The money will develop the Thacker Pass project in Nevada, with GM entering a pair of 20-year lithium off-take agreements

General Motors (GM) is entering into a new joint venture with Vancouver-based miner, Lithium Americas.

In an announcement last week, GM is committing to make a US$625 million ($864 million) investment in Lithium Americas.

The funding will help develop and operate the Thacker Pass lithium carbonate mine in Humboldt County, Nevada. GM and Lithium Americas claim Thacker Pass is North America’s largest known lithium deposit.

The mine is scheduled to begin production in the second half of 2026. Phase 1 targets an annual production capacity of 40,000 tonnes of lithium carbonate.

In the second phase (to begin in 2027), the goal is to increase production by another 40,000 tonnes per year.

That would bring Thacker Pass’ total output to 80,000 tonnes per annum of battery-grade lithium carbonate.

Lithium Americas estimates the mine will produce enough lithium to power approximately one million electric vehicles, annually.

GM’s stake in the mine

The new joint venture between GM and Lithium Americas replaces an earlier agreement between the two companies from January 2023.

In the original deal, GM invested $320 million in Thacker Pass mine in the first of what would have been two tranches of a $650 million agreement. In that deal GM would get no stake in the Lithium Americas.

Tranche 2 — and the remaining $330 million in the 2023 deal — was scrapped due to Lithium Americas reorganization.

Under the new deal, GM now holds a 38 per cent stake in Thacker Pass, while Lithium Americas retains a 62 per cent controlling interest and will manage the project. Lithium Americas is also contributing $387 million to the joint venture.

“Our relationship with GM has been significantly strengthened with this joint venture as we continue to pursue a mutual goal to develop a robust domestic lithium supply chain by advancing the development of Thacker Pass,” said Jonathan Evans, president and CEO of Lithium Americas, in a press release.

20 year off-take agreements

GM’s investment in Thacker Pass is part of its strategy to ensure a reliable supply of North American lithium.

GM has secured two 20 year off-take agreements.

The first will see the automaker buy up to 100 per cent of the lithium produced during Phase 1 of the Thacker Pass project.

The second agreement says GM will obtain up to 38 per cent of the lithium from Phase 2, with the option to purchase more if necessary.

“We’re pleased with the significant progress Lithium Americas is making to help GM achieve our goal to develop a resilient EV material supply chain,” said Jeff Morrison, SVP for global purchasing and supply chain at GM.

“Sourcing critical EV raw materials, like lithium, from suppliers in the U.S., is expected to help us manage battery cell costs, deliver value to our customers and investors, and create jobs.”

Unlocking the DOE loan

Earlier this year, the U.S. government’s Department of Energy (DOE) announced it would provide Lithium Americas with a loan up to US$2.26 billion to support the mine’s construction.

However, before accessing the loan, Lithium Americas has to contribute $195 million towards covering the project’s cost.

That requirement is being met through the new joint venture with GM.

The US$625 million investment will divide between two purposes: US$430 million in direct cash funding to support Phase 1 construction and an additional US$195 million via a letter of credit facility in order for Lithium Americas to access the DOE loan.

“GM’s JV Investment demonstrates their continued support and helps us to unlock the previously announced $2.3 billion DOE Loan,” added Evans.

Lithium Americas says it is working with the DOE to finalize the loan agreement in the coming weeks.

Next steps at Thacker Pass

Construction at the Thacker Pass project initially began in March 2023. Nearly 40 per cent of the engineering design is complete, according to Lithium Americas.

Major site preparations are advancing, with earthworks for the process plant excavation almost finished. Preparations for concrete placement are underway; to begin by mid-2025.

Key procurement milestones include awarding contracts for the top seven pieces of long-lead equipment and critical construction materials. On-site purchases of goods and services have already started.

“The current focus is on finalizing engineering and permitting for utilities and preparing to award contracts for the detailed earthworks, foundation installation and erection of the housing units,” says Lithium Americas.

Lithium Americas is using engineering, procurement, and construction management contractor Bechtel to oversee the build of the Thacker Pass mine.

The three-year construction phase may create up to 1,800 direct jobs.