Mining giant Anglo American plc has withdrawn from a large-scale project in Alaska it co-owned with Vancouver’s Northern Dynasty Minerals Ltd. (TSX:NDM).
Under a joint venture known as the Pebble Limited Partnership, Anglo American and Northern Dynasty each owned 50% of the Pebble Project – a copper, gold and molybdenum deposit in southwest Alaska.
Northern Dynasty now owns 100% of the project.
News of Anglo American’s withdrawal from Pebble sent Northern Dynasty stock plummeting 38% to $1.45 this morning.
In a conference call from London with investors this morning, Northern Dynasty CEO Ron Thiessen said his company has not yet been in negotiations with other companies to join the Pebble project.
But, added Thiessen, he always envisioned the deposit “being developed by a consortium of companies.”
Rio Tinto (NYSE:RIO) owns 19% of Northern Dynasty Minerals.
In a press release, Anglo American CEO Mark Cutifani said, “Despite our belief that Pebble is a deposit of rare magnitude and quality, we have taken the decision to withdraw, following a thorough assessment of Anglo American’s extensive pipeline of long-dated project options.
“Our focus has been to prioritize capital to projects with the highest value and lowest risks within our portfolio and reduce the capital required to sustain such projects during the pre-approval phases of development, as part of a more effective value-driven capital allocation model.”
Last month, Anglo American announced it would expand its Roman coal mine near Tumbler Ridge, B.C. The expansion is known as the Trend-Roman project.
Cumulatively, the Trend mine and the Trend-Roman project are expected to produce 2.5 million tonnes of metallurgical coal per year over a 16-year lifespan.
