The U.S. Environmental Protection Agency announced today that it had reached settlement terms with the Pebble Limited Partnership (PLP) over litigation PLP had brought against the agency in 2014. That litigation focused on the EPA’s decision to apply the sparingly-used 404(c) process to limit development at the Pebble deposit site in Bristol Bay in order to protect the region’s watershed and unique wild salmon fishery.
Terms of the settlement include:
Halting the 404(c) Process
In 2014, a federal judge issued a preliminary injunction, ordering EPA to halt any work on the 404(c) process, pending outcome of the litigation. At the time, the agency was reviewing more than 671,000 public comments it had received on a “Proposed Determination” that outlined EPA’s proposed restrictions on dredge and fill activities at the Pebble deposit site. The 2017 settlement provides for EPA and PLP to ask for dismissal of the case and lifting of the injunction. EPA has agreed to withdraw the Proposed Determination and will not pursue the next step in the process, a “Recommended Determination,” until 48 months after the settlement (or until the U.S. Army Corps of Engineers issues a final environmental impact statement, whichever comes first). (See our graphic guide to the 404(c) process.) PLP would have to apply for a permit within 30 months of the settlement in order to take advantage of this forbearance.
Use of the Bristol Bay Watershed Assessment
Over a 3-year period, the EPA had developed an assessment of the Bristol Bay watershed, to include potential risks from large-scale mining in the area. PLP had long contended that the assessment was flawed. As part of the settlement, EPA will be able to use the study “without limitation.”
Fees and FOIA requests dropped
PLP agreed to drop its lawsuits and requests for fees against EPA. Additionally, it won’t file any new Freedom of Information Act (FOIA) requests during the “forbearance” period.
A Contrast in Approaches
The 2017 settlement comes on the heels of the new White House Administration and the appointment of a new EPA Administrator, Scott Pruitt. Regarding the settlement, Pruitt said, “We are committed to due process and the rule of law, and regulations that are ‘regular’. We understand how much the community cares about this issue, with passionate advocates on all sides. The agreement will not guarantee or prejudge a particular outcome, but will provide Pebble a fair process for their permit application and help steer EPA away from costly and time-consuming litigation. We are committed to listening to all voices as this process unfolds.”
The former EPA Administrator, Gina McCarthy, when releasing the Proposed Determination in 2014, stated: “The Bristol Bay fishery is an extraordinary resource, worthy of out-of-the-ordinary agency actions to protect it.” At that time, after several visits to Bristol Bay and public hearings on the issue, EPA administration had determined that use of the 404(c) process was justified due to the unique nature of the fishery.
Administrator Pruitt has not yet visited Bristol Bay. However, within the first week of his appointment, he received a request from the Republican Chairman of the House Committee on Science, Space and Technology to rescind the Proposed Determination, as well as a request from the ranking Democrat on the same committee asking just the opposite.
Reaction to the Settlement
Bristol Bay tribes, many of which had initially asked the EPA to invoke the 404(c) process to protect Bristol Bay, held a press conference on Thursday decrying the settlement and reemphasizing local opposition to the project.
PLP and Northern Dynasty representatives expressed gratitude to EPA Administrator Scott Pruitt and President Trump for their “commitment to the rule of law, and to the fair and equal treatment of those who would invest in job-creating industries in America.”
For investors, finalization of the settlement symbolized the high-end of short-term growth. Now that it’s complete, many investors are selling stock, leading to a 16% drop in value.
EPA reaches deal with Pebble mine developer, Alaska Dispatch News, May 13, 2017
Why Northern Dynasty Minerals Stock Slumped 16% on Friday, Motley Fool, May 13, 2017