(Bloomberg) — Northern Dynasty Minerals Ltd. plunged as the U.S. Army Corps of Engineers said the controversial Pebble mining project in Alaska cannot be permitted as currently proposed.
The project “would likely result in significant degradation of the environment and would likely result in significant adverse effects on the aquatic system or human environment,” according to a U.S. Army statement Monday. “Therefore, the Corps finds that the project, as currently proposed, cannot be permitted under section 404 of the Clean Water Act.”
Pebble is in a remote area in southwestern Alaska that drains into Bristol Bay, home to the world’s most productive salmon fishery. Conservationists, local activists and fishing operations have fought the project for years — citing potential impacts on the environment and native cultures in the region. More recently, the project has drawn opposition from prominent Republicans including Donald Trump Jr.
Blocking Pebble would be a reversal for an administration that has allowed a review of the plan to proceed.
The massive project, which has known deposits of copper, gold and other metals, secured a final environmental impact review from the Army Corps last month. But on Sunday, people familiar with the matter said the Trump administration was planning to block the controversial mine.
On Monday, an Army Corps letter was made public demanding a mitigation plan for “unavoidable adverse impacts.”
In order to submit a “record of decision,” the Army Corps had said in the letter dated Aug. 20 the company needs to develop a mitigation plan within 90 days “to compensate for all direct and indirect impacts caused by discharges into aquatic resources” over thousands of acres of wetlands.
The Army Corps’ mitigation request “has been anticipated,” the miner’s Pebble Limited Partnership unit said in a statement Monday.
“The letter we received today is a normal letter in the permitting process and we are well into an effort to present a mitigation plan to the USACE that complies with the requirements of their letter,” PLP Chief Executive Officer Tom Collier said.
Northern Dynasty fell 38% in Toronto on Monday, the steepest drop since at least 1994, when Bloomberg records begin. The shares had more than tripled this year through Friday.
“After years of extensive process and scientific study, federal officials have determined the Pebble project, as proposed, does not meet the high bar for large-scale development in Bristol Bay,” Alaska Republican Senator Lisa Murkowski said in a statement. “I understand, respect, and support this decision.”
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