EPA to Put a Stop to Pebble Mine, Northern Dynasty Shares Plummet

Less than two months after the EPA concluded that large-scale mining within the Bristol Bay watershed poses significant risks to the region’s native tribes and world’s largest sockeye salmon fishery, the government agency is looking at ways to ensure that the salmon habitat will be protected from the “potentially destructive impacts of the Pebble Mine.”

“Extensive scientific study has given us ample reason to believe that the Pebble Mine would likely have significant and irreversible negative impacts on the Bristol Bay watershed and its abundant salmon fisheries,” Gina McCarthy, EPA administrator, said in a press release. She added, “[i]t’s why EPA is taking this step forward in our effort to ensure protection for the world’s most productive salmon fishery from the risks it faces from what could be one of the largest open pit mines on earth.”

The EPA has only invoked the Clean Water Act a handful of times in the past, and invoking it on the Pebble mine puts the massive operation on ice, preventing the US Corps of Engineers from approving permits until a solution — if any — can be found.

Stressing the infrequency of the EPA’s action, McCarthy acknowledged, “[t]his process is not something the Agency does very often, but Bristol Bay is an extraordinary and unique resource.”

The Pebble mine

For those unfamiliar with the project, Pebble is an incredibly large copper and gold deposit located at the headwaters of two rivers in Alaska’s Bristol Bay. While the project has the potential to be worth hundreds of billions of dollars and provide thousands of jobs, it has become the most controversial project in Alaska. That’s because the river systems support the world’s largest salmon run and contribute nearly $500 million annually and roughly 14,000 jobs to the region.

For the last three years, the EPA has been collecting data on the environmental impact of the mine, and in January released its findings, much to the dismay of the parties involved in the project.

The Pebble Limited Partnership (PLP), a group led by CEO Tom Collier that is committed to bringing the Pebble mine to life, has no plans to take the EPA’s news lying down, calling the organization’s process “premature and unprecedented.”

In response to the EPA’s action plan, the PLP released a statement saying, “[w]e remain confident in our project and our position. We will continue to state our case with the EPA as we work through their process. The EPA’s actions today are an unprecedented federal action and reflect a major overreach onto an asset of the State of Alaska. There is a prescribed, science based process for evaluating projects such as Pebble and the EPA has initiated a step that turns this process on its head.”

Furthermore, the PLP believes that the steps taken by the EPA have expanded outside the realm of standard practice, and seem to be “unduly influenced by environmental advocacy organizations.” The group remains committed to the project’s development, and looks “forward to the opportunity to present [their] full mine plan and have it properly evaluated under the environmental laws of Alaska and the United States.”

Northern Dynasty Minerals (TSX:NDM), the project’s owner and developer, echoed the PLP’s statement. “For a wide range of reasons, we remain confident that final decisions about Pebble will be made by federal and state regulators working within the rigorous National Environmental Policy Act (NEPA) permitting process, and not unilaterally and pre-emptively by EPA,” said Ron Thiessen, president and CEO of the company.

He added, “[w]e will participate fully in EPA’s process to consider necessary safeguards to ensure that responsible mineral development can co-exist with clean water and healthy fisheries in Bristol Bay, and we will continue our efforts to prepare for the NEPA permitting process to come.”

Following the news on Friday, Northern Dynasty shares fell by 33 percent; they sank even further on Monday to trade at $0.84.