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Pebble mine public meeting with EPA administrator Gena McCarthy
EPA administrator Gena McCarthy, center, listens to people voice their concerns about the proposed Pebble Mine during a meeting in the Iliamna Lake Lodge in Iliamna, Alaska. Photograph: Bill Roth/Anchorage Daily News/Alamy
EPA administrator Gena McCarthy, center, listens to people voice their concerns about the proposed Pebble Mine during a meeting in the Iliamna Lake Lodge in Iliamna, Alaska. Photograph: Bill Roth/Anchorage Daily News/Alamy

Anglo American pulls out of Alaska mines project

This article is more than 10 years old
Company withdraws from plans to develop vast open-pit gold and copper mines in an area of pristine streams and wetlands

Anglo American withdrew on Monday from plans to develop vast open-pit gold and copper mines in one of the last big wild salmon runs in Alaska's Bristol Bay.

The company said in a statement that it was pulling out of the Pebble mine project, spread across rolling tundra about 200 miles south-west of Anchorage, despite the huge mineral potential.

The area is believed to hold the world's richest gold deposits, but Anglo American's exit could now put the entire project in jeopardy.

"Despite our belief that Pebble is a deposit of rare magnitude and quality, we have taken the decision to withdraw, following a thorough assessment of Anglo American's extensive pipeline of long-dated project options," the company's chief executive, Mark Cutifani, said in a statement. The company faces a $300m penalty for quitting the project.

"Our focus has been to prioritise capital to projects with the highest value and lowest risks within our portfolio and reduce the capital required to sustain such projects during the pre-approval phases of development," he went on.

Anglo American's withdrawal and the uncertainty over the project brings a temporary pause to what had been expected to be a long and bitter fight between mining companies and their opponents.

The Pebble mine was seen as one of the most important environmental decisions on Barack Obama's second term agenda – even though it was overshadowed at times by the controversy over the Keystone XL pipeline.

The mining companies and their opponents were gearing up for a big and expensive lobbying and advertising campaign over the project. The two companies in the Pebble venture spent $500,000 last year to lobby members of Congress for its approval.

Monday's announcement from Anglo American may have been the result of growing uncertainty over whether the Environmental Protection Agency (EPA) would approve the project, in light of its threat to miles of pristine streams and wetlands, habitat for half of the world's sockeye salmon.

Every summer, 30 to 40 million sockeye salmon return to the bay to spawn.

Environmental campaigners and local native Alaskan communities had fiercely opposed the project, arguing that it posed a threat to the commercial fishing industry as well as their traditional way of life.

But even more tellingly for Anglo American were the signs that the EPA was disinclined to give the project a swift go-ahead.

The EPA administrator, Gina McCarthy, visited the project late last month in one of her first trips since taking charge of the agency.

Anglo American Pebble has already spent $541m on the project as of last June, the statement said.

But there were growing signs the project would run into further delays, because of environmental concerns.

The EPA in an environmental study released last April was scathing of the project, determining that the mine could wipe out nearly 100 miles of streams, and 4,300 acres of wetlands in the Bristol Bay region.

The study provoked a backlash from some Republican members of Congress who accused the EPA of being anti-industry.

McCarthy defended the study in her visit to Alaska last month.

"The EPA is all about making sound decisions," she told reporters. "We listen to people's concerns and we follow the science."

With Anglo American's withdrawal, ownership of what had been a 50-50 partnership on the project now reverts entirely to Northern Dynasty. The company's chief executive, Ron Thiessen, said the project would continue.

"Northern Dynasty will again own 100% of one of the world's most important copper and gold resources and will have the benefit of $541m worth of expenditures, which opens the door to a number of exciting possibilities for Northern Dynasty and its shareholders and the Pebble project and its stakeholders. Northern Dynasty and the Pebble partnership have both the expertise and resources necessary to advance the Pebble project."

Alaska's native tribes, which had strenuously opposed the project, said Anglo American's exit was a positive development.

"We have said for a long time that this would be the wrong mine in the wrong place," said Jason Metrokin, chief executive of the Bristol Bay native corporation. "The people of Bristol Bay overwhelmingly oppose the Pebble project. We are glad that Anglo American has recognised that the proposed mine is too risky, and we urge Northern Dynasty Minerals to do the same."

Tim Bristol, director of Trout Unlimited Alaska's programme, called on the EPA to follow up on Anglo-American's withdrawal and protect the area from mining. "I can't think of a development project in the state's history that has faced such wide and deep opposition," he said in a statement.

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