Shares in Canadian miner Northern Dynasty Minerals (TSX:NDM) were soaring Wednesday morning following Alaska's Department of Natural Resources (DNR) approval of a long-awaited land-use permit that clears the way for the company's vast, but stalled Pebble copper-gold-silver project.
The permit, issued late Tuesday, allows Northern Dynasty's subsidiary - Pebble Limited Partnership - to conduct reclamation and monitoring activities at hundreds of boreholes for the next 12 months. The company, which applied for such permit in October last year, was hoping to get it until 2018.
The land use permit comes after months of reviewing the application and over 1,000 public comments, the authority said.
Alaska's Department of Natural Resources conditions include an unprecedented $2 million guarantee as back stop for exploration clean-up.Investors reacted positively to the news, with the stock up more than 20% to Cdn$21.20 in Toronto at 10:40 am local time.
The Vancouver-based miner's project has faced heated opposition since the mid-2000s. A 2006-poll by the Cromer Group revealed that 53% of Alaskans oppose it; a second poll ran by Hellenthal Associates that same year found that 71% were against it, and a third poll presented in 2011 stated that 85% of commercial fishermen also reject the project.
In 2014, the US Environment Protection Agency (EPA) issued a preliminary determination that blocked the mine from being built, but it was brought to court by Pebble Limited Partnership. The group claims that the agency manipulated scientific results and that some of its staff should have been found to be in conflict of interest.
Since then, there has been a long string of actions implemented by environmentalists, Native American groups, and even the EPA itself to prevent Pebble from going forward. They all have expressed concerns about the "irreversible negative impacts" of the mine in one of the planet's greatest wild salmon fisheries, and the risk it represents to 14,000 jobs and the $252 million-a-year the local fishing industry generates.
Unprecedented $2 million guaranteeAlaska's authorities latest decision, however, paves the way for the contended mine to finally move forward, but with some conditions. For one, the permit includes an unprecedented $2 million as back stop for exploration clean-up.
Pebble spokesman Mike Heatwole described the requirement as "very workable," adding it was not a surprise for the company, which has held several discussions with DNR officials in the past months.
Locals applauded the decision, saying the authority did a good job at recognizing what's at stake. "Projects like Pebble need to be held accountable for how exploratory drilling impacts the areas they use," Kimberly Williams, executive director of Nunamta Aulukestai said in a statement. "They should be expected to take care of these areas rather than paying millions to lawyers and consultants in Washington DC to avoid their responsibilities."
The Pebble deposit is one of the greatest stores of mineral wealth ever discovered, according to Northern Dynasty. The current resource estimate includes 6.44 billion tonnes in the measured and indicated categories containing 57 billion pounds of copper, 70 million ounces of gold, 3.4 billion pounds of molybdenum and 344 million of silver.
The company said it is currently reviewing in detail the state land use permit received. However, Tom Collier, Pebble Partnership CEO, confirmed Northern Dynasty's subsidiary will be advancing a program of work in Alaska this year to prepare the project to initiate permitting under the Clean Water Act and National Environmental Policy Act.