- The U.S. Department of Energy will acquire a 5 per cent equity stake in Lithium Americas (TSX:LAC) and a 5 per cent economic stake in its Thacker Pass lithium joint venture with General Motors (NYSE:GM)
- This is the first installment of a US$2.23 billion DOE loan to support the Thacker Pass project, with US$182 million in debt service deferred over five years
- GM will amend its offtake agreement to allow third-party contracts for lithium not forecasted for GM, while retaining rights to major production volumes
- Lithium Americas stock (TSX:LAC) last traded at C$3.95 per share
In a landmark move to bolster domestic lithium production and reduce reliance on foreign supply chains, Vancouver-based Lithium Americas (TSX:LAC) announced that the U.S. Department of Energy (DOE) has taken a 5 per cent equity stake in the company, along with a separate 5 per cent economic stake in its Thacker Pass lithium project joint venture with General Motors (NYSE:GM).
The stakes were acquired through warrants priced at $0.01, as part of a broader agreement to initiate the first US$435 million draw from a previously announced US$2.26 billion DOE loan. The Thacker Pass project, located in Nevada, is expected to become the largest source of battery-grade lithium in the Western Hemisphere, with Phase 1 production forecasted at 40,000 metric tons per year—enough to power 800,000 electric vehicles.
Key terms of the agreement
- DOE loan restructuring: The DOE will defer US$182 million in debt service over the first five years of the loan. The total loan amount has been revised to US$2.23 billion, with a principal of US$1.97 billion and zero spread over the U.S. Treasury rate.
- Equity stakes:
- 5 per cent in Lithium Americas via common share warrants.
- 5 per cent in the Thacker Pass JV via non-voting, non-transferable equity warrants.
- Board representation: The DOE will have an observer seat on the JV board for as long as it holds JV warrants or units.
- GM’s role: GM, which invested US$625 million last year for a 38 per cent stake, will amend its offtake agreement to allow third-party contracts for lithium volumes not forecasted for GM. GM retains rights to 100 per cent of Phase 1 and 38 per cent of total production for 20 years.
Deeper implications
The DOE’s investment marks a significant shift in U.S. industrial policy, aligning with President Trump’s broader strategy to secure critical mineral supply chains and reduce dependence on China, which currently dominates global lithium refining. The move follows similar government stakes in Intel and MP Materials, reinforcing a pattern of direct intervention in strategic industries.
“We’re confident in the Thacker Pass project, which will reduce U.S. dependence on imported lithium and can support domestic manufacturing across many industries, such as aerospace, defense and electrical grid resiliency, in addition to automotive,” Shilpan Amin, senior vice president global chief procurement and supply chain officer of General Motors said in a news release.
About Lithium Americas
Lithium Americas is developing its world-class Thacker Pass project in Nevada towards production.
Lithium Americas stock (TSX:LAC) last traded at C$3.95 per share. The stock has risen 84.88 per cent since the year began, this defies lithium‘s recent slide in price, but could rest in the foundation for a value play supported by a tier-1 project and forecasted 20x demand growth by 2050.
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