February 14, 2017 was a dark day for The Pebble Partnership, its sole remaining partner Northern Dynasty Minerals, and the Pebble Mine.
The day went south early with the release of a detailed, 25-page report from a New York investment firm called Kerrisdale Capital, which clearly identified that it holds a “short” position on Northern Dynasty. Summarized yesterday in a blog post by my colleague Taryn Kiekow Heimer, the report is a relentless indictment of the project, of Northern Dynasty, and of their prospects for the future. The bottom line, according to Kerrisdale: “Northern Dynasty’s shares are worthless.”
The day got worse for Pebble with the convening of an almost two-hour teleconference hosted by Kerrisdale. Under intense and at times angry cross-examination by a string of individuals presumably concerned about the impact of Kerrisdale’s report on their investment portfolios, the firm’s analysts calmly and thoroughly answered each question with poise, specificity, and a comprehensive knowledge of the project and its history, leaving several frustrated callers to sputter in frustration that Kerrisdale’s report would cost investors “millions of dollars.” And indeed, Northern Dynasty shares saw a precipitous drop in value yesterday, plunging up to 40 percent, as well as a temporary halt to trading in the stock mandated by Canadian authorities.
By the end of the day, citing the Kerrisdale report, three experienced securities law firms had announced plans to initiate investigations of Northern Dynasty in anticipation of possible class action litigation against the company on behalf of its shareholders. And it is this development— the entrance into the decades-long Pebble Mine wars by these three securities law firms, Levi & Korsinski, The Rosen Law Firm, and Bronstein, Gewirttz & Grossman – that may ultimately prove to be the worst news of the day for Northern Dynasty. At last, its non-stop, self-serving, hyperbolic campaign to persuade investors that this uniquely reckless mining project has been resurrected by Donald Trump’s election will be tested in the bright light of federal securities laws.
The Pebble Mine is a project that makes no economic, environmental, or social sense. And the Kerrisdale report is only the latest proof. As stated in its conclusion, “[i]t’s not just some stroke of bad luck that everyone who has touched the Pebble deposit, from Teck to Mitsubishi to Rio Tinto to Anglo American to Northern Dynasty itself, has given up on it or tried to; the project is fundamentally and irretrievably flawed.”
This project must be abandoned — once and for all.