A recent exclusive from Reuters revealed that the Trump administration is aiming to secure a 10% stake in Lithium Americas (NYSE: LAC). This move is part of ongoing negotiations to revise a $2.3 billion Department of Energy loan, which backs the Thacker Pass lithium project in Nevada—developed in partnership with General Motors.
The move shows Washington’s increasing readiness to take charge of key mineral projects. This aims to protect national security and lessen dependence on China.
Trump Targets Lithium Americas Equity
This proposed deal reflects a larger trend. Trump officials have pursued stakes in Intel, MP Materials, and other key tech firms. Washington’s push for direct equity in Lithium Americas shows that taxpayer-backed financing needs real returns. This is vital for sectors important to the clean energy transition.
The same Reuters report revealed what a White House official told the news agency. He said, “President Trump supports this project. He wants it to succeed and also be fair to taxpayers. But there’s no such thing as free money.”
Loan Backdrop: A $2.26 Billion Bet
In October 2024, the U.S. Department of Energy’s Loan Programs Office (LPO) approved a $2.26 billion loan for Lithium Nevada Corp., part of Lithium Americas. This loan includes $1.97 billion in principal and $289.7 million in capitalized interest. It’s one of the largest federal investments in U.S. lithium production.
The loan lasts for 24 years and has an interest rate tied to the U.S. Treasury rate. It will fund facilities to produce lithium carbonate for lithium-ion batteries.
Thacker Pass: America’s Lithium Powerhouse
Thacker Pass is in Humboldt County, Nevada, about 25 miles south of the Oregon border. It aims to be the largest lithium source in the Western Hemisphere. Construction has been underway for nearly a year, with over 600 contractors currently active on-site.
The project is massive in scale:
- Phase 1 output: 40,000 tonnes of battery-grade lithium carbonate annually.
- Enough material to power up to 800,000 electric vehicles (EVs) each year.
- Backed by the world’s largest measured lithium resource, enabling the development of a full lithium district in northern Nevada.
Slated to open in 2028, Thacker Pass is seen as a cornerstone of America’s clean energy strategy, promising to cut foreign dependence while fueling the EV boom.
Economic Impact for Nevada Communities
The Thacker Pass project also carries major local economic benefits. During construction, it is expected to create 1,800 jobs, with 360 permanent positions once operational. These jobs range from chemical processing specialists to management roles, providing new opportunities for rural Nevada.
The Biden administration earlier emphasized that the project aligns with its pledge to ensure the energy transition generates prosperity in communities that have historically been left out of economic growth.
- SEE ALSO: Live Lithium Prices Today
Why Trump Wants a Bigger Piece
Despite bipartisan support, the Trump administration has raised concerns about loan repayment amid a slump in lithium prices caused by Chinese overproduction. The fear: Lithium Americas might struggle to repay the DOE loan, potentially putting taxpayer dollars at risk.
Trump officials are demanding stronger safeguards, including:
- Equity Warrants: No-cost warrants that could give Washington 5%–10% ownership of Lithium Americas.
- GM Guarantees: A binding commitment that General Motors (GM) will purchase lithium from Thacker Pass for decades.
- Project Oversight: Pressure on GM to relinquish parts of its project control to the federal government.
GM’s $625 Million Bet on Lithium
GM invested $625 million in Thacker Pass in 2024, securing a 38% stake and long-term supply rights. The automaker locked in access to all lithium from the mine’s first phase and part of the second phase for 20 years, making the project essential to GM’s EV strategy.
A GM spokesperson stressed: “We’re confident in the project, which supports the administration’s goals. The loan is a necessary part of financing to commercialize this important national resource.”
For GM, Thacker Pass is a supply lifeline as it ramps up EV production under its electrification roadmap.
- SEE DETAILS: General Motors Invests $625M in Lithium Americas to Boost Nevada’s Thacker Pass Lithium Project
A Tightrope Over Loan Restructuring
Lithium Americas had sought a modification in the loan’s amortization schedule—shifting when certain payments are due, though not altering the overall repayment timeline or interest owed.
In exchange, the company offered no-cost equity warrants equal to 5–10% of its common shares and funds to cover the administrative costs of restructuring.
But as we understand, Trump officials want more. They see the deal as a chance to ensure taxpayers capture upside from any future rise in lithium prices and to cement federal influence over a strategic resource.
Even under the existing loan agreement, Washington holds protections. Reuter explained that clauses in the contract allow the government to seize control of the project if it faces significant delays or cost overruns. That safeguard reflects how seriously the U.S. views critical mineral projects in its broader economic and defense strategy.
Lithium Supply: America’s Weak Spot
Currently, the U.S. produces less than 5000 tonnes of lithium per year, less than 1% of global supply. By contrast, Australia, Chile, and China dominate mining, while China refines over 75% of the world’s battery-grade lithium.
Latest lithium data from USGS shows:
- U.S. reserves: ~1.8 million tonnes.
- Geological resources: ~19 million tonnes.
- Global production (2024): 240,000 tonnes.
That imbalance leaves the U.S. heavily exposed. Overreliance on foreign supply chains poses risks to defense capabilities, infrastructure, and technology development. With minerals traveling an average of 50,000 miles before being assembled into batteries, the carbon footprint of global lithium supply is also a concern.
Thacker Pass promises to change the equation by establishing a domestic EV battery supply chain, reducing emissions, and enhancing economic security.
China’s Grip on Lithium
China may not be the top miner of lithium, but its control of refining capacity is unrivaled. The country processes 60–75% of the global supply, turning raw ore into the high-purity lithium carbonate and hydroxide required for EV batteries.
That dominance has raised concerns in the U.S., which views domestic lithium production as crucial for both the energy transition and national security. Direct U.S. ownership in Thacker Pass would send a clear message: America is ready to compete.
Lithium Americas Stock (NYSE: LAC) Jumps
This announcement fueled a dramatic rally in Lithium Americas’ stock. Shares closed at $3.07, then soared pre-market to $5.23 – a remarkable jump of nearly 71%. After markets opened, the price surged even higher, reaching $6.30 intraday. The rally sent the company’s market capitalization above $1.39 billion, highlighting how direct government involvement can rapidly transform investor confidence and reshape valuation.
Other U.S. lithium developers—including ioneer (ASX: INR), Standard Lithium (TSX-V: SLI), and even Exxon Mobil (NYSE: XOM), which has entered lithium projects—are closely watching. If Washington pursues direct ownership across the sector, project financing and timelines could shift overnight.
By seeking a stake in Lithium Americas, the Trump administration is reshaping how the U.S. approaches critical mineral projects. It’s now about equity and control.
A Turning Point for U.S. Lithium
Thacker Pass is becoming the test case for America’s resource nationalism. With Trump pushing for equity, and GM relying on its output for EV production, the project sits at the intersection of energy security, industrial policy, and the clean energy future.
Additionally, analysts are also considering a reduction in the volatility of lithium prices with this deal. Notably, SMM data shows battery-grade lithium carbonate prices are approximately $9,165 per metric tonne (USD) and battery-grade lithium hydroxide around $9,200 to $9,800 per metric tonne.
If successful, Thacker Pass could anchor a new domestic lithium district and accelerate the U.S. energy transition. But with Washington demanding a slice of ownership, the deal could redefine how America funds and controls its most critical resources. However, it’s marking a new era in the race for clean energy minerals.
