* Environmental Baseline and geological data aside, uncertain economic value due to EPA action as further described in slide 2. 3 Resource ? World Class – Tier 1 by every measure – Pebble is strategic First -World Location ? Alaska USA – State land – Exploration & Development designation ? Politically stable -history of responsible resource management and rule- of- law ? Very significant benefits to USA, Alaska and the region Resolution ? Multi-prong strategy to resolve impasse with EPA ? Position Pebble to initiate permitting unencumbered by any extraordinary development restrictions Re -Partnering ? Mining cycle has turned ? The kind of long-life asset that major mining companies covet Re-Positioning ? Strategic initiative to restore balance to public debate and prepare Pebble for permitting ? Change the face of Pebble through key partnerships with Alaska interests The Asset ? $US 750+ million invested to date in Project* ? Including $US 150 million Environmental Baseline Document ? Rigorous science facilitates the best mine ? National Environmental Policy Act (NEPA) permitting process well established Compelling Value ? EV/Resource Basis – Northern Dynasty is compelling value Catalysts ? Trump Presidency – a return to normal permitting ? The Three R’s ? Northern Dynasty and Pebble Limited Partnership are com
A World-Class Mineral Resource
* Refer to table of Measured, Indicated and Inferred
Resources in Appendix ? 6.44 B tonnes of Measured & Indicated
? 4.46 B tonnes of Inferred Resources Measured & Indicated Inferred
Copper 57 B lb
25 B lb
Gold 70 M oz 37 M oz
Molybdenum 3.4 B lb 2.2 B lb
Silver 344 M oz
Pebble
– ‘Multi-Prong’ Strategy in Action • Federal Advisory Committee Act (FACA) litigation - Preliminary Injunction granted - EPA Motion to Dismiss denied - Depositions ongoing • Freedom of Information Act litigation – a significant success • Cohen / DLA Piper – Highly critical, independent report – released October 2015 • Media Strategy – Washington Post, WSJ – beginning to lay bare EPA misconduct • Inspector General report – Found misconduct by one EPA official • Congressional Activity - Several congressional committees conducting or considering hearings • Objective of resolution with EPA remains top priority - Joint Notice for mediation filed with Federal court by PLP and EPA - Joint motion for legal ‘stay of proceedings’ – Approved by Federal Court - Indicates both sides seek resolution to impasse
Trump Election Victory – A Return to Normal • President - elect
Donald Trump’s Administration is widely expected to re-visit EPA’s unprecedented ‘pre -emptive’ veto • A timely return to a normal permitting process is anticipated: – Clean Water Act 404 permit application in 2017 – Environmental Impact Statement process under National Environmental Policy Act – US Army Corps of Engineers serves as lead federal agency
Pebble: The Path to a Record of Decision NEPA and 404 Permit Process • For a project like Pebble once an application has been filed: – Scoping – ½ year – Prepare Draft EIS – 1 - 1½ years – Public Comments – ½ - 1 year – Final EIS/ROD – 1 year – Total = 3 – 4 years • Our View: – EPA will not proceed to a preemptive 404c veto or development restriction – Pebble will get a 404 permit
10 Pebble Project – National Economic Impact Study 1 Pebble can help address Alaska’s fiscal crisis • Nationally – 15,000 jobs – $2.7 billion to US GDP annually – Increase US copper production by 20% over decades of production • In Alaska – Some 3,000 high- wage jobs – $109,500 average annual salary for mine workers – more than double the state average – More than $1 billion in annual operating expenses – Pebble- related economic activity in Alaska will boost the state's GDP by more than 3% over 2011 levels • Pebble will literally transform the regional economy in Bristol Bay – Secure, high-paying jobs – Of 5,394 working- age residents, just 63% worked in 2011 and only 35% were employed throughout the year – Increase Lake and Peninsula Borough tax base by a staggering 600% annually over 2013 levels – Potential for affordable power for Southwest Alaska
Milestones
Pebble Project Milestones
– Completed and Projected 18 2016 • Resolve EPA’s ‘Proposed Determination’ and position Pebble to initiate permitting unencumbered by any extraordinary development restrictions • Advance conversations regarding potential partner(s) transaction • Negotiate transportation corridor agreements with Alaska Native village corporations • Enhance public and political support for the Pebble Project ? ? ? 2017 • The Three R’s • Resolution with EPA: position Pebble to initiate permitting unencumbered by any extraordinary development restrictions • Re -partner: advance ongoing partner conversations to a successful conclusion • Re -position: begin roll -out of strategic initiatives to restore balance to public debate on Pebble • Advance key Alaska and Native partnerships • Advance into US Army Corps of Engineers -led permitting process once the 404(c) action is withdrawn • Finalize transportation corridor agreements with Alaska Native village corporation landowners 2020 • Feasibility study completed • Project construction commenced 2024 • Commercial production
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Investment Conclusions – A World-Class Investment Opportunity ? World-Class Resource ? US$750+* million invested ? Great Location ? Fisheries and mining can safely co-exist ? Strategic Advantages ? Very Important Economic Benefits for Alaska and USA ? Conclusion ? Pebble is a world-class deposit ? Resolution with EPA,
Re -partnering and
Re -positioning are potential catalysts ? We believe Pebble will receive a 404 permit ? Compelling valuation ? Northern Dynasty and PLP are committed to delivering results Northern Dynasty Shares are Undervalued Listed NYSE MKT – NAK; TSX – NDM Shares Out (Fully Diluted) 270.9 (341.8) Million
Water Management – Surplus Water Situation 27 • Robust engineered water management system – all contact water collected, stored for re-use, treatment, &/or release – extensive seepage management collection & monitoring systems • State of the art water treatment & conditioning • Strategic surplus water releases – Scientifically proven habitat modeling (PHABSIM) to define flow habitat effects – Considers salmon & resident fish species for each key life stage Pebble will maintain downstream water quality & flows to safeguard fish, wildlife & communities.
Comprehensive Multi -Disciplinary Science Exhaustive data collection since 2004: Environmental Studies • Surface Water • Water Quality • Groundwater • Geochemistry • Snow Surveys • Analytical QA/QC • Fish & Aquatic Resources • Macro -i nvertebrates • Wetlands • Trace Elements • Flow Habitat Study • Iliamna Lake Study • Marine • Wildlife • Air Quality • Noise • Cultural Resources • Subsistence • Land Use • Recreation • Socioeconomics • Visual Aesthetics • Impact Assessment & Management • Mine Closure & Reclamation
Environmental Baseline Document (EBD) – January 2012
Scientific Integrity – Foundation for Successful Permitting 29 • State/Federal permitting requires scientific rigor • Pebble environmental science – unprecedented scope/rigor – $150 million spent on intensive multi-disciplinary studies over 9 years – 27,000 pages – Data collection and other preparatory work ongoing – Integrity of work unassailable – World class 3 rd party scientists • Empirical knowledge used to: – Characterize local environmental conditions – Provide unique guidance to optimize engineering design – Assess residual effects and inform mitigation measures – Establish a database for long- term project monitoring – Facilitate effective permitting – Counter ill -informed negative rhetoric • Conclusions: – We have the science to build and operate a safe mine – Fisheries and mines can & do co- exist
Pebble Limited Partnership Approach – Responsible Mineral Development • Environmentally driven design – Engneers and Scientists collaborate on optimal design • Avoid, minimize, mitigate and compensate • EBD science informs the project impacts which in turn inform mitigation response and design • Mitigation possibilities include: – In-s tream habitat improvement – Improves existing and/or creates new habitat – “Off channel” habitat improvement – Creates new habitat – Water discharge – Project will have stringent water quality standards. Pebble site has excess water . Depending on water usage, flow at Pebble will be distributed spatially and temporarily to maximize downstream fish habitat • Habitat suitability modeling • Very helpful during periods of natural water flow reduction • Wetlands – “in kind” and “mitigation banks” • Exceptional commitment to the environment – Great neighbor • Conclusion – No net loss of any fishery – AND enhancement possibilities abound – Fisheries and mining do co- exist around the world
• Numerous Pebble/Bristol Bay streams not producing fish at full potential due to natural constraints: – beaver dams & other barriers – dewatered & relic channels – low habitat complexity – limiting water quality – poor seeding due to low escapement • Significant opportunities exist to apply proven techniques to remove constraints & enhance fish production: – agency friendly – proven success with +50 years of fish habitat mitigation track record – typically low technology measures – cost -effective • Strategic surplus water releases using PHABSIM
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