By Ernest Scheyder and Nate Raymond
March 30 (Reuters) - A federal judge rejected claims by environmentalists that the U.S. government in 2024 improperly approved Australia-based ioneer's Rhyolite Ridge lithium and boron mine project in Nevada in a ruling on Monday that boosts efforts to increase U.S. critical minerals production.
U.S. District Judge Cristina Silva ruled in Las Vegas that U.S. Interior Department regulators during Democratic former President Joe Biden's administration sufficiently
analyzed how the planned Rhyolite Ridge mine could affect Tiehm's buckwheat, a rare wildflower that ioneer has vowed to protect.
Shares of ioneer gained about 24% in afternoon trading on the New York Stock Exchange. The company is still seeking a financial partner for the project after Sibanye Stillwater pulled out last year.
The mine is slated to become one of North America's largest sources of lithium, a metal important for batteries, and a key supplier to automaker Ford and others.
The Center for Biological Diversity environmental group, which filed suit in a bid to halt the project, had argued that the mine could drive the flower to extinction and harm groundwater, air quality, cultural resources and wildlife habitats.
The group challenged the legality of the government's approval of the project. The lawsuit said the Interior Department's Bureau of Land Management approved the mine without ensuring that it would not jeopardize the wildflower or unduly impact the environment in violation of the National Environmental Policy Act, the Federal Lands Policy and Management Act and the Endangered Species Act.
Silva, appointed to the bench by Biden, wrote in a 14-page ruling that federal officials imposed mitigation measures for the flower that "are sufficiently detailed and reasonable" and had correctly analyzed the project's effect on groundwater and other ecological concerns.
An ioneer spokesperson welcomed the ruling, calling it a significant milestone for the U.S. government's critical minerals plans.
"Rhyolite Ridge will create hundreds of new American jobs, reduce reliance on foreign materials and processing and provide a domestic source of two critical minerals," said spokesperson Chad Yeftich.
The Center for Biological Diversity said it was deeply disappointed by the ruling, and called the government's plan to save the wildflower "a house of cards."
"We're exploring our next steps but we're more determined than ever to continue fighting to save Tiehm's buckwheat," said Patrick Donnelly, a regional director for the group.
The Interior Department declined to comment. The department said when it approved the mine that it had taken numerous steps to protect the ecosystem near the mine site, roughly 225 miles (362 km) north of Las Vegas.
NEXT FUNDING STEPS
Days before leaving office last year, Biden finalized a $996 million loan for the project from the U.S. Department of Energy as part of a bid to cement his green energy legacy. Biden issued the project's final permit in 2024.
The company had been set to develop the project with Sibanye Stillwater but that company pulled out not long after Biden issued the loan due to its own financial issues. Executives at ioneer then launched an effort to find a new financial partner for the project, which would be key to fund its $1.67 billion capital cost. The company said this month it is in "active discussions with a number of parties."
(Reporting by Ernest Scheyder in Houston and Nate Raymond in Boston; Editing by Will Dunham)
