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Rio Tinto wants to build its own lithium mines because its cheaper than buying them

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In an interview with Bloomberg TV, Rio Tinto Ltd.’s CEO Jakob Stausholm said that the mining giant seeks to be a “meaningful” lithium producer but thinks it’s cheaper to build its own mines than to buy them.

In the interview, Stausholm said the company is actively looking to expand its presence in the lithium market as the demand for carbon-free technologies and electric vehicle batteries increases. Stausholm said that Rio Tinto is looking to expand its exploration efforts for lithium in Western Australia where its iron ore mines are based.

“We rather use our competence to develop the projects ourselves because lithium companies are very, very expensive and that may be relevant to somebody that doesn’t have competencies in the area but we believe we can find much cheaper ways to do that.”

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Stausholm said during the interview that while the market and demand for lithium is small right now compared to aluminum and copper, it is set to increase 10 times by 2030.

“I do believe that society nowadays is focusing on how things are being done and we rather be a step ahead than a step behind, we can’t run away from the fact that extraction has an impact but we can minimize it, we can offset that and find really good solutions,” said Stausholm about the company’s ESG efforts.

“So that is actually the value proposition from our side.”

The company also announced Tuesday that in partnership with Midland Exploration Inc, it identified a series of spodumene-bearing pegmatite dykes on the Galinée project. The project is approximately 8 kilometres east of the Adina lithium deposit held by Winsome Resources.

Spodumene is an important source of lithium, which is widely used in batteries for electric vehicles, smartphones, and other electronic devices.

Last December, its Jadar Lithium project in Serbia was halted after the country’s prime minister ruled out a way forward because of protests over environmental concerns. Stausholm told Mining.com and Bloomberg that the company would still consider the project as part of the portfolio.

In March last year, Rio Tinto acquired the Rincon lithium project in Argentina for $825 million from Rincon Mining in the Salta Province in Argentina.

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