A 15-year fight to mine for gold along Alaska’s pristine Bristol Bay might have just ended — with a whimper.

Canadian mining firm Northern Dynasty Minerals has been a hot topic in investment advice since Election Day. The company’s stock jumped 326 percent after Donald Trump’s victory, as newsletters feverishly pitched the company’s prospects under the new regime. One even went so far as to label the stock “Trump’s Gold.”

But Northern Dynasty’s long-planned gold and copper mine, located inside a key salmon spawning habitat, is less a secret fortune-maker and more an elaborate pump-and-dump stock scheme, investment analysts from Kerrisdale Capital said Tuesday.

“All this enthusiasm is misplaced. We believe Northern Dynasty is worthless,” the analysts said in the note. Despite the stock jump, the company is actually “worth nothing because its key asset is not commercially viable.”

Kerrisdale is a private, New York-based investment management firm.

The firm’s note is a potential death blow to Northern Dynasty Minerals’ Pebble Mine project, which fishermen, conservationists, Alaska natives, and environmental groups have fought against for more than a decade. The sheer size and value of the wilderness area at stake made Bristol Bay one of the most prominent battlefields for environmental activists.


Bristol Bay has remained undisturbed by commercial development due to its remote geography. But it’s no mere pretty landscape. The area is home to a $1.5-billion annual salmon fishing economy and produces half the world’s supply of wild sockeye salmon, according to the Natural Resources Defense Council.

“The Pebble Mine concept represents siting the worst possible project in the worst possible place,” Center for American Progress associate director of ocean policy Shiva Polefka told ThinkProgress. “Copper mine waste is especially toxic to trout and salmon, and Northern Dynasty wants to locate a huge reservoir full of it at the headwaters of a fishery that is invaluable to Alaska native culture, and one of North America’s crown jewels for the fishing industry.”

Mining would inevitably spoil that habitat and destroy that sustainable fishing economy. Dammed-up toxic waste would almost certainly spill into the watershed eventually, given the site’s location along the earthquake-prone “Ring of Fire.” Coalitions of businessmen and environmentalists have objected vigorously ever since the first exploratory drilling was done there in 2002.

The 15-year clash that followed ranks among the largest and highest-profile battles between unsustainable, pollution-heavy industries and environmentalists who argue the long-term economic and social value of preserving spaces like Bristol Bay far outweighs the short-term, privately controlled value that could come from mining there.

“This investor report confirms what sportsmen have known for more than a decade. The real investment is in Bristol Bay, not the Pebble Mine,” said Samuel Snyder, Alaska Engagement Director for Trout Unlimited. “Protecting Bristol Bay is one of the most important conservation issues of for American sportsmen. I hope that President Trump will be a leader in standing up to a foreign mining company to protect one of the greatest American fisheries.”


Rumors of Pebble’s death have proved premature in the past — Northern Dynasty continues to pursue the estimated $350 billion in gold and copper ore beneath Bristol Bay even after three larger mining companies abandoned the project between 2011 and 2014 — but Kerrisdale’s note on the project Tuesday is damning.

The findings savage the project and company alike, in far more fiery language than the dry, nerdy econospeak that is typical in such investment notes. The Kerrisdale report is the equivalent of an opera critic turning in a column composed entirely of “your mom” jokes.

“[T]he upfront capital costs necessary to build and operate the mine are so onerous that the mine isn’t commercially viable,” the analysts said.

The details of Pebble’s impossible math are surprisingly simple. The precious mineral deposits present are so low-grade — a pound of gold and copper ore per 99 pounds of rock — that extracting them would require massive infrastructure and intensive chemical treatment.

That physical reality was largely what motivated the EPA to declare the project unviable in environmental terms — all that construction, combined with 10 billion tons of toxic waste sitting behind earthen dams that could break or leak at any time, amount to doom for the Bristol Bay salmon run — and it is the prime driver of Kerrisdale’s scorching advisory on Tuesday.


“Though the legal and regulatory problems that will continue to plague the Pebble project even under a Trump presidency are enormous, the project’s Achilles’ heel is more fundamental: economics,” the note says.

The analysts further report accusations from insiders that as far back as 2013 Northern Dynasty covered up internal research that found the project was economically impossible, concealing the math that dooms Pebble Mine from the public in favor of “a hidden agenda of telling a good story.” Former project partner Anglo American had dropped half a billion dollars into Pebble, before it simply walked away in 2013 while “making no effort to renegotiate the terms of its deal instead of simply exiting.”

While the jump in Northern Dynasty stock since Election Day is based on the idea that the mine’s problems “stemmed entirely from regulatory concerns that will now abate,” Kerrisdale’s analysts write, the truth is Pebble’s startup costs are more than twice what Northern Dynasty claims.

“President Trump’s EPA may be easier on the mining industry than President Obama’s,” they add, “but it can’t make a success out of a value-destroying boondoggle.”