Buying Rio Tinto shares? Here's why this 'world-class' lithium project could be back on track

Rio Tinto's lithium ambitions have been largely on hold since 2022. But is that about to change?

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Rio Tinto Ltd (ASX: RIO) shares are slipping on Monday.

Shares in the S&P/ASX 200 Index (ASX: XJO) mining stock closed Friday trading for $120.20. In afternoon trade today, shares are swapping hands for $119.16 apiece, down 0.87%.

For some context, the ASX 200 is down 0.11% at this same time.

Looking ahead, Rio Tinto shares could garner some ongoing tailwinds as the miner's stalled Jadar lithium project in Serbia appears to be back on track.

Here's what's happening.

Rio Tinto shares could get a bigger lithium footprint

Lithium prices have come off the boil since the November 2022 record highs. However, most analysts agree that global demand for the battery-critical metal will continue to grow over the decade ahead.

And Rio Tinto shares could derive more revenue from lithium in the years ahead with the Financial Times reporting that Serbian President Aleksandar Vucic is set to lift the ban on the ASX 200 miner's Jadar project.

This follows "new guarantees" from Rio Tinto and the European Union addressing environmental concerns that had derailed the US$2.4 billion project following public protests in 2022. Protestors demanded an end to all lithium exploration in Serbia.

Commenting on the revocation of the licences related to the Jadar lithium-borates project, Rio Tinto states on its website:

We believe the Jadar project has the potential to be a world-class asset that could act as a catalyst for the development of other industries and tens of thousands of jobs for current and future generations in Serbia, while sustainably producing battery-grade lithium carbonate, a material critical to the energy transition.

Jadar is planned as an underground mine.

To give you an idea of the potential on offer for Rio Tinto shares, the miner says the project can produce around 58,000 tonnes of refined battery-grade lithium carbonate, 160,000 tonnes of boric acid and 255,000 tonnes of sodium sulphate annually. All will be produced in powdered form.

And Serbia's president indicated that the Jadar lithium project might be running as early as 2028.

"If we deliver on everything, (the mine) might be open in 2028" Vucic said (quoted by Reuters).

Vucic noted the lithium production from Jadar would be "enough for 17% of EV production in Europe — approximately 1.1 million cars".

Rio Tinto stated, "We believe the Jadar Project has the potential to be a world-class asset that could act as a catalyst for developing an EV value chain in Serbia".

Rio Tinto shares are up 3% over 12 months, excluding the ASX 200 miner's two dividend payments.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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