Preliminary Injunction Halts EPA Process At Northern Dynasty's Pebble Mine

Preliminary Injunction Halts EPA Process at Northern Dynasty's Pebble Mine It's no secret that Northern Dynasty Minerals (TSX:NDM) has been having a tough time moving forward with its Pebble project in Alaska. The Pebble mine has run into its fair share of roadblocks, mostly put up by the US Environmental Protection Agency (EPA), but Northern Dynasty recorded a victory today when the Pebble Partnership, wholly owned by Northern Dynasty, was granted a preliminary injunction against the EPA.

The injunction will stop the EPA from taking further action to stop the development of the Pebble mine. As Pebble Partnership CEO Tim Collier is quoted as saying in Tuesday's release from Northern Dynasty, "[s]pecifically, the court has granted a Preliminary Injunction that blocks EPA from taking any further steps in the 404c regulatory process it has initiated at Pebble before Judge Holland is able to issue a final decision on the merits of our FACA case."

Judge H. Russell Holland of the US Federal District Court for Alaska granted the preliminary injunction, and is currently presiding over the Pebble Partnership's litigation against the EPA.

Procedural battles

The EPA initiated the process earlier this year, using its 404(c) authority under the US Clean Water Act to obstruct the mine by preemptively blocking its permit approval. The agency took the action to protect the world's largest sockeye salmon fishery, which is located in Bristol Bay, Alaska, near the Pebble project. EPA Administrator Gina McCarthy has said that the mine "would likely have significant and irreversible negative impacts on the Bristol Bay watershed and its abundant salmon fisheries."

According to the EPA's website, 404(c) has been used very sparingly, typically when "major projects with significant impacts on some of America's most ecologically valuable waters" are involved.

In response, the Pebble Partnership filed three lawsuits against the EPA, with one in particular alleging that the agency did not operate according to the requirements of the Federal Advisory Committee Act (FACA). Pebble has said that the EPA didn't conduct its business in an open manner, and reiterated claims in Tuesday's release that the agency colluded with environmental activists with the aim of bringing about predetermined results without properly undertaking scientific inquiry.

Procedural victories

To be sure, the ruling marks a major development for the project. Though Collier noted that "the decision is a procedural victory and does not resolve our claims that EPA pursued a biased and predetermined 404c veto initiative against Pebble," he nevertheless stressed its importance. "[F]or first time, EPA's march to preemptively veto Pebble has been halted," he said.

That's because under the injunction, the EPA won't be able to take further action in the 404(c) process until Judge Holland makes a decision on the merits of Pebble's FACA case — which could take several months. For its part, the EPA is hoping that won't be the case. Jennifer Colaizzi, an agency spokeswoman, said in a statement to Bloomberg, "[t]he "EPA hopes the litigation is resolved expeditiously so the agency can move forward with its regulatory decision-making."

Still, Northern Dynasty president and CEO Ron Thiessen said the company is "heartenened" by the ruling in Pebble's favor, and that the company looks forward to the opportunity to argue the merits of its case in court.

Moving forward

Sean Magee, a spokesman for the Pebble Partnership, reiterated the positive sentiment regarding the injunction to Copper Investing News. "We are looking to conclude the process with the EPA in such a way that we can move forward with permitting, unencumbered by preemptive development restrictions. Today's ruling is certainly a major milestone in that regard," he said.

Magee also said that the company is looking for a funding partner to help it move forward with the Pebble project.

Whether the company will be successful in those endeavours remains to be seen, but today's news certainly suggests that procedural delays implemented by regulatory bodies do not necessarily mean a nail in the coffin for mining projects. Investors will no doubt be keeping an eye out to see how the Pebble Partnership's case against the EPA progresses.


Securities Disclosure: I, Teresa Matich, hold no direct investment interest in any company mentioned in this article.

Preliminary Injunction Halts EPA Process at Northern Dynasty's Pebble Mine from Copper Investing News