Lithium Americas shares rally after it gets environmental seal for Cauchari-Olaroz project

Lithium Americas Corp. (TSE:LAC) (OTCQX: LHMAF) said Wednesday it has received the environmental approvals for the construction of its Cauchari-Olaroz lithium-potash project in Argentina, sending shares up over 12 per cent this morning.
The miner said the provincial environmental agency of Jujuy Province, Argentina (UGAM) has recommended approval of the environmental impact statement (EIS) for the project.
Lithium Americas previously obtained definitive mining title, as well as secured long term land use agreements with the five aboriginal communities on which its Cauchari-Olaroz mine will be built.
Following the recommendation from the agency, the project proposal is now being reviewed by the provincial committee of experts for submission to the governor of Jujuy, in a bid for final construction approval.
This marks the remaining administrative step required to be fully permitted to build and operate the company’s lithium-potash project in the province of Jujuy.
"Receiving approval from UGAM for our EIS is a key milestone in the final permitting process for the Cauchari-Olaroz project,” said company president and CEO, Dr. Waldo Perez.
“We have continued to work closely with the Committee of Experts and all the agencies involved in the permitting process during the EIS approval, as proven by the short period between submission of the EIS in December 2011 to UGAM and their positive recommendation 8 months after.
"We anticipate receiving the Committee of Experts recommendation for the project in the near term.”
Lithium Americas has defined the world’s third largest lithium brine resource at its project, and completed a definitive feasibility study that identified its operating cost per tonne of lithium carbonate is expected to be one of the lowest in the industry.
In June, the company said the low operating cost and large brine reserves of the project compare "very favourably" to existing lithium carbonate producers, and suggest that the company has the potential to become one of the largest and lowest cost lithium operations in the world.
The property has proven and probable reserves sufficient to operate at a production rate of up to 40,000 tonnes per annum (TPA) of lithium carbonate for 40 years, the company said, and up to 80,000 TPA of potash, which would include an initial five year ramp-up period.
The company's plan is to build the project in two stages, with each stage consisting of a 20,000 TPA lithium carbonate facility and a 40,000 TPA potash facility.
Highlights of the base case feasibility study include a pre-tax net present value, at an 8 per cent discount rate, of US$738 million and a pre-tax internal rate of return of 23 per cent.
Net cash operating costs per tonne of lithium carbonate are seen at US$1,332. Overall project revenue is projected at US$6.6 billion and project EBITDA is pegged at US$4.3 billion.
Mitsubishi Corporation and Magna International are shareholders in Lithium Americas, with both companies having off-take arrangements with the lithium miner.
Shares of Lithium Americas jumped more than 12 per cent Wednesday morning, to trade at $1.21 as of 10:24 am ET.