Reuters news agency reported that "shares in Rio Tinto tumbled on Friday after Serbia revoked its lithium exploration licences over environmental concerns, hurting the Anglo-Australian miner's ambition to become Europe's largest supplier of the metal used in electric vehicles."
The agency said Serbia’s Government decision came ahead of the country’s April 3 presidential, early general, Belgrade and some local elections.
It added that „Rio’s shares in Australia closed down 4.1% after falling as much as 5.1% in the Australian stock market, its worst intra-day drop since August 2021. The benchmark index ended down 2.3%,“ while „in London, Rio’s shares were down more than 3% by 0855 GMT, slightly underperforming their peers.“
Reuters also linked the termination of Rio Tinto's licences to the latest blow to Belgrade – Canberra relations after the world number one tennis player and nine times Australian Open champion Novak Djokovic was deported from Melbourne a day before the first Grand Slam tournament started on Monday.
Djokovic lost his legal battle before the Australian Federal Court despite being allowed to the country on a medical exemption.
Reuters cited the Australian Government regretting Serbia's decision to revoke Rio's licences.
"We note the strong economic benefits of the significant investment by Rio Tinto in Serbia. Australian resources companies have an outstanding reputation around the world, particularly when it comes to their expertise," the government said in a statement to Reuters.
In its first reaction to Brnabic's decision, Rio Tinto said they "always respected the laws of the Republic of Serbia during our work on the Jadar Project.” It added it was looking into the "legal grounds for the Government’s decision and its implications on the company’s activities and staff in Serbia."
Reuters said that the mine (in western Serbia) is Rio's only lithium project, and the company announced just a month ago a deal to buy a second lithium asset for $825 million, as it looks to build its battery materials business." the agency said.
The agency recalled that Serbia's Prime Minister Ana Brnabic told a news conference in Belgrade she decided to cut ties with Rio Tinto "after requests by various green groups to halt the $2.4 billion Jadar lithium project that had planned to start production in 2027."
"Thousands of people blocked roads last year in a protest against the government's backing of the project, demanding Rio Tinto leave the country and forcing the local municipality to scrap a plan to allocate land for the facility," Reuters said, adding "the decision came days after ties between Australia and Serbia hit rock bottom as tennis star Djokovic was deported before he could play in the Australian Open."