LAC - Lithium Americas Receives Conditional Commitment for $2.26 Billion ATVM Loan from the U.S. DOE for Construction of Thacker Pass | Benzinga
(All amounts in US$ unless otherwise indicated)
VANCOUVER, British Columbia, March 14, 2024 (GLOBE NEWSWIRE) -- Lithium Americas Corp. (TSX:LAC) (NYSE:LAC) ("Lithium Americas" or the "Company") has received a conditional commitment (the "Conditional Commitment") from the U.S. Department of Energy ("DOE") for a $2.26 billion loan under the Advanced Technology Vehicles Manufacturing ("ATVM") Loan Program (the "Loan") for financing the construction of the processing facilities at Thacker Pass, located in Humboldt County, Nevada ("Thacker Pass" or the "Project").
HIGHLIGHTS
- Based on the terms of the Conditional Commitment, the Loan for $2.26 billion will have interest rates fixed from the date of each monthly advance for the term of the loan at applicable U.S. Treasury rates. The Loan amount includes interest accrued during construction, which is estimated to be $290 million over the three-year period.
- The Loan is intended to help finance the construction of Thacker Pass, targeted to produce an initial 40,000 tonnes per year ("tpa") of battery grade lithium carbonate ("Phase 1").
- Thacker Pass Phase 1 is expected to create approximately 1,800 direct jobs during its three-year construction period and approximately 360 jobs in operations for its 40-year mine life. The Company commissioned the University of Nevada, Reno to complete an economic impact assessment, which estimated that every direct job created by Lithium Americas' construction investment will generate an additional 1.5 local jobs during construction.
- Lithium Americas and its engineering, procurement and construction management ("EPCM") contractor, Bechtel, entered into a National Construction Agreement (Project Labor Agreement) ("PLA") with North America's Building Trades Unions ("NABTU") for construction of Thacker Pass.
- Lithium Americas is committed to sustainably developing Thacker Pass, including working closely with local communities and designing the operation to reduce any potential environmental impacts.
- Thacker Pass supports the U.S. government's commitment to securing a domestic supply chain for critical minerals to reduce reliance on foreign materials. Phase 1 production could support lithium needs for up to 800,000 electric vehicles ("EVs") annually.
"The United States has an incredible opportunity to lead the next chapter of global electrification in a way that both strengthens our battery supply chains and ensures that the economic benefits are directed toward American workers, companies and communities," said Jonathan Evans, President and Chief Executive Officer of Lithium Americas. "The ATVM Loan Conditional Commitment announced today by the DOE is a significant milestone for Thacker Pass, which will help meet the growing domestic need for lithium chemicals and strengthen our nation's security."
Evans added, "We are pleased to have completed the rigorous DOE due diligence process. The Loan plus GM's strategic investment will provide the vast majority of the capital necessary to fund Phase 1. We deeply appreciate the U.S. government's support as we advance the responsible development of Thacker Pass, and we are excited to continue collaborating with all of our stakeholders to bring shared success for America."
Thacker Pass is currently the largest known Measured and Indicated lithium resource in North America, targeting total production capacity of 80,000 tpa of battery-quality lithium carbonate to be developed in two phases of 40,000 tpa, respectively (Phase 1 and "Phase 2"). Phase 1 production is anticipated to commence in 2027. Material sourced from Thacker Pass will support EV eligibility for consumer incentives under the U.S. clean energy tax credits program.
In January 2023, General Motors Holdings LLC ("GM") agreed to invest $650 million in Lithium Americas across two tranches for the development of Thacker Pass, representing the largest investment publicly disclosed to date by an automaker in a company to produce battery raw materials. GM has exclusive offtake to 100% of the lithium production from Phase 1 for up to 15 years and has a right of first offer on Phase 2 production.
The Company and Bechtel entered into a PLA with NABTU for construction of Thacker Pass to minimize construction risk, provide skilled labor and prioritize the employment of local and regional skilled craft workers, including members of underrepresented communities.
The Company has been closely engaged with the nearby Fort McDermitt Paiute Shoshone Tribe (the "Tribe") (located approximately 40 miles from the Project site) since 2018 and entered into a binding Community Benefits Agreement ("CBA") in 2022. The CBA provides infrastructure improvements at Fort McDermitt, additional job training and employment opportunities for tribal members, and support for cultural education and preservation. The Company is committed to hiring from the regional area in Humboldt County wherever possible, including among tribal members and communities identified by DOE as disadvantaged communities.
Larina Bell, Acting Chairwoman of the Fort McDermitt Paiute Shoshone Tribe commented on the Loan, "Thacker Pass will provide important economic and employment opportunities for members of our Tribe." She cited ...