Northern Dynasty Minerals

October 4, 2011, Vancouver, BC -- Alaska Superior Court Judge Eric Aarseth has ruled in favour of the State of Alaska and the Pebble Limited Partnership (the "Pebble Partnership" or "PLP") in a case brought by anti-Pebble activists who charged that the state's system for permitting mineral exploration activity is unconstitutional, and that PLP's exploration program has caused environmental harm.

"This is not the first time that paid opponents of resource development in Alaska have sought to use the state's court system and its democratic processes to derail the Pebble Project before a development plan for the project has been proposed or state and federal permitting begun," confirmed Ron Thiessen President & CEO of Northern Dynasty Minerals Ltd. ("Northern Dynasty") (TSX: NDM), (NYSE Amex: NAK). "We are pleased to see that, once again, the rule of law has prevailed. This decision confirms that mineral resources on state land in Alaska are owned by the citizens of the State, and the right to pursue responsible development of those resources for the benefit of all Alaskans cannot be extinguished by moneyed special interests."

The lawsuit in question was filed in Anchorage Superior Court in July 2009 by Trustees for Alaska (an environmental law firm) on behalf of Nunamta Aulukestai -- an organization established and funded to oppose development of the Pebble Project. It alleged that the Alaska Department of Natural Resources (DNR) had violated the state constitution by granting exploration and temporary water use permits to the Pebble Partnership, and that PLP exploration activities had caused harm to vegetation, water, fish and wildlife. The Pebble Partnership actively participated in the trial proceedings after being granted intervener status.

Superior Court Judge Aarseth denied each of the allegations made by Nunamta Aulukestai, and ruled that no evidence of environmental harm was presented. He described one of the prosecution's expert witnesses, Lance Trasky, as providing "seat of the pants assertions (that) were simply not persuasive to this Court."

"It is not often that persons who oppose responsible resource development in the United States are called upon to prove their accusations with facts and empirical science, whereas resource developers are required to demonstrate how their proposals will meet strict environmental standards," Thiessen said. "The totally unsupported allegations of Nunamta Aulukestai in this case are illustrative of the rhetoric that anti-Pebble activists have used to alarm local people about the potential effects of the Pebble Project, a project that has not yet even entered the permitting process.

"The good news for supporters of responsible resource development in Alaska and the United States is that the legal system, the regulatory and permitting system and the rule of law in these jurisdictions are strong. The Pebble Project will ultimately be judged on its merits and the quality of the environmental safeguards it has established to protect fish, water, subsistence activities and other important values in the region. On that basis, we remain confident that Pebble is a technically sound and economically robust project that will provide significant benefits for local residents and the State of Alaska for decades into the future."

Other findings in Judge Aarseth's 154-page ruling in the case Nunamta Aulukestai vs. State of Alaska, DNR and Pebble Limited Partnership include:

• There is no persuasive evidence that drilling activities have caused impacts to fish or fish habitat.
• Plaintiff's evidence was insufficient to show that drilling activities have caused impacts to wildlife or wildlife habitat.
• There is no evidence that mineral exploration activities have caused significant and permanent impacts to vegetation.
• There is no evidence that exploration activities have impacted any archeological or cultural resources.
• Pebble's drilling operation and water withdrawals do not impact reasonable concurrent use of water by fisheries resources.
• Plaintiffs failed to show that Pebble's drilling operation impacted reasonable concurrent use of state lands by wildlife resources.
• Pebble's exploration activity has not excluded hunting guides.
• Plaintiffs failed to show that the exploration activity at Pebble has impacted or excluded subsistence users.

The proposed ballot measure has been opposed by a broad range of Alaska entities, including the State of Alaska, the Pebble Partnership, the Resource Development Council for Alaska, the Alaska State Chamber of Commerce, the Alaska Miners Association, Alaska Council of Producers, the Alaska Oil and Gas Association, Alaska Industry Support Alliance, among others. Alaska Native village corporations representing seven Native communities in the Lake and Peninsula Borough have also publicly opposed the ballot measure, stating that it would restrict economic development opportunities on their lands and throughout the region.

"We are strongly of the view, and this view is shared by many Alaska business and political leaders, that the initiative is unequivocally unconstitutional because it seeks to restrict development of state-owned resources on state lands through a municipal ordinance," Thiessen said. "We know that a large and growing coalition of elected leaders, business people and Native tribes in the borough have mobilized to defeat the initiative, and we're optimistic that voters will ultimately understand that it is a cynical attempt by outside interests -- notably a single wealthy lodge owner who has bankrolled the entire campaign -- to restrict all forms of development in their region.

"If the measure is passed, we're confident that the rule of law in Alaska will prevail yet again, and the proposed legislation will be struck down by the courts as being unconstitutional."

About the Pebble