U.S. DOE Announces $996 Million Loan Guarantee to Ioneer Rhyolite Ridge to Advance Domestic Production of Lithium Carbonate, Boost U.S. Battery Supply Chain

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Rhyolite Ridge will process lithium carbonate to support the domestic EV battery supply chain.

The U.S. Department of Energy’s (DOE) Loan Programs Office (LPO) announced today the closing of a $996 million loan guarantee (including $968 million of principal and $28 million of capitalized interest) to Ioneer Rhyolite Ridge LLC to develop a domestic supply of lithium carbonate for electric vehicle (EV) batteries from the Rhyolite Ridge Lithium-Boron Project (Rhyolite Ridge) in Esmeralda County, Nevada. The project is being developed by Ioneer Ltd (Ioneer). LPO’s loan to the Rhyolite Ridge project will finance the on-site processing of lithium carbonate that would support production of lithium for more than 370,000 EVs each year. This project would reduce annual gasoline consumption by nearly 176 million gallons and prevent the release of 1.56 M tons of carbon dioxide each year. Ioneer submitted its application to LPO in October 2021.

Ioneer entered into an agreement in September 2021 with Sibanye Stillwater Limited (Sibanye-Stillwater), a mining and metals processing company, subject to certain conditions, to establish a joint venture related to the Rhyolite Ridge project. Sibanye-Stillwater is a valued interested party and is expected to partner in the project.

This project supports a broader commitment by the Biden-Harris Administration to strengthen the nation’s domestic battery supply chain and electrify the transportation sector to reduce our reliance on fossil fuels and foreign supply of raw materials. The Biden-Harris Administration has announced over $5 billion in federal investments to boost domestic production of materials critical to advancing our national security and economic goals.

The urgency to secure critical materials for batteries is expected to rapidly increase in the coming years as demand for lithium is projected to exceed current global production by 2030.This is subsequently causing U.S. auto manufacturers to seek a robust domestic supply of critical materials to keep pace with the increased demand.

The Rhyolite Ridge project has executed offtake agreements with Ford, Prime Planet Energy & Solutions (a joint venture battery company between Toyota Motor Corporation and Panasonic Corporation), and EcoPro Innovation (the world’s second largest lithium nickel-cobalt-aluminum oxide cathode materials manufacturer and a major cathode supplier for global battery manufacturers), with contracts ranging from three to five years.

Rhyolite Ridge will be the first lithium-boron project in the world and the second operational lithium project in the U.S.  Currently, Original Equipment Manufacturers (OEMs) in the U.S. are entirely dependent on international mines to source lithium, and on Asian companies to process lithium into a form that can be used in EV batteries. Locating lithium production in the U.S. is critical for the growing EV market and U.S. economic and national security. LPO expects the project to further develop a socially and environmentally responsible U.S. supply chain for lithium.

The Rhyolite Ridge project is projected to create up to 500 construction jobs and approximately 350 operations jobs. LPO borrowers are required to develop and ultimately implement a comprehensive Community Benefits Plan (CBP). CBPs ensure borrowers meaningfully engage with community and labor stakeholders to create good-paying jobs and improve the well-being of residents and workers. Rhyolite Ridge is committed to hiring locally and offering training opportunities, including funding higher education scholarships for local high school students and residents in various technical and managerial fields. This investment supports the Biden-Harris Administration’s Justice40 Initiative, which sets a goal that 40% of the overall benefits of certain federal investment in climate, clean energy, and other areas flow to disadvantaged communities that are marginalized by underinvestment and overburdened by pollution.

The loan is offered through LPO’s Advanced Technology Vehicles Manufacturing (ATVM) program. The ATVM program provides loans to support U.S. manufacturing of advanced technology vehicles, qualifying components, and materials that improve fuel economy.  These projects are central to the Biden-Harris Administration’s effort to onshore and re-shore electric vehicle and critical mineral supply chains and to manufacture half of all new vehicles sold in 2030 zero-emissions vehicles. Developing a U.S. supply chain for these materials is a national priority as the country works toward energy independence, lower costs for American customers, and protection from global supply bottlenecks. Earlier this year, the DOE announced a comprehensive strategy to secure America’s clean energy supply chain. A core focus within the strategy is increasing the availability of the critical materials that are essential components of the clean energy technologies necessary for reaching national climate and economic goals.

Across all LPO’s programs, DOE has attracted 182 applications for projects across the country totaling over $278.9 billion in requested loans and loan guarantees, as of December 2024. For more information about Ioneer Rhyolite Ridge, read the conditional commitment blog post and visit LPO’s portfolio project page.