General Motors in investing $650 million in the largest known lithium deposit in the United States and the third largest globally, Kallanish reports.

The Michigan-based auto giant is making the equity investment in Lithium Americas that is developing the Thacker Pass lithium project in northwest Nevada. GM will get exclusive access to Phase 1 production under a binding agreement and has the right of first offer on Phase 2 production. The investment is the largest ever by an automaker to produce battery raw materials and continues GM's efforts to secure the needed raw materials to transition to electric vehicles. GM would also be eligible for consumer incentives under federal clean energy tax credits.

Production at Thacker Pass in Nevada’s Humboldt County is projected to begin in the second half of 2026. The project is fully permitted, but the final federal approval has been challenged in court by mine opponents. A decision is expected in the coming months.

Lithium production from the project’s first phase will be 20,000 tonnes/year for 3.5 years. The second phase is expected to boost production to 60,000 t/y. Thacker Pass is estimated to contain 179m t of proven and probable reserves of lithium ore grading 3,283 ppm lithium. It is estimated to contain 3.1 m t of lithium carbonate equivalent. The mine is projected to operate for 46 years.

Lithium carbonate from Thacker Pass will be used in GM’s proprietary Ultium battery cells. Lithium Americas, with headquarters in Vancouver, British Columbia, says the lithium extracted and processed from the project can support production of up to 1m EVs/year.

GM had said earlier that it had the needed raw materials to build 1m EVs in 2025 but the new deal provides even more raw materials going forward.

“Direct sourcing critical EV raw materials and components from suppliers in North America and free-trade-agreement countries helps make our supply chain more secure, helps us manage cell costs and creates jobs,” says chair and ceo Mary Barra in a statement.

GM’s investment will be split into two tranches. The funds for the first tranche will be held in escrow until certain conditions are met including the ruling by US District Court Judge Miranda Du in Reno, Nevada. That verdict is expected before year-end 2023.

GM has signed numerous EV battery supply agreements for lithium, nickel and cobalt in the last year, after being hurt by semiconductor chip shortages in recent years.