State lawsuit claims federal government owes Alaska $700 billion for quashing Pebble mine

Kaskanak Creek in the Bristol Bay's Kvichak watershed is seen from the air on Sept. 27, 2011. Threats to the watershed and other sites were cited by the Environmental Protection Agency when it issued a decision barring permitting of the Pebble mine. But the Dunleavy administration and Northern Dynasty Minerals Ltd. have taken legal action to try to reverse that decision. (Photo provided by Environmental Protection Agency)

The federal government owes Alaska more than $700 billion in compensation for the 2023 Environmental Protection Agency action that blocked development of the massive and controversial Pebble Mine in Southwest Alaska, Gov. Mike Dunleavy’s administration claims in a lawsuit filed in a federal court.

The lawsuit, filed Thursday in the U.S. Court of Federal Claims in the District of Columbia, is part of a flurry of legal actions by the state and the mine’s would-be developer that seek to revive the massive copper and gold project.

The state and company legal actions follow an unsuccessful attempt by the Dunleavy administration to have the matter decided directly by the U.S. Supreme Court. In an unusual legal maneuver, the Dunleavy administration last July petitioned the Supreme Court to rule on the matter without having lower courts weigh in. The Supreme Court in January declined to take on the case.

In its complaint filed Thursday with the U.S. Court of Federal Claims, the state cited an estimate for 100 years of production to support the $700 billion figure. And it said Alaska had been depending on Pebble development for its economic future.

“No land-use project in recent memory was more important to the State than the Pebble Deposit. It would have generated billions of dollars in revenue for the State and tens of thousands of jobs for Alaskans, many of whom are rural residents with limited economic opportunities,” the complaint said.

Vancouver-based Northern Dynasty Minerals Ltd. and the Pebble Limited Partnership, of which Northern Dynasty is the sole owner, filed parallel lawsuits with the same aims.

One, filed on Thursday in the U.S. Court of Federal Claims, seeks compensation for loss of opportunity to develop Pebble. Unlike the state case, it does not seek a specific dollar amount, but it says that the Pebble Limited Partnership has spent over $1 billion to date to acquire the property and pursue the mine’s development.

The second, filed Friday in U.S. District Court in Anchorage, seeks to overturn the EPA’s January 2023 decision to invoke a rarely used Clean Water Act provision to bar permitting of the Pebble project.

The state anticipates filing its own challenge to the EPA action in U.S. District Court,the Department of Law said in a statement released Friday.

Northern Dynasty’s chief executive officer said of the two company lawsuits, the substantive claim challenging the EPA action is the more important legal effort.

Salmon sculptures that line the outside of the Bristol Bay Native Corp. building in Anchorage are seen on Feb. 21, 2024. Bristol Bay Native Corp. has opposed the Pebble mine, citing the region’s dependence on salmon. (Photo by Yereth Rosen/Alaska Beacon)

“Our priority is to advance the District Federal Court Complaint, because overturning the illegal veto removes a major impediment from the path of getting the permit to build the proposed mine,” Northern Dynasty President and CEO Ron Thiessen said in a statement. “The filing of the takings complaint puts the US Government on notice that we will be seeking very substantial compensation if they continue to illegally block the lawful permitting process. It is basically an insurance policy, ensuring that this case is available to us when, or if, we decide to pursue it further.”

The state and company legal moves drew rebukes from Pebble opponents, who have characterized the mine project as a dire threat to the Bristol Bay habitat on which major commercial, sport and subsistence salmon harvests depend.

“The State’s legal filing is unhinged, sounding more like conspiratorial rantings from some dark corner of the internet than a legitimate legal argument,” Tim Bristol, executive director of the advocacy group SalmonState, said in an emailed statement.

 “What the Governor and his appointees are saying is Federal rules and regulations do not apply to Alaska and when the law proves otherwise, they deserve astronomical amounts of money from American taxpayers. This is political posturing at its worst and pure legal fantasy. Reality is Bristol Bay’s wild salmon runs, the people who depend on them, and the jobs and income they provide. It’s deeply disappointing the Governor and his people have decided to turn their backs on one of Alaska’s most incredible renewable resources in favor of some wild, ideologically-driven delusion,” Bristol said.

Jason Metrokin, president and chief executive officer of the Bristol Bay Native Corp., also criticized the legal actions. In a statement, he said the EPA’s actions “are grounded in science and are supported by a majority of Alaskans.”

“It is simply a mistake for [Northern Dynasty Minerals] and the State of Alaska to continue to pursue the development of what could be North America’s largest open pit mine near the headwaters of Bristol Bay’s incredible salmon fisheries,” Metrokin said, adding that commercial fishing generates $2 billion in annual economic activity and over 15,000 jobs.

In a separate statement, Delores Larson, interim director of United Tribes of Bristol Bay, predicted that the new legal attempts would fail. “We are confident the courts will uphold the EPA’s protections and reject Pebble’s attempts to revive a mining project that Alaskans do not support and the science has shown time and time again would be devastating for the waters that support salmon habitat and our way of life. Our lawmakers must step up and take action to permanently protect Bristol Bay – our future depends on it.” 

Dunleavy, when asked at a Friday news conference about the state’s $700 billion claim, declined to make a prediction about its success.

“I have no idea. Right? You have a November election that may change the complexion of the world in this country,” he said.

He acknowledged that many Alaskans oppose Pebble but said he disagreed with that sentiment. “I’m not going to stop saying that the proper development of any mining claim in the state of Alaska, including Pebble, is a bad thing,” he said.

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