Trump Administration Rescinds $57 Million Grant for Lithium Project

A Nevada mining company will lose a significant opportunity as the Trump administration has rescinded a federal grant worth $57 million intended for a lithium hydroxide manufacturing plant near Tonopah. The announcement came on Monday, leading to disappointment among stakeholders involved in the project.

Ryan Melsert, CEO of American Battery Technology Co., expressed pride in the project’s progress and reaffirmed the company’s commitment to working with the administration to secure necessary federal permits. The proposed Tonopah Flats Lithium Project, located approximately 5 miles west of Tonopah, is poised to enhance Nevada’s status as a leading state in lithium production. At present, the only operational lithium mine in the United States is located in Esmeralda County, specifically the Silver Peak mine operated by Albemarle Corporation.

In his statement, Melsert highlighted the alignment of the project with the administration’s goals for critical minerals, emphasizing that it was previously designated as a Priority Project eligible for expedited federal permitting. This designation was confirmed in June 2025, raising expectations for the project’s future.

The Energy Department has not responded to inquiries regarding the grant’s termination. This development comes amid an ongoing push by the Trump administration to bolster domestic production of critical minerals, which are deemed essential for economic stability and national security.

China currently dominates the lithium market, raising concerns among U.S. policymakers about reliance on foreign sources. The administration’s commitment to developing a domestic supply chain for these minerals appears to remain strong. In fact, less than a month before this announcement, U.S. officials acquired a 5 percent stake in another Nevada lithium operation, indicating continued interest in local production.

In response to the grant termination, American Battery Technology Co. has filed an appeal. According to a filing with the Securities and Exchange Commission, approximately $52 million of the grant had not been utilized at the time of its cancellation. Melsert conveyed optimism about the project’s potential to fortify the U.S. supply chain for critical minerals, stating, “We’re energized by the potential of this project to strengthen the U.S. critical minerals supply chain.”

As the situation unfolds, the implications of the rescinded grant for both the company and the broader lithium production landscape in the United States remain to be seen.