Pebble loses permitting funder

Northern Dynasty Minerals released a brief statement today announcing that it had not been able to finalize a deal with First Quantum Minerals Ltd. to partner on permitting and development of the proposed Pebble mine in Bristol Bay, Alaska.

First Quantum Minerals, based in Vancouver, had expressed interest in the Pebble project last December, but the two parties needed time to agree on all the details. The deadline for the formal agreement was extended twice – once to April 30 and again to May 30.

In December First Quantum CEO Philip Pascal stated that:

“We are very aware of the environmental and social sensitivity of this project and will utilize the lengthy option period to apply our extensive project development and operating experience to ensure that this project can be developed with the support of stakeholders.”

It is not clear yet what led to First Quantum’s decision. During the option period, it was performing due diligence, watching for regulatory hurdles to be crossed, and negotiating other terms. Stakeholders have been vocal with First Quantum throughout the option period, which may have had an impact as well.

It is not clear how today’s news will affect Northern Dynasty’s bid to gain permits for the mine. According to the framework agreement detailed in December, First Quantum would have provided the funds for permitting – $150 million over four years – after which it would have had an option to become a 50% partner. First Quantum had already paid the first $37.5 million dollar installment, which kick-started the permitting process that is currently ongoing.