The Thacker Pas lithium project in Nevada has received a major funding boost, enabling the construction of the mine to be nearly fully funded. Lithium Americas (TSX: LAC), the operator of the project, this morning disclosed that it has received a conditional commitment for a massive $2.26 billion loan from the US Department of Energy.
The loan, to be provided under the Advanced Technology Vehicles Manufacturing Loan Program, is intended to assist in financing the construction of the mine, which will produce 40,000 tonnes of battery grade lithium carbonate per year. The project is expected to provide 1,800 jobs during construction, and 360 jobs in operations for its entire mine life.
The terms of the loan outline that the funds are to be provided on a monthly basis, with interest rates fixed at US treasury dates at time of issuance. The loan also include $290 million in interest which is expected to accrue over the three year construction period. Phase one production is currently estimated to begin in 2027.
READ: General Motors To Invest $329 Million In Lithium Americas Following Separation Agreement
In a separate announcement this morning, the company indicated that combined with the major investment from General Motors last year, the funding is expected to cover the “vast majority” of capital needed for phase 1 construction. Site prep for major earthworks has been completed, with detailed engineering now being advanced along with procurement and execution planning. Engineering is said to be 30% design complete to date.
Estimate capital costs meanwhile have been revised to $2.93 billion.
A full notice to proceed is expected to be issued in the second half of the year. Until that notice has been issued, the company has reduced project capital expenditures to preserve liquidity, and has moved to cut its general and administrative expenses by more than 25%.
Lithium Americas last traded at $7.70 on the TSX.
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