GM invests in Lithium Americas to develop Thacker Pass mine

Transaction Highlights:

• The largest-ever investment by an automaker to produce battery raw materials, with GM to become Lithium Americas’ largest shareholder.
• Lithium Americas to receive US$650 million equity investment from GM consisting of:
  • US$320 million first tranche investment for common shares representing 9.999% of Lithium Americas before separation.
  • US$330 million second tranche investment, contemplated to be invested in the company’s US business following the separation of its US and Argentine businesses. 
• After the first tranche investment, GM will receive exclusive access to Phase 1 production through a binding supply agreement and a right of first offer (ROFO) on Phase 2 production.
• Investment supports the development of Thacker Pass, the largest known lithium resource in the US. 
  • Project estimated to supply lithium needed for up to one million electric vehicles (EVs) per year.
• Investment also supports the company’s previously announced separation by creating the foundation for an independent US business focused on Thacker Pass and a North American lithium supply chain.

Project Highlights:

• Advancing Thacker Pass construction plan targeting 80 000 tpy of battery-quality lithium carbonate (Li₂CO₃) production capacity in two phases of 40 000 tpy, respectively (Phase 1 and Phase 2).
  • Phase 1 production expected to commence in 2H26.
• Project life of 40 years (LOM) utilising less than 25% of the current measured and indicated (M&I) mineral resource estimate.
  • Proven and probable mineral reserves of 3.7 million t lithium carbonate equivalent (LCE) at an average grade of 3160 parts per million lithium (ppm Li).
  • M&I mineral resource estimate of 16.1 million t LCE at an average grade of 2070 ppm Li.
• US$5.7 billion net present value (NPV) at 8% discount and 21.4% internal rate of return (IRR), after-tax when using a price assumption of US$24 000/t of Li₂CO₃.
• Phase 1 and Phase 2 capital cost estimates of US$2.27 billion and US$1.73 billion, respectively, are based on cost estimates from 3Q23 and include a 13.1% contingency.
• Awarded the engineering, procurement and construction management contract for the construction of Thacker Pass to Bechtel Corporation.
• Thacker Pass is expected to create 1000 jobs during construction and 500 jobs during operations.

Read the article online at: https://www.globalminingreview.com/mining/02022023/gm-invests-in-lithium-americas-to-develop-thacker-pass-mine/