Topline
Shares of Lithium America rallied more than 97% on Wednesday, after the Trump administration said it would seek a stake in the Canadian mining firm as it negotiates a multibillion-dollar loan with the Energy Department, in a deal involving the largest lithium source in the U.S.
Lithium Americas’ stock soared about 97% to around $6 as of 11:25 a.m. EDT, nearly doubling the firm’s market capitalization from $674 million to about $1.32 billion.
The Trump administration has requested an equity stake in Lithium Americas as it renegotiates a $2.2 billion loan with the Energy Department for its Thacker Pass mine in Nevada, a White House official told Forbes (Reuters first reported the request).
The stake could be as much as 10%, Reuters reported, citing two people familiar with the discussions.
Lithium Americas and General Motors, who partnered with the mining firm for the Thacker Pass project, requested to renegotiate terms reached under the Biden administration, the official said, and the Energy Department agreed to accommodate the firms’ requests with “minor modifications to the loan to protect taxpayers.”
Lithium Americas said in a statement Wednesday the company “continues to work with the [Energy Department] and GM regarding proposals for a mutually agreeable resolution.”
40,000. That’s how many metric tons of battery-quality lithium are expected to be produced annually at Lithium Americas’ Thacker Pass facility, enough to power roughly 800,000 electric vehicles, according to the company and the Energy Department.
Lithium Americas’ joint venture with GM to produce lithium carbonate at the Thacker Pass facility has been lauded by both the Biden and Trump administrations for cutting reliance on China-based products. The project was approved under Trump during his first presidency, while the Energy Department’s loan was secured under former President Joe Biden last year. At the time, Energy Department officials said the job would create more than 2,000 jobs and help transition the U.S. to green energy, as electric vehicle batteries produced with the metal would cut the consumption of an estimated 317 million gallons of gasoline each year. GM invested about $625 million for a 38% stake in the project and agreed to buy offtake from the mine once it’s fully operational.
Interior Secretary Doug Burgum in April said the Trump administration would seek equity in companies that mine and process critical minerals in an effort to cut dependence on imports. In July, the Defense Department acquired a 15% stake in the rare earth miner MP Materials. The company’s shares have nearly doubled since the deal was reached. Other industries have seen boosts from the Trump administration seeking equity: Trump announced in August the U.S. would take a 10% stake in the beleaguered Intel, marking one of the largest government interventions in an American company in more than a decade.
Trump Wants Piece Of Company In Charge Of America’s Largest Lithium Mine (Reuters)