Lithium Americas Corp. and General Motors (GM) have announced a new investment agreement to establish a joint venture for the development and operation of the Thacker Pass lithium project in Humboldt County, Nevada. Under the agreement, GM will invest a total of $625 million in cash and letters of credit, acquiring a 38% ownership stake in the project. This investment includes $430 million in direct cash funding to support the construction of Phase 1 and a $195 million letter of credit facility to meet reserve account requirements under a $2.3 billion loan from the U.S. Department of Energy (DOE).
The joint venture replaces the previously announced $330 million Tranche 2 common equity investment commitment from GM under its original agreement with Lithium Americas in January 2023. This new structure allows Lithium Americas to secure additional funding while avoiding the common equity dilution associated with Tranche 2.
“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,” said Jonathan Evans, President and CEO of Lithium Americas. “GM’s investment demonstrates their continued support and helps us unlock the previously announced $2.3 billion DOE loan. We are working closely with GM to advance towards the final investment decision, which we are targeting by the end of the year.”
Jeff Morrison, Senior Vice President of Global Purchasing and Supply Chain at GM, added, “We’re pleased with the significant progress Lithium Americas is making to help GM achieve our goal of developing a resilient EV material supply chain. Sourcing critical EV raw materials like lithium from suppliers in the U.S. is expected to help us manage battery cell costs, deliver value to our customers and investors, and create jobs.”
Joint Venture Details:
- Ownership and Management: Lithium Americas will hold a 62% interest and manage the project on behalf of both partners.
- GM’s Investment: GM will contribute $625 million, comprising:
- $330 million in cash upon closing of the joint venture.
- $100 million in cash at the Final Investment Decision (FID) for Phase 1.
- A $195 million letter of credit facility prior to the first draw on the DOE loan.
- Lithium Americas’ Contribution: The company will contribute $387 million for its 62% ownership stake:
- $211 million to be contributed upon closing, with capital expenditures after August 2024 credited against this amount.
Source: Lithium Americas
