Benzinga | Jan 11, 2021 06:50AM EST

Northern Dynasty Says the State of Alaska Will Appeal the US Army Corps of Engineers' Denial of a Federal Permit for The Pebble Project

Northern Dynasty Minerals Ltd. (TSX:NDM)(NYSE:NAK) ("Northern Dynasty" or the "Company") reports the Office of Alaska State Governor Mike Dunleavy issued a statement late last week to announce his administration will formally appeal the US Army Corps of Engineers' ("USACE") November 25, 2020 denial of a key federal permit for Alaska's Pebble Project.

In a statement released January 8, 2021, Governor Dunleavy said the USACE's Record of Decision ("ROD") and accompanying denial of a Clean Water Act 404 permit for the proposed copper-gold-molybdenum-silver-rhenium project in southwest Alaska is "flawed (and)...creates a dangerous precedent that will undoubtedly harm Alaska's future."

As owner of the land and subsurface mineral estate at Pebble, the State of Alaska has the right - along with Northern Dynasty's 100%-owned US-based subsidiary Pebble Limited Partnership ("Pebble Partnership"), which owns state-issued mineral claims at the property - to launch an administrative appeal of the USACE's permitting decision.

Northern Dynasty believes the State of Alaska - as an asset owner and professional regulator with a constitutional mandate to develop the state's resources in the best interests of its citizens - will bring different perspectives and motivations in challenging a federal decision that Pebble believes to be arbitrary, unprecedented in Alaska and unsupported by the administrative record. This includes a serious concern about the decision's long-term implications for Alaska's ability to responsibly develop its natural resources.

The Pebble Partnership's and State of Alaska's 'requests for appeal' ("RFA") must be submitted within 60 days of the USACE's November 25, 2020 issuance of a ROD and CWA 404 permit denial. Pebble is preparing a comprehensive RFA to challenge the USACE's permitting decision on procedural, substantive and legal grounds, including:

* that it is not supported by the administrative record for the Pebble Project, including the Environmental Impact Statement published July 24, 2020; and,

* that mitigation requirements for Pebble are contrary to policy and precedent in Alaska, and the rejection of Pebble's Compensatory Mitigation Plan was both procedurally and substantively invalid.

In its statement, the State of Alaska also suggests the USACE's requirements concerning mitigation at Pebble are unprecedented and inconsistent with longstanding practice and policy guidance in the state.

The Office of Alaska Governor's statement quotes Acting Attorney General Ed Sniffen: "This appeal asks the Army Corps Pacific Ocean Division to remand the permit decision back to the Alaska District for a more thorough review consistent with the law. The Division ignored Corps' long-standing guidance that required it to tailor mitigation requirements to recognize Alaska's unique position of holding more intact wetlands than any of the lower 48 states combined. Instead, the Division is requiring mitigation measures that are simply impossible to meet in Alaska."

The Pebble Partnership intends to submit its RFA to the USACE's Pacific Ocean Division Engineer headquartered in Hawaii within two weeks. Following its receipt, the USACE will have 30 days to notify Pebble as to whether its RFA is complete. USACE guidelines indicate the administrative appeal process should conclude within 90 days.

"The Alaska District's decision has far-reaching and ominous implications for our rights as a state to develop our resources for the benefit of all Alaskans, whether its mineral deposits like Pebble, or oil and gas on the North Slope, or other resources anywhere in the state," said Alaska Department of Natural Resources Commissioner Corri Feige. "The Alaska Constitution specifically directs us to develop our resources in the public interest. When a federal agency arbitrarily tries to deprive us of our rights with the stroke of a bureaucrat's pen, we simply must challenge that action."