Lithium Americas Corp. (TSX:LAC)(OTCQX:LHMAF) ("Lithium Americas" or the "Company") is pleased to announce that it has received approval for the construction of its Cauchari-Olaroz lithium project from the Committee of Experts of the province of Jujuy. The Committee of Experts is tasked with assessing the impact and benefits to the province of Jujuy of any proposed lithium project.
"Receipt of Committee of Experts project approval is another major milestone for our Company," said Tom Hodgson, Executive Chairman of Lithium Americas. "Given that the fundamentals of the lithium industry continue to be very strong, we are extremely pleased to be one important step closer to the construction of Cauchari-Olaroz, projected to be one of the largest and lowest cost lithium brine projects in the world. Our focus is now on finalizing project financing, and on preparing for the project construction phase."
Committee of Experts' approval has been granted following the Company entering into an agreement with Jujuy Energia y Mineria Sociedad del Estado ("JEMSE"). JEMSE is the government of Jujuy's mining investment company, involved in the development of mining projects in the province of Jujuy. The agreement with JEMSE, whereby JEMSE will acquire an 8.5% equity interest in the Cauchari-Olaroz project, provides Lithium Americas with valuable management services in order to develop its world class lithium project.
JEMSE will be required to cover its pro rata share of the financing requirements for the construction of the Cauchari-Olaroz project. These funds will be loaned to JEMSE by Lithium Americas and will be repayable out of one-third of the dividends to be received by JEMSE over future years from the Cauchari-Olaroz project. The distribution of dividends to JEMSE and other shareholders in the project will only commence once all annual commitments related to project debt financing are met.