Lithium Americas’ flagship Thacker Pass costs jump 31%
Rising labor and construction costs raise Nevada's lithium project budget to $3.83 billion, adding nearly $1 billion in funding needs.
Lithium Americas has increased the projected cost of its main Thacker Pass lithium project in Nevada by 31%, raising the first phase budget to $3.83 billion. The expansion is primarily due to escalated labor, construction, and logistics costs. This adjustment amounts to an extra $895 million in capital expenses and a $995 million increase in funding demands.
The company intends to cover these additional requirements through internal contributions and available reserves under a U.S. Department of Energy loan. Shares of Lithium Americas fell almost 8% to C$2.48 each following the news, bringing the company's market capitalization to C$544 million. Lithium Americas CEO Jonathan Evans affirmed that the project remains on schedule for peak construction activity by the end of 2026 and mechanical completion by late 2027.
The cost surge underscores the difficulties in constructing a domestic lithium supply chain in the U.S., where factors like rising wages, skilled labor shortages, and tariffs are placing pressure on major mining ventures. Thacker Pass, a joint effort with General Motors, is anticipated to provide lithium for around 1 million electric vehicles yearly.
Despite the higher costs, the company still aims for commercial production in 2028. However, the increased budget puts greater strain on construction productivity and cost control measures as the project advances into its most labor-intensive phases.
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