Acoording to businesswire, Lithium Americas Corp. (TSX: LAC) (NYSE: LAC) (“Lithium Americas” or the “Company”) has announced a $250 million strategic investment from funds managed by Orion Resource Partners LP (“Orion”), a leading global investment firm specializing in metals and materials. This investment is expected to fully fund the Phase 1 development and construction of the Thacker Pass lithium project in Humboldt County, Nevada. The completion of Phase 1 is targeted for late 2027.
Investment Structure: Orion’s $250 Million Commitment
1. $195 Million in Convertible Notes
Orion has agreed to purchase $195 million in senior unsecured convertible notes as a direct investment in Lithium Americas.
2. $25 Million Production Payment Agreement (PPA)
Under the PPA, Orion will pay $25 million to Lithium Americas in exchange for payments tied to minerals processed and gross revenue generated by Thacker Pass.
3. $30 Million in Additional Convertible Notes (Delayed Draw Notes)
Orion has also committed to purchasing an additional $30 million in convertible notes within two years, subject to the fulfillment of certain conditions and upon request by the Company.
4.Total Investment: $250 Million for Phase 1 Development
Together, the Convertible Notes, PPA, and Delayed Draw Notes represent a total investment of $250 million, ensuring the successful development and construction of Phase 1 of the Thacker Pass project. The transaction is expected to close the week of March 10, 2025, pending the satisfaction of certain closing conditions.
Long-Term Partnership with Orion & Potential for $500 Million Additional Financing
Beyond this initial investment, Orion has also agreed to explore providing up to $500 million in financing for the development and construction of Phase 2 of the Thacker Pass project. This strategic partnership with Orion, a premier resource investment firm, reinforces Lithium Americas’ strong financial position and long-term growth potential in the lithium sector.
Executive Insights on the Strategic Investment
Jonathan Evans, President and CEO of Lithium Americas, stated:
“Orion’s long-term investing horizon and experience with resource development makes them an excellent partner for Lithium Americas and Thacker Pass and contributes to our strong relationships with General Motors and the U.S. Department of Energy, Orion’s commitment to this Project highlights the strategic importance of Thacker Pass to national security and developing a domestic supply chain, as we work to reduce American dependence on foreign suppliers for critical minerals.”
Oskar Lewnowski, Founder and Group CEO of Orion, commented:
“Orion is excited to make this strategic investment in Lithium Americas to support the development of a domestic lithium supply chain to meet the rising demand across industries.”
Istvan Zollei, Managing Partner at Orion, added:
“Thacker Pass is a world-class lithium project, and we remain committed to providing investment solutions for critical metals and materials essential to sustainable economic growth and the energy transition.”
Investment Supports $2.26 Billion DOE Loan Approval
The $220 million initial investment from Orion will fulfill all remaining equity capital requirements set by both the U.S. Department of Energy (DOE) and General Motors (GM) for the previously announced $2.26 billion DOE loan to finance the project.
- This funding ensures that Lithium Americas will be fully funded at both the project and corporate levels throughout the construction phase.
- The first drawdown of the DOE loan is expected to occur in Q3 2025.
Final Investment Decision (FID) Expected Upon Closing
Upon the completion of Orion’s initial $220 million investment, Lithium Americas expects to make a final investment decision (FID) on the Thacker Pass joint venture (JV) for Phase 1 together with General Motors.
- The FID remains subject to certain conditions, including GM’s formal approval as a JV partner.
- In Q4 2024, Lithium Americas issued full notice to proceed (FNTP) to Bechtel, the engineering, procurement, and construction management (EPCM) contractor, as well as other major contractors, to de-risk the project timeline.
- Thacker Pass Phase 1 remains on track for completion by late 2027.
Conclusion: Strengthening U.S. Lithium Supply Chain
The $250 million strategic investment from Orion marks a significant milestone for Thacker Pass Phase 1, ensuring full financial support for its construction. Additionally, Orion’s potential $500 million commitment for Phase 2 could further accelerate the project’s expansion.
With the DOE loan secured, GM’s continued support, and a strong partnership with Orion, Lithium Americas is well-positioned to advance the U.S. lithium supply chain, supporting the energy transition and the growing demand for electric vehicle (EV) batteries.
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