Pebble developer craters after copper giant pulls out

The arrangement would have given a unit of Toronto-based First Quantum an option to earn a 50% interest for $1.5 billion in Pebble in return for $150 million paid over four years to fund permitting for the project, one of the richest copper-gold deposits ever discovered. Shares in First Quantum declined more than 4% on Friday affording the world’s seventh largest copper producer a market value of $10.7 billion.

Effectively banned by the US Environmental Protection Agency under Barack Obama, prospects for the development of Pebble brightened considerably after the election of Donald Trump and the appointment of Scott Pruitt as head of the EPA, seen as friendly to the extractive industries.

Northern Dynasty reached a key settlement in May last year with the EPA that ended a dispute over the agency’s decision to block construction. It came three months after Alaska’s Department of Natural Resources (DNR) granted Northern Dynasty’s subsidiary — Pebble Limited Partnership — a long-awaited land-use permit. In January, the US Army Corps of Engineers accepted Pebble’s wetlands-fill permit, which is required under the Clean Water Act and is a key authorization in the permitting process.

Earlier this month, opponents disrupted First Quantum’s annual general meeting in Toronto and took out a full-page ad in Canada’s Globe and Mail newspaper vowing to continue fighting the project. Critics have said the Pebble project located in Alaska’s Bristol Bay region would harm indigenous communities and the world’s largest sockeye salmon fishery.

Northern Dynasty estimate that the Pebble operations will contribute of $49-$66 million to Alaskan state coffers and create 1,500 to 2,000 direct and indirect jobs.

Pebble’s current resource estimate includes 6.5 billion tonnes in the measured and indicated categories containing 57 billion pounds copper, 71 million ounces gold, 3.4 billion lb molybdenum and 345 million oz silver; and 4.5 billion tonnes in the inferred category, containing 25 billion lb copper, 36 million oz gold, 2.2 billion lb molybdenum and 170 million oz silver. Palladium and rhenium also occur in the deposit.