Thousands of Serbs protested for the fourth weekend in several cities, not just Rio Tinto, who demanded an unconditional ban on lithium exploration and mining by any company. At the largest rally in Belgrade, activists vowed to step up the protests if their requests were not met next month.
When Rio Tinto officially announced the project in July, it seemed like a steady business for the new CEO, Jakob Stausholm.
Lithium is a future-proof commodity that is essential for global decarbonization. From Tesla to Volkswagen to Toyota, the biggest automakers need a growing supply of battery materials to accelerate the adoption of electric vehicles, and Bloomberg NEF expects mineral demand for lithium-ion battery packs to grow fivefold by 2030.
The global lithium price index for 2021 has more than tripled, and Bloomberg NEF predicts that next year's lithium-ion battery prices will rise for the first time since 2010.
In addition, the mine will be built on farmland, rather than primary forest, and will be only a 10-hour drive from Germany's auto manufacturing hub. Rio Tinto said the project, which could create more than 2,000 jobs, is scheduled to start construction in 2026 and fully operational in 2029.
However, these so-called "lists of advantages" are not important to many. From cyanide spills to dam collapses, countless deadly disasters have revealed the mining industry's dark history.
Just in 2020, Rio Tinto destroyed an ancient Aboriginal site in Juukan Gorge in western Australia, forcing the CEO to leave his job.
Sinead Kaufman, rio Tinto's director of the Serbian mine, said: "There are indeed some disgraceful things, and the Yukan Canyon incident is the number one. ”
It's not just lithium that's at problem. Copper is an important metal in the energy transition and demand is expected to grow by nearly 50 percent over the next decade, according to Chilean miner Antogasta Plc. It usually takes about 15 years for a mine to go from discovery to production.
Even so, many beautiful visions remain at a standstill.
Rio Tinto's proposed Deficit copper mine in Arizona could meet a quarter of U.S. demand, but the federal government is reviewing the project amid opposition from the San Carlos Apache tribe, whose leader declined to meet with Rio Tinto's CEO in 2021.
Mark Cutifani, chief executive of Anglo American Plc, said in a speech in London in December: "Despite the fact that the mining industry has contributed to almost every aspect of modern life, people still think the industry is asking for more than giving. ”
Rio Tinto's solution now is to convince the Serbs that the Jadar mine will not be like the previous mine. The company said it would be built to the highest standards, that almost all of the water would be reused and that electric trucks would be used.
Kaufmann of Rio Tinto Group said: "A mine that will be built in the 2020s and will exist for decades is very different from a mine built 50 years ago, or even 20 years ago. That's the message we need to get across. ”