Companies:

 

Articles:

 
Hot Topics

Why a US Stake in Lithium Americas Could Be a Tailwind for ASX Names in North America

Go to Paul Sanger author's page
By Paul Sanger - 
US Stake Lithium Americas Tailwind ASX Names North America
Copied

Shares of Lithium Americas (LAC) almost doubled in after-hours trading after reports the US government is negotiating to take an equity stake in the company’s Thacker Pass lithium project in Nevada.

The stake would come as part of a renegotiation of an existing US$2.3b Department of Energy loan.

Talks are ongoing; officials described the position as a “small stake.”

Project backdrop

  • Thacker Pass (LAC 62%) is a JV with GM (38%), targeting first production by 2028.
  • The move follows other US “policy-for-equity” steps (e.g., Intel, MP Materials) as Washington seeks to accelerate domestic supply chains in critical minerals and advanced manufacturing.

Why the market cares:

  • An equity co-investment from the US government reduces financing risk, can de-risk project execution, and often improves borrowing terms.
  • It also signals policy durability across administrations on critical minerals, supportive for project timelines, offtake confidence and valuation multiples.

Positives for ASX-listed companies with North American projects

Lower cost of capital / better funding pathways

Government participation (loans, grants, equity stakes) can compress the financing stack.

For ASX developers in the US and Canada, this raises the odds of blended packages (DOE loans, state incentives, private capital), potentially shortening time to FID.

Permitting & execution confidence

A government on the cap table or heavily involved can align agencies and stakeholders, improving visibility on permits, infrastructure and ESG compliance, key risks for greenfield projects.

Stronger offtake and OEM interest

Policy momentum plus government capital tends to attract automakers and battery OEMs, strengthening offtake terms (price floors/indexation, prepayments) and strategic partnerships.

Valuation support via “policy put”

When the policy objective is domestic supply, projects that tick the boxes (jurisdiction, scale, ESG) can command higher development-stage multiples, especially if they demonstrate near-term milestones.

Names to Watch

Other ASX-listed developers with North American exposure may also see sentiment benefit.

What Could Blunt the Impact

  • Policy execution risk (changes to program terms, timing).
  • Community/legal challenges at the project level.
  • Macro headwinds (lithium price volatility, cost inflation).

Bottom line: US equity participation at Thacker Pass is a powerful signal of policy-backed capital for critical minerals.

For ASX developers in North America, it strengthens the case for lower financing risk, faster development paths, and deeper OEM engagement, all supportive for re-ratings as milestones land.