WR1 General Discussion, page-32749

If one has to rely on the shifty govt for anything - it means your project is as good as dead imo
Their policies don't stick and flip flops every few years.

Layoffs. Scaled-back projects. Federal loan guarantee applications in flux.

Companies seeking to dig up and process lithium — a key EV battery ingredient — are adjusting plans in the face of cratering prices and uncertain presidential politics, marking turbulence for the Biden administration’s electric vehicle agenda.

Despite the call for U.S. producers to pump out more of the critical mineral, some lithium producers in recent months have responded to sagging prices by putting projects on hold, even as the federal government tries to juice supply chains and the shift to electric vehicles.

Lithium prices reached multiyear lows in June, hampered by slowing sales of plug-in electric vehicles and bloated supplies of raw materials, according to an Aug. 29 report from Clean Energy Associates, which found low prices will linger through 2028. The report also fingered politics as further fueling market volatility.

“The upcoming U.S. presidential election poses uncertainties for federal EV tax credits, putting the domestic planned cell production capacities at risk of being delayed or canceled, further impacting the projected global lithium demand-supply balance,” authors of the report wrote.

Adam Webb, a director at Benchmark Mineral Intelligence, broadly agreed and said demand for electric vehicles isn’t weak — annual growth in sales this year is expected to be more than 20 percent, so still a rapidly growing market — but it is lower than expected. In turn, Webb said the price of spodumene concentrate, which is shipped to China to be processed into lithium chemicals, has fallen from about $1,000 per ton at the start of the year due to anemic demand, bloated supply and high inventory throughout the lithium supply chain. It’s now currently trading at about $820 per ton, he said.

Piedmont Lithium has for months been weighing when to resubmit an application for a Department of Energy loan guarantee through the agency’s Advanced Technology Vehicles Manufacturing Loan Program to build a lithium project in Gaston County, North Carolina. The company pulled its applications last year, citing changes in its operations and collapsing lithium prices. Reuters first publicly reported the company’s move.

Keith Phillips, president and CEO of Piedmont Lithium, said in an email that the company has at various points submitted or modified its loan applications under the ATVM program for projects in North Carolina and Tennessee and has had to evolve with changing market conditions.

“We don’t have an active ATVM loan application into [loan program office] at this time,” Philips in an email.

“With market conditions the way they are and a need to update the definition of Carolina Lithium in respect of an ATVM application, we don’t necessarily feel a sense of urgency at this stage,” Phillips continued. “We would expect to submit a fresh application at a point in the future and we would look forward to working with DOE when that time comes.”

Earlier this year, Piedmont, citing “prevailing market realities,” announced it was canceling plans for a lithium production plant in Tennessee and instead adding that project to its North Carolina site. The Tennessee project had already secured a $142 million federal grant from the DOE, which the company later opted not to use.

“In our most recent earnings call you would have heard of our plans not to pursue Tennessee Lithium, and to change the way that we look at Carolina Lithium,” Phillips said. “We also mentioned that our intention in the current market is to maintain discipline and manage cash, which invariably means that our timelines for development will have to move to the right.”

In January, Albemarle, the world’s largest lithium producer, announced plans to cut jobs and defer spending on projects in the Carolinas — part of a larger effort to curb costs.

That trend continued overseas this week with Arcadia Lithium, a major Australia-based producer, said on Thursday its plans to idle its Mount Cattlin spodumene operation in western Australia next year to curb costs amid falling prices.

Webb with Benchmark Minerals said Mount Cattlin is the first major Australian mine to be closed as a result of the current lithium bear market.

“However, many producers in Australia and elsewhere are under pressure at current prices and we could see further closures if prices do not recover,” Webb said. “With the lithium market expected to remain oversupplied into 2025, we expect limited upside to prices in the short term. However, if enough mining capacity is taken offline this could provide price support and re-balance the market.”

Despite the sour price outlook, some lithium producers said they see little change to their plans from the upcoming election.

Earlier this week, General Motors delayed a second tranche of its $650 million investment into Lithium Americas’ Thacker Pass lithium mine in Nevada. Lithium Americas in a press release said the timing would allow both companies to “explore alternative structures for GM’s additional investment in a mutually beneficial manner,” but stopped short of providing more details.

When asked about the announcement, Tim Crowley, vice president of government and external affairs for Lithium Americas, said the Thacker Pass mine is fully permitted to move forward with construction and that work on the project’s infrastructure began last year.

The project, he said, has received support under both the Trump and Biden administrations and is poised to close a $2.26 billion conditional loan from the Energy Department this year, on schedule.

“We don’t believe the elections will impact our project,” said Crowley. “The DOE has always been on schedule to close the Thacker Pass loan this year. They remain on that path.”