Lithium Americas Receives Record Loan For $2.2B, Milestone Project In Nevada

Lithium Americas LAC has received a conditional commitment for a $2.26 billion loan from the U.S. Department of Energy (DOE) to develop its Thacker Pass project, the largest lithium deposit in the United States. The record loan comes at a turbulent time for the industry, with prices declining by 80% from the peak in December 2022.

“Our team has been focused on refining the development plan and de-risking construction execution of Phase 1 for Thacker Pass,” said President and CEO, Jonathan Evans.

“We have de-risked execution by advancing detailed engineering and project planning. To date, we have completed all the early works and infrastructure required for major construction, including excavating the processing plant areas. We anticipate issuing full notice to proceed and commencing major construction shortly following the closing of the DOE Loan,” he added.

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The conditional loan, under the Advanced Technology Vehicles Manufacturing Loan Program, is for the construction of a lithium carbonate processing plant.

Positioned adjacent to the $2.2 billion Thacker Pass mine, this investment is essential for producing the metal crucial for electric vehicle batteries, solar panels, and wind turbines.

The funding, stemming from President Joe Biden‘s climate-focused Inflation Reduction Act, reflects a proactive approach to addressing the increasing demand for lithium while reducing reliance on imports, especially from China, where a significant portion of global lithium processing currently occurs. Biden's recent budget proposal further increases DOE's discretionary budget by $750 million, now standing at $51 billion.

Set in Northern Nevada, the Thacker Pass mine is a sand-and-gravel operation spanning around 6,000 acres of "disturbed area" and a further 12,000 acres of the buffer zone. Despite its mine classification, it is mostly a chemical processing plant. The company expects total costs of around $2.93 billion for the Phase 1 construction, which should be completed in 2027. The production expectation for Phase 1 is 40,000 tons per annum, and Phase 2 aims to eventually double that output. The life expectancy of the mine is at least 40 years.

General Motors GM, which has agreed to invest $650 million in the project, has exclusive access to 100% of the lithium production from Phase 1 for up to 15 years and a right of first offer on Phase 2 production.

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