The U.S. government is acquiring a minority interest in Lithium Americas, a firm developing a major lithium mine in northern Nevada. In this partnership, the Department of Energy will hold a five per cent equity stake in the Vancouver-based company, as well as a five per cent interest in the Thacker Pass lithium mining project, a collaboration with General Motors.
Following this announcement, Lithium Americas’ stock surged more than 33 per cent before the market opened on Wednesday. U.S. Energy Secretary Chris Wright emphasized that this strategic move aims to enhance domestic supply chains, reduce reliance on foreign mineral sources, and ensure efficient utilization of American taxpayer funds.
Thacker Pass holds significance in diminishing America’s dependence on China for lithium, a crucial component in manufacturing high-tech batteries used in various applications such as cellphones, electric vehicles, and renewable energy systems. The bipartisan support for this initiative highlights the importance of closing the production gap, given China’s predominant position as the world’s largest lithium processor.
The initial phase of the Thacker Pass project is projected to yield 40,000 metric tons of battery-grade lithium carbonate annually, sufficient to support the operation of 800,000 electric vehicles. This stake acquisition in Lithium Americas underscores the Trump administration’s direct involvement with private enterprises, exemplified by recent engagements with companies like Intel and MP Materials.
In a separate development, Lithium Americas disclosed a preliminary non-binding agreement with the DOE to access the first tranche of a $435 million federal loan. As part of this agreement, the DOE will defer $182 million in debt service over the initial five-year period. Collaborative efforts between the White House and Lithium Americas have advanced the agreement, facilitating modifications to a $2.3 billion federal loan to expedite the extraction of lithium for electric vehicle battery production.
General Motors has committed over $900 million to support the development of Thacker Pass, a resource-rich site capable of supplying lithium for up to one million electric vehicles annually. Analyst Dan Ives from Wedbush views the Thacker Pass project as a significant opportunity for the U.S. to lessen its reliance on foreign sources for lithium, thereby strengthening domestic supply chains and safeguarding American taxpayer investments in the expanding lithium production sector.
