Doubts grow Alaska's Pebble Mine can satisfy new regulatory hurdles, shares tumble (updated)

Northern Dynasty Minerals

25/08/2020 20:12

(Updates share price, adds Factbox link)
    Aug 25 (Reuters) - Northern Dynasty Minerals Ltd  NDM.TO 
shares fell more than 30% on Tuesday on rising doubts the
company can clear regulatory hurdles for its Pebble Mine project
in Alaska, and prominent politicians said it would harm the
state's salmon fishing industry.
    The U.S. Army Corps of Engineers on Monday gave Northern
Dynasty 90 days to explain how it would offset "unavoidable
adverse impacts" to more than 3,200 acres (1,295 hectares) of
wetlands were the mine to be developed.  urn:newsml:reuters.com:*:nL1N2FQ0PA
    Late on Monday, Alaska's U.S. Senators Dan Sullivan and Lisa
Murkowski, both Republicans, came out against the mine, saying
it could cause significant damage to the state's Bristol Bay
region popular for fishing and hunting.
    Murkowski is the powerful chair of the Senate Energy and
Natural Resources Committee and her opposition is likely to
carry weight across U.S. federal agencies.
    Other prominent Republicans, including Donald Trump Jr., son
of President Donald Trump and a keynote speaker on Monday at the
Republican National Convention, have opposed the project, saying
it would destroy areas where they enjoy fishing and hunting.
    Northern Dynasty, in response to the Army Corps, said it
plans to "preserve enough land so that multiples of the number
of impacted wetland acres are preserved," but its shares still
fell more than 40% on Monday.  urn:newsml:reuters.com:*:nL1N2FQ0PA
    Northern Dynasty shares were down 32.8% at 80 cents Canadian
in Toronto at mid-afternoon.
    The potential cost of such a mitigation plan is unknown and
thus concerning, Cantor Fitzgerald analyst Mike Kozak said in
research note. "It will be exceptionally challenging to reach a
compensation plan ... that will satisfy all parties," he said.
    Cantor Fitzgerald put its price target and stock rating for
the company under review, effectively saying it is not
immediately clear how much the company is worth.
    The Army Corps deadline likely means any final permit
decision would come after the Nov. 3 U.S. presidential election.
A victory by Democrat Joe Biden would likely to scuttle the
entire project, TD Securities analyst Craig Hutchinson said.
    Northern Dynasty did not immediately respond to a request
for comment. 
    The mine, one of the world's largest copper and gold
deposits, has been through a rollercoaster of regulation over
the past 13 years.  urn:newsml:reuters.com:*:nL1N2FR1JK 
    Doubts about the project have steadily risen in recent
months. Morgan Stanley  MS.N , once one of the largest Northern
Dynasty shareholders, sold most of its holdings two months ago,
according to regulatory disclosures.

 (Reporting by Jeff Lewis and Ernest Scheyder; Writing by Ernest
Scheyder; Editing by Bill Berkrot and Richard Chang)
 ((ernest.scheyder@thomsonreuters.com; Twitter: @ErnestScheyder;
+1-713-210-8512; Reuters Messaging:
ernest.scheyder.thomsonreuters.com@reuters.net))