Major Pebble funder pulls out

Pebble Partnership CEO says project will move forward

By Carey Restino
Homer Tribune
The company funding the current development costs at the Pebble Prospect, Anglo American, has pulled out, leaving many to question the controversial mining project’s future viability in Alaska.
But John Shively, CEO of the Pebble Limited Partnership, said Monday that the project, a proposed large-scale gold, copper and molybdenum mine in the Bristol Bay watershed, is far from dead.
“We don’t know the complete impact at this point, but there’s no question that we are going to continue to move forward,” Shively said. “This is a great project and a world-class ore body and I’m confident that 21st century technology will allow us to build and operate the mine and coexist with the Bristol Bay fishery.”
Shively spoke to one of the main stumbling blocks to the proposed mine — it’s potential impact on the Bristol Bay fishery, one of the largest salmon runs in the world. Opposition to the Pebble Mine began to build in the Bristol Bay area and throughout Alaska and the world as the wisdom of placing a large-scale mine in the critical salmon habitat area was questioned. Opponents, including many of the area Native corporations, requested that the federal government step in, prompting the Environmental Protection Agency to launch a Bristol Bay Watershed Analysis.
The drafts of that analysis, released earlier this year, stated that the development of the mine would likely disrupt the salmon run. However, proponents of the mine say the Environmental Protection Agency jumped the gun, as few specifics of the mine plan have been released to date, and the Pebble Partnership has yet to begin its permitting process with the federal and state agencies.
The Bristol Bay region is not unanimously opposed to the proposed mine, with many noting that the economic stimulation would help breath life into an otherwise desperate economy. Pebble has estimated the project, if it were to move forward, would generate close to 1,000 direct Alaska jobs and $200 million in annual revenue for the state and local governments. When EPA administrator Gina McCarthy visited Illiamna in August, the room was full of Pebble Partnership employees, many of them Bristol Bay residents, who spoke of the need for jobs to keep their communities alive.
Monday’s announcement was viewed as diversely as the mine, with mine opponents heralding Anglo American’s move to pull out — taking a $300 million hit in the process — as welcome news.
“I think that Anglo-American just confirmed what Alaskans have known for a long time,” said Bob Shavelson, executive director of Cook Inletkeeper. “The risks are too great.”
For those working as bear guides and in other capacities for the Pebble Prospect, however, the news was not so good. Anglo American’s 50 percent share in the project was contingent on its bankrolling the prospect’s development. It was required to fund $1.5 billion in project costs, according to the Pebble Project’s website, an investment that would take the project all the way into its construction.
Northern Dynasty, a Canadian company, now owns 100 percent of the project shares, but its value took a huge tumble on the stock market on Monday following the news, reportedly selling at $1.48 a share on Tuesday, down from $2.30 a share on Friday. Its shares sold for as much as $5 in the last year.
Northern Dynasty Minerals has investments from Rio Tinto, which holds 19 percent of the company’s shares following a $200 million investment.
Shively said the Pebble Partnership, which is managing the prospect development, is still waiting to see what the impact will be to current project plans. The mine developers had said they would begin the permitting process this fall. Mine developers have long asked critics to wait for the release of mine plans — such as those that would be used to apply for federal and state permits. This summer, Sen. Lisa Murkowski, R-Alaska, publicly asked the Pebble Partnership to release those plans to the state, saying Alaskans had waited long enough.
Shively said Anglo American’s decision to pull out of the prospect was a reflection of that company’s internal assessment of its investments, not a reflection of Anglo’s concern about the controversy surrounding the mine. He said he didn’t think the EPA’s scrutiny was a contributing factor.
“I don’t think that had an impact,” he said.
In a release, Anglo American attributed its withdraw to a need to “prioritize capital to projects with the highest value and lowest risks within our portfolio, and reduce the capital required to sustain such projects during the pre-approval phases of development … .”
“We wish the project well through its forthcoming permitting process and express our thanks to all those who have supported Pebble and who recognize the opportunities and benefits that such an investment may bring to Alaska,” said Mark Cutifani, chief executive of Anglo American in the release.
However, opponents of the prospect’s development say this pullout by Anglo American is clearly an indication that the company recognized the proposed mine was too great a risk and not popularly supported by the state or the nation.
“If one of the world’s largest mining companies sees this project as a bad business investment, Alaskans and other mining companies should follow their lead and abandon the proposed Pebble Mine project as well,” said Anders Gustafson, executive director of the Renewable Resources Coalition in a release. “The state needs to protect the world’s greatest wild salmon fishery and the vibrant fishing industry of Bristol Bay.”
Meanwhile, others note that a recent comment period on the EPA’s Bristol Bay Watershed Assessment had an overwhelming response from those supporting EPA action in the watershed — 98 percent of Bristol Bay residents and 84 percent of Alaskans supported the effort, said Bob Waldrop, executive director of the Bristol Bay Regional Seafood Development Association.
“I can’t think of a development project in the state’s history that has faced such wide and deep opposition from the citizens of Alaska, and so it’s no surprise that Anglo American announced its withdrawal from the Pebble project after 84 percent of Alaskans who commented to the EPA supported action to protect Bristol Bay,” said Tim Bristol, director of Trout Unlimited’s Alaska Program, a longtime opponent of the proposed mine. “Bristol Bay is one of the greatest sport and commercial fishing habitats on the planet, and the EPA should act now to protect it and the more than 14,000 jobs it supports.”
The Bristol Bay Native corporation, which took a stance in opposition to the mine following a survey of its some 9,400 shareholders, said the news is encouraging, but added that the EPA needs to continue its attention to the proposed mine and its impacts.
“Today’s announcement is a positive development, but it remains important for the Environmental Protection Agency to take action to protect the fishery and water resources of the region and the economic and subsistence values that depend on those resources,” said President and CEO Jason Metrokin in a release.
The United Tribes of Bristol Bay, which represents nine tribes responsible for requesting in 2010 that the EPA use its 404(c) authority under the Clean Water Act to protect Bristol Bay from the potential Pebble Mine, had a similar response to the withdraw.
“We are glad Anglo American has finally recognized developing Pebble is just too risky in Bristol Bay and pulled out of the Pebble Partnership,” said Robert Heyano president of the tribal group. “We’ve known this mine would destroy some of the most productive salmon streams in the world and therefore the indigenous cultures who have depended on salmon since time immemorial. At the same time we can’t pass this uncertainty down to our children and grandchildren.”

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Posted by on Sep 18th, 2013 and filed under Headline News. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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