Northern Dynasty buys out Pebble interests

AP PHOTO/James Poulson/Daily Sitka Sentinel
Northern Dynasty Minerals Ltd. officials announced this week that the company is set to acquire a 100 percent working interest in the Pebble Project property north of Lake Iliamna.

In November, NDM purchased all of Teck Cominco American Inc.’s interest in a portion of the Pebble property labeled "Resource Lands" and last month bought Teck Cominco’s, 50 percent working interest in a portion known as "Exploration Lands."

In a press release in mid-March, NDM president and chief executive officer Ronald Thiessen said the company’s board of directors reached an agreement with Hunter Dickinson Group Inc., a related party, to acquire its 20 percent "remaining carried interest" in the resources and exploration lands of the Pebble porphyry gold-copper-molybdenum deposit.

Northern Dynasty will pay Hunter Dickinson with a little more than 14 million shares of NDM common stock, which Thiessen said represents about 20 percent of NDM’s market capitalization, a measure of the corporation’s value determined by the market price of its issued and outstanding common stock.

"As a result of the acquisition of the carried interest, Northern Dynasty will have acquired a 100 percent working interest in the entire Pebble property, subject only to Teck Cominco’s net profits interest in the exploration land’s portion of the property," Thiessen said.

When Teck Cominco sold its major Pebble holdings to NDM, it retained an interest in a portion of any profits. Specifically, it retained a maximum 4 percent pre-payback, net-profits interest and a 5 percent after-payback, net-profits interest in mine production from the exploration lands.

Northern Dynasty had until March 14 to acquire the remaining 20 percent of carried interest held by Hunter Dickinson.

Bruce Jenkins, chief operating officer of NDM, said NDM would be 100 percent owners of the mine property "as soon as the ink dries on the paperwork."

04/02/2005 - 8:00pm