The US will have a bigger hand in the global lithium battery supply chain from 2028 with Lithium Americas and General Motors’ final investment decision on the US$2.9 billion phase one Thacker Pass project in northern Nevada, USA, part of a potential $12.4 billion investment to produce up to 160,000 tonnes per annum of lithium carbonate by the 2040s.
For some perspective on the scale of the proposed venture, the entire US battery market was worth circa-$16.9 billion in 2023.
The International Energy Agency (IEA) said this month US battery manufacturing capacity had doubled since 2022, exceeding 200 GWh in 2024. About a further 700 GWh of manufacturing capacity is under construction. The global battery supply chain marketplace could be worth $400 billion by 2030.
Lithium Americas, a c$600 million lithium developer paired with a $48 billion car maker at Thacker Pass, wants to be producing lithium carbonate by the end of 2027. Lithium carbonate prices recently fell below $10,000/tonne having averaged $15,000/t last year and gone past $70,000/t in 2022.
Lithium Americas has been using a $24,000/t base case long-term average lithium price assumption and life-of-mine opex of $8039/t lithium carbonate equivalent. It expects to achieve a C1 costs of $6238/t and $7508/t AISC LCE in years 1-25. China’s average total cash cost of LCE production in 2023 was said to be $8219/t.
The Canadian and US junior, which owns 62% of Thacker Pass, says only about 1% of the world’s lithium is currently mined in the US, with most of that shipped to China for processing and then lithium chemicals shipped back to the US, Europe or other parts of Asia for production of cathodes and battery packs. Most of the world’s lithium is mined in Australia and Latin America. Western Australia, accounting for about half the world’s lithium supply, sends 99% of it to China and currently earns about $3 billion from those exports.
“We will develop a US-produced lithium supply chain to reduce American dependence on foreign suppliers for critical minerals,” Lithium Americas CEO Jonathan Evans said this week.
General Motors, investing about $945 million in Thacker Pass 1.0 and able to take all of its output for the first 20 years of its 80-plus-year planned life, says its electric vehicle business became “variable profit positive” for the first time in 2024, meaning EV revenue was higher than GM’s variable costs attached to the units. The automaker produced 189,000 EVs in 2024 and has a nominal target of 300,000 vehicles in 2025.
According to the IEA, electrification of transportation has progressed at a significant pace over the past five years in the US with the share of electric cars rising from 2% in 2019 to 10% in 2024. “In 2024 the number of EVs sold in the US increased by about 10% year-on-year, moderating significantly from the 40% growth observed in 2023,” the agency says. “Of the 1.6 million plug-in EV (PEV) sales in 2024, about 80% were battery electric vehicles (BEVs) and 20% plug-in hybrid vehicles (PHEVs).”
The IEA says EV factory output in China has meanwhile increased from 3.5 million vehicles in 2021 to around 13 million vehicles in 2024. Production of lithium batteries rose from nearly 250 GWh to about 900 GWh during the same time. “By the end of 2024 China’s new energy vehicle (NEV) fleet reached over 30 million, around 70% of which were BEVs,” the IEA says. “NEVs accounted for about 9% of total vehicle ownership, up from 3% in 2021. In 2024 alone, over 11 million new NEVs were registered, a 51% increase compared with 2023.”
Investment in low-carbon energy transition worldwide grew 11% to hit a record $2.1 trillion in 2024, including $757 billion of electrified transport investment, the IEA says.
Lithium Americas has a $2.26 billion US Department of Energy (DOE) loan to go with GM’s investment and $250 million from funds managed by Orion Resource Partners for its phase-one development of Thacker Pass, which it calls the world’s largest lithium reserve and resource.
The giant lithium-clay deposit has a NI 43-101 proven and probable reserve estimate of 14.3 million tonnes of LCE grading an average 2540 parts per million and a measured and indicated resource estimated at 44.5Mt LCE at 2230ppm.
Lithium Americas completed a pre-feasibility study on Thacker Pass in August 2018 and started the state and federal permitting process in 2020. It got its federal Bureau of Land Management Record of Decision approving mine development early in 2021. It told EPCM contractor Bechtel late last year it could “proceed to de-risk the construction schedule and continue to target completion in late 2027”.
The project owners want to build four separate 40,000tpa lithium carbonate and 2250 tonnes per day sulphuric acid production models at Thacker Pass, adding rail access to the site in phase four and then a 3000tpd sulphuric acid plant in phase five. The $12.4 billion price tag is based on 2022 study costings.
The project could employ up to 2000 construction workers by the second half of next year, with the main project workforce hub in Winnemucca about 100km from the mine.
Lithium Americas’ share price is down about 50% in the past 12 months, capitalising the company at US$600 million.
