Miner First Quantum Minerals could emerge with a 50 per cent stake in the world’s biggest undeveloped copper project, fanning hopes the controversial project in Alaska will finally get off the ground after years of environmental opposition.
First Quantum said it had signed an option agreement with the mine’s owner Northern Dynasty Minerals that will see it pay $150m over four years to help fund the permitting process for the Pebble project. The agreement gives the company the right to a 50 per cent stake in the project after a further $1.35bn investment, the company said.
The pact comes amid signs the administration of President Donald Trump could take a more favourable stance towards the project. Located in Alaska’s Bristol Bay, a center for salmon fishing, Pebble came under environmental scrutiny under President Barack Obama.
But Mr Trump’s appointee to the US Environmental Protection Agency Scott Pruitt directed his staff to withdraw a plan to protect the watershed of Bristol Bay, CNN reported in October.
“We believe a successful outcome to the permitting process for Pebble would deliver the potential for further growth in copper for First Quantum well into the future,” Philip Pascall, chairman and chief executive of First Quantum, said.
Mining companies are scrambling to increase their exposure to copper as analysts forecast a deficit of the metal by early in the next decade. Both Rio Tinto and Anglo American have previously had stakes in the project before selling out.
The agreement is expected to be finalised in the second quarter of 2018, First Quantum said.
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