The U.S. government has acquired a minority ownership stake in Lithium Americas, a firm involved in developing a major lithium mine in northern Nevada. The Department of Energy has secured a five percent equity interest in the Vancouver-based company and a similar stake in the Thacker Pass lithium mining project, a collaboration with General Motors.
Lithium Americas’ shares surged over 33 percent prior to the market opening on Wednesday. U.S. Energy Secretary Chris Wright stated that the partnership with Lithium Americas aims to enhance domestic supply chains, reduce reliance on foreign sources for critical minerals, and ensure efficient management of taxpayer funds.
The Thacker Pass project is vital for diminishing America’s dependency on China for lithium, a crucial component in manufacturing batteries for smartphones, electric vehicles, and renewable energy systems. The project, supported by both political parties, aims to bridge the production gap, as China currently leads in lithium processing worldwide.
The initial phase of the Thacker Pass project is forecasted to yield 40,000 metric tons of battery-grade lithium carbonate annually, sufficient to power 800,000 electric vehicles. This move to obtain an equity stake in Lithium Americas aligns with the Trump administration’s strategy of direct involvement with private enterprises.
In a separate agreement, the U.S. government is acquiring a ten percent share in Intel by converting previously awarded funds. Additionally, the administration recently invested $400 million in MP Materials stock and negotiated revenue-sharing deals with Nvidia and AMD regarding chip sales to China.
Lithium Americas announced a preliminary non-binding agreement with the DOE to access the initial $435 million of a federal loan. As part of the agreement, the DOE will defer $182 million in debt service over the loan’s first five years. The collaboration between the White House and Lithium Americas signifies progress in finalizing a federal loan modification of approximately $2.3 billion to support the project’s advancement.
General Motors has committed over $900 million to aid in the development of Thacker Pass, a site with enough lithium resources to manufacture one million electric vehicles annually. Industry analyst Dan Ives views the Thacker Pass project as a significant opportunity for the U.S. to decrease its reliance on foreign sources for lithium, thereby strengthening domestic supply chains and safeguarding American taxpayer funds amid the expected surge in lithium production in the years ahead.