{"id":1206398,"date":"2020-09-09T14:05:38","date_gmt":"2020-09-09T19:05:38","guid":{"rendered":"https:\/\/www.mining.com\/?p=1035090"},"modified":"2020-09-09T23:05:00","modified_gmt":"2020-09-10T04:05:00","slug":"short-seller-says-northern-dynasty-is-gaslighting-investors","status":"publish","type":"post","link":"https:\/\/juniorminingnews.com\/?p=1206398","title":{"rendered":"Short seller says Northern Dynasty is \u201cgaslighting investors\u201d"},"content":{"rendered":"

J Capital Research, a company founded in China a decade ago usually targets overvalued media and tech companies for short-selling, but has now set its sights on the mining industry, specifically on gold explorers.<\/p>\n

Back in June, JCap said the Donlin project in Alaska, which is 50-50 owned by Novagold and Barrick, \u201cwill never be built\u201d and \u201cin short, is a stock promote, not a mining plan<\/a>.\u201d Surprising no-one, the matter became the subject of lawsuits<\/a>.<\/p>\n

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“Since management is bonused on lobbying success instead of for producing minerals, NAK has no reason to care that the new plan is irrational”<\/p>\n

J Capital Research<\/cite><\/p><\/blockquote>\n<\/figure>\n

On Wednesday, JCap went after Vancouver-based Northern Dynasty Minerals (TSE:NDM, NYSEAMERICAN: NAK) which is advancing another giant Alaska copper and gold project called Pebble.<\/p>\n

In a report titled Pretend and Extend \u2013 The No Return Deposit<\/a>, New York-based JCap, in typical fashion, pulls no punches accusing Northern Dynasty management of \u201cgaslighting investors\u201d and said the latest mine plan \u201cis on its face absurd\u201d: <\/p>\n

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\u201cWe believe Northern Dynasty has crafted a money-losing mining plan to achieve government approvals. Since management is bonused on lobbying success instead of for producing minerals, NAK has no reason to care that the new plan is irrational: we think it will lose money, leave investors with a stranded asset, and be canceled anyway if Joe Biden is elected.<\/p>\n<\/blockquote>\n

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\u201cSo why has NAK twisted itself into this knot? The CEO of Pebble Partners, the operating entity for NAK\u2019s low-concentration gold and copper deposit, will receive $4.4 mln of the promised $12.5 mln bonus for winning a green light just to start the permitting process.<\/p>\n<\/blockquote>\n

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\u201cWe believe that the deposit cannot be mined profitably and that mining majors Anglo American (AAL L) and Rio Tinto (RIO US) know that. AAL withdrew from its partnership in the mine in 2013 after spending $500 mln. Rio gifted its 19.1% stake in NAK to two Alaskan charities. One of those, the Bristol Bay Native Corporation, benefitting people in the impacted Bristol Bay area, promptly sold off the shares. <\/p>\n<\/blockquote>\n

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\u201cThe local people clearly don\u2019t believe in the mine. What\u2019s more, NAK has claimed poverty to dodge a feasibility study, which would demonstrate economic viability. Pebble CEO Tom Collier said they did not have the money to pay for one despite the fact they have spent $1 bln and such a study would cost $80 mln at most.\u201d<\/p>\n<\/blockquote>\n

Northern Dynasty\u2019s share price has been on a white-knuckle ride over the past few weeks after doubts about its ability to secure the necessary approvals for Pebble and following rumours<\/a>, stoked by Donald Trump Jr’s opposition to the project, that the US president will block the mine.<\/p>\n

On Wednesday, investors in Northern Dynasty shrugged off the short-seller’s report, sending the company\u2019s shares 14% higher, affording it a $754 million market value in New York. The stock has doubled from its 2020 opening levels, but even after today’s bounce is down 52% from its summer highs.<\/p>\n","protected":false},"excerpt":{"rendered":"

In a scathing report, JCap says Vancouver promotors of giant Pebble copper-gold mine in Alaska are lobbying for bonuses, not producing minerals.<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"footnotes":""},"categories":[2849,949,369],"tags":[],"_links":{"self":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/1206398"}],"collection":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1206398"}],"version-history":[{"count":5,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/1206398\/revisions"}],"predecessor-version":[{"id":1206755,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=\/wp\/v2\/posts\/1206398\/revisions\/1206755"}],"wp:attachment":[{"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1206398"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1206398"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/juniorminingnews.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1206398"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}