In a groundbreaking move, the Trump administration has finalized a $2.23 billion loan to advance the Thacker Pass lithium mine in Nevada, securing a significant federal stake in America's largest planned lithium project.

This Trump-led deal not only ensures the development of a critical mineral resource but also positions the U.S. to reduce reliance on foreign lithium supplies through a 10% equity stake in the project, as the Washington Free Beacon reports.

The journey to this agreement began under the Biden administration, which initially approved the substantial loan to fund the Thacker Pass mine, located in northern Nevada.

Securing domestic lithium for national needs

The Department of Energy finalized the loan in October 2024, aiming to bolster the domestic electric vehicle industry by supporting the first U.S. facility to produce battery-grade lithium.

However, when the Trump administration took over, officials raised concerns about the project's competitiveness against Chinese lithium producers, who currently mine 17% and process 70% of the global supply.

They pushed for General Motors, the lead investor, to commit to a "take or pay" clause for lithium purchases, a condition the company ultimately rejected.

Navigating challenges in loan negotiations

This disagreement led to a delay in the loan's disbursement, and in September 2024, tensions escalated as negotiations between the Department of Energy, General Motors, and Lithium Americas, the project developer, nearly derailed the deal.

Had the loan fallen through, Lithium Americas might have been forced to halt the project and seek alternative funding to avoid financial collapse.

Eventually, a compromise was reached, with the federal government agreeing to take a 10% equity stake in Thacker Pass, a term not included in the original Biden-era agreement.

Strengthening America's strategic positioni

The first portion of the loan, amounting to $435 million, is set to be disbursed by the end of 2025, providing crucial funding for a processing facility at the mine.

Once operational, Thacker Pass is projected to produce up to 40,000 tons of lithium annually, a volume at least eight times the current U.S. output, potentially making the country a major player in global lithium production.

Lithium is vital for electric vehicle batteries, long-duration energy storage, and military equipment, underscoring its importance for both energy independence and national security.

Industry support, broader implications

General Motors is expected to purchase the majority of the processed lithium for its electric vehicle batteries, while other American companies, including a smartphone glass manufacturer in New York and a battery producer in California, have expressed interest in sourcing from Thacker Pass.

Energy Secretary Chris Wright praised the agreement, stating it "ensures better stewardship of American taxpayer dollars."

He added, "Today's announcement helps reduce our dependence on foreign adversaries for critical minerals by strengthening domestic supply chains."