Lithium Americas (LAC): Made in the USA Lithium Producer; Initiate at Neutral

Research evidence excerpt

Lithium Americas (LAC): Made in the USA Lithium Producer; Initiate at Neutral

Goldman Sachs Lithium Americas (LAC)

Lithium Americas (LAC) - Exploratory lithium mining out of Thacker Pass (North Nevada)

Investment Thesis:

1. Substantially De-Risked Project Execution and Financing

A primary concern for a pioneering large-scale mining project is execution risk. We

believe LAC has mitigated this through several key actions:

n Blue-Chip Partnerships: The project’s credibility is enhanced by well positioned

strategic partners.

o General Motors (GM): GM has established a joint venture with LAC, acquiring

a 38% direct ownership stake in the Thacker Pass project for a total of

$625mn in cash and letters of credit. This follows a previous 2023 $320mn

equity investment in LAC, making GM a stakeholder at both the asset and

corporate level. GM’s involvement aligns its strategic interests with the

project’s success given ownership stake and offtake agreement to secure

domestic lithium supply for it’s EV needs.

o U.S. Department of Energy (DOE): A $2.23bn ATVM loan provides the

majority of the required capital for Phase 1 and we believe signifies the

project’s strategic importance at the federal level. The DOE is also a holder of

warrants equal to 5% at the equity level and 5% at the JV level.

o Orion Resource Partners: A strategic investment of $250mn from a

specialized mining financier has closed the remaining funding gap for Phase 1

construction, meeting all equity requirements under the DOE and GM

agreements.

n Proven Construction & Mining Partners: LAC has outsourced key operations to

industry experts, minimizing execution risk. Bechtel serves as the engineering,

procurement, and construction management (EPCM) contractor, while Sawtooth is

the mining contractor.