Lithium Americas Provides General Motors Transaction Details and Update on Construction Plan for Thacker Pass
NEWS RELEASE
Lithium Americas Provides General Motors Transaction
Details and Update on Construction Plan for Thacker Pass
January 31, 2023 – Vancouver, Canada: Lithium Americas Corp. (TSX: LAC) (NYSE: LAC) (“Lithium
Americas” or the “Company”) today announced that it has entered into a purchase agreement (“Purchase
Agreement”) with General Motors Co. (NYSE: GM) (“GM”) pursuant to which GM will make a $650 million
equity investment in Lithium Americas (the “Transaction”). In connection with the Transaction, the
Company has provided an update on the construction plan for the Thacker Pass lithium project in Humboldt
County, Nevada (“Thacker Pass” or the “Project”), including the release of an independent National
Instrument 43-101 (“NI 43-101”) feasibility study (“Feasibility Study”).
Further details on the Transaction are reported in a joint release issued today by the Company and GM. All
figures presented are in U.S. Dollars.
TRANSACTION HIGHLIGHTS:
• The largest-ever investment by an automaker to produce battery raw materials, with GM to become
Lithium Americas’ largest shareholder.
• Lithium Americas to receive $650 million equity investment from GM consisting of:
o $320 million first tranche investment for common shares representing 9.999% of Lithium
Americas before separation; and
o $330 million second tranche investment, contemplated to be invested in the Company’s
U.S. business following the separation of its U.S. and Argentine businesses (the
“Separation”).
• After the first tranche investment, GM will receive exclusive access to Phase 1 production through
a binding supply agreement and a Right of First Offer (“ROFO”) on Phase 2 production.
• Investment supports the development of Thacker Pass, the largest known lithium resource in the
U.S.
o Project estimated to supply lithium needed for up to one million electric vehicles (“EVs”)
per year.
• Investment also supports the Company’s previously announced Separation by creating the
foundation for an independent U.S. business focused on Thacker Pass and a North American
lithium supply chain (“Lithium Americas (NewCo)”).
PROJECT HIGHLIGHTS:
• Advancing Thacker Pass construction plan targeting 80,000 tonnes per annum (“tpa”) of battery-
quality lithium carbonate (“Li2CO3”) production capacity in two phases of 40,000 tpa, respectively
(“Phase 1” and “Phase 2”).
o Phase 1 production expected to commence in the second half of 2026.
• Project life of 40 years (“LOM”) utilizing less than 25% of the current measured and indicated
(“M&I”) mineral resource estimate.
o Proven and probable mineral reserves of 3.7 million tonnes (“Mt”) lithium carbonate
equivalent (“LCE”) at an average grade of 3,160 parts per million lithium (“ppm Li”).
o M&I mineral resource estimate of 16.1 Mt LCE at an average grade of 2,070 ppm Li.
• $5.7 billion net present value (“NPV”) at 8% discount and 21.4% internal rate of return (“IRR”), after-
tax when using a price assumption of $24,000 per tonne (“/ t”) of Li2CO3.
• Phase 1 and Phase 2 capital cost estimates of $2.27 billion and $1.73 billion, respectively, are
based on cost estimates from Q3 2022 and include a 13.1% contingency.
• Awarded the Engineering, Procurement and Construction Management (“EPCM”) contract for the
construction of Thacker Pass to Bechtel Corporation.
• Thacker Pass is expected to create 1,000 jobs during construction and 500 jobs during operations.
TRANSACTION DETAILS
STRATEGIC INVESTMENT
GM has agreed to make an aggregate investment of $650 million in two tranches. In tranche 1, GM will
acquire 15.0 million common shares of Lithium Americas (each, a “LAC Share”) at a price of $21.34 per
share (the “Tranche 1 Subscription Price”), for gross proceeds of $320 million (“Tranche 1”). The funds
from Tranche 1 will be held in escrow until certain conditions are met, as discussed in the Transaction
Terms section below. If those conditions are met, the funds will be released to the Company and GM will
own a 9.999% equity interest in Lithium Americas. Lithium Americas anticipates that the escrow release
will occur by mid-2023.
Following the Separation and the satisfaction of certain conditions, GM has agreed to subscribe for shares
of Lithium Americas (NewCo) at the then market price on the date of subscription, subject to a cap of 130%
of the Tranche 1 Subscription Price (adjusted for the Separation) in an amount equal to $330 million
(“Tranche 2”).
Lithium Americas has agreed to use the proceeds from the Transaction for the development of Thacker
Pass.
OFFTAKE & INVESTOR RIGHTS AGREEMENT
Lithium Americas has entered into an agreement to supply GM with lithium carbonate production from
Phase 1 of Thacker Pass (the “Offtake Agreement”) in connection with the escrow release of the Tranche
1 investment. The price within the Offtake Agreement will be based on an agreed upon price formula linked
to prevailing market prices. The term of the Offtake Agreement will be 10 years from the commencement
of Phase 1 production, with the option for GM to extend by an additional five years. GM will also have a
ROFO on the offtake of Thacker Pass’ Phase 2 production.
As part of the Transaction, Lithium Americas and GM will enter into an investor rights agreement (the
“Investor Rights Agreement”). GM will be required to “lock-up” their securities until the later of (i) one year
after the Separation, or (ii) the earlier of (i) six months after the closing of Tranche 2, or (ii) the date Tranche
2 is not completed in accordance with its terms, provided that the foregoing lock-up restriction will not apply
if the Separation does not occur (such date being the “Lock-up Outside Date”). The Investor Rights
Agreement also provides among other things, for GM to be entitled to the following:
• If (i) following the closing of Tranche 1 and prior to the completion or termination of Tranche 2, GM
owns any issued and outstanding LAC Shares, or (ii) following the completion or termination of
Tranche 2, GM owns 10% or more of the issued and outstanding LAC Shares – the right to
nominate an individual to serve on the Board of Directors of Lithium Americas;
• If (i) following the closing of Tranche 1 and prior to the completion or termination of Tranche 2, GM
owns any issued and outstanding LAC Shares, or (ii) following the completion or termination of
Tranche 2, GM owns (i) 10% or more of the issued and outstanding LAC Shares or (ii) own 5% or
more of the issued and outstanding LAC Shares and is a party to the Offtake Agreement (or a
similar agreement with Lithium Americas) and does not have a nominee on the board of directors
of Lithium Americas – the right to have a nonvoting observer attend all Lithium Americas board
meetings; and
• Until the later of: (i) the Lock-up Outside Date, and (ii) the date on which GM ceases to either (i)
own 10% or more of the issued and outstanding LAC Shares, or (ii) owns 5% or more of the issued
and outstanding LAC Shares and be a party to the Offtake Agreement (or a similar agreement with
Lithium Americas) – the right to participate in any subsequent issuances of Lithium Americas
securities to “top-up” its pro rata ownership of Lithium Americas.
In addition, GM will be subject to a standstill limitation whereby it will not be able to increase its holdings
beyond 20% of the issued and outstanding LAC Shares until a period that is the earlier of (i) five years
following the effective date of the Investor Rights Agreement, and (ii) one year following the date of the
commencement of commercial production for Phase 1 (the “Phase 1 Effective Date”) as outlined in the
Offtake Agreement.
U.S. DOE ATVM LOAN
As previously announced in April 2022, the Company submitted a formal application to the U.S. Department
of Energy (“DOE”) for the funding of Thacker Pass through the DOE’s Advanced Technology Vehicles
Manufacturing Loan Program (“ATVM”) designed to provide loans for facilities located in the U.S. for the
manufacturing of advanced technology vehicles and qualifying components used in those vehicles. Lithium
Americas believes that the specific terms of this investment and Offtake Agreement both demonstrate the
Company’s commitment to supply lithium to U.S. domestic EV production in alignment with the principles
of the ATVM and position the Company as a model candidate to receive the maximum potential benefit of
the ATVM program. The proceeds from the DOE’s ATVM loan are expected to contribute a significant
portion of the initial capital costs for Thacker Pass Phase 1.
TRANSACTION TERMS
Tranche 1 of the transaction will be structured through the initial issuance of 15,002,243 subscription
receipts to GM, whereby each subscription receipt will, upon satisfaction of escrow release conditions,
convert into one common share and 79.26% of a Tranche 2 Alternative Exercise Warrant (“Tranche 2
AEW”), with a Tranche 2 AEW exercisable into a common share at a price of $27.74 for a term of 36
months. The conversion of the subscription receipts will result in the issuance of all shares issuable for the
Tranche 1 Investment and, through the shares issuable upon exercise of the Tranche 2 AEW, the allocation
of all shares issuable under the Tranche 2 subscription. The escrow release conditions for the subscription
receipts include delivery of a ruling under the Thacker Pass Record of Decision (“ROD”) appeal that does
not result in vacatur of the ROD, and conditions related to water rights transfer for Thacker Pass among
other customary closing conditions. Upon satisfaction of the escrow release conditions and the issuance of
the Tranche 1 shares, the parties will execute and deliver the Offtake Agreement and the Investor Rights
Agreement.
The parties will implement Tranche 2 either through the exercise of the Tranche 2 AEW or a purchase of
shares under a second tranche subscription agreement (which would result in the automatic termination of
the Tranche 2 AEW) that provides for the purchase $329,852,134.38 of shares of the Company at prevailing
market price, to a maximum of $$27.74 per share (adjusted for the separation, if applicable). To the extent
that GM completes an investment under one subscription alternative (either the Tranche 2 subscription
agreement or the Tranche 2 AEW), the Common Shares will cease to be issuable under the other
agreement. In addition to other closing conditions, Tranche 2 will be subject to a condition that the Company
secure sufficient funding to complete the development of Phase 1 of the Thacker Pass Project as set out
in the Feasibility Study.
Completion of the Transaction remains subject to customary regulatory approvals, including approval of the
TSX and NYSE, and other customary closing conditions.
A copy of the Purchase Agreement, the Offtake Agreement and the Investor Rights Agreement will be
available on the Company’s page on SEDAR at www.sedar.com and on EDGAR at www.edgar.com.
ADVISORS AND COUNSEL
BMO Capital Markets served as financial advisor, and Cassels Brock & Blackwell LLP, Dorsey &
Whitney LLP and McCarthy Tétrault LLP served as legal counsel to Lithium Americas.
Morgan Stanley & Co. LLC served as financial advisor to GM. Mayer Brown LLP and Osler, Hoskin &
Harcourt LLP served as legal counsel to GM.
SEPARATION UPDATE
On November 3, 2022, the Company announced that it intended to advance a reorganization that will result
in the separation of its U.S. and Argentine business units into two independent public companies. The
Company continues to advance the execution plan for the Separation, targeting completion in Q3 2023.
For more details about the Separation, please refer to Lithium Americas’ press release on November 3,
2022.
PROJECT UPDATE
Thacker Pass Feasibility Study results reflect operational and process improvements, including increased
extraction rates from an optimized mine plan through new ore control strategy, an increase in sulfuric acid
utilization by targeting illite clay with greater potential for increasing lithium extraction per tonne of sulfuric
acid and increased crystallization steps to further remove magnesium impurities.
Other process and design improvements were made to further minimize the Project’s environmental impact,
including, increased capacity to 80,000 tpa within approximately the same mining footprint as the permitted
pit boundary and without increasing the size of the sulfuric acid plant, additional beneficiation and
neutralization circuits to increase the neutrality of filter pressed tailings and implementing a tail gas scrubber
utilizing a neutralization solution in the sulfuric acid plant to minimize emissions and reduce impacts to
ambient air quality.
FEASIBILITY STUDY SUMMARY1
Scenarios Year 1-25 40 Years LOM
Design production capacity 80,000 tpa Li2CO3 (Phase 1 - 40,000 tpa)
Mining method Continuous open-pit mining
Processing method Sulfuric acid leaching
Mineral reserves 3.7 Mt LCE at a grade of 3,160 ppm Li
Period 25 years 40 years
Lithium carbonate price2 $24,000 / t Li2CO3
Initial capital costs – Phase 1 $2,268 million
Initial capital costs – Phase 2 $1,728 million
Sustaining capital costs $628 million $1,510 million
Operating Costs (average) $6,743 / t $7,198 / t
Average Annual EBITDA (per year) $1,176 million $1,094 million
After-tax NPV @ 8% Discount Rate $4,950 million $5,727 million
After-tax IRR 21.2% 21.4%
CONSTRUCTION TIMELINE
Phase 1 will consist of a single sulfuric acid plant with a nominal production rate of 3,000 tonnes per day
(“tpd”) sulfuric acid. Phase 2 construction will begin upon completion of Phase 1, with the addition of a
second sulfuric acid plant with an additional nominal production rate of 3,000 tpd.
Total designed capacity of 80,000 tpa Li2CO3 production upon completion of both Phase 1 and Phase 2.
Actual production varies by year with anticipated average production of approximately 70,000 tpa Li2CO3
in the first 25 years and approximately 67,000 tpa over LOM, including ramp up of Phase 1 and Phase 2.
The Company continues to prepare for construction while we await a ruling for the appeal of the issuance
of the ROD following a hearing held by the US District Court, District of Nevada (“Federal Court”) on
January 5, 2023. During the hearing, plaintiffs and the Company addressed final questions, the Federal
Court reaffirmed no additional hearings or briefings are required and they expect to issue a decision in the
next couple months.
CAPITAL COST ESTIMATE
The initial capital cost estimate covers early-works, mine development, mining, the process plant, the off-
site transload facility, commissioning and all associated infrastructure.
The capital cost estimates include a 13.1% contingency. The Phase 2 estimate is derived from the Phase
1 estimate and the lower Phase 2 estimated capital costs are a result of mine development, infrastructure
and transload facility synergies.
1 The economic analysis is based on Q3 2022 pricing for capital and operating costs.
2 Based on Q3 2022 long-term lithium carbonate price outlook from a leading industry market consultant.
Initial Capital Costs ($ millions) Phase 1 Costs Phase 2 Costs
Mine $58 $30
Process Plant and Infrastructure $1,963 $1,582
Offsite – Transload Facility $78 $31
Owner's Costs $169 $86
Total Initial Capital Costs $2,268 $1,729
In addition to the initial capital costs, $50 million in mining equipment cost will be repaid to the mining
contractor over the first five years of production.
Sustaining capital costs include replacement costs for mining equipment, process plant equipment, and
expansions of storage facilities and infrastructure.
OPERATING COST ESTIMATE
Operating costs in each area include labor, maintenance materials and supplies, raw materials, and outside
services, among others. Reagents account for approximately 63% of LOM total operating costs for the
process plant and the sulfuric acid plant. Primary reagents include liquid sulfur, limestone, soda ash,
flocculant and quicklime.
Year 1-25 40 Years LOM
$ per tonne
Li2CO3 % of Total $ per tonne
Li2CO3 % of Total
Mine $1,026 15% $1,144 16%
Lithium Process Plant $3,088 46% $3,213 45%
Liquid Sulfuric Acid Plant $2,424 36% $2,627 36%
General & Administrative $205 3% $215 3%
Total Operating Costs $6,743 100% $7,198 100%
MINERAL RESOURCE ESTIMATE
Thacker Pass Mineral Resource Estimate as of November 2, 2022
Category Tonnage
(Mt)
Average Li
(ppm)
Lithium Carbonate
Equivalent (Mt)
Measured 534.7 2,450 7.0
Indicated 922.5 1,850 9.1
Total Measured & Indicated 1,457.2 2,070 16.1
Inferred 297.2 1,870 3.0
Notes for the November 2, 2022 Mineral Resource:
1. The Qualified Person who supervised the preparation of and approved disclosure for the estimate is Benson Chow, P.G.,
SME-RM.
2. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. Mineral Resources are
inclusive of 217.3 million metric tonnes (Mt) of Mineral Reserves.
3. Mineral Resources are reported using an economic break-even formula: “Operating Cost per Resource Tonne”/“Price per
Recovered Tonne Lithium” * 10^6 = ppm Li Cutoff. “Operating Cost per Resource Tonne” = US$88.50, “Price per Recovered
Tonne Lithium” is estimated: (“Lithium Carbonate Equivalent (LCE) Price” * 5.323 *(1 – “Royalties”) * “Recovery”. Variables
are “LCE Price” = US$22,000/tonne Li2CO3, “Royalties” = 1.75% and “Recovery” = 73.5%.
4. Presented at a cutoff grade of 1,047 ppm Li.
5. A resource constraining pit shell has been derived from performing a pit optimization estimation using Vulcan software.
6. The conversion factor for lithium to LCE is 5.323.
7. Applied density for the mineralization is 1.79 t/m3.
8. Measured Mineral Resources are in blocks estimated using at least six drill holes and eighteen samples within a 262 m
search radius in the horizontal plane and 5 m in the vertical direction; Indicated Mineral Resources are in blocks estimated
using at least two dri ll holes and six to eighteen samples within a 483 m search radius in the horizontal plane and 5 m in
the vertical direction; and Inferred Mineral Resources are blocks estimated with at least two drill holes and three to six
samples within a search radius of 722 m in the horizontal plane and 5 m in the vertical plane.
9. Tonnages and grades have been rounded to accuracy levels deemed appropriate by the QP. Summation errors due to
rounding may exist.
MINERAL RESERVE ESTIMATE
Thacker Pass Mineral Reserve Estimate as of November 2, 2022
Category Tonnage
(Mt)
Average Li
(ppm)
Lithium Carbonate
Equivalent (Mt)
Proven 192.9 3,180 3.3
Probable 24.4 3,010 0.4
Total Proven and Probable 217.3 3,160 3.7
Notes for the November 2, 2022 Mineral Reserve:
1. The Qualified Person who supervised the preparation of and approved disclosure for the estimate is Kevin Bahe, P.E.,
SME-RM.
2. Mineral Reserves have been converted from measured and indicated Mineral Resources within the feasibility study and
have demonstrated economic viability.
3. Reserves presented at an 85% maximum ash content and 1.533 kilogram of lithium recovered per run of mine feed cutoff
grade. A sales price of $5,400 US$/t of Li2CO3 was utilized in the pit optimization resulting in the generation of the reserve
pit shell in 2019. Overall slope of 27 degrees was applied. For bedrock material pit slope was set at 47 degrees . Mining
and processing cost of $57.80 per tonne of ROM feed, a processing recovery factor of 84%, and royalty cost of 1.75% were
additional inputs into the pit optimization.
4. A LOM plan was developed based on equipment selection, equipment rates, labor rates, and plant feed and reagent
parameters. All Mineral Reserves are within the LOM plan. The LOM plan is the basis for the economic assessment within
the NI 43-101 technical report titled “Feasibility Study, National Instrument 43-101 Technical Report for the Thacker Pass
Project Humboldt County, Nevada, USA” with an effective date of November 2, 2022 (the “ Technical Report”), which is
used to show economic viability of the Mineral Reserves.
5. Applied density for the ore is 1.79 t/m3.
6. Lithium Carbonate Equivalent is based on in-situ LCE tonnes with 95% recovery factor.
7. Tonnages and grades have been rounded to accuracy levels deemed appropriate by the QP. Summation errors due to
rounding may exist.
8. The reference point at which the Mineral Reserves are defined is at the point where the ore is delivered to the run-of-mine
feeder.
Please refer to the Technical Report for full details on the geology, mining, processing and infrastructure of
Thacker Pass.
MINERAL RESERVE ESTIMATE METHODOLOGY
The Mineral Reserves estimate in the Technical Report is based on current knowledge, engineering
constraints and permit status. A qualified person, as defined under NI 43-101 (“QP”), has reviewed and
verified the Mineral Reserve estimate (the “Mineral Reserves QP”), and is of the opinion that the
methodology for estimation of Mineral Reserves in the Technical Report is in general accordance with the
2019 CIM Estimation of Mineral Resources and Mineral Reserves Best Practice Guidelines, and using the
definitions in 2014 CI M Definition Standards for the classification of Mineral Reserves. Large changes in
the market pricing, commodity price assumptions, material density factor assumptions, future geotechnical
evaluations, cost estimates or metallurgical recovery could affect the pit optimization parameters and
therefore the cutoff grades and estimates of Mineral Reserves.
MINERAL RESOURCE ESTIMATE METHODOLOGY
A QP has reviewed and verified the Mineral Resources estimate (the “Mineral Resources QP”) and is of
the opinion that the Mineral Resource estimation methodology is in general accordance with the 2019 CIM
Estimation of Mineral Resources and Mineral Reserves Best Practice Guidelines and uses the definitions
in 2014 CIM Definition Standards for Mineral Resources and Mineral Reserves for the classification of
Mineral Resources. Potential risk factors that could affect the Mineral Resource estimates include but are
not limited to large changes in the market pricing, commodity price assumptions, material density factor
assumptions, future geotechnical evaluations, metallurgical recovery assumptions, mining and processing
cost assumptions, and other cost estimates could affect the pit optimization parameters and therefore the
cutoff grades and Mineral Resource estimates.
QUALITY ASSURANCE AND QUALITY CONTROL
MINERAL RESOURCES
Sample names, certificate identifications, and run identifications were cross referenced with the laboratory
certificates and sample assay datasheet for spot checking and verification of data. No data anomalies were
discovered during this check.
Quality Assurance / Quality Control (QA/QC) methodology utilized by Lithium Americas and results of these
checks were discussed between Lithium Americas’ geologists and the Mineral Resources QP.
Geologic logs, Access databases, and Excel spreadsheets were provided to the Mineral Resources QP for
cross validation with the Excel lithological description file. Spot checks between Excel lithological
description sheets were performed against the source data with no inconsistencies found with the geologic
unit descriptions.
Verification of the block model was performed by the creation of a geostatistical model and the review of
its various outputs. Histograms, HERCO grade tonnage curves, and swath plots were created and analyzed
to validate the accuracy of the block model.
Based on the various reviews, validation exercises and remedies outlined above, the Mineral Resources
QP concluded that the data is adequate for use for Mineral Resource estimation.
MINERAL RESERVES
The Mineral Reserves QP reviewed the following as part of the mine planning, cost model and Mineral
Reserves data verification.
• Geotechnical: slope stability study completed by BARR Engineering in 2019 was reviewed.
• Mining Method: open-pit mining with limited blasting has been reviewed and assessed with
geotechnical reports.
• Pit Optimization: the pit limits were established based on the Environmental Impact Statement pit
extents and physical features. The final pit shell was verified to provide a positive economic value.
• Mine Design: ramp, bench and face angle parameters were validated by geotechnical reports.
• Production Schedule: the production schedule was validated based on reasonability.
• Labor and Equipment: estimations for equipment sizes, capacity, availability and utilization were
reviewed for reasonability.
• Economic Model: model was reviewed and demonstrated economic viability for the project.
• Facilities and Materials: facilities and materials located within the reserve pit boundary will be re-
located when access to those areas are required during mining.
QUALIFIED PERSON
The scientific and technical information contained in this news release has been derived from the Technical
Report and has been reviewed and approved by Rene LeBlanc, RM-SME, Chief Technical Officer of the
Company, a QP as defined under NI 43-101.