Trump Administration Withdraws $57 Million Grant for Lithium Plant

A Nevada mining company has lost a significant opportunity as the Trump administration rescinded a federal grant worth $57 million intended for the construction of a lithium manufacturing plant near Tonopah. The announcement, made on Monday, has raised concerns about the future of the Tonopah Flats Lithium Project, which aims to produce battery-grade lithium hydroxide approximately five miles west of Tonopah.

Ryan Melsert, CEO of American Battery Technology Co., expressed disappointment over the decision but reaffirmed his commitment to advancing the project. He stated that the company would continue to engage with the administration in hopes of securing the necessary federal permits. The project is seen as pivotal for reinforcing Nevada’s status as a leading state in lithium production, critical for electric vehicle batteries and renewable energy technologies.

Currently, the only operational lithium mine in the United States is located in Esmeralda County, known as Albemarle’s Silver Peak mine. The Tonopah Flats Lithium Project was designated as a Priority Project by the administration in June 2025, which aimed to expedite federal permitting processes for initiatives deemed crucial to the economy and national security.

In a statement, Melsert emphasized that “all evidence demonstrates that this critical minerals project aligns with the Administration’s mission and key priorities.” The Energy Department did not respond to inquiries regarding the grant termination.

The withdrawal of funding highlights the ongoing challenges facing lithium production in the United States. The Trump administration’s support for establishing a domestic supply of critical minerals has been a consistent theme, mirroring similar efforts from previous administrations. With China currently dominating the global lithium market, U.S. officials are keen to bolster local production.

In a recent development, the administration purchased a 5 percent stake in another Nevada lithium mine, signaling a strategic interest in domestic lithium resources. In response to the grant’s cancellation, American Battery Technology Co. quickly filed an appeal, with approximately $52 million remaining unused at the time of the rescission, according to a filing with the Securities and Exchange Commission.

Melsert concluded by stating, “We’re energized by the potential of this project to strengthen the U.S. critical minerals supply chain,” underscoring the importance of lithium in the transition to sustainable energy solutions. As the situation unfolds, the future of the Tonopah Flats Lithium Project remains uncertain, but the company’s resolve and the broader strategic implications for U.S. energy independence are clear.