7 June 2023

The Jadar mine is not welcomed in Serbia, why would Savannah’s Barroso be welcomed in Portugal?

Permitting progress for Savannah Resources’ Barroso project brings to surface past opposition to Rio Tinto’s Jadar mine, highlighting problems for social licencing of hard-rock mining in Europe. For Savannah, patience, improved due diligence, and proximity to conversion sites seems to do the trick.

On Wednesday 31st May, the Portuguese Environment Agency issued a positive statement on the environmental impact of the Barroso project of Savannah Resources. However, Barroso’s full environmental licensing still faces 12 months of additional processes and continued population resistance.

SFA’s views:

1. Savannah can bring momentum on agile EU mine permitting.

• • Europe has failed to become a comparatively favourable jurisdiction for mining.

  • Savannah has been in the process of environmental clearance since May 2020, highlighting the long lead times to production in Europe.

  • Barroso’s permitting gives a precedent to the industry that can be significant for modifying permitting structures to respond in a manner that reduces uncertainty to investors.

Dr Emilio Soberón

Principal Consultant

2. Negative sentiments from populations are unchanged by permitting.

• • De-risking Europe against strong public opposition has been attempted by Rio Tinto in Serbia, without positive results to date.

  • Demonstrations at Rio Tinto’s London HQ in April 2023 mirror those against Savannah in Portugal. Barroso risks emulating Jadar.

  • Populations in Portugal, Spain, and France, as in Serbia, have shown discontent against domestic lithium mining projects.

  • Europe has a difficult way ahead to reconcile battery demand with public sentiments on domestic raw material supply.

  • Stronger and more coordinated opposition could counter positive mine permitting results, as EU authorities acknowledge battery raw material shortages without engaging civil society.

3. Europe will need every mine it can get.

• • Even if Savannah is successful, Barroso’s potential lithium supply is a small portion of Europe’s expected demand.

  • Regional actions in Europe have focused on partnering with other supplying countries, such as Australia, US, Argentina, and Chile, but have neglected coordinated progress on permitting and risk mitigation for domestic projects.

  • Lithium refineries are increasingly being planned in Europe, but their economics face threats as forthcoming EU supply chain standards might raise import costs for battery metals.

  • Raw lithium materials from Barroso would significantly benefit Northvolt and Galp’s Aurora lithium conversion plant in Portugal, for example, with fully traceable, EU compliant, co-located feed.

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Source: SFA (Oxford). Note: EV demand includes BEV, PHEV, EREV, FHEV, MHEV and FCEV. *Excludes early-stage projects.

Source: SFA (Oxford), Savannah Resources, Northvolt. Note: *Based on lithium hydroxide monohydrate (LiOH.H₂O) to lithium carbonate (Li₂CO₃) conversion factor of 0.88.

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