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Released October 18, 2024 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--Despite a severe downturn in lithium prices causing some projects to be delayed, General Motors Company (NYSE:GM) (GM) (Detroit, Michigan) has altered its funding plans for Lithium Americas Corporation's (NYSE:LAC) (Vancouver, British Columbia) Thacker Pass project in Humboldt County, Nevada, increasing a planned second round of funding to form a joint venture. The increased investment makes it the largest investment by a U.S. automaker in a lithium project.
GM originally agreed with Lithium Americas to provide $650 million toward the Thacker Pass project in a first tranche of $320 million, which was made in 2023, and a second tranche of $330 million later. Earlier this year, GM announced it was delaying the payment of the second tranche, but in recent days has returned with an even stronger investment in the project, upping its funding to a total of $945 million, a 45% increase from the originally planned $650 million. The $625 million second round of funding will include $430 million cash and $195 million in letters of credit. In exchange, GM receives exclusive rights to the first stage of production at Thacker Pass for 20 years. GM also has agreed to take 38% of the second phase of production for a 20-year period, with an option to increase this.
Before Lithium Americas takes its first draw of a $2.3 billion loan from the U.S. Department of Energy for the project, it must fund about $195 million toward reserve accounts for things such as construction contingency and sustaining capital. GM will provide its $195 million letter of credit at this time.
Lithium Americas Chief Executive Jonathan Evans said in a release, "Our relationship with GM has been significantly strengthened with this joint venture as we continue to pursue a mutual goal to develop a robust domestic lithium supply chain by advancing the development of Thacker Pass. We will be working closely with GM to advance towards the final investment decision (FID), which we are targeting by the end of the year."
Lithium Americas retains 62% ownership of Thacker Pass, for which it will manage the project and contribute $211 million when the deal closes and a further $176 million when the FID is made. Although the proposed FID is still a few months away, design work and some preparations are moving along. Lithium Americas reports that about 40% of the project's engineering design is complete, as is site preparation for major earthworks.
The Thacker Pass mine is to be developed in two phases along with an accompanying processing plant. Phase I would involve developing a 9,000-ton-per-day open-pit mine with 6,000 tons per day of sulfuric acid leaching to produce 40,000 tons per year of battery-grade lithium carbonate from 3.3 million tons per year of mined ore feed. After three years of production, Phase II would come online, doubling the mine's production capacity to 80,000 tons of lithium carbonate per year for the remaining 36 years of the mine's expected life. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can learn more by viewing the related project reports on Phase I and Phase II.
Nevada leads the U.S. in potential lithium investments, garnering some $15.6 billion worth of active projects, although not all of these will move forward as planned. While many of these projects remain in the planning stages, others are progressing further. The projects include both above-ground mines like Thacker Pass and solution mines in which lithium is extracted from underground brines. Albemarle Corporation (NYSE:ALB) (Charlotte, North Carolina) is expanding an existing lithium solution mine in Esmeralda County, where the company aims to increase production from 6,000 tons per year of lithium carbonate to 10,000 tons per year. To do this, Albemarle is adding and replacing extraction wells to increase brine flow and performing debottlenecks as well as expanding its system of evaporation ponds at the site. The pond segment of the project entails the construction or rehabilitation of more than 4,100 acres of ponds at the site. The expansion of the mine is expected to be completed by the end of this year, followed by the pond additions in 2027. Subscribers can learn more by viewing the related project reports.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 trillion (USD).
GM originally agreed with Lithium Americas to provide $650 million toward the Thacker Pass project in a first tranche of $320 million, which was made in 2023, and a second tranche of $330 million later. Earlier this year, GM announced it was delaying the payment of the second tranche, but in recent days has returned with an even stronger investment in the project, upping its funding to a total of $945 million, a 45% increase from the originally planned $650 million. The $625 million second round of funding will include $430 million cash and $195 million in letters of credit. In exchange, GM receives exclusive rights to the first stage of production at Thacker Pass for 20 years. GM also has agreed to take 38% of the second phase of production for a 20-year period, with an option to increase this.
Before Lithium Americas takes its first draw of a $2.3 billion loan from the U.S. Department of Energy for the project, it must fund about $195 million toward reserve accounts for things such as construction contingency and sustaining capital. GM will provide its $195 million letter of credit at this time.
Lithium Americas Chief Executive Jonathan Evans said in a release, "Our relationship with GM has been significantly strengthened with this joint venture as we continue to pursue a mutual goal to develop a robust domestic lithium supply chain by advancing the development of Thacker Pass. We will be working closely with GM to advance towards the final investment decision (FID), which we are targeting by the end of the year."
Lithium Americas retains 62% ownership of Thacker Pass, for which it will manage the project and contribute $211 million when the deal closes and a further $176 million when the FID is made. Although the proposed FID is still a few months away, design work and some preparations are moving along. Lithium Americas reports that about 40% of the project's engineering design is complete, as is site preparation for major earthworks.
The Thacker Pass mine is to be developed in two phases along with an accompanying processing plant. Phase I would involve developing a 9,000-ton-per-day open-pit mine with 6,000 tons per day of sulfuric acid leaching to produce 40,000 tons per year of battery-grade lithium carbonate from 3.3 million tons per year of mined ore feed. After three years of production, Phase II would come online, doubling the mine's production capacity to 80,000 tons of lithium carbonate per year for the remaining 36 years of the mine's expected life. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can learn more by viewing the related project reports on Phase I and Phase II.
Nevada leads the U.S. in potential lithium investments, garnering some $15.6 billion worth of active projects, although not all of these will move forward as planned. While many of these projects remain in the planning stages, others are progressing further. The projects include both above-ground mines like Thacker Pass and solution mines in which lithium is extracted from underground brines. Albemarle Corporation (NYSE:ALB) (Charlotte, North Carolina) is expanding an existing lithium solution mine in Esmeralda County, where the company aims to increase production from 6,000 tons per year of lithium carbonate to 10,000 tons per year. To do this, Albemarle is adding and replacing extraction wells to increase brine flow and performing debottlenecks as well as expanding its system of evaporation ponds at the site. The pond segment of the project entails the construction or rehabilitation of more than 4,100 acres of ponds at the site. The expansion of the mine is expected to be completed by the end of this year, followed by the pond additions in 2027. Subscribers can learn more by viewing the related project reports.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 trillion (USD).
