Lithium Americas shares power higher after $160M Chinese investment

Lithium Americas (TSE:LAC) (NYSE:LAC) was a big mover on the TSX on Monday after the company announced that it had received a $160 million investment in its Caucharí-Olaroz lithium project from China’s Ganfeng Lithium Co.

Shares of Lithium Americas were up nearly 11% on Monday to close at C$5.58 in Toronto and almost 12% higher in New York to close at US$4.21.

The Vancouver-based junior miner’s Caucharí-Olaroz project is currently under construction in northern Argentina with a resource of nearly 18 million tons of lithium carbonate equivalent. The project is currently under construction and slated to begin production by the end of 2020.

As a result of the investment, Ganfeng Lithium will increase its state in Caucharí-Olaroz from 37.5% to 50%, forming a 50-50 joint venture subsidiary, Minera Exar.

New lithium partnership

The $160 million investment significantly de-risks Caucharí-Olaroz by providing additional assurances that the company remains fully-funded for the current 25,000 tonnes per annum (tpa) development plan and supports the evaluation of an increase in initial production capacity to 40,000 tpa of lithium carbonate, Lithium Americas said in a statement.

“We are delighted to have Ganfeng Lithium and Lithium Americas as 50/50 partners in Caucharí-Olaroz and we look forward to building on our long and productive history of working together,” said Tom Hodgson, CEO, and Jon Evans, President and COO at Lithium Americas.

One of the largest lithium product makers in China, Ganfeng Lithium procures lithium sources as feedstock from producers and processes those materials into saleable products.  

Contact Angela at [email protected]

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Story by ProactiveInvestors