The U.S. government agrees to hold shares, Lithium Americas surged 41% in after-hours trading

U.S. Secretary of Energy Chris Wright stated on Tuesday that the U.S. government has agreed to acquire shares in Lithium Americas Corp., which will support the Canadian company in advancing its Thacker Pass lithium mine project in Nevada.

Wright said in a media interview on Tuesday, the U.S. government will hold a 5% stake in Lithium Americas and a 5% stake in its related mining projects at the largest lithium deposit in the U.S. Following the news, Lithium Americas' stock listed in the U.S. surged by as much as 41% in after-hours trading, later narrowing to an increase of about 35%. The stock price of Lithium Americas has risen by 92% year-to-date.

Wright said:

“Building this mine is in the best interest of the United States. We will see a huge new lithium resource come online. In the coming years, it will replace a significant amount of imported lithium.”

Media analysis suggests that Lithium Americas' Thacker Pass project in Nevada is expected to become an important domestic source of lithium, while currently, the U.S. produces only a small amount of this battery metal.

This week, after media reports of the government considering equity participation, Lithium Americas stated that the company has been discussing the terms of a $2.3 billion federal loan with its joint venture partner General Motors Co.

Earlier reports indicated that after Lithium Americas and General Motors requested the U.S. Department of Energy to restructure financing because they could not meet the initial conditions, U.S. government officials sought to modify the loan terms, including requiring additional external equity to protect taxpayers. Earlier discussions also included pushing the Department of Energy to require General Motors to sign a binding underwriting agreement to purchase project output, with General Motors holding a 25% stake in the mine.

The loan from the Department of Energy, finalized by the Biden administration in October 2024, will help fund the construction of a lithium carbonate processing plant located next to the Thacker Pass mine in Nevada. Media reports describe this as one of the most promising opportunities in the U.S. for producing metals needed for electric vehicle batteries, solar panels, and wind turbines.

The Department of Energy stated in a press release that once fully operational, the facility is expected to produce approximately 40,000 tons of battery-grade lithium carbonate annually for lithium-ion batteries