US judge dismisses action brought by Pebble mine opponents

The proposed site for Alaska’s Pebble mine, at the headwaters of the rivers that empty into Bristol Bay. Credit: jsear | Flickr

Northern Dynasty Minerals (TSX: NDM) announced on Monday that a US federal district court judge has granted the US Environmental Protection Agency’s (EPA) motion to dismiss a case brought by a collection of activist groups who are against the company’s proposed Pebble copper-gold mine in Alaska’s Bristol Bay region.

The litigation challenged the EPA’s decision in July 2019 to withdraw its prior regulatory action under Section 404(c) of the Clean Water Act, initiated in 2014 by the Obama Administration, which sought to pre-emptively veto the Pebble project before permit applications had been filed or an Environmental Impact Statement (EIS) permitting process was undertaken.

In granting the motion to dismiss, the judge determined that the decision on whether or not to take action under the Clean Water Act — the regulation which the EPA based its 2014 pre-emptive veto on — is at “the agency’s discretion.”

The Pebble project can now continue to be vetted under the National Environmental Policy Act’s permitting process. Currently, the mine’s federal permit application is pending with the US Army Corps of Engineers, and the EPA retains the right to veto the permit, a power that was reaffirmed by the federal judge’s ruling.

The latest court decision removes another obstacle to receiving a final EIS and record of decision on the Pebble project

Shares of Northern Dynasty opened 11% higher on Monday on the favorable court decision. The Vancouver-based miner has a market capitalization of C$345 million.

The latest court decision removes another obstacle to receiving a final EIS and record of decision on the Pebble project, said Tom Collier, chief executive of Northern Dynasty’s Alaska-based subsidiary.

The permitting process is still on track for completion by mid-2020, despite the ongoing situation with covid-19, Northern Dynasty said last month.

“We have long held that the preemptive veto against Pebble was poor public policy and that decisions about the merits of developing a mine at the Pebble prospect should be made through the traditional permitting process,” Collier added.

The Pebble project proposal has been the subject of controversy in the southwest Alaska region for the past few years, in particular with regards to its potential risk to the watershed, salmon and other fisheries. However, a leaked draft of the EIS suggests that the nearby water resources could co-exist with the mine.

In the past, Northern Dynasty and Alaska’s congressional delegation have complained of government overreach, claiming the EPA tried to veto the project before seeing an application. The company eventually applied for a Clean Water Act permit following the Obama Administration in late 2017.

If permitted, Pebble would become North America’s largest mine, with an estimated measured and indicated resource of 6.5 billion tonnes containing 57 billion lb copper, 71 million oz gold, 3.4 billion lb molybdenum and 345 million oz silver.