Resolute Mining says it will pay Mali $160 million in tax dispute
The company’s shares in Sydney were suspended on Thursday, after tumbling 40% since news of the detention of CEO Terry Holohan.
Northern Dynasty Minerals (TSX: NDM) shares continued to crater on Tuesday as doubts grow over whether the company can clear regulatory hurdles for its Pebble project in Alaska.
The stock declined nearly 32% by 2:20 p.m. ET after falling by more than 40% during the previous session, leaving the company with a market capitalization of just over C$410 million.
On Monday, the US Army Corps of Engineers gave the company 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.
The deadline likely means any final permit decision would come after the November 3 presidential election
Later that day, Republicans Senators Dan Sullivan and Lisa Murkowski both came out against the mine, stating it could cause “significant damage” to the state’s Bristol Bay region.
Many believe that opposition from Murkowski, who chairs the Senate Energy and Natural Resources Committee, is likely to carry weight across other US 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 spoken out against the project, saying it would destroy areas where locals fish and hunt.
In response to the Army Corps’ request, Northern Dynasty said it plans to “preserve enough land so that multiples of the number of impacted wetland acres are preserved,” but that did not help sway investors from selling off shares.
The potential cost of such a mitigation plan is unknown and thus concerning, Cantor Fitzgerald analyst Mike Kozak said in a research note.
“It will be exceptionally challenging to reach a compensation plan that will satisfy all parties,” he said.
Cantor Fitzgerald has also 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 November 3 presidential election. A victory by Democrat Joe Biden would likely scuttle the entire project, TD Securities analyst Craig Hutchinson told Reuters.
Doubts about the project have steadily risen over recent months. Morgan Stanley, once one of the largest Northern Dynasty shareholders, sold most of its holdings two months ago, according to regulatory disclosures.
(With files from Reuters)
