logo-loader

Northern Dynasty takes severe hit as Anglo American makes Pebble exit

Published: 13:05 16 Sep 2013 EDT

no_picture_pai

Northern Dynasty Minerals (TSE:NDM) (NYSE MKT:NAK) fell to an all-time low on Monday after news emerged that Anglo American's US subsidiary is withdrawing from the Pebble copper project in Alaska. 

Anglo American gave notice under the two companies' partnership agreement, according to a joint statement released Monday. As a result of the withdrawal, Northern Dynasty will become the sole owner of the asset. 

"Despite our belief that Pebble is a deposit of rare magnitude and quality, we have taken the decision to withdraw following a thorough assessment of Anglo American's extensive pipeline of long-dated project options," said CEO of Anglo American, Mark Cutifani. 

"Our focus has been to prioritise capital to projects with the highest value and lowest risks within our portfolio, and reduce the capital required to sustain such projects during the pre-approval phases of development as part of a more effective, value-driven capital allocation model."

As of the end of the second quarter, Anglo had funded US$541 million on the Pebble project, which has the potential to support 15,000 American jobs and contribute more than $2.5 billion annually to US GDP over decades of production, said Northern, citing a recent study authored by IHS Global Insight. 

The partners said they desire an orderly exit, with details on Anglo American's exit from the project currently being developed and implemented, according to the release. 

"Northern Dynasty will again own 100% of one of the world's most important copper & gold resources and will have the benefit of $541 million worth of expenditures, which opens the door to a number of exciting possibilities for Northern Dynasty and its shareholders and the Pebble Project and its stakeholders," assured Northern Dynasty CEO Ron Thiessen, adding that the company has both the expertise and resources necessary to advance the property. 

The project is located 200 miles southwest of Anchorage on state land designated for mineral exploration and development, and sits in a region of rolling tundra approximately 1,000 feet above sea-level, 65 miles from tidewater on Cook Inlet.

Vancouver-based Northern Dynasty holds indirect interests in more than 600 square miles of mineral claims in southwest Alaska, with its flagship asset being Pebble. Shares of the company plunged 34 per cent early afternoon on Monday, to $1.53 in Toronto, after falling to levels as low as $1.36. So far this year, the stock has lost more than 51 per cent.

Ramp Metals Launches Drilling Program in Pursuit of High-Grade Nickel in...

Ramp Metals CEO Jordan Black joined Steve Darling from Proactive to introduce the company to the public domain and share exciting developments in the mining industry. With a background as a geotechnical engineer and experience in venture capital, including a notable role in taking GoldSpot...

1 hour, 13 minutes ago