Serbia to get the largest lithium mine in Europe, plans to produce batteries for 1.1 million electric vehicles

Serbia will give Mercedes-Benz, Volkswagen, and Stellantis the opportunity to purchase lithium for automotive batteries as it seeks to prioritize European over Chinese car manufacturers, said President Aleksandar Vučić.

– The EU needs lithium, and we want to strengthen our ties with the EU – Vučić told the German daily Handelsblatt in a recently published interview.

German Chancellor Olaf Scholz will travel to Serbia on Friday for talks with Vučić, with key raw materials for battery and electric vehicle supply chains being the main topic.

According to German government spokesman Steffen Hebestreit, Scholz and Vučić will sign a declaration of intent for strategic partnership. Within this framework, sustainable support for raw materials will be established, battery value chains will be set up, and financing instruments will be developed. Additionally, a memorandum of understanding will be signed between the Government of Serbia and several European and Serbian companies. Among them, according to government circles, are the British-Australian mining company Rio Tinto, the European automotive group Stellantis, Mercedes, and the German development bank KfW.

– The background is a project for sustainable lithium mining in Serbia. Overall, it is about further developing the European raw materials program and diversifying sources of raw materials – added Hebestreit. The letter of intent includes ‘commitment to high environmental and sustainability standards’.

The Serbian government only opened the way for the largest lithium mine in Europe in the Jadar Valley on Tuesday. This came after years of protests from ecologists who opposed the project due to fears of contamination of groundwater with arsenic present in the lithium-containing ore. The Serbian government revoked the previously granted permit due to protests in 2022.

Recall that the European industry has been seeking lithium suppliers worldwide for years and is competing with China, which has taken the lead in the electric vehicle sector. Chinese companies have taken control of lithium mining and processing in many countries, thereby reducing the competitiveness of European manufacturers in the industry.

Serbia has restored the license to Rio Tinto for the development of the largest European lithium mine, potentially strengthening the electric vehicle industry in the EU. Vučić told Handelsblatt that Serbia plans an annual lithium production of 58,000 tons, enough for about 1.1 million electric vehicles or about 17 percent of the European market.

Supply contracts would depend on the largest part of further lithium processing and battery production taking place in Serbia, he added.