- Lithium Americas (TSX:LAC) reported a net profit of C$71.7 million in 2019, which was largely due to a substantial project investment by Ganfeng Lithium
- Ganfeng Lithium invested $221 million to acquire a 50 per cent interest in the Cauchari-Olaroz Lithium Project in Arizona
- Earlier this year, Ganfeng Lithium purchased another one per cent interest in Cauchari-Olaroz, bringing its total to 51 per cent
- The investment will help Lithium Americas to progress the Thacker Pass Lithium Project located in Nevada
- Lithium Americas Corp (LAC) was up 4.03 per cent, with shares trading for $4.39
Lithium Americas Corp (TSX:LAC) has moved into net profit, after a substantial project investment by Ganfeng Lithium.
In August last year, Ganfeng agreed to invest C$221 million into the Cauchari-Olaroz lithium project in Argentina. Cauchari-Olaroz is currently under construction and should be complete in 2021.
The company stated that the lithium project could process 40,000 tonnes per year, over a forty-year life. As a result, the expected net value of the property is $2.5 billion.
The $221 million investment increased Ganfeng’s interest in Cauchari-Olaroz to 50 per cent.
At the time of investment, Jon Evans, President and CEO, was pleased with the partnership.
“We are delighted to complete the Project Investment with our fifty-fifty joint venture partner, Ganfeng Lithium, building on our long history of working together,” he said.
In Lithium Americas’ full-year report, released today, the investment has been a substantial boost to the company’s year.
The company reported a net profit of $71.7 million in 2019, versus a net loss of around $39.3 million in the previous year.
Lithium Americas currently has no operating facilities and therefore credits the dramatic change entirely to the Gangfeng partnership.
Earlier this year, Ganfeng elected to increase its holding again. The company purchased a key percent from Lithium Americas for a further $22.3 million in cash.
As a result, Lithium Americas now owns a 49 per cent interest in Cauchari-Olaroz, with Ganfeng holding the remaining majority.
Lithium Americas is using the funds from this latest agreement to advance its Thacker Pass Lithium Project located in Nevada, USA.
Lithium Americas Corp (LAC) was up 4.03 per cent, with shares trading for $4.39 at 11.29am EST.