ANCHORAGE, ALASKA (AP) — The company behind a proposed copper and gold mine in Alaska faces lawsuits from investors claiming it misled shareholders who have seen an 85 per cent drop in stock value since the summer.
Two lawsuits filed in United States (US) District Court in New York claim Northern Dynasty Minerals violated federal securities law when project executives did not fully provide information about the project, The Anchorage Daily News reported on Friday.
Developer The Pebble Limited Partnership and parent company Northern Dynasty Minerals Ltd sought to build a mine about 320 kilometres southwest of Anchorage and near the headwaters of the world’s largest sockeye salmon fishery in Bristol Bay.
The project was criticised by environment groups and also condemned by Alaska Republican US Senators Dan Sullivan and Lisa Murkowski.
The US Army Corps of Engineers in late November denied a permit request, causing the company stock to lose half its value that day alone. Pebble Limited Partnership said it is appealing that decision, calling the rejection political.
McCarthy Lodge co-owner Neil Darish was named as lead plaintiff in a lawsuit filed on December 4. The lawsuit, similar to a complaint filed in mid-December, accused the company of making “materially false and misleading statements”, and failing to disclose the project was not in line with federal law and was much larger than proposed.
Northern Dynasty spokesperson Sean Magee said the company could not comment on pending litigation. The company previously said it had no formal, defined plans for the proposed mine other than the 20-year plan submitted to the US Army Corps of Engineers for approval, adding that additions would have required new state and federal reviews.
Darish told the Daily News on Wednesday that he bought Northern Dynasty stock starting in 2017, thinking the project could be built without putting salmon at risk. Northern Dynasty’s stock sold for USD2.23 a share in July. It sold for USD0.33 last Wednesday.
Darish said he lost more than USD10,000 because of his investment, and that he agreed to be named in the lawsuit after the company “made giant mistakes”.