Lithium Americas hails mixed ruling allowing Thacker Pass build

Lithium Americas (TSX: LAC; NYSE: LAC) has won part of a court case allowing construction to start on North America’s largest lithium mine, the Thacker Pass project in Nevada where General Motors plans to invest hundreds of millions of dollars.   

United States federal court judge Miranda Du on Monday ruled against ranchers, environmentalists and Indigenous groups who argued Thacker Pass will harm the local sage grouse population, groundwater aquifers and air quality. They wanted the federal Bureau of Land Management to rescind its approval given during the tenure of former president Donald Trump. Du’s ruling can be appealed.  

However, the judge also ruled the bureau must determine if the developer is allowed to store waste rock and tailings on part of the 24-sq.-km site. At question is whether the 5 sq. km of government land to hold the waste contains lithium. Another court in a separate case ruled last year that miners don’t have the right to use government land in their project if it doesn’t contain valuable minerals.   

Vancouver-based Lithium Americas said it would work closely with the bureau to complete its work and welcomed Du’s decision which in effect allows construction to start.  

“We are pleased that the federal court has recognized the bureau’s decision to issue the federal permit, reflecting our considerable efforts to ensure Thacker Pass is developed responsibly and for the benefit of all stakeholders,” Jonathan Evans, president and chief executive officer, said in a news release on Tuesday. “The favourable ruling leaves in place the final regulatory approval needed in moving Thacker Pass into construction.” 

Automaker GM said a week ago it will invest US$650 million in the open-pit project aiming to produce 60,000 tonnes a year of battery-grade lithium carbonate over a 46-year mine life, according to a 2018 prefeasibility study. The miner says output is expected to be 20% of the continent’s production by 2032 and be enough to power a million electric vehicles. U.S. President Joe Biden has pushed for lithium and other critical mineral production to ease dependence on China’s supplies.  

Judge Du also ruled against allegations by the Reno-Sparks Indian Colony and other tribes that they weren’t properly consulted about the proposed mine’s impacts.  

A government lawyer testified in a hearing last month that the bureau probably doesn’t need to find lithium across the entire project site to allow the tailings plan to proceed.  

Thacker Pass has measured and indicated resources of 385 million tonnes averaging 2,917 parts per million (ppm) lithium for 6 million tonnes of lithium carbonate equivalent (LCE). Inferred resources are 147 million tonnes averaging 2,932 ppm for 2.3 million tonnes of LCE. 

Shares in Lithium Americas jumped by nearly 10% to $34.63 Tuesday morning in Toronto, within a 52-week range of $23.80 and $50.42, valuing the company at $4.7 billion.