Catch the Bullish Run on Northern Dynasty Minerals Ltd (NYSEMKT:NAK) Shares


Northern Dynasty Minerals Ltd (NYSEMKT:NAK) shares rose 10.53% to $3.36 and were unchanged in after-hours trading. Share prices have been trading in a 52-week range of $0.28 to $3.45 so it is currently approaching resistance. The company has a market cap of $998.06 million at 291.11 million shares outstanding.

Northern Dynasty Minerals Ltd is a mineral exploration company. Through its subsidiaries, the company holds interest in mining claims on State of Alaska land in southwest Alaska, the United States, which are part of the Pebble Copper-Gold-Molybdenum Project.

The Pebble Project is located in southwest Alaska, approximately 20 miles from the villages of Iliamna and Newhalen, and over 200 miles southwest of the city of Anchorage. The property consists of approximately 2,400 mineral claims and is situated over 1,000 feet above sea-level and approximately 60 miles from tidewater on Cook Inlet. The company is in the process of exploring and developing the Pebble Project.

Northern Dynasty Minerals Ltd is banking on support from the Trump administration when it comes to pursuing the Pebble Project, as this is seen to hold the second largest gold and silver reserves in the world and the ninth largest copper reserves. However, this project has been on hold due to the Environmental Protection Agency’s crackdown efforts during the Obama administration.

The EPA exercised its veto in 2014 to impose restrictions on Pebble, blocking it from applying for a permit, citing “potentially destructive impacts” to the world’s largest sockeye salmon fishery. This led Anglo American & Rio Tinto Group who were partners in Pebble until 2013, to walk away after permission-related challenges.

Now that Trump has expressed his intention to be less focused on environmental regulation and favor corporate America instead, investors are hopeful that Northern Dynasty Minerals could get the ball rolling with its mining efforts sooner or later. So far, the company has invested around $750 million in operations but stands to gain much more when it’s able to move past the development stage.

The company is also expected to find new partners or reestablish its previous relationship with Anglo American and Rio Tinto once mining is underway. This should help stop the bleeding in terms of costs and put the company on a much stronger financial footing to expand its operations. Last month, Northern Dynasty Minerals reported that it has closed its previously announced bought deal offering, including the exercise in full of the underwriters’ over-allotment option. This covered the sale of 20.24 million common shares at $1.85 per share for gross proceeds of US$37.444 million.

The proceeds of this sale are to be used for  theadvancement of the Company’s multi-dimensional strategy to address the pre-emptive regulatory action of the U.S. Environmental Protection Agency under Section 404 (c) of the Clean Water Act; the preparation of the Pebble Project for the initiation of federal and state permitting under the U.S. National Environmental Policy Act; environmental monitoring, engineering and environmental studies, field investigations and related technical studies to finalize a proposed development plan for the Pebble Project, enhanced outreach and engagement with political and regulatory offices in the Alaska state and U.S. federal government and among Alaska Native partners and broader regional and state-wide stakeholder groups, Alaskan corporate, tenure and site maintenance, general corporate purposes, and working capital requirements.

DISCLAIMER: There is a substantial risk of loss with any speculative asset, especially small cap stocks. The opinions expressed are those of the author, and do not constitute recommendations to buy or sell a stock. Do your own research before committing capital.