LAC permits & mining play Q1 2022

We need to start getting better research on this company as it has run with the EV craze and is often discussed in VC and trading floor chat. I believe they have a case right now to get permits to mine on large area of land, but locals are fighting them on it due to potentially sacred/historic land (or however you want to call it). Main concern is to make sure this isn’t overvalued or buying calls at the wrong support could kill this play.

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In the latest company news, on Dec. 9, 2021, the initial purchasers of unsecured convertible notes exercised their option to purchase an additional $33.75 million in convertible notes, bringing the total of unsecured convertible senior notes to $258.75 million. LAC used these funds to pay off their secured debt and will use the remainder to pay off some other, smaller debts and general corporate purposes.

These convertible notes mature on January 15, 2027. It appears that the initial conversion rate calculation shows that the noteholders are betting the company will be worth in excess of the conversion price of $47.10/share from and after 2024, which is the first time LAC has the option to redeem. So long-term, it appears bullish. They paid of secured debt with unsecured debt. The noteholders are large financial institutions. The institutions believe the stock has a decent chance of being worth $47.10/share by 2024.

Will look into other issues like the permits and stuff later, but wanted to get this up once I found it.

Exactly why I am glad we finally got this ticker on here. So in my timeframe I have a 99.99% chance of not holding it till 2024. Thinking main play may be this court case and the outcome and proper entry points if we think this may be a play. Biggest concern is this stock has performed like a meme in the last year too.

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As of December 28, 2021, Free Cash Flow is expected to decline to about (95.1 M ). In addition to that, Enterprise Value is expected to decline to about 966.1 M .

Lithium Americas Corp secures a last-minute Real Value of $33.21 per share. The latest price of the firm is $28.83. Model forecasts the value of LAC from analyzing the firm fundamentals such as Shares Owned by Insiders of 16.74 %, return on equity] of (13.16) %, and Current Valuation of 2.11 B as well as examining its technical indicators and Probability Of Bankruptcy.

Project 1-Cauchari-Olaroz mine project has advanced their expected begin of production date to mid 2022, they are shooting for July. This mine is located in Argentina and is expected to pay $3,579 a ton at a rate of 40,000 tons per acre (TPA) for the 40yr phase 1.

Project 2- Thacker Pass, which is planned to be the largest and next lithium mine in the US and is close to production at a rate of 60,000 TPA over 46 years. This mine is being said to be 1000 acres but rumor of more and it covers some sites that have caused controversy over mining the area and have been in litigation for over a year and are set to settle on final appeal in February. In November a US Federal Judge ruled that the two accounts submitted as evidence to a sacred land because of a very small number of Native Americans getting killed by U.S. military in 1865 still was not sufficient evidence to stop digging in the future.

This is possibly a long term play and will require more monitoring as time progresses, there are two dates that need to be considered in LAC Feb and July. I am not an expert so please use caution at all times on any play.

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The Thacker Pass mining site in Arizona is expected to begin mining in mid-to-late 2022 with LAC expecting to receive all proper permits in Q1 2022.

This play is the inverse of Piedmont Lithium ($PLL) failing to get their state permits which caused shares to tumble nearly 20%. I’m willing to bet LAC will announce they’ve attained their permits when the time comes and investors will flood in an attempt to get in early. For those of you looking to enter with shares, I am confident (assuming Thacker Pass and Cauchari-Olaroz proceed without any obstructions) LAC will contend with the likes of Albemarle ($ALB). As mentioned above, there are lawsuits claiming the area being developed for Thacker Pass will intrude upon Native American sacred land.

While the Cauchari-Olaroz project in Argentina has split ownership (46.7% Ganfeng Lithium, 44.8% LAC, 8.5% JEMSE) the Thacker Pass project is 100% owned by LAC. While LAC is a Canadian company, lithium mined in America is sure to get some people riled up. As time goes on, vehicle manufacturers are switching to full-time EV production which will increase demand for lithium and a potential partnership may be announced (speculation). For example, when $PLL announced they inked a lithium supply deal with Tesla the stock soared 10x. The magnitude of change is not likely to occur with LAC as there is a fair amount of growth priced in but I believe it will see substantial growth.

LAC sentiment peaked in late November with the Infrastructure Bill being passed and has since fallen with news of BBB being delayed by Manchin. If Manchin stops being a pussy and BBB is passed expect this to move in a similar timeframe as the permit announcement.

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Fantastic response thank you both

I bought in for some long calls actually. Looking at May. So far even though I bought in higher that 28.50 area I wanted to fill around, they are doing well. I would wait if you believe in this play to let it cool down as it ran this am.

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LAC on Jan 25 2022 acquired 100% of all issued and outstanding shares of Millennial Lithium Corp Pastos Grandes Lithium Brine Project. Estimated TPA is 24000 and the Pastos Grande is late stage in meaning that it is very near full production and LAC intends to reevaluate the TPA as speculated could be. The Mine should bring quick development to meet current rising demand. Millennial Lithium Corp delisted Jan 26 22 with LAC giving .1261 of a common LAC stock and $.001 in cash. Currently LAC near term plans are heavy focused on bringing the Cauchari-Olaroz project into production. The two mines are actually neighbors to each other being less than 100 Km or 62 miles from each other. This play as it has been said is developing slowly and is looking for major good news sometime in Feb 22 when the judgement on the final appeal of the Thacker Pass is set.

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LAC had a fairly bullish call that resulted in a 9% price increase on the 15th.

https://www.lithiumamericas.com/_resources/presentations/corporate-presentation.pdf?v=0.31

There is alot to like from that presentaion as prices and demand seem to be seriously in their favor. We have alot to look forward to with this one. As long as fridays dip didnt wreck the uptrend we might have seen the recent bottom and the Thacker Pass decison is now imminent.
“Permitting process on track with final decision expected in Q1 2022”
I would expect to see a pretty large move depending on approval or denial of these permits. Approval would give them the go ahead to start construction this year. I started positoning on Friday with some 3/18 $30 calls.

Bonus:Seeking Alpha that is somewhat rambling but digs a bit deeper into the permitting/current thacker pass lawsuits.

https://seekingalpha.com/article/4487973-lithium-americas-a-legal-update-on-thacker-pass

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Great article about the current state of Lithium.
Highlights:

  • Prices are up 50% in 2022
  • Prices are up 400% since 2020
  • The largest challenge to increasing supplies is bringing mines online which can take 5-7 years.

LACs Pastor Grandes project started in 2011 mentioned as the next big ticket project.

The current options chain has pretty low interest for April and I feel that March may be too soon to catch the Thacker pass ruling.

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February 25, 2022 - Vancouver, Canada: Lithium Americas Corp. (TSX: LAC) (NYSE: LAC) (“Lithium Americas” or the “Company”) is pleased to announce the Nevada Division of Environmental Protection (“ NDEP ”) has issued the final key state-level permits for the Thacker Pass lithium project in Humboldt County, Nevada (“ Thacker Pass ” or the “ Project ”). The three approved permits include the Water Pollution Control Permit, Mine Reclamation Permit and Class II Air Quality Operating Permit.

“With the final key state environmental permits in hand, Lithium Americas can begin to advance Thacker Pass towards construction,” said Jonathan Evans, President and CEO. “Thacker Pass provides an opportunity to enable a US-based battery supply chain for the growing electric vehicle market. Our commitment to developing Thacker Pass in the most environmentally responsible way is demonstrated from over a decade of conducting the necessary planning, design and engagement.”

I have closed postions on this as it could be a sell the news event. If it holds I may enter next week as this is a great move for them long term.