I THINK MINING

Here is how you tease the mining industry and confound reporters:  issue a news release that you have published your new NI 43-101.  Then let them search for an actual copy.  I have had an army of so-called specialists looking for a copy of Northern Dynasty’s Pebble Mine Ni 43-101.  It does not yet exist, is what we finally determined.  The smartest amongst us finally got to the SEDAR site, only to find a news release.   And this announcement:

The Preliminary Assessment updates and  substantially revises project economic analysis last done by Northern Dynasty in 2004, and so constitutes a  material change for which a material change report containing the full executive summary will be shortly filed along with a complete copy of the Technical Report.

If you read the popular mining press, you will find slavish repeats of the news release, but no comment on the contents or the conclusions of the report.  You will just have to wait to get your hands on the document and make an independent assessment.

Which makes me wonder about the intentions of those who seek to manipulate the press and hence public opinion by putting out a favorable press release well ahead of the official supporting document.  A good strategy, if you think about it.  By the time the full report is out, public interest has waned, the story is old news, and hence you can readily bury any negatives in the report.   Which is why I will read the full report with interest when it finally does become available. 

There is some interesting stuff in the press release.  From a report readily accessible: 

The controversial Pebble Copper-Gold-Molybdenum Project in southwest Alaska could operate for as long as 78 years and become “one of the most important metal producers of the 21^st Century,” a preliminary assessment report by Wardrop reveals.  The NI 43-101 technical report made public Wednesday depicted Pebble as “a superior, long-life mineral development opportunity of global importance. As presented in the Preliminary Assessment, project economics are robust and support a mine development that is both technically feasible and permittable under existing regulatory standards in Alaska.”

Of course they are wrong in saying the full report is out, so you must doubt the validity or accuracy of everything else they report.  You can only conclude we have another lazy hack trotting out what smart company publicists want trotted out. 

   Here is what I did get on the tailings and water treatment:

A site-wide water surplus is forecast at the Pebble Project over the life of the mine. All surplus water would be treated to meet prevailing regulatory standards for water quality and the protection of aquatic life, and released to optimize downstream flow conditions for fish and aquatic habitat.

Process tailings are stored behind purpose-built embankments during mining, and thereafter in the pit. A mine life  extension beyond 25 years would require a second tailings storage facility (TSF) to be developed; topographical  and land status conditions in the project area present a number of nearby siting opportunities. Engineering has  been undertaken to a preliminary level for TSF sites with sufficient capacity to receive mine tailings after 25  years.  The TSF option selected for the 25-year IDC Case is Site G, located approximately three miles west of the open pit. The TSF impoundment would be created by three embankments. The north embankment is constructed initially to a height of approximately 200 feet and raised each year, while the south and east embankments would be built later in the mine life as the impoundment fills. The ultimate height of the north embankment is approximately 685 feet, while ultimate heights for the south and east embankments are approximately 450 feet and 100 feet, respectively.

    So now we know they will have to treat big volumes of water during mining and probably in perpetuity thereafter.  They do not actually say “in perpetuity,” but that is the only obvious conclusion from what they do say.  I see no cost for post-closure perpetual care and water treatment.  In NPV terms for a 78 -year mine life the NPV is small.  But in 78 years time, the sum will be big. 

And now we know the tailings will be above-grade in nearly 700-ft high embankments standing strong against the maximum credible earthquake.  They do not actually say that.  They just give the height. 

    In practice, there will probably be no more than this in the full report.  So now sit back and await the EIS.