Northern Dynasty prices US$13.5 million offering

Diamond drilling at the Pebble copper-gold project in Alaska. Source: Northern Dynasty Minerals Ltd.

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Northern Dynasty Minerals Ltd. [NDM-TSX; NAK-NYSE] on Friday December 13 said it has priced a previously announced marketed public offering of common shares that will be used to advance its Alaskan Pebble copper-gold project. The move comes after the company retained an underwriting syndicate for the sale of 36.5 million common shares at 37 cents each, generating proceeds of US$13.5 million.

The underwriting syndicate, led by Cantor Fitzgerald Canada Corp. has been granted a green shoe option to purchase an additional 5.47 million common shares at the issue price for up to 30 after closing , potentially adding another US$2.02 million to the proceeds.

In addition, Northern Dynasty said it is proceeding with a previously announced non-brokered private placement of 13.5 million common shares at the issuer price for gross proceeds of US$5 million.

On Friday, Northern Dynasty shares fell 22.4% or 15 cents to 52 cents on volume of 3.5 million. The shares are currently trading in a 52-week range of 56 cents and $1.47.

Northern Dynasty’s principal asset, owned through its wholly-owned Alaska-based U.S. subsidiary, Pebble Limited Partnership, is a 100% interest in a contiguous block of 2,402 mineral claims in southwest Alaska, including the Pebble deposit.

First discovered in 1989, it has been described as one of the greatest stores of mineral wealth on the planet.

At a 0.3% copper equivalent cut-off, the Pebble Project is estimated to contain 6.456 billion tonnes in the combined Measured and Indicated categories  grading 0.40% copper, 0.34 g/t gold, 240 ppm molybdenum, containing 57 billion pounds of copper, 71 million ounces of gold, 3.4 billion pounds of molybdenum and 345 million ounces of silver.

However, the project has been a lightning rod for global environmentalists who expressed concerns about the impact of such a large mining operation on local salmon runs.

Still, Northern Dynasty shares soared in late July, 2019 after the Trump administration said it would lift an Obama-era restriction on the Pebble Project.

Under former President Barack Obama, the U.S. Environmental Protection Agency in 2014 proposed limits on large scale mining in Alaska’s Bristol Bay watershed, citing environmental concerns. Under President Trump, the EPA has dismantled scores of environmental rules –Trump rejects mainstream climate science.

The proposed restrictions are based on hypothetical scenarios that were different from Northern Dynasty’s submitted permit application, the EPA said in a statement. However, the company will still need to go through a permit application process.

The announcement means that the Environmental Impact Statement (EIS) and permitting process for the Pebble Project currently being led by the US Army Corps of Engineers may advance to a final Record Date of Decision in 2020 without the cloud of uncertainty created by EPA’s unprecedented, pre-emptive regulatory action, Northern Dynasty said.

The Corps expects to finalize the Pebble EIS in early 2020 and issue a final Record of Decision by the middle of next year.

Northern Dynasty said proceeds of the latest financing will enable the Pebble Ltd. Partnership in Alaska to continue other work that is needed to support timely completion of the EIS permitting process for the Pebble Project in 2020.

Meanwhile, the company said it remains in discussion with potential partners to secure long-term funding to initiate state permitting and project development.


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