Shares in Northern Dynasty Minerals – the company behind the proposed Pebble mine project in south-west Alaska – have fallen almost 60% since the decision of US regulators to deny a key permit earlier this week.
After an application process full twists, turns and plenty of controversy, the US Army Corps of Engineers (USACE) confirmed on 25 November that permission would not be granted to go ahead with the project due to environmental concerns.
The Pebble mine has been touted as the world’s largest undeveloped resource of copper, gold, molybdenum, silver and rhenium, and would have been one of America’s biggest mining operations if approved.
But concerns over its potential environmental impact on the prized Bristol Bay salmon-fishing area have sparked strong opposition to its development.
Earlier this month, Northern Dynasty submitted a Compensatory Mitigation Plan (CMP) for the project – an updated development proposal that was requested in August after an initial rejection on grounds it would cause “unavoidable adverse impacts to aquatic resources” in the surrounding region.
In its final record of decision after reviewing the CMP, the USACE said the revised Pebble mine proposal remained “not compliant” with water-safety regulations, and would be “contrary to the public interest” if a permit were approved.
Northern Dynasty’s share value fell to 0.46 Canadian dollars at the close of trading yesterday (26 November), down from CAD$1.11 before the decision was published.
Northern Dynasty blasts ‘politically-motivated’ Pebble mine permit decision
The Vancouver-based miner, which has been pursuing the venture through its US-based Pebble Partnership subsidiary, labelled the ruling “politically motivated” and “short sighted”, and confirmed it intends to launch an appeal. It has 60 days to do so.
“Conclusions […] that development of the Pebble Project is ‘not in the public interest’ are wholly unsupported,” the company said in statement, citing a previous USACE environmental assessment that determined the project would have “no measurable effect” on fish populations in nearby waterways.
Pebble Partnership chief executive John Shively said he was “dismayed” by the ruling, and repeated the allegation that it had been a “politically-driven decision”.
“Since the beginning of the federal review, our team has worked closely with the USACE staff to understand their requirements for responsibly developing the project, including changing the transportation corridor and re-vamping the approach to wetlands mitigation,” he added.
“All of these efforts led to a comprehensive, positive EIS [environmental impact assessment] for the project that clearly stated it could be developed responsibly. It is very disconcerting to see political influence in this process at the eleventh hour.”
Senators welcome the ruling
Alaska Senators Lisa Murkowski and Dan Sullivan – who were the subject of controversial comments made by Northern Dynasty executives in secretly-recorded conversations earlier in the year – released a joint statement welcoming the decision.
Senator Murkowski said: “This is the right decision, reached the right way. It should validate our trust and faith in the well-established permitting process used to advance resource-development projects throughout Alaska.”
She said the permit denial would protect the Bristol Bay waterway – a pristine salmon-fishing area adjacent to the proposed mine site that has become the focal point of concerns about environmental damage.
Senator Sullivan added: “Given the special nature of the Bristol Bay watershed and the fisheries and subsistence resources downstream, Pebble had to meet a high bar so that we do not trade one resource for another. Pebble did not meet that bar and, accordingly, the Corps rightly denied the permit.”
The Pebble venture, which was blocked on environmental grounds in 2014 by the Obama administration, appeared poised to be green lit during the summer following President Trump’s intervention to revive the permitting application.
But when the USACE demanded a mitigation plan in August, it was reported the president had been lobbied by close allies – including his son Donald Jr – to deny the permit due to their fondness of using the fishing grounds.
Former Pebble Partnership chief executive Tom Collier – who resigned in September after making “offensive”, secretly-recorded comments boasting of relationships with senior government officials – dismissed these reports at the time, saying the White House had “nothing to do” with the reversal.
Northern Dynasty boss says US is ‘turning its back’ on critical minerals
Northern Dynasty argues the vast resource potential of the Pebble mine invalidates the claim that the project is not in the public interest.
It said in a statement: “At a time when the US has declared a ‘national emergency’ due to its over-reliance on foreign producers for critical minerals required to ensure the country’s future economic and military security, it is unconscionable to determine that permitting and development of one of the greatest accumulations of strategic and critical minerals ever discovered on American soil is ‘not in the public interest’.”
Northern Dynasty chief executive Ron Thiessen added: “For the US to turn its back on an opportunity to develop these minerals here at home in a manner that US regulators have agreed is environmentally safe and responsible, and to do so for purely political reasons, is not just short-sighted, it’s self-destructive.”
Joel Reynolds, a senior attorney with the Natural Resources Defense Council (NRDC), welcomed the USACE ruling, saying the Bristol Bay region has been “whip-sawed with uncertainty about its fate for a decade”.
“This move recognises there was never any way to mitigate the harm Pebble mine would do,” he added. “The next step is for the Environmental Protection Agency to use section 404c of the Clean Water Act to permanently protect this national treasure from large-scale mining for all time.”
