Open Letter to Lithium Americas Corporation Thacker Pass Lithium Mine Investors
June 2, 2021
Jonathan Evans, Director, CEO, and President Lithium Americas Corporation
300 – 900 West Hastings Street
Vancouver, BC V6C 1E5
Significant uncertainties and financial, legal, and political risks face Lithium Americas Corp.’s proposed Thacker Pass lithium mine project (“Thacker Pass project”) in northern Nevada. The project’s many issues conflict with Lithium Americas’ own Code of Business Conduct and Ethics, which declares: “We require the highest standards of professional and ethical conduct from our consultants, employees, officers and directors. Our reputation for honesty and integrity is important for the success of our business.” The following letter elaborates the various risks and ethical problems confronting the Thacker Pass project. Lithium Americas should accurately report this information to shareholders, potential investors, and other appropriate parties.
The first major risk associated with this project is the potential loss of reputation and investor support due to serious opposition to the proposed Thacker Pass open-pit lithium mine. Opposition is rapidly growing at the proposed mining site, across the country, and internationally. According to the May 6, 2021, cover story in The New York Times, the Thacker Pass mine “has drawn protests from members of a Native American tribe, ranchers, and environmental groups because it is expected to use billions of gallons of precious ground water, potentially contaminating some of it for 300 years, while leaving behind a giant mound of waste.” The story also notes that “Production of raw materials like lithium… [is] often ruinous to land, water, wildlife and people.”
The opposition noted by The New York Times now includes Atsa koodakuh wyh Nuwu (the People of Red Mountain); the Nevada Statewide Native American Caucus; the tribal Governments of the Fort McDermitt Paiute Shoshone Reservation and the Duck Valley Indian Reservation; Bartell Ranch; Basin and Range Watch; Western Watersheds Project; Great Basin Resource Watch; Wildlands Defense; the majority of local residents of the Quinn River and King’s River valleys; Mom’s Clean Air Force NV; the grassroots alliance called “Protect Thacker Pass,” which includes U.S. military veterans, veterans of the “Standing Rock” battle against the Dakota Access Pipeline, and other activists; and many other individuals and organizations. In the last four weeks, more than 1,200 people have signed a petition created by Atsa koodakuh wyh Nuwu (the People of Red Mountain) urging the Department of the Interior to rescind the Thacker Pass Lithium Mine Project Final Environmental Impact Statement (FEIS), Record of Decision, and Plan of Operations.
The growing opposition to the Thacker Pass project is multi-pronged. In February, a local rancher and ranching business filed suit in the United States District Court, District of Nevada, alleging that by permitting the Thacker Pass Project, the Bureau of Land Management (“BLM”) violated the National Environmental Policy Act, the Federal Land Policy and Management Act, and the Administrative Procedure Act. A few weeks later, four environmental organizations filed another lawsuit making similar claims against the BLM in the United States District Court, District of Nevada.
This lawsuit was filed just a year after a whistleblower filed a complaint with the U.S. Office of Special Counsel and Department of Interior Office of Inspector General alleging “illegalities and wrongdoing” by managers at the BLM’s Nevada state office. This complaint alleges that the office failed to enforce the National Environmental Policy Act. The complaint also accuses a BLM Nevada district manager of “abusing his authority by fast-tracking mining and oil and gas drilling projects…”
To contest mine construction on the ground, the Protect Thacker Pass camp began at the proposed mining site on January 15, 2021. Individuals from around the United States are converging on Thacker Pass to resist the project, and the occupation has grown steadily. These protectors demand the complete cancellation of the project. The occupation has drawn local support from communities in Orovada and King’s River (located east and west of Thacker Pass, respectively) and from the Fort McDermitt tribal community. The Fort McDermitt Tribe expresses that they were not consulted adequately on this project, which was permitted during a CoVID-19-related lock-down on the reservation. Traditional in-person public comment periods were replaced with online public comment periods, which simply are inadequate for communities with limited internet access.
We assume that Lithium Americas’ Thacker Pass project shareholders and potential investors already know that research indicates that investors care about human rights concerns and consultation with indigenous communities. We also assume that the corporation knows that failure to disclose human rights violations harms investors and that many investors refuse to associate with companies that are in conflict with local communities.
We hope Lithium Americas shareholders are aware of statements from Sue Slaughter, Ford Motor Company’s purchasing director for supply chain sustainability, who is quoted in The New York Times’ story as stating: “Indigenous tribes being pushed out or their water being poisoned or any of those types of issues, we just don’t want to be party to that. We really want to force the industries that we’re buying materials from to make sure that they’re doing it in a responsible way. As an industry, we are going to be buying so much of these materials that we do have significant power to leverage that situation very strongly. And we intend to do that.” Additionally, industry groups such as the Initiative for Responsible Mining Assurance, which vets mines that source raw materials for companies such as Ford Motor Company and BMW, have expressed concerns that “Our new clean-energy demands could be creating greater harm” and have stated that “We can’t allow that to happen.”
With these ethical issues and related risks in mind, we want to remind Lithium Americas shareholders that the Thacker Pass project is proposed for land traditionally inhabited by the Northern Paiute and Western Shoshone people. The United Nations’ Committee for the Elimination of Racial Discrimination has called upon the United States and its federal agencies, with special regard for the Western Shoshone, to “guarantee, in law and in practice, the right of indigenous peoples to effective participation in public life and in decisions that affect them based on their free, prior, and informed consent.”
Lithium Americas’ shareholders should pay close attention to the fact that the UN Committee has expressed “particular concern” about efforts to privatize and then transfer Western Shoshone ancestral lands over to multinational extractive industries and energy developers. The Committee has urged the United States and federal agencies to “pay particular attention to the right to health and cultural rights of the Western Shoshone people, which may be infringed upon by activities threatening their environment and/or disregarding the spiritual and cultural significance they give to their ancestral lands.”
The corporation and its investors should also consider that Atsa koodakuh wyh Nuwu (the People of Red Mountain), a group of traditional indigenous people from the Fort McDermitt Paiute Shoshone Tribe, have recently stated in the media that “Thacker Pass is sacred to our people. Thacker Pass is a spiritually powerful place blessed by the presence of our ancestors, other spirits, and golden eagles – who we consider to be directly connected to the Creator. Some of our ancestors were massacred in Thacker Pass. The name for Thacker Pass in our language is Peehee mu’huh, which in English, translates to “rotten moon.” Peehee mu’huh was named so because our ancestors were massacred there while our hunters were away. When the hunters returned, they found their loved ones murdered, unburied, rotting, and with their entrails spread across the sagebrush in a part of the Pass shaped like a moon. To build a lithium mine over this massacre site in Peehee mu’huh would be like building a lithium mine over Pearl Harbor or Arlington National Cemetery. We would never desecrate these places and we ask that our sacred sites be afforded the same respect.” In the same statement, they write that “Thacker Pass is essential to the survival of our traditions.”
The Thacker Pass FEIS states that there are over 1,000 cultural resource sites and 56 historic properties that are eligible for listing in the National Register of Historic Places that will be directly and adversely affected in Thacker Pass.
Given the stated intent of potential lithium-compound buyers (such as Ford Motor Company) to avoid “indigenous tribes being pushed out,” we assume that Lithium Americas will inform stakeholders and potential investors of the opposition from Atsa koodakuh wyh Nuwu (the People of Red Mountain), which could influence shareholder returns.
Lithium Americas’ public-facing media does not seem to disclose that an investigation by Fundación Ambiente y Recursos Naturales (“FARN”) found that Minera Exar (an Argentine company formed by Lithium Americas and Ganfeng Lithium and dedicated to the development and production of lithium in the Salar Cauchari-Olaroz) failed to provide free and informed consultation with indigenous communities who own territory where Minera Exar’s lithium project is located. According to statements gathered from community members in FARN’s investigation, Minera Exar also failed to disclose relevant information on risk factors and potential environmental impacts. FARN’s findings resemble claims made by local community members affected by the Thacker Pass project. In a February High Country News article, Fort McDermitt Paiute Shoshone tribal councilman Billy A. Bell said he only learned about the mine’s approval by the Bureau of Land Management (BLM) after High Country News asked for his comments nearly a month after the Record of Decision was released.
The notion that Lithium Americas may once again be failing to provide free, prior, and informed consent to local communities – and failing to disclose all relevant information – is further substantiated by allegations made by the four environmental organizations in their recent Motion for Preliminary Injunction filed in Western Watersheds Project v. United States Department of the Interior (Case No. 3:21-cv-00103). In a declaration supporting the Motion filed by Western Watersheds Project’s counsel Talasi Brooks, Brooks stated that she was informed by Lithium Nevada Corporation (LNC) “that LNC intends to begin ground disturbance as soon as June 23, 2021 consisting of initial excavations and digging associated with a newly approved ‘Historic Properties Treatment Plan’ which has never been submitted for public review.” These excavations will consist of mechanical trenching operations at seven sites each up to 40 meters long and a few meters deep. LNC also plans to dig up to 5 feet deep at 20 other undisclosed sites.
The only consultation with Tribes culturally connected to Thacker Pass that the FEIS mentions is hardly meaningful. Apparently, consultation letters in 2019 were transmitted to tribal representatives at the Fort McDermitt Paiute and Shoshone Tribe, Summit Lake Paiute Tribe, and Winnemucca Indian Colony; an in-field meeting and project discussion was held at Thacker Pass with unspecified Fort McDermitt tribal members on October 3, 2018 well-before project details had solidified; BLM literature searches and ethnographic studies were conducted; and consultation with the Fort McDermitt and Summit Lake Tribes in connection with a proposed Kings Valley Clay Mine in 2014 was held, though it’s not clear that this project was even being considered in Thacker Pass.
The Fort McDermitt Paiute and Shoshone Tribe, the Summit Lake Paiute Tribe, and the Winnemucca Indian Colony are only a few of the Tribes culturally connected to Thacker Pass. Other tribal governments were left out of consultation including Battle Mountain Band Colony of the Te-Moak Tribe of Western Shoshone, Burns Paiute Tribe of Oregon, Cedarville Rancheria, Duck Valley Shoshone-Paiute Tribe, Fallon Paiute Shoshone Tribe, Ft. Bidwell Indian Community, Lovelock Paiute Tribe, Pyramid Lake Paiute Tribe, and the Reno-Sparks Indian Colony. Just because regional tribes have been isolated and forced on to reservations relatively far away from Thacker Pass does not mean these regional tribes do not possess cultural connections to the Pass. It appears, then, that LNC is preparing to loot indigenous cultural sites and artifacts without meaningful consultation, and in some tribes’ cases without any consultation.
Before BLM issued a Record of Decision on the Thacker Pass FEIS prepared by LNC, three local, grassroots environmental organizations wrote a letter to the BLM claiming that “…the Draft and Final EIS failed to adequately analyze all direct, indirect, and cumulative impacts from the project, as well as the baseline conditions of the lands, waters, air, wildlife, and other resources that may be affected by the mine project…”
In their complaint, the local rancher and ranching business who filed suit against the Thacker Pass project characterized the project’s FEIS as a “one-sided, deeply-flawed, and incomplete analysis and characterization of the proposed project and its likely adverse environmental impacts…” The four environmental groups who filed suit against the project similarly claim that “In the rush to implement the Project, Defendants violated federal environmental statutes and swept under the rug the mine’s serious environmental impacts.”
The FEIS was completed in less than a year, during a time when the Fort McDermitt Paiute and Shoshone Reservation was hit particularly hard with COVID-19 and public involvement was seriously hampered. In 2015, the Department of Energy reported that the average completion time for an EIS was 4.1 years. The White House Council on Environmental Quality reports that the median completion time for an EIS is 3.6 years.
The fact that the proposed project may not receive all regulatory approvals in a timely manner constitutes yet another significant risk for LNC shareholders. The BLM’s Record of Decision stipulates that no work is authorized under the Plan of Operations until LNC “has complied with all federal, state, and local regulations, including obtaining all necessary permits from the Nevada Department of Environmental Protection and other federal, state, and local agencies.” LNC still lacks four public water permits that require approval by the State of Nevada’s Division of Water Resources. All four of those permits have been protested by two local businesses; Bartell Ranch, LLC; and Kings River Land and Cattle Co. Meanwhile, LNC has not obtained an Eagle Take Permit from the United States Fish and Wildlife Service to account for effects from the mine’s construction and operation on golden eagles. Impacts to golden eagles are particularly concerning to tribal communities.
Though Lithium Americas President and CEO Jon Evans has characterized the Thacker Pass permitting process as “complete,” it is not. The lawsuit recently filed by Bartell Ranch, LLC, and Edward Bartell (collectively “Bartell Ranch”) against BLM asks a federal district judge to consider the mine’s impacts to threatened Lahontan-Cutthroat Trout and Lahontan-Cutthroat Trout habitat; to endangered Sage-Grouse and Sage-Grouse habitat; to wetlands and stream-flows; to air quality (especially because LNC’s FEIS included a proposed amount of sulfur to be used that was double the amount proposed in the draft Environmental Impact Statement); and to water quality through contamination by toxins such as arsenic, antimony, and uranium.
The lawsuit filed by the four environmental organizations (Western Watersheds Project, Great Basin Resource Watch, Basin and Range Watch, and Wildlands Defense) points out that the FEIS itself admits that the mine would cause antimony – a toxin – in the groundwater to exceed the applicable Nevada water quality standard, despite federal law prohibiting mining operations that are predicted to violate water quality standards at any time. Furthermore, in a January 4, 2021 letter to the BLM about the FEIS, the United States Environmental Protection Agency notes that “…the plans are not developed with an adequate level of detail to assess whether or how groundwater quality down gradient from the pit would be effectively mitigated.” The four environmental organizations’ lawsuit also claims that the FEIS fails to adequately address impacts to threatened and endangered wildlife or violations of binding BLM visual protection standards. Resolving Bartell Ranch’s and the four environmental organizations’ claims could require expensive expert witnesses and time-intensive litigation.
The proposed processing methods and technologies for the Thacker Pass mine also raise investor risks. The proposed methods have never been used to extract lithium out of clay on a commercial scale. The proposed clay-extraction mining process was previously considered dubious due to the massive amount of sulfuric acid required. According to the FEIS, the proposed Thacker Pass mine would produce 5,800 tons of sulfuric acid per day by importing 1,896 tons of sulfur per day. That’s nearly 700,000 tons per year, roughly equivalent to the mass of two Empire State Buildings.
Even if the DuPont air scrubbers satisfactorily clean sulfur from the air as promised, the sulfuric acid process entails inevitable environmental harm at the front end. Most sulfur comes from oil and gas refining. According to the U.S. Geological Survey, tar sands contain 11 times as much sulfur as conventional heavy crude oil. There are literal “mountains” of sulfur piling up in Alberta and at various refineries which process tar sands fuel. According to statements from Lithium Americas Corp. Vice President of Global Engineering Hugh Broadhurst at an April 6th meeting in Orovada, Nevada, the proposed lithium mine at Thacker Pass would purchase sulfur on the bulk commodity market. The bulk commodity market sources nearly 100% of its elemental sulfur from oil and gas refineries.
Revenue from sales of sulfur is not unimportant to the economics of tar sands oil extraction. One report from 2018 found that as much as half a million barrels per day of tar sands product would be uneconomical to extract if legal levels of sulfur allowed in fuels were lowered. Another report found that “developing a plan for storing, selling or disposing of the sulfur will help to ensure the profitability of oil sands operations.”
Therefore, if Lithium Americas Corporation and its investors move forward with the Thacker Pass lithium mine project, they will be economically supporting the Alberta Tar Sands, which has been called “the world’s largest industrial project.” Tar Sands extraction requires logging large tracts of boreal forest, pollutes water, is linked to increases in rare diseases and cases of missing and murdered indigenous women, and constitutes a globally significant source of greenhouse gas emissions.
The proposed Thacker Pass project also would burn tens of thousands of gallons of diesel fuel per day and release 152,713 tons of carbon-dioxide equivalent annually. These direct emissions, combined with links to the oil and gas industry, and even to the tar sands, tend to contradict Lithium Americas’ and Lithium Nevada’s statements about the climate benefits of the Thacker Pass project.
The ethical and practical concerns detailed above and the long list of organizations against this mine constitute one of most broad-based mining opposition movements in Nevada history. LNC investors should consider carefully the growing local, national, and international opposition to the Thacker Pass project; the Bartell Ranch lawsuit; the four environmental organizations’ lawsuit; the increasing number of protectors occupying the proposed mine site; the United Nations’ declaration about how multi-national extractive industries and energy developers threaten Western Shoshone human rights; allegations that Minera Exar (a Lithium Americas company) has failed to provide free, prior, and informed consent as well as failed to disclose relevant information to indigenous communities in Argentina; similar claims about free, prior, and informed consent and the disclosure of relevant information from communities affected by the Thacker Pass project; the BLM’s requirement that LNC obtain all local, state, and federal permits before mine construction can begin; and the environmental damage associated with sulphuric acid lithium processing.
Lithium Americas does not have a social license to operate this proposed mine. A social license is intangible and unwritten and cannot be granted by a regulatory agency. A social license is a set of demands and expectations, held by stakeholders – like citizens, environmental groups and Native Nations – for how a business should operate.
This array of issues creates a financial, political, and legal risk for investment in the Thacker Pass project. Lithium Americas, shareholders, and potential investors should consider whether continued investment in this project is wise.
Protectors of Thacker Pass
 Lithium Americas Code of Business Conduct and Ethics, available at: https://www.lithiumamericas.com/_resources/governance/Code-of-Conduct-1.pdf
 Bartell Ranch, LLC v. Ester M. McCullough, United States District Court, District of Nevada, Case No. 3:21-cv-00080
 Western Watersheds Project v. United States Department of the Interior, United States District Court, District of Nevada, Case No. 3:21-cv-00103
 Imai, Shin, and Sarah-Grace Ross. “Empirical Data On How Investors Are Harmed When Companies Do Not Disclose Information About Violence and Lack of Indigenous Consent.” Available at SSRN (2020)
 United Nations Committee for the Elimination of Racial Discrimination “Early Warning and Urgent Action Procedure 1 (68)” (March 10, 2006)
 Available at: https://www.protectthackerpass.org/people-of-red-mountain/
 Thacker Pass Lithium Mine Project, Final Environmental Impact Statement (DOI-BLM-NV-W010-2020-0012-EIS), pg. 4-82. Available at: https://eplanning.blm.gov/public_projects/1503166/200352542/20030633/250036832/Thacker%20Pass_FEIS_Chapters1-6_508.pdf
 Marchegiani, Pía; Jasmin Höglund Hellgren and Leandro Gómez Lithium extraction in Argentina: a case study on the social and environmental impacts; Fundación Ambiente y Recursos Naturales – FARN, Argentina (2020)
 Kapoor, Maya L., “Nevada lithium mine kicks off new era of Western extraction.” High Country News (Feb. 18, 2021), available at: https://www.hcn.org/issues/53.3/indigenous-affairs-mining-nevada-lithium-mine-kicks-off-a-new-era-of-western-extraction
 Exhibit 25 to Plaintiffs’ Motion for Preliminary Injunction in Western Watersheds Project v. U.S. Dept. of Interior.
 FEIS, Appendix G, pg. G-50. Available at: https://eplanning.blm.gov/public_projects/1503166/200352542/20030645/250036844/Thacker%20Pass_FEIS_Apx%20G_Affected%20Env_508.pdf
 Bartell Ranch, LLC v. Ester M. McCullough, para. 2.
 Western Watersheds Project v. United States Department of the Interior, para. 3.
 Department of Energy, Lessons Learned Quarterly Report, Mar. 2016, available at http://energy.gov/nepa/downloads/lessons-learned-quarterly-report-march-2016
 Ruple, John, and Heather Tanana. “Debunking the Myths Behind the NEPA Review Process.” (2020)
 Record of Decision and Plan of Operations Approval, DOI-BLM-NV-W010-2020-0012-EIS, pg. 21. Available at: https://eplanning.blm.gov/public_projects/1503166/200352542/20033308/250039507/Thacker_Pass_Project_ROD_signed_2021-01-15.pdf
 Record of Decision and Plan of Operations Approval, pg. 15.
 Bartell Ranch, LLC v. Ester M. McCullough, para. 52.
 Western Watersheds Project v. United States Department of the Interior, paras. 12-14.
 “EPA’s Detailed Comments on the Final Environmental Impact Statement for the Thacker Pass Project, Humboldt County, Nevada, January 4, 2020,” at 1.
 It is worth noting that DuPont is widely known for environmental irresponsibility. https://www.ewg.org/news-insights/news/why-are-dupont-and-chemours-still-discharging-most-notorious-forever-chemical
 Thacker Pass FEIS, pg. 4-77 and 78.