This week, Lithium Americas (NYSE:LAC) (TSE:LAC) provided a key update on its Thacker Pass project, alongside its first-quarter results. The Thacker Pass project, owned by the lithium exploration and development company, holds the largest known Measured and Indicated (M&I) lithium resource in North America.
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Progress at Thacker Pass
LAC has completed site preparation and expects major construction at Thacker Pass to begin in the second half of this year. Earlier this year, LAC received a conditional commitment for a $2.26 billion loan from the U.S. Department of Energy (DOE) to set up processing facilities at Thacker Pass. It plans to produce around 40,000 tons of battery-grade lithium carbonate annually from Phase 1 of the project.
And Its Strategic Importance
Notably, General Motors (NYSE:GM) has agreed to a $650 million investment in LAC to advance the project. This is the largest investment by an automotive producer in a company to produce battery-grade raw materials. Importantly, the Phase 1 of Thacker Pass is estimated to produce enough lithium to support production of up to 800,000 EVs per year, and GM has exclusive access to lithium production from Phase 1 for up to 15 years. The automaker also has a right of first offer on Phase 2 of Thacker Pass.
The Thacker Pass project, with its scale, could play a critical role in the U.S.’ drive to secure domestic supplies for critical minerals. LAC anticipates production from the Phase 1 to begin in 2027.
What Is the Stock Price Forecast for LAC?
Despite steady progress at Thacker Pass, Lithium America’s share price has tanked by nearly 36% over the past six months amid challenging times for the broader lithium industry. Overall, the Street has a Moderate Buy consensus rating on the stock, alongside an average LAC price target of $7.57.
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