Northern Dynasty Minerals (TSE: NDM, NYSE MKT: NAK) shares fell on Monday after saying Rio Tinto (ASX: RIO, LON: RIO) is undertaking a strategic review of its stake in the Vancouver-based company, including a possible sale.
Rio, through an indirect subsidiary, owns 18.15 million shares of Northern Dynasty, representing about 19.1% of the Canadian-listed company, which owns the undeveloped Pebble copper-gold-molybdenum deposit in southwest Alaska.
The project is located 200 miles southwest of Anchorage on state land designated for mineral exploration and development. It is situated in a region of rolling tundra approximately 1,000 feet above sea-level, 65 miles from tidewater on Cook Inlet.
"As part of its review, Rio Tinto will consider the Pebble Project's fit with the group's strategy of investing in and operating long life and expandable assets, and with the strategy for its Copper business, which is focussed on its four producing assets (Kennecott Utah Copper, Oyu Tolgoi and its interests in Escondida and Grasberg), and two development projects, La Granja in Peru and Resolution in Arizona," Rio said in its statement announcing the possible divestment.
Shares of Northern Dynasty tumbled over 21% to C$1.40 in Toronto on the news, while Rio's shares in New York rose 0.65% to US$54.18.
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