Replies to post #9773 on Northern Dynasty Minerals Ltd (NAK)

[Giovanni]

Who is going to stick around for 6 years?
I Am a buyer @$1.00

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Northern Dynasty Minerals could receive up to $1.5 billion total, including $150 million within the next four years, but that's not guaranteed. It would also have to give up a 50% equity stake in the Pebble Project, which some analysts think is worth more than $1.5 billion. Given a lack of financial resources and that the only true bargaining chip is the asset itself, investors shouldn't be too surprised.

That said, there's plenty more uncertainty ahead that investors need to take into account. Here's a list of outstanding tasks that Northern Dynasty Minerals must complete between 2018 and 2025:

Goal

Time Frame

Engineering studies

2004 to 2019

Environmental and socioeconomic studies

2004 to 2022

First Quantum Minerals option execution

2017 to 2018

Permitting

2017 to 2021

Feasibility

2019 to 2021

Project financing

2019 to 2021

Design engineering

2020 to 2023

Construction

2021 to 2025

Production (ramp-up)

2024 to 2025

Data source: Northern Dynasty Minerals.



Many of these tasks are dependent on the successful and timely completion of preceding tasks. That means even the slightest delay in permitting, for example, would delay the start date for project financing, and so on.

While the timeline is reasonable and Northern Dynasty Minerals could complete each goal in the specified time, there are many factors outside of the company's control. Regulatory agencies could drag their feet during the permitting process, or First Quantum Minerals could still walk.

Case in point: The company already missed its self-imposed deadline to find a partner by the end of September 2017 (and having only a framework agreement in place means this task is still technically incomplete) and downsized the footprint of planned operations at Pebble. Therefore, it's reasonable to expect the path between now and production will deviate from current plans.

Investor takeaway
The Pebble Project is the world's largest undeveloped known copper and gold resource. That looks great on paper, and that alone is enough to draw the attention of investors. However, there's a lot of time between now and the estimated start of production in 2024. Given all the hurdles left to jump through spanning regulatory, engineering, and financial, it's best not to get greedy with Northern Dynasty Minerals stock at the present time.