Risky Business

A prospective investor or other person reviewing Northern Dynasty for a prospective investor should not consider an investment in Northern Dynasty unless the investor can sustain an economic loss of their entire investment.” – Northern Dynasty Mineral’s Management Discussion and Analysis, September 30, 2024.

The Pebble project at its core is a business proposition, one that investors hope will pay off. In 2020, the U.S. Army Corps of Engineers denied Pebble developers a Clean Water Act 404 permit, leaving the company scrambling to find a path forward. In 2023, the U.S. Environmental Protection Agency also finalized limitations on certain development activities at and around the Pebble deposit.

Pebble owner Northern Dynasty Minerals (NDM) is focused on two clear goals: fighting the regulatory decisions that have stymied its progress, and convincing major investors or partners to join the project.

On the legal front, NDM has the backing of the State of Alaska, which has joined its suits against the EPA.

For prospective partners and individual investors, NDM’s disclosure statements ring loud and clear: it’s an investment proposition with a litany of risks.

NDM has faced big challenges before, namely when its 50/50 partner Anglo American left the project in 2013. Since then, it has cobbled together several short-term financial vehicles (such as bought deals, private placements, and convertible notes) to keep it a “going concern.” The big question is: how long can NDM afford to continue its quest, and are investors willing to accept the risks?

Some of the risks that could affect Northern Dynasty Minerals plans to develop the Pebble prospect, as outlined in its September 30, 2024 Management Discussion and Analysis. The list is not exhaustive.