Thacker Pass Lithium Royalty

Project: Thacker Pass Lithium

Property: Thacker Pass

Location: Nevada USA

Operator: Lithium Americas Corp

Commodity: Lithium

Stage: Advancing towards construction

Mineral Reserves: 3.1 million tonnes of LCE at 3,283 ppm Li 

Royalty

Royalty 60% interest in a 1.75% gross revenue royalty  (1.05% net to Trident)

Annual Production Rates

Phase 1: 30,000 tpa for (3.5 years)

Phase 2: 60,000 tpa Li2CO3 

Trident has acquired a 60% interest in a Gross Revenue Royalty (“GRR”) over the Thacker Pass Lithium Project, one of the largest known lithium resources in North America. The project is 100% owned and operated by Lithium Americas Corp.

Thacker Pass currently contains CIM compliant Mineral Reserves of 3.1Mt Lithium Carbonate Equivalent (“LCE”), the largest lithium reserve in the United States, with a mine life of 46 years based on Reserves. With the Total Resources amounting to circa 8.3Mt LCE plus further as yet undrilled exploration targets, there is significant additional resource upside to potentially provide further reserve conversion to increase the mine life or support a production expansion.  

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Thacker Pass is at an advanced stage of development with a highly attractive Pre-Feasibility announced on 21 June 2018 and a definitive feasibility study due for completion in 2021. The key permits are in place with construction targeted for late 2021 or early 2022, and Trident expects Phase 1 production to begin in 2024.

Based on the Pre-Feasibility Study parameters, anticipated Phase 1 steady-state royalty revenue attributable to Trident of US$3.8 million per annum, increasing to US$7.6 million per annum at Phase 2 steady-state.

The key terms of the GRR are as follows:

A gross revenue royalty on all mineral products generated at the mine of 8% (4.8% attributable to Trident) until US$22 million is paid, after which the GRR drops to 4%

The GRR may be reduced to 1.75% (1.05% attributable to Trident) at any time by the operator making a one-time payment of US$22 million (US$13.2 million attributable to Trident)

Trident notes that the PFS assumes the US$22 million buyback is completed within the first year of operation

Thacker Pass contains the largest defined lithium Mineral Reserve in the United States, making it a strategic asset with lithium having been designated a “critical” mineral by the United States government and located in the # 1 global mining jurisdiction (Nevada).

It consists of a lacustrine volcanosedimentary / sedimentary lithium clay deposit, originally formed in a caldera lake setting. The deposit is laterally consistent with near horizontal layered beds of lithium-bearing, clay-rich volcaniclastic sedimentary rocks. The mineralised horizon is laterally consistent varying from 1m to >60m thick with around 10m of overburden. The structure and geometry of the proposed first stage mining area is well understood.

The royalty provides Trident with attractive exposure to the growing lithium market, operated by an innovative and renowned operator with a strong balance sheet in a world-class jurisdiction. The demand in the lithium market is growing as a result in the demand for rechargeable battery, particularly with the uptake in electric vehicles.