Pebble development dynamics change: this could be a world-class mine, providing many jobs and wealth to the state. But will opponents stop it?

Author:Liles, Patricia


Everything about the Pebble copper-gold-molybdenum prospect in Southwest Alaska is gigantic--the amount of metals contained in the deposit, the spending on exploration and environmental work this year, the size of the operation needed to produce metals, and especially the level of public attention and controversy created.

Years, perhaps even a decade away from possibly pouring the first gold bar and shipping copper and molybdenum from the Iliamna Lake region, Pebble is creating a huge impact on the state.


And that's not limited to just the state's mining industry. It is Alaska's largest mineral exploration project, with the most surrounding mining claims staked and with a seasonal work force that involved 625 people last year. More than any other single mine operation in Alaska.

The discovery and discussion about development of one of the world's largest unmined mineral deposits is creating an enormous effect in the public debate about resource development in Alaska. Pebble has become a lightening rod for debate between pragmatics who believe that Alaska's past, present and future economy relies heavily on responsible natural resource extraction and environmentalists, including many Outsiders, who view Alaska as the nation's Last Frontier and unsullied wilderness area.

That basic public debate has placed Pebble's developers, Vancouver, B.C.-based Northern Dynasty Minerals Ltd., and its new partner, global mining giant Anglo American plc., in a precarious position.

Project managers are more than a year away from beginning the formal permit-seeking process to build and operate a hard rock mine, seeking approvals from a myriad of state and federal regulators in an expected lengthy, closely monitored and very public environmental review. Detailed development plans have not been released, partially because the scope is being redefined to include a recently discovered, deeply buried mineralized zone.

Spending at Pebble is expected to grow in the near future, as the project advances toward a development decision. Between 2002 and 2006, Northern Dynasty spent a total of $130 million on Pebble. In 2007, spending on the project is expected to total $95 million. Under the agreement announcing the partnership, Anglo American will earn a 50 percent interest in Pebble by making a staged cash investment of $1.425 billion, after which expenses will be shared equally by the two companies.

The Anglo cash contribution plan includes spending at least $125 million to complete a pre-feasibility study targeted by the end of 2008, an additional $325 million for a feasibility study by 2011 and the next $975 million of spending for primary construction.

"The purpose of the strategic partnership is to engineer, permit, construct and operate a modern, long-life mine...

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