U.S. DOE ATVM Loan Program: Lithium Americas Receives Letter of Substantial Completion

On February 22, 2023, Lithium Americas Corp. (TSX: LAC) (NYSE: LAC), which is also known as “Lithium Americas” or the “Company”, received a Letter of Substantial Completion from the U.S. Department of Energy’s Loan Programs Office for its application related to financing the Thacker Pass lithium project in Humboldt County, Nevada. According to the Letter of Substantial Completion, all the necessary information has been provided for an eligibility assessment and this can now be used to commence confirmatory due diligence and terms sheet negotiation processes.

We are thankful for the Biden Administration’s efforts and support in creating a secure domestic supply chain of critical minerals to benefit national security, the economy, and sustainability. Jonathan Evans, President, and CEO expressed his appreciation for GM and the DOE who provide invaluable aid in propelling the energy transition while simultaneously stimulating job creation and economic prosperity here in America. Over recent months, we have accomplished considerable milestones that lay a firm foundation for a U.S.-based lithium source for electric vehicles, allowing us to start construction and ordering essential long-term equipment at Thacker Pass.

The Company has applied to the Department of Energy’s ATVM Loan Program in April 2022 and if offered a loan, up to 75% of Thacker Pass’ total capital costs for construction may be funded by the Program. Expenses related to the Project that were incurred before January 31, 2023, could be counted as eligible expenses. However, while DOE has invited the applicant to enter due diligence, this does not guarantee either that it will extend an offer or that its conditions will mirror those proposed. Indeed, all these outcomes depend on the results of the advanced due diligence and DOE’s decisions about whether to proceed further.

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In addition to being the most significant known lithium resource in the country, Thacker Pass intends to develop two phases of 40,000 tonnes of battery-quality lithium carbonate, each of which will produce 80,000 tonnes per annum (“tpa”). Production in Phase 1 is expected to begin in the second half of 2026, creating 1,000 construction jobs and 500 operations jobs and supporting the production of one million electric vehicles annually.

In January 2023, Lithium Americas entered into a binding agreement with General Motors Co. (NYSE: GM) (“GM”). According to the terms of this deal, GM will have exclusive access to Phase 1 production for 10 years from the commencement of production, along with the option of an additional five-year extension under the same conditions. They will also have the right to first offer on Phase 2 production. This lithium carbonate will be used in GM’s Ultium battery cells. As part of this agreement, GM has made a strategic equity investment of $650 million which was divided into two tranches — the initial $320 million tranche was closed on February 16th. Their second tranche of $330 million is expected to close following Lithium America’s separation of its U.S. and Argentine businesses during the second half of 2023 subject to meeting certain conditions.

Combined with GM’s $650 million equity investment and cash on hand, Lithium Americas expects to be able to substantially de-risk Thacker Pass Phase 1 construction with funding from the ATVM Loan Program.

A technical report titled “Feasibility Study, National Instrument 43-101 Technical Report for the Thacker Pass Project Humboldt County, Nevada, USA” has been filed on SEDAR under the Company’s profile on January 31, 2023, with the effective date of November 2, 2022. The figures presented are in US dollars.

LITHIUM AMERICAS ABOUT

With Lithium Americas, lithium projects are being advanced in Argentina and the United States toward production. It is expected that Thacker Pass construction will begin in the U.S. within the next few months. The company’s stock is traded on the Toronto Stock Exchange as well as the New York Stock Exchange under the ticker symbol “LAC.”.

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