Name and Location
Pebble copper/gold/molybdenum project, Alaska, US.

Client
Northern Dynasty Minerals (NDM).

Project Description
The project proposes to construct a large openpit mine; an on-site milling facility; on-site storage for rock, ore and tailings; a port facility; an access road connecting the mine site to the port; an on-site water supply for the mill; and to provide electrical power for the mine site, in south-west Alaska.

In addition, the project plans to include an on-site 378 MW gas-fired turbine plant, a 138 km transportation corridor to Cook Inlet for road and pipeline rights of way and a new deep-water port at Cook Inlet.

The project’s key assets are the near-surface 4.1-billion-tonne openpit-style Pebble West deposit and the deeper and higher-grade 3.4-billion-tonne Pebble East deposit, which is amenable to underground bulk mining methods. The Pebble resources rank among the world’s most important accumulations of copper, gold and molybdenum.

Estimates show that the Pebble deposit comprises measured and indicated resources of 5.94-billion tonnes, grading 0.78% copper equivalent and containing 55-billion pounds of copper, 67-million ounces of gold and 3.3-billlion pounds of molybdenum.

The deposit also has 4.84-billion tonnes of inferred resources, grading 0.53% copper equivalent and containing 26-billion pounds of copper, 40-million ounces of gold and 2.3-billion pounds of molybdenum.

Net Present Value/Internal Rate of Return
Not stated.

Value
Capital expenditure on Pebble will reach between $6-billion and $8-billion.

Duration
Commercial production is expected by 2015.

Latest Developments
An independent review of the US Environmental Protection Agency's (EPA’s) decision-making process regarding potential mining in south-west Alaska's Bristol Bay Watershed has concluded that the agency’s actions were not fair to all stakeholders, raising concerns about alleged possible misconduct by the EPA.

Former US senator and secretary of defence William Cohen has released the findings of a report following a year-long in-depth investigation into the EPA’s actions regarding Canadian project developer Northern Dynasty Minerals' Pebble base metals project and its efforts to issue the first-ever 'pre-emptive' veto in the 43-year history of the Clean Water Act to halt or limit development of the deposit.

The 346-page report, released this month, was prepared by a team of independent investigators employed by The Cohen Group and law firm DLA Piper. The investigation team reviewed thousands of EPA documents secured through Freedom of Information Act requests and interviewed about 60 individuals involved in the EPA or its controversial review of the Pebble project.

The report raises concerns about possible EPA misconduct, including that the EPA might have predetermined the outcome of its review before conducting the Bristol Bay Watershed Assessment (BBWA) and that EPA officials might have had “inappropriately close relationships” with environmental activists.

Cohen has urged US Congress and the independent office of the EPA Inspector General to use their individual subpoena powers to further investigate the alleged EPA misconduct outlined in the report.

The EPA Inspector General and several Congressional committees are investigating the EPA's actions regarding the Pebble project. In October 2014, a federal court judge in Alaska approved the Pebble Partnership's motion for a preliminary injunction that forbade the EPA from taking any further steps to advance its proposed veto, pending the outcome of litigation alleging that the federal agency violated the Federal Advisory Committee Act.

Meanwhile, Cohen has also suggested that US lawmakers consider taking action to ensure that all significant development projects in the US, including Pebble, are evaluated through the National Environmental Policy Act (Nepa) permitting process.

According to the report, the state of Alaska and the Pebble Partnership had argued that the EPA should have used the process that was usually employed when assessing the effects of potential development – the permit application process.

To date, the Pebble Partnership had not submitted a permit application, resulting in the EPA relying on hypothetical scenarios rather than the characteristics of a mine as it was actually planned to be built and maintained.

The EPA had proposed restrictions based on its BBWA conclusion that an “unacceptable adverse effect on fishery areas” would subsequently result from development that would cause estimated losses of habitat greater than those associated with the hypothetical 250-million-ton mine it had evaluated.Tthere is currently an injunction in place, temporarily barring the EPA from further proceedings.

Cohen’s report has found that the EPA relied on the BBWA in its proposed determination, despite having acknowledged that there were significant gaps in its assessment and that it was not designed to duplicate or replace the permit/Nepa process. The agency’s decision to pre-emptively use Section 404(c) also hindered the involvement of two key participants – the US Army Corps of Engineers and the state of Alaska.

Key Contracts and Suppliers
Wardrop Engineering (preliminary assessment report).

On Budget and on Time?
Not stated.

Contact Details for Project Information
PLP, tel +1 907 339 2600, fax +1 877 450 2600 or email receptionist@pebblepartnership.com.
Wardrop media and public relations, email media@tetratech.com.