Lithium Americas (TSX: LAC; NYSE: LAC) announced on Thursday that it has received a conditional commitment loan of $2.26 billion from the U.S. Department of Energy (DOE) to finance the construction of processing facilities at Thacker Pass in Nevada.
The project will be adjacent to Lithium Americas’ $2.2 billion Thacker Pass mine, aimed at producing an initial 40,000 t/y of battery-grade lithium carbonate. The mine is also expected to create approximately 1,800 direct jobs during its three-year construction period and around 360 jobs in operations for its 40-year mine life.
This funding represents the largest-ever loan to a mining company from the DOE’s Loan Programs Office, amid increasing efforts to bolster domestic supplies of critical minerals. General Motors, which has invested $650 million in Lithium Americas, has an exclusive offtake agreement for 100% of the lithium production from the mine for up to 15 years after expected production commences in 2027.
The proposed mine has the potential to become North America’s largest source of lithium for electric vehicle batteries and would support U.S. President Joe Biden’s efforts to reduce dependence on Chinese supplies of the metal.
Currently, about 65% of the critical mineral is processed in China, although U.S. lithium production is projected to increase 13-fold thanks to tax credits and other subsidies provided in 2022’s Inflation Reduction Act, Energy Secretary Jennifer Granholm said Wednesday at a conference held by SAFE.
Measured and indicated mineral resources at Thacker Pass are estimated at 385 million tonnes averaging 2,917 parts per million (ppm) lithium for 6 million tonnes of lithium carbonate equivalent (LCE). Inferred resources are 147 million tonnes averaging 2,932 ppm for 2.3 million tonnes of LCE.
Shares of Lithium Americas surged 28% in New York trading and 18% in Toronto on Thursday morning. The Vancouver-based miner has a market capitalization of C$1.18 billion (US$870m).
THIS ARTICLE WAS ORIGINALLY POSTED ON MINING.COM
April 24, 2024
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