AJOC EDITORIAL: Cantwell letter to SEC latest nonsense over Pebble
Thanks to Sen. Maria Cantwell, the federal budget put forth by Sen. Patty Murray wasn’t the dopiest thing to come out of the Washington delegation last week.
On March 18, Cantwell sent a letter to the Securities and Exchange Commission asking the agency to investigate Northern Dynasty Minerals Ltd. for what she alleged may be “inaccurate information” filed with the SEC or “intentionally fraudulent” testimony by the company to the Environmental Protection Agency.
There has been a lot of nonsense surrounding the proposed Pebble mine, but Cantwell has set a new standard by making Murray look like the brains of the Washington Senate outfit.
Cantwell claims Northern Dynasty, the Vancouver-based co-owner of the Pebble prospect along with Anglo American PLC of London, is either misleading investors or the EPA about a preliminary economic assessment prepared by Waldrop released in February 2011 and filed with U.S. and Canadian agencies.
The Waldrop Report laid out the potential economic value of developing Pebble based on 25-, 45- and 78-year mine life scenarios.
The development scenarios described in the Waldrop Report were then used by the EPA in preparing its assessment of potential mining impacts on the Bristol Bay watershed released in May 2012.
Referring to the 2011 release of the Waldrop Report, Cantwell wrote to the SEC, “Northern Dynasty subsequently informed the SEC and investors that the proposed Pebble mine design and specifications are feasible and permittable in a press release from 2011 that is currently on file with your agency.”
Then, referring to the public hearings on the assessment conducted in Anchorage, Cantwell wrote, “Recently, however, the Northern Dynasty Minerals referred to the very same Waldrop Report as a ‘fantasy proposal’ when it delivered formal testimony to the EPA in August of 2012. This contradictory use of the Waldrop Report is extremely concerning as it is unclear whether Northern Dynasty Minerals is misleading investors by attracting investment for a ‘fantasy proposal’ or it is intentionally providing fraudulent testimony to the EPA.”
Perhaps it is unclear to Cantwell because her statements are the real fantasy.
First, let’s go back to the Waldrop Report, and what it actually says about Pebble being “feasible and permittable.”
Here is the sentence Cantwell is quoting from (emphasis mine):
“While the mineral development project described in this Preliminary Assessment is considered to be economically viable, technically feasible and permittable under existing regulatory standards in Alaska and the United States, it must be noted that no decision has been taken by the Pebble Partnership to seek permits for the project as described.”
That’s called a disclaimer, Sen. Cantwell.
No fewer than three times in the first six pages of the Waldrop Report are published disclaimers that the project as described may vary “in a number of ways” from what is ultimately proposed by the Pebble Partnership.
Now, consider Cantwell’s retelling of the August 2012 public hearings when she claims Northern Dynasty referred to the Waldrop Report as a “fantasy proposal.”
Following Cantwell’s citation to an Aug. 7, 2012, report by KTUU, we find Cantwell gets neither the context, the company nor even the quote itself correct.
According to the KTUU story, Pebble Partnership CEO John Shively was clearly not referring to the Waldrop Report but to the EPA’s hypothetical mine laid out in the draft assessment.
“The fantasy mine the EPA uses to measure the substantial impacts in this very large watershed has no basis in reality in the 21st century,” Shively said, according to the KTUU story.
Indeed, the mine described in the EPA assessment was savaged by the peer review panel assembled to critique the document.
Peer reviewer John Stednick of Colorado State University wrote: “The level of detail in the assessment of the potential system failures varies considerably and baits the question — why? Does this demonstrate lack of understanding of failure prediction, lack of failure prediction, or writing team expertise?”
Reviewer William Stubblefield of Oregon State University wrote: “… the potential reality of the assessment is somewhat questionable. It is also unclear why the EPA undertook this evaluation, given that a more realistic assessment could probably have been conducted once an actual mine was proposed ...”
Phyllis Weber Scannell, a former Alaska Department of Fish and Game biologist, wrote: “Some of the assumptions appear to be somewhat inconsistent with mines in Alaska.”
In short, Shively isn’t the only one calling the EPA mine scenario a fantasy. So are the peer reviewers hired by the EPA.
The other fantasy is that stupidity like this unfounded allegation out of a U.S. Senator’s office is in any way helpful to the process.