Shares in Lithium Americas (TSX:LAC, NYSE:LAC) nearly doubled in price on Wednesday this week, on the back of reports that the US government is seeking up to a 10% equity stake in the company. This move is part of negotiations over a US$2.2B loan from the US Department of Energy (DOE) to support the development of the Thacker Pass lithium project in Nevada, which, once developed, could be the largest lithium source in North America.
Lithium Americas and its partner, General Motors, which holds a 38% stake in the project, requested to renegotiate terms originally set under the Biden administration. The Trump administration responded by proposing a small equity stake in exchange for more favourable loan terms.
This initiative is part of a broader national security strategy by the Trump administration to secure domestic supply chains for critical minerals, reduce dependence on China, and assert more direct government involvement in strategic industries. Similar moves have already been made in sectors like rare earths and semiconductors.
The market reacted strongly to the news, with Lithium Americas’ market cap nearly doubling to around $1.5 billion, and other lithium-related stocks also seeing gains.
