Wednesday, May 30, 2018

Pebble Project Losing Financial Footing

Efforts to finance a highly controversial mining project in Alaska’s Bristol Bay region have hit another stumbling block, with a potential substantial financial backer pulling out of the deal.

News that Northern Dynasty Minerals was unable to reach an agreement with First Quantum Minerals Ltd. was cheered by opponents of the copper, gold and molybdenum mines slated for construction near the world’s sockeye salmon producing fishery, even while a spokesman for the project said he was sure they would secure the funds necessary to continue the permitting process.

An announcement from Northern Dynasty Minerals Ltd., on May 25, confirmed that the two companies were unable to reach an agreement on a proposed deal that would have given First Quantum Minerals Ltd. an option to earn a 50 percent interest in the Pebble mine in return for First Quantum’s investment of $150 million to fund permitting. First Quantum is a leading producer of copper, gold, nickel and zinc. Northern Dynasty, whose whole focus is advancing the Pebble project, is a subsidiary of Hunter Dickenson Inc. (HDI), a diversified, global mining group. The companies are based in Vancouver, British Columbia.

“Our project is well defined and we are going to continue communicating with Alaskans about why we believe in the opportunity it represents,” said Tom Collier, chief executive officer for the Pebble Limited Partnership in Anchorage, Alaska, a subsidiary of Northern Dynasty.

HDI declined any further comment.

Bloomberg News meanwhile reported that Northern Dynasty stock plummeted after the collapse of the deal that would have helped finance the project. Bloomberg also noted that earlier in May backlash against the mine disrupted First Quantum’s annual meeting in Toronto, Ontario, with mine opponents taking out a full-page ad in Canada’s Globe and Mail newspaper vowing to continue fighting the project.

Opponents of the mine had plenty to say though, even as the U.S. Army Corps of Engineers in Anchorage continued to work with a third-party firm to produce a draft environmental impact statement for the project.

“This news could not have come at a more opportune time,” said Jason Metrokin, president and chief executive officer of the Bristol Bay Native Corp. The Alaska Department of Fish and Game is again forecasting strong salmon runs for Bristol Bay this year.”

“This is the fourth major company that’s pulled out of Pebble because of the massive environmental risks, lack of economic feasibility and widespread local opposition,” said Robin Samuelsen, a lifelong Bristol Bay harvester and regional leader.

“The governor needs to call for a moratorium on mineral exploration in the watershed and just let people go fishing,” said Mark Niver of Commercial Fishermen for Bristol Bay. “We need a year where we don’t have this sword hanging over our head,” he said.

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