Rio Tinto announced on April 7 that it is gifting its 19.1% shareholding in Northern Dynasty Minerals, owner of the Pebble copper-gold-molybdenum project in southwest Alaska, to two local Alaskan charitable foundations. The shares will be divided equally between the Alaska Community Foundation to fund educational and vocational training and the Bristol Bay Native Corp. Education Foundation, which supports educational and cultural programs in the region.
Rio Tinto said its decision followed a strategic review that concluded that the Pebble project did not fit with its corporate strategy. Rio Tinto held 18.15 million shares in Northern Dynasty, which is listed on the Toronto Stock Exchange. The shares were trading at around $1/share at the time of the Rio Tinto announcement, down from a high of more than $20/share in early 2011.
The Pebble project has drawn widespread opposition. In late February, the U.S. Environmental Protection Agency (EPA) initiated a 404(c) review process under the Clean Water Act “to identify appropriate options to protect the world’s largest sockeye salmon fishery in Bristol Bay, Alaska, from the potentially destructive impacts” of the Pebble project (E&MJ, April 2014, p. 10).
The EPA review process effectively blocks completion of the Pebble permitting process until the review is complete. In initiating the review, the EPA stated it received more than 850,000 requests from citizens, tribes, Alaska native corporations, commercial and sport fisherman, jewelry companies, seafood processors, restaurant owners, chefs, conservation organizations, members of the faith community, sport recreation business owners, elected officials, and others asking it to take action to protect Bristol Bay.
EPA regulatory actions such as its Pebble project review have drawn industry and political criticism. Sens. David Vitter (Republican-Louisiana) and Joe Manchin (Democrat-West Virginia) have introduced a bill, the Regulatory Fairness Act of 2014, that would limit the time period during which the EPA can deny permits and that also would prevent the agency from revoking a permit once it has been issued.
The bill targets what is seen as a pattern of EPA regulatory overreach and does not specifically cite the Pebble project. “The Regulatory Fairness Act of 2014 would give American businesses a fair shot at going through the process of building or mining without having to worry about politics getting in the way,” Vitter said. “After seeing the EPA grossly overstep on established permitting procedures, it’s clear that this legislation is necessary to prevent a serious disincentive to investing in America and distinctly state what the EPA can and cannot do.”