Concerns and Facts about the proposed Jadar Project

Fact: Jadar would be an underground mine, not an open-pit mine. The industrial site which includes mining and processing facilities would cover 220 hectares. In comparison, the Kolubara open-pit coal mine covers approximately 60,000 hectares. This smaller footprint results in less disruption to agricultural land.

Jadar’s underground activities would also generate less noise and dust in comparison to an open pit mine, because it would have an electrical fleet of vehicles operating underground. Underground construction and mining operations would include a combination of methods designed to minimise rock material excavation, which would reduce the total amount of waste generated and other beneficial materials that need to be stored.

Open pit mine example (Not Jadar)

Jadar underground mine

More information: The Jadar Project

Fact: Our water management approach and our project design ensure that Jadar will not impact drinking water sources or groundwater resources that are accessed for domestic or agricultural supply, or used by local industries.

There are two main groundwater systems in the Jadar Valley. Good quality water is present in the shallow aquifer (up to 30m deep) and this is accessed for local needs and agricultural use. Groundwater in deeper aquifers where mining would occur (i.e. greater than 300m deep) is naturally of a low quality, high salinity and not suitable for drinking or use in agriculture or industry.

We recognise that the shallow groundwater is a vital water source for local communities, and we have designed the mine at Jadar so that it has a minimal impact on these water resources.

Pumping of groundwater that flows from the deep aquifer into the underground mine is required to safely manage underground working conditions and to ensure the stability of the mine. This water would be pumped to the surface and treated as one of the main water supply sources for use within the lithium processing operations.

Fact: No current or future public water supply sources (as defined in the Basic Water Management Plan of the Republic of Serbia) would be used to process the jadarite mineral or to meet Jadar’s water usage requirements.

Jadar would be designed so that over 70% of the project’s water demands could be supplied from within the project itself through rainfall capture, underground inflows or treatment and recycling of water that is already within the mining process. Of this 70%:

• 18% of supply would come from water pumped from the underground mine workings;
• 48% of supply would come from water reused within the project. Water from mined material, waste rock, residue, washdown and processing would be re- captured and treated to ensure that water is reused where possible and the potential for wastage is reduced; and
• 12% of supply would come from capture of rainfall and runoff within the core project footprint.

Our water management and water use is based on the July 2023 water balance for the project. We are constantly working to refine and improve our water management approach and we will update these values as new information becomes available.

The remaining water demands that cannot be met from rainfall, underground inflows and recycling would be sourced from the alluvial aquifer next to the Drina River, and not from the river flow itself. On average, approximately 22% of Jadar’s water demand would be sourced from this aquifer. This aquifer cannot be used as a source of drinking water due to historical gravel excavation activity undertaken by other companies upstream, which has led to the alluvial sediments being unsuitable to host a drinking water resource.

The Jadar Project would not source any water from the shallow aquifers of the Jadar Valley during operation. We recognise that this is a vital water source for local communities, and we have designed Jadar to ensure it has a minimal impact on shallow groundwater sources.

Fact: Our water treatment process is designed in accordance with EU regulations, and to support the Republic of Serbia 2034 Water Strategy objective that surface waters should achieve Class II status (good ecological status). A core component of the water management strategy for Jadar is that no water would be discharged without treatment to meet Serbian Class II standards, the same target status as the rivers in the Jadar area.

Discharge would only occur when water volumes exceed water management pond capacity. Discharging water would only occur during periods of high rainfall or when there may be higher inflows to the underground mine.

The proposed water treatment solutions are technologically advanced and highly efficient and would meet environmental quality standards set out in both Serbian and EU law. We would spend over $100 million on water treatment, environmental, and biodiversity protection and work with the Serbian Environmental Protection Agency, other state institutions and CSOs to monitor water use on the project. We would also allow all stakeholders to monitor water quality programmes for the project.

It should be noted that there are currently no environmental quality standard values for lithium in Serbia. Therefore, we are working to define industry best practice within the EU and other jurisdictions (e.g. USA, Canada, Australia, New Zealand etc) for the management of lithium concentrations in discharge to surface waters.

Jadar’s water treatment facilities would use a range of purification technologies (ultrafiltration, reverse osmosis and ion exchange) to remove contaminants and produce consistent water quality. Once this initial process is complete, the water would pass through an additional treatment process to ensure that all appropriate minerals are present. This process would ensure that any water that is discharged into the local river system is safe and of a Class II standard.

The flow, pH and electrical conductivity of the water treatment plant would be monitored in real time to ensure effective performance. The local river system would also be regularly sampled and analysed and this information would be made available to the public.

Fact: Piezometers are observation tools installed to monitor changes in the groundwater deep beneath the surface. They record data relating to the level or pressure of groundwater which is then used for hydrogeological studies. Piezometers do not mix water from different underground levels; their purpose is to sample and test water at different depths below the surface.

Piezometers can be installed both as small hollow tubes into the ground, or as sensors cement-grouted at different depths inside a drillhole. When piezometers are installed correctly and in line with regulatory standards, they are safe, and there can be no leakage or mixing of groundwater from different aquifers. Shallow and deep piezometers have been installed in the Jadar Valley in line with regulatory standards set by the Ministry of Mining and Energy. The piezometer installation was completed by licenced companies, with certified material used for installation (stainless steel pipes, bentonite clay shavings for sediment isolation, cement mixture for grouting, etc.). The installations were completed under supervision of experts from the University of Belgrade, the Department of Hydrogeology.

Piezometers do not pose an ecological risk, even during flooding events. For example, during the floods of 2014, all deep piezometers in the Jadar and Korenita valleys remained functional due to their proper construction and installation. Installed piezometers are being monitored at least once per month, and if any issues were identified, construction parts of the piezometers would be repaired as soon as possible.

Fact: Elevated levels of lithium, arsenic and boron exist in the Jadar River. However these are entirely unrelated to the Jadar Project. In 2015, we commissioned the Jaroslav Černi Water Institute – a leading Serbian research institution – to carry out an analysis of the surface water regime around the project area. This monitoring continued on a quarterly basis until September 2021.

Elevated concentrations of these heavy metals were recorded at surface water monitoring locations after the point where the Korenita river converges with the Jadar river. As evidenced in section 6.1 of a Ministry of Environmental Protection report (published in 2018), this has been caused by the collapse of the Stolice tailings dam during the 2014 floods.^{[1] Zemljiste_18_19.pdf (sepa.gov.rs)} Therefore, these elevated levels cannot be attributed to the Jadar Project.

The last monitoring round was completed in August 2021. We have not been able to access our monitoring stations since our licences were revoked by the Government of Serbia in January 2022. Should our licences be reinstated, we would carry out an extensive programme to assess the status and integrity of our monitoring network, and re-sample the available monitoring points to update our understanding of the hydrogeological and hydrological conditions.

All monitoring reports are publicly available on the Jadar website.

Fact: The groundwater sources in the Mačva region represent a valuable natural resource in Serbia. These groundwater resources would not be impacted by Jadar’s operations due to the distance between the Jadar Project and the Mačva area containing groundwater reserves, as well as planned protective measures, standards and controls for water management at Jadar. There are no studies that support the claim that groundwater sources in the Mačva region could provide drinking water for 85 million people however the Jadar project will in no way be reducing or impacting on those waters which are available.

Fact: The water treatment and management facilities at the Jadar Project would ensure that water is only released from the site after treatment. The water we would release would be treated to Serbian Class II quality standards for surface waters, which supports the Republic of Serbia 2034 Water Strategy objectives. This means that the quality of water in the Drina and Sava rivers would be preserved.

In order to ensure transparency in relation to water quality throughout the lifecycle of the mine, we would have an expert accredited Serbian laboratory regularly sampling the discharge waters. The results of this analysis would be made publicly available.

More informaton: Water management

Fact: We have and always will follow the Serbian regulatory process which includes the publication of the Environmental Impact Assessment (EIA) for public consultation. We did not get to the public consultation phase of the process by the time the licences were revoked, so the EIAs were never published. Since the licence was cancelled, we have continued feasibility studies regarding the design of the project to meet internal commitments, meaning that the impact assessments need to be updated to reflect these changes. If studies can be completed, they would be made publicly available and shared with all stakeholders.

We started conducting baseline studies for our Environmental Impact Assessments (EIA) in 2015, which began with surface water testing. This multi-year baseline data informs detailed environmental and social impact modelling, so that the facilities can be designed to eliminate or minimise potential adverse environmental impacts.

New management plans would be created to monitor and control any interactions with our surroundings. These baseline studies would be the basis of our EIAs should the Jadar Project’s licences be reinstated.

Developing the baseline studies has involved working with a group of more than 100 local and global independent experts on all aspects of ESG, including around 40 university professors from more than 10 faculties and scientific institutions. So far, more than 23,000 biological, physical and chemical analyses of soil, water, air and noise have been conducted. Draft EIAs have been developed based on this data.

Fact: Forests of high ecological value would be preserved through strict compliance with mitigation hierarchy measures (mainly avoidance and minimisation). According to the current plan, 145 hectares of forest are planned for removal. To compensate for the removal of 145 hectares of forest, we would plant 300 hectares of new forest, as required by the Law on Nature Protection of the Republic of Serbia. As well as compensating for the forests we remove, we would compensate for biodiversity micro- niches and habitats that are disturbed or lost within the forest ecosystem. This would be the first example of this practice in Serbia and a demonstration of our commitment to biodiversity conservation.

Fact: During development and operation, Jadar would be strictly governed by Serbia’s nature protection laws and regulations. It would also meet European Union environmental principles, practices and standards.

We would safeguard, and where feasible, enhance ecosystems to achieve No Net Loss of biodiversity. To achieve this, we would predict and mitigate any negative impacts on flora and fauna via a mitigation hierarchy of avoiding, minimising and restoring.

According to the State Institute for Nature Conservation, there are 1,783 strictly protected species and 860 protected species of plants, animals, and fungi in Serbia, equating to a total of 2,643 nationally. The Jadar Project team has identified around 145 protected and strictly protected species in the project’s proposed area; these species are prevalent across much of Western Serbia. This level of species prevalence is typical of most small scale industrial or civil developments, and scientific evidence has shown over time that species are typically resilient to this small-scale level of change. Nevertheless, we recognise that it is vital to appropriately manage any potential impacts in line with relevant laws and guidance.

The Jadar Project team also found that none of the species located at the proposed project area are likely to qualify under critical habitat criteria of EBRD PR6.

The proposed project area is not a protected natural site, NATURA 2000, Emerald or nationally protected. No endemic species have been registered in the proposed project area, and 98% of all identified species belong to the least concern (LC) category of the International Union for Conservation of Nature (IUCN) Red List of Threatened Species. Least Concern species have a stable population and are not endangered or threatened. The 2% of species of a higher status of the IUCN would be protected, and management plans would be put in place in cooperation with the relevant institutions in Serbia.

More informaton: Conservation of biodiversity

Fact: The Jadar deposit does not contain high levels of heavy metals such as arsenic. Therefore, the concentration of heavy metals in Jadar’s industrial waste would be comparable to the concentrations found in local soils, including agricultural land.

The concentration of arsenic in jadarite waste of 90 ppm is similar to the results of soil sample analysis taken in the Jadar flood plain farming land. For reference, this is 50 times lower than in the Stolice antimony tailings (4272 ppm). This is due to the fact that arsenic tends to concentrate in deposits of some mineral raw materials such as antimony, however this is not the case with lithium. Furthermore, arsenic in jadarite waste is classified as highly insoluble and physically isolated within the waste according to the highest possible waste regulations and standards, and therefore the small quantity of arsenic present is not considered to pose a risk of dispersion in waters.

To ensure that any arsenic-related pollution is prevented, we would use an ore processing approach to prevent ore exposure to air or water. Following processing, the remaining residue would be dried and compacted to achieve very low permeability, restricting air and water ingress. It would then be disposed of in landfill that is designed to minimise exposure to air and water. Therefore, the release of arsenic would be inhibited.

The landfill solution includes a system of multiple impermeable barriers at the top and bottom of the landfill site. There would also be a system for water seepage collection, with the collected water being directed to water treatment and recycling. After the closure of the mine, we would continue to monitor all the potential impacts to prevent contamination of the surrounding environment.

More information: How would we minimize potential impacts.

Fact: Emissions from our operations, together with emissions from our power supply, would make up approximately 249,000 tonnes of CO₂ annually. According to recent figures cited by the Ministry of Mining and Energy, Serbia’s total carbon dioxide emissions is estimated at 60 million tonnes annually. Therefore, Jadar would contribute approximately 0.4 % of Serbia’s total emissions.

The focus on CO₂ emissions primarily relates to their cumulative effect on the planet’s climate. The manufacturing and use of electric vehicles – for which lithium projects such as Jadar are essential – reduces overall CO₂ emissions compared to the use of cars with internal combustion engines. Therefore, Jadar could be considered to be a net positive impact on global CO₂ levels.

Fact: No sulphuric acid will be present in any emissions or residue streams from the jadarite ore process.

Sulphuric acid is one of the most important and widely used products of the chemical industry. In Southeast Europe, about 6 million tonnes of sulphuric acid are used annually. In Serbia, around 400,000 tonnes of sulphuric acid are used per year. In Western Europe, Germany uses about 7 million tonnes per year.

Jadar would use about 320,000 tonnes of sulphuric acid per year. The process for using sulphuric acid in various industries is safe and strictly regulated by the Government of Serbia. The proposed process enables the ore to be digested without creating and emitting any sulphuric vapour. The jadarite would be digested in sulphuric acid in closed steel vessels to produce lithium at 90°C. Because this is significantly below the boiling point of sulphuric acid (250°C) and below the boiling point of water (100°C), the gas produced by the digestion would primarily contain carbon dioxide and water. As a result, there would be no evaporation of sulphuric acid as part of processing. All the added sulphuric acid components are ultimately converted into benign compounds such as water and gypsum, or saleable boric acid and sodium sulphate products.

More information: Air quality management

Fact: A wide range of procedures would be put in place to ensure the safe transport of sulphuric acid.

Engineering principles for handling sulphuric acid are established, proven, and widely applied. Sulphuric acid would be transported by bespoke, dedicated trains. Following the onloading process, transport would be performed in a closed system, which would be equipped with accident detection and automatic pump shutoff systems.

Jadar rail studies have not identified any capacity or bottleneck issues related to the current rail network’s capacity to manage additional cargos. Moreover, the rail branches or different rail routes planned to be utilised for sulphuric acid transportation had recent network upgrades (Ruma – Brasina and Niš – Zaječar), increasing the overall safety and capacity.

Fact: We are completing the land acquisition process for negotiations that began before the project’s licences were cancelled in January 2022. All our activities are in compliance with the legal status of our presence in Serbia.

More information: Land acquisition and Community Development

Fact: As temporary stewards of the land during our period of operational tenure, we know our impact and responsibilities continue after our operations end. As our sites transition to their next life, our goal is to leave a positive legacy, delivering value for both us and our stakeholders. Delivering mutually beneficial Closure outcomes is critical to earn our social license to operate and to grow. To be successful we must work in partnership with local communities and other stakeholders who may be the owners of and/or use the land, governments, our employees, contractors, and suppliers.

We plan for closure throughout the life cycle of an asset beginning in the project development stage. Throughout this planning process, we aim to invite, engage and collaborate with interested stakeholders to allow for the development and operation of an asset in a way that manages the impact of our activities in order to optimise outcomes for host communities and key stakeholders.

The location of Jadar within Serbia

The proposed project area, prior to development

The Jadar site once operational

The rehabilitated area following the closure of Jadar

Fact: We understand and value the economic and cultural importance of agriculture in the Jadar Valley. The project and agriculture could co-exist. Farming will continue alongside the proposed mine as Jadar would be an underground mine. This means significantly lower impacts on the landscape and environment due to a smaller surface operations area in comparison to an open pit development. Our global operations have many examples of partnerships with local farmers, empowering their yield and income. For example, in the Saguenay – Lac-Saint-Jean region of Quebec, Canada, we are working with blueberry growers to improve the yields and quality of the fruit they produce.

Fact: Jadar would displace agricultural production from approximately 220 hectares or less than 1% of agricultural land in the Loznica municipality (308 km² in total (equivalent to 30,800ha)). In the core project footprint area (underground mine, processing facilities, and landfill), the total value created from agriculture is estimated to be below EUR 0.62 million annually. The Jadar Project’s estimated GDP contribution is around EUR 695 million per year, out of which EUR 24 million per year would be transferred directly to the municipal budget. The figures provided were calculated using a lithium carbonate price of approximately $15k per tonne. It is important to note that royalty and tax contributions are directly tied to the price of lithium. As such, there exists a significant potential for positive outcomes if lithium prices were to reach $20k, $30k, or even $80k, as witnessed last year. For example, if the price remains in the range of $30k to $40k, the tax and royalty contributions would more than double, resulting in a substantial increase in revenue for the state and Loznica municipal budgets.

If Jadar were to become operational, it would adhere to strict environmental, social and governance (ESG) standards to ensure that agriculture can continue alongside the proposed mining site. We would also continue to invest in agricultural development in the region. Further, the lands on which the project is located would be made available again to agriculture at the end of mining.

Fact: Any accusation that we have threatened residents with expropriation is false and is rejected in the strongest terms. Our code of conduct is clear: we do not offer, pay or accept bribes, no matter where we operate, what the situation or who is involved; such activities are strictly prohibited.

We have engaged with community members on the project and secured voluntary sales of land by 96% of landholders on the project footprint, this includes nearly all permanent residents in this area agreeing to the purchase of their property without the use of any expropriation laws, and the support of these families and households to secure alternative housing and sustainable livelihoods in their selected location.

All asset valuations have been carried out in line with International Finance Corporation (IFC) global standards.

In January 2023 we launched a sustainable local development programme, which is open to all interested parties in the Loznica and Krupanj areas. This is part of our ongoing support for local economic development, with a focus on agriculture, tourism and green entrepreneurship. Applicants must fulfil defined criteria and comply with a set of commitments designed to ensure accountability in the development program. There is no obligation for beneficiaries of the programme to support or work with Rio Tinto in any way.

Fact: There were 52 permanent residents households within the core project footprint (CPF) area which would be used for the development of mining and processing facilities. Out of these 52 households, 50 (96%) have sold their properties and resettled, most of them with the support of our company. We have supported those who have sold their properties throughout the resettlement process and continue to do so, to ensure that their livelihoods are maintained and, where possible, enhanced. An additional 23 residential buildings for non-permanent residents (vacation, weekend or abandoned houses) have been identified, out of which 18 have been purchased. The land acquisition process is implemented in accordance with international standards. International standards distinguish physical displacement (loss of shelter) and economic displacement (loss of means of livelihood). Both groups are considered in our livelihood restoration plan.

Currently, 129 households have been confirmed to be economically impacted after selling their land (this includes the 52 households which have been physically resettled). All of these households have received, or are currently receiving, livelihood restoration support. The total number of economically displaced households in the CPF would be confirmed if the land acquisition process continues.

Fact: The project would not create ecological refugees. In fact, we expect that the project would attract new residents to the Mačva region from other regions in Serbia.

Emissions from our operations, together with emissions from our power supply, would make up approximately 249,000 tonnes of CO2 annually. According to recent figures cited by the Ministry of Mining and Energy, Serbia’s total carbon dioxide emissions is estimated at 60 million tonnes annually. Therefore, Jadar would contribute approximately 0.4 % of Serbia’s total emissions. The Jadar deposit does not contain high levels of heavy metals such as arsenic. Therefore, the concentration of heavy metals in Jadar’s industrial waste would be comparable to the concentrations found in local soils, including agricultural land. No sulphuric acid would be present in any emissions or residue streams from the jadarite ore process.

Jadar would ensure approximately 3,500 high-paying jobs at the peak of construction and 1,300 full-time jobs once operational, with an average net monthly salary of EUR 1100 once the operations start. The project is focused on the long-term development of Serbian suppliers. We would pursue collaborations with government, Serbia’s bilateral and international development partners and other private sector players, to support local business development.

Fact: We understand that protecting cultural heritage in Serbia is a matter of public importance. Based on research to date, we have identified two culturally significant sites that are close to or within the proposed location of the mining site - the Paulje Necropolis and the Church of St. George the Martyr.

The Paulje Necropolis is an archaeological site of a Bronze Age cemetery dating back around 3,500 years. We have been cooperating with the Jadar Museum in Loznica to support the careful excavation of cultural artifacts, such as burial mounds, ceramics, stone tools and bronze objects. While supporting conventional research methodologies, excavation and preservation of artefacts for public display, we have also invested in advanced technology, including LiDAR and geomagnetic technologies, which have improved the precision of survey techniques to better identify and map archaeological sites. These technologies have also improved the excavation of important finds.

The Church of St. George the Martyr is located close to the mine’s proposed location, however, it would not be physically impacted by the Jadar Project’s operations. We understand the important role that the church plays in the community and we are committed to ensuring that it remains a protected cultural heritage site.

Fact: The proposed ore processing technology, process and equipment are common to mineral and hydrometallurgical processing plants globally, including in the European Union. For example, the process we would use to produce Boric Acid is the same that we have used for over 50 years at our boron operations in California, USA. Boric acid is used for many everyday products, for example in eye drops to provide relief from irritation and to remove pollutants.

Fact: All waste would be carefully managed in line with local Serbian and European standards. The envisaged landfill location is in the Štavice valley, 10 km from the proposed Jadar site, and outside the flood plain area. Instead of storing industrial waste as a slurry (75% moisture content) in a typical large-scale tailings dam, we plan to dry and compact waste to a high impermeability level and store it in a stable landfill designed according to the highest standards. More specifically, we would put a range of measures in place that meet both Serbian and EU regulatory requirements, including multiple barriers to ensure groundwater protection. The proposed measures include:

• Dewatering with filter presses to create solid processing residue to support progressive rehabilitation, and reduce the landfill area;
• Ongoing research and development to find new and better ways to reuse waste and processing residue;
• Using multiple barriers to prevent contamination at mine waste management facilities;
• Installing a leachate drainage and collection system for water treatment and recycling;
• Installing water diversion channels around the storage facility to reduce contact of clean rainwater with waste and processing residue;
• Progressively capping and rehabilitating the waste storage facility; and
• Installing systems to monitor the effects of waste and processing residue on the environment.

Dried and compacted processing residue

More informaton: Waste management