Anglo American withdraws from Pebble Project

September 16, 2013

Northern Dynasty Minerals announced that it plans to begin the permitting application process for its $4.7 billion Pebble Project in Alaska, but it will be doing it alone as Anglo American, Northern Dynasty’s partner in the project, announced that it was withdrawing from the joint venture.

Anglo American chief executive officer Mark Cutifani made the decision to pull out from the project, saying his company would be more selective about the projects it pursues, the Financial Times reported.

"Everything will be under review by Northern Dynastyt" Ron Thiessen, Northern Dynasty's CEO, told The Wall Street Journal in a telephone interview. However, he noted that "not too much work is left on the project other than to go to permitting."

Anglo American said it has taken an impairment charge of $300 million after withdrawing from the Pebble Project, a massive, environmentally challenging Alaskan copper-and-gold venture, in favor of prioritizing high-value, low-risk projects. Cutifani vowed to pare back Anglo American's $17 billion of projects when he took over for Cynthia Carroll in April.

Thiessen told the Wall Street Journal that Anglo American informed Northern Dynasty on Sept. 13 about its decision to pull out of the partnership. He added that Northern Dynasty would now review its project plan but effectively wouldn't have to compensate Anglo American for the amount Anglo had invested to date because Anglo did not invest above an undisclosed threshold. Anglo American had invested $540 million out of the $1.5 billion it committed to spend on the project as of the end of June, Thiessen 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," said Cutifani.

"We wish the project well through its forthcoming permitting process and express our thanks to all those who have supported Pebble and who recognise the opportunities and benefits that such an investment may bring to Alaska," said Cutifani in a statement.

Anglo American and Northern Dynasty will embark upon a 60-day process to unwind their partnership, Thiessen said.


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