Reputational Risks, Regulatory Challenges, and Legal Uncertainties
From the introduction:
THIS REPORT HIGHLIGHTS THE RANGE OF EXISTING AND EMERGING RISKS ASSOCIATED WITH DEVELOPMENT OF THE PROPOSED PEBBLE COPPER AND GOLD MINE IN SOUTHWEST ALASKA.
Anglo American purchased a 50% stake in the Pebble project in Bristol Bay, Alaska in July 2007, forming the Pebble Limited Partnership (PLP) with Canadian-based junior Northern Dynasty. The project is currently in advanced exploration, and to retain its 50% interest, Anglo American must continue its staged investment of $1.43 billion to advance the Pebble project toward permitting and operations.
In 2009, PLP stated that it could complete the feasibility study, permitting process and begin project construction by 2013, with production occurring in 2016. But the political, legal and regulatory environment for the Pebble mine (and the associated 100-mile road, pipelines, deep water port, power source and transmission lines) has already caused significant delays. The Pebble Limited Partnership now states that they don’t expect to submit permit applications until late 2012 or 2013. A number of regulatory, reputational and legal risks for the company put even this time frame in doubt.
The Pebble project is located at the headwaters of the Bristol Bay watershed, which produces 50% of the world’s commercial supply of wild sockeye salmon. Given the harsh, undeveloped environment of the region and the sensitivity of the Bristol Bay fishery, each of the mine components, standing alone, would pose enormous technical, logistical and political challenges. Taken together, the scale and ambition of the Pebble project are unprecedented.
Pebble is already vigorously opposed by a diverse and politically sophisticated coalition of local communities, tribal governments, commercial and sport fishing businesses, and other economic interests. As a result, it is expected that Pebble will face political and regulatory challenges in the short and long term, and there is real risk that it may never receive approval to proceed.
For more information:
Contacts:
- Jonas Kron, Trillium Asset Management Corp., (503) 592-0864, jkron@trilliuminvest.com
- Will Lana, Trillium Asset Management Corp., (415) 925-0105, wlana@trlliuminvest.com
- Dave Chambers, Center for Science & Public Participation, (406) 585-9854 dchambers@csp2.org
- Bonnie Gestring, Earthworks, (406) 549-7361, bgestring@earthworks.org
