Northern Dynasty Minerals Ltd (NAK)

[slazenger7]

1. TD and Gabelli have $4-6 USD price targets on NAK pre veto lift and pre partnering - suggests that the company is highly undervalued relative to even veto lift.

2. Precedent transactions in the space show this is highly undervalued. The company has shared a great deal of valuation information in their corporate presentation, which is currently being updated on their site. Suggest all longs review those pages when the presentation is updated.

3. Two precedents I have looked at which at least show back of the envelope undervaluation are:

A) Xstrata Peru sale of Las Bambas to MMG for $5.85 billion. At the end of 2013, Glencore gave the following resources numbers for Las Bambas: Measured and indicated, 1.21 billion tonnes grading 0.66% Cu and inferred, 500 million tonnes grading 0.50% Cu.

http://www.canadianminingjournal.com/news/copper-glencore-sells-las-bambas-for-5-85b-to-chinese/

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Pebble:

6.44 billion tonnes in the combined Measured and Indicated categories at a grade of 0.40% copper, 0.34 g/t gold, 240 ppm molybdenum and 1.66 g/t silver, containing 57 billion pounds of copper, 70 million ounces of gold, 3.4 billion pounds of molybdenum and 344 million ounces of silver; and

4.46 billion tonnes in the Inferred category at a grade of 0.25% copper, 0.26 g/t gold, 222 ppm molybdenum and 1.19 g/t silver, containing 24.5 billion pounds of copper, 37 million ounces of gold, 2.2 billion pounds of molybdenum and 170 million ounces of silver.

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Based on M&I Alone (not inferred) Las Bambas had 1.21 bn tonnes vs our 6.44, so 19% of our resource at a slightly better grade but not material.

$5.85 bn / .19 = $31.1 bn ALONE on a precedent valuation basis for the Cu deposit

This ignores the Au and Silver and Moly


Now I am not saying we are worth 31 billion RIGHT NOW but given that precedent it should tell people about potential.

B) Second Precedent is Donlin, which was acquired in 2006 Prepermit (same stage as Pebble, with 2006 Au Pricing for 1.5bn. Donlin, also in AK and 10 miles from the water is in the final stages of permitting now. It has ~38 % of the Au of Pebble.

On that precedent at 2006 prices our Au would be worth 1.5/.38 = $4bn AT 2006 prices ignoring the Cu and of course the huge price increases and change in outlook for Au since.

So prepermit is it asburd to say we are worth $6-8 billion off precedents for the Au and Cu at 2017 prices? I think not.

4. Other points to consider, we have had a 35% increase in institutional ownership in the last quarter. Names like Oppenheimer, Vertex1, Goldman, Millenium, Wellington, Hudson Bay, UBS,Aribter and Mackenzie with sizable positions. https://fintel.io/so/us/nak

5. Flatt family (Stirling) has a 10% stake in the company and funded NAK at the highest risk moment of its existence. They funded management to fight the EPA DURING Obama's term when there was no talk of Trump. Given how material that risk was and low probability of change with Dems in office, it shows the Flatt's clearly believe in the resource and the team. They are not in this for $3-4 dollars when taking that risk. If you don't know who the Flatt's are, Look up Bruce Flatt CEO Brookfield. A billionaire and one of Canada's top investors.

6. Stirling, or insiders never sold a share when it went to $3.50 - indicates they believe value is MUCH higher. And, as stated institutions have been adding

7. Float is decreasing and potential for a squeeze is increasing, in particular if retail continues to hold and act like institutions, chances of a squeeze are getting higher.

Float

295 mil shares O/S

- 31 mil (Stirling)
- 46 mil (Institutions)
- 24 mil (insiders)
= 195 Retail

Estimated 27 mil short based on last report of 24 mil and movement since

If only 30% of retail hold tight (58 mil) the float is then 136 mil (195-58)

Short interest off that 'effective float' is then 27/136 = 20% = Squeeze territory especially if more institutions keep adding on partner along with retail.


8. Industry Dynamics also create significant value enhancement over time given size of resource and desperate need by majors for large deposits in safe jurisdictions. FCX problems with Grasberg are an example.

http://www.bnn.ca/bankers-markets-anticipate-mining-m-a-at-pdac-1.690188

https://www.bloomberg.com/news/articles/2017-02-08/gold-miners-burned-by-bad-deals-are-once-again-rushing-to-m-a

9. The Enviro propaganda against this mine has been proven as such by even an EPA sanctioned and paid peer review and the media is catching on (second link and video)

http://www.nationalcenter.org/NPA646.html

http://www.foxnews.com/opinion/2017/05/24/john-stossel-new-york-times-pebble-mine-and-outrageous-smear-campaign.html

http://www.newsbusters.org/blogs/nb/tim-graham/2017/05/28/foxs-john-stossel-exposes-new-york-times-green-baloney-rich-jfk


Hope this dump of diligence is helpful to longs, and prospective buyers!

Just some important thoughts to consider as you think about value vs price for your position here.

Good Luck!

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