- with reporting by Reuters

The Biden administration will relaunch a process that could permanently ban the development of the contentious Pebble mine in Alaska’s Bristol Bay watershed, which is home to North America’s most productive salmon fisheries.

According to news reports, the Department of Justice asked in an Alaska federal district court filing on Thursday that the court vacate a 2019 decision by the Trump-era Environmental Protection Agency (EPA) to remove protection of the Bristol Bay watershed.

If the court grants the request, it would automatically reinstate the EPA’s Clean Water Act Section 404 review process, which would enable the agency to resume an effort to protect certain waters in the Bristol Bay watershed.

In July 2019, the Trump administration EPA withdrew a proposed Clean Water Act Section 404(c) "proposed determination" from 2014 that, if finalised, could have permanently prevented development of the Pebble mine.

Northern Dynasty, of Canada, has been advocating for the development of Pebble, which has one of the biggest undeveloped copper and gold deposits in the world, for at least a decade. But the project was dealt a blow in November 2020, when the US Army Corps of Engineers (USACE) denied it a ‘dredge and fill’ permit under the Clean Water Act on the grounds that its ‘compensatory mitigation plan’ is noncompliant and the project is not in the public interest.

Northern Dynasty’s US-based subsidiary, Pebble Limited Partnership, in January appealed the decision and previously said that the process could take a year or more, given the complexity of the case.

NEW STUDY
Meanwhile, Northern Dynasty on Thursday also published a new preliminary economic assessment (PEA) for the Pebble project, providing updated production, financial and cost estimates, as well as potential mine expansion scenarios and alternative strategies for gold recovery.

The PEA proposes a 20-year project that is similar to the project submitted for permitting, with an openpit producing an average of 320-million pounds a year of copper, 363 000 oz/y of gold, 15-million pounds a year of molybdenum, 1.8-million ounces a year of silver and 12 000 kg/y of rhenium.

Over the 20-year mine life, the proposed project would produce 6.4-billion pounds of copper, 7.3-million ounces of gold, 300-million pounds of molybdenum, 37-million ounces of silver and 2230 00 kg of rhenium.

The proposed project has an internal rate of return (IRR) of 15.8% and a net present value (NPV), at a 7% discount, of $2.3-billion.

The expansion scenarios could see increased mining and processing rates at three different points, starting in years 21, 10 and five of the mine life, and at various throughput rates. These scenarios increase the Pebble mine life to about a century with life-of-mine output estimated at 60-billion pounds of copper, 50-million ounces of gold, 2.9-billion pounds of molybdenum, 267-million ounces of silver and two-million kilograms of rhenium.

The expansion studies have an IRR of 18.2% to 21.5% and an NPV of between $5.8-billion and $8.5-billion.

The project proposed in the latest PEA does not include an onsite gold plant, but the study does make provision for the addition of a secondary onsite gold plant in year five of production.

“The significant metal production forecasts and robust financial estimates we’re releasing today clearly suggest that Pebble is potentially more than just one of the greatest accumulations of copper and other strategic metals ever discovered on American soil,” said Northern Dynasty president and CEO Ron Thiessen.

“It’s also a mineral resource that has the potential to sustain an environmentally sound and financially rewarding mining operation in the near-term, and become one of America’s most important metals producers for decades to come.”

Thiessen said the proposal evaluated in the 2021 PEA – a project the USACE determined in its final environmental impact assessment would “not have measureable effects” on fisheries in south-west Alaska – incorporates industry-leading engineering and environmental safeguards, and substantial closure funding (about $1.4-billion after 20 years of mining). The USACE issued a negative record of decision for the Pebble project based, in part, on perceived impacts to the fishery that the company believed were not adequately substantiated.

“We believe the proactive, environmentally-driven risk reduction concepts we’ve incorporated are setting a new standard for the global mining sector,” Thiessen said. “They are costs that must be incurred to develop safely and responsibly in America, and they are fully reflected in the positive economics from the development scenarios we’re announcing today.”

The proposed Pebble project has the potential to make a significant positive contribution towards achieving the US’ economic, manufacturing, military and climate change policy goals.

“As the largest undeveloped copper, gold and rhenium resource in the world, Pebble has the potential to produce considerable quantities of critical minerals and metals – including those for which the US currently relies on foreign producers for a significant proportion of its needs. Copper, in particular, is considered to be critical for renewable energy and electrification technologies, including EVs.

“In order to achieve its vision for global leadership in transitioning to a low-carbon future, the US simply must develop its own domestic sources of copper and other critical metals,” Thiessen said.

“In doing so, it should also demonstrate to the rest of the world what environmentally sound and socially responsible mining looks like. That’s precisely what we’ve undertaken to do at Pebble, and through the project designs evaluated in this PEA.”