Northern Dynasty Minerals
Northern Dynasty Minerals (NAK) is a mineral exploration company existing under the Business Corporations Act (British Columbia) focused on developing, through our subsidiaries, the Pebble copper-gold-molybdenum-silver mineral project located in the state of Alaska, U.S. (the Pebble Project). The Pebble Project is located in southwest Alaska, 19 miles (30 kilometers) from the village of Iliamna, and approximately 200 miles (320 kilometers) southwest of the city of Anchorage.1
Our Alaska mineral resource exploration business is operated through an Alaskan registered limited partnership, the Pebble Limited Partnership (the Pebble Partnership), in which we own a 100% interest through an Alaskan general partnership, the Northern Dynasty Partnership. Pebble Mines Corp., a 100% indirectly owned Alaskan subsidiary of the Company, is the general partner of the Pebble Partnership and responsible for its day-to-day operations.
In February 2014, the EPA announced the initiation of a regulatory action under the CWA to consider restriction or a prohibition on mining activities associated with the Pebble deposit. Much of the Company's efforts since that time have been focused around providing information and responses to ward off this action. The background and history of the regulatory action initiated by the EPA, and our efforts to address this regulatory action, are summarized in detail in our 2015 AIF, 2015 MD&A and our Q3 2016 MD&A.
Ongoing work by Northern Dynasty and the Pebble Partnership during 2016 has been concentrated on three key activities:
- advancing a Multi-Dimensional Strategy, as described in our 2015 AIF, 2015 MD&A and our Q3 2016 MD&A, to address the EPA's pre-emptive regulatory action under Section 404(c) of the CWA;
- maintaining an active corporate presence in Alaska in order to advance relationships with political and regulatory offices of government, Alaska Native partners and other stakeholder groups; and
- seeking potential partner(s) with greater financial resources to further advance the project.
On October 27, 2016, the Pebble Partnership and the EPA filed a joint Notice in federal court stating their intent to enter into mediation in an effort to resolve ongoing litigation under the Federal Advisory Committee Act (FACA). To date, no mediator has been appointed in these mediation proceedings.
On December 30, 2016, the Pebble Partnership and the EPA filed a joint Notice in federal court staying the ongoing FACA litigation until March 20, 2017, as part of an effort to resolve ongoing litigation and to provide the opportunity for the Company and the EPA to proceed with the mediation proceedings.
Our business objectives and milestones for 2017 are outlined below under Use of Proceeds.
Our current Multi-Dimensional Strategy may be impacted by the change in the leadership of the EPA that will be completed in the first quarter of 2017 as a result of the new Republican administration. We have had preliminary discussions with certain members of the new administrations transition team and believe, based on these discussions, that there is a possibility that the new leadership of the EPA will reconsider its position with respect to the EPA's previously proposed pre-emptive action under Section 404(c) of the CWA. This would allow us to proceed with our permitting process. These discussions are, however, not binding and there is no assurance that this change of leadership will result in the EPA reversing its position, and at this time we are still planning to proceed to mediation with the EPA. There can also be no assurance of the results of mediation with the EPA. In the event that there is a change in the EPA's position that results in the Company being able to proceed with its permitting process, we anticipate that 
our MultiDimensional Strategy will change somewhat, as the key objective of this strategy will in effect have been met, however, political and social license outreach efforts will continue, (ii) we will commence the preparation of documentation to initiate our applications for federal and state permitting under the CWA and the NEPA, and (iii) we may re-allocate some of the Multi-Dimensional Strategy budget to these permitting efforts. In the event that there is no change on the EPA position, then we will continue with our Multi-Dimensional Strategy and the related mediation proceedings with the EPA. Even if we are successful in our dealings with the EPA and commence the permitting process, there can be no assurance that we will be successful in securing the permits we require to proceed with development of the Pebble Project.
