RENO, Nev. (AP) — President Joe Biden’s administration has conditionally agreed to lend more than $2 billion to the corporate building a controversial lithium mine in Nevada with the largest known U.S. deposit of the metal crucial to making batteries for electric vehicles, key to his renewable energy agenda.

The U.S. Department of Energy on Thursday agreed to provide a $2.26 billion conditional loan to Canada-based Lithium Americas to cover the cost of the open-pit mine that is deeper than the length of a football field near the Oregon line .

The loan would help finance a lithium carbonate processing plant at the Thacker Pass mine, about 200 miles (322 kilometers) north of Reno — “the largest proven lithium reserves in North America,” DOE said in a statement.

“The Thacker Pass is a treasure trove of lithium – the key to strengthening America’s energy security and electrifying America,” Energy Secretary Jennifer Granholm said in a message posted Friday on X, formerly known as Twitter.

“By offering this $2.26 billion conditional loan, we are helping to level the global playing field and boost clean energy production across the country,” she said.

The Energy Department said the loan is contingent on the Loan Programs Office’s review of the project under the National Environmental Policy Act.

Biden’s renewable energy agenda, aimed at easing America’s dependence on fossil fuels to reduce greenhouse gas emissions, is expected to be a key issue in his re-election bid against former President Donald Trump, who has said he would focus on drilling for more oil.

The ministry said lithium carbonate from Thacker Pass could support battery production for up to 800,000 electric vehicles per year, avoiding the consumption of 317 million gallons (1.2 billion liters) of gasoline per year.

“Today’s announcement reinforces the Biden-Harris administration’s approach to strengthening America’s position. critical materials supply chain, which is essential to building America’s clean transportation future and improving our national and energy security,” DOE said Thursday.

Lithium Americas said the loan would cover the vast majority of the first phase of the Thacker Pass project, now estimated to cost $2.93 billion. Last January, General Motors Co. conditionally agreed to invest $650 million in the project.

The conditional commitment to the government loan “is an important milestone for Thacker Pass, which will help meet growing domestic needs for lithium chemicals and strengthen our nation’s security,” said Jonathan Evans, president and CEO of Lithium Americas.

“The United States has an incredible opportunity to lead the next chapter of global electrification in a way that both strengthens our battery supply chains and ensures that the economic benefits are focused on American workers, businesses and communities,” he said.

Environmental groups and leaders of three tribes have fought for almost two years against the mine, which they say is adjacent to the sacred site where more than twenty Indians were murdered in 1865.

But a federal judge in Reno rejected the latest challenges in December and the chairman of the Reno Sparks Indian Colony, which spearheaded the legal battle, said weeks later they would drop any future appeal.

The acting chairman of the Nevada tribe closest to the mine said its members support the project.

“The Thacker Pass will provide important economic and employment opportunities for members of our tribe,” Larina Bell of the Fort McDermitt Paiute Shoshone Tribe said in a statement.

Lithium Americas said site preparation has been completed, including all site clearances, commissioning of a water supply system, improvements to site access and site infrastructure.

The company said the latest estimated total cost of Phase 1 construction has been revised upward to $2.93 billion based on several factors, including the use of union labor for construction, updated equipment pricing and the development of an all- inclusive housing facility for construction workers.

The company said it spent $193.7 million on the project in the year ended December 31. Mechanical completion of phase one is scheduled for 2027, with full production expected sometime in 2028.

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