U.S.Government Gains equity in Lithium Americas & Nevada Mining Venture with GM
WASHINGTON D.C. – The U.S. Department of Energy (DOE) will acquire equity stakes in Canadian lithium mining company Lithium Americas and its joint venture with General Motors, as part of a revised federal loan agreement. The DOE will receive a 5% ownership in both Lithium Americas and the Lithium Americas-GM venture through no-cost warrants, granting the government the right to purchase shares at a predetermined price.
The move stems from a renegotiation of a $2.26 billion loan awarded to Lithium Americas by the DOE’s Loan Programs Office.The DOE stated the equity stakes will act as additional collateral, mitigating risk to taxpayers. Lithium is a critical component in electric vehicle and smartphone batteries.
“Despite having some of the largest deposits, the United states produces less than 1% of the global supply of lithium. Thanks to President trump’s bold leadership, American lithium production is going to skyrocket,” U.S. Energy Secretary Chris Wright said in a press release. “Today’s proclamation helps reduce our dependence on foreign adversaries for critical minerals by strengthening domestic supply chains and ensures better stewardship of American taxpayer dollars. President Trump promised to do both and he is delivering.”
This action follows the Trump administration’s previously announced plans to take ownership stakes in Intel (10%) and MP Materials,a U.S.-based rare earth minerals mine operator.
Lithium Americas is developing the Thacker Pass mine in Nevada,projected to yield enough lithium for approximately 800,000 electric vehicles annually during its initial phase. The project received permitting approval from President Trump in January 2021.
General Motors invested $625 million in Lithium Americas last year,securing a 38% stake and rights to the first phase of production,as well as lithium supply from the mine for 20 years during the second phase - enough for an estimated 1.6 million EVs over two decades.
Shares of Lithium Americas increased by 34% in after-hours trading following the announcement.
