Anglo American Establishes 50:50 Partnership with Northern Dynasty Minerals

On July 31, 2007, Anglo American plc (through a wholly owned subsidiary) became a 50 per cent partner with Northern Dynasty Minerals Ltd. (through a wholly owned subsidiary of its own) in a limited partnership in the Pebble Copper-Gold-Molybdenum Project in southwestern Alaska, by committing to make a staged cash investment of US$1.425 billion, based on certain milestones.

The purpose of the partnership is to engineer, permit, construct and operate a modern, long-life mine at the Pebble Project. The transaction agreements lay out a schedule to accomplish this goal, targeting completion of a pre-feasibility study in December 2008, a feasibility study by 2011 and commencement of commercial production by 2015.

Anglo's staged investment includes a committed expenditure of US$125 million to complete a pre feasibility study targeted at the end of 2008. After the completion of the pre-feasibility study, Anglo must, in order to retain its 50 per cent interest, elect to commit to investing a further US$325 million for a feasibility study, the completion and approval of which is targeted for 2011. This is expected to take the partnership to a production decision. Upon a positive decision to develop a mine, Anglo must elect to commit to make the next US$975 million of expenditures to retain its 50 per cent partnership interest, completion of which will meet the US$1.425 billion requirement. Thereafter, any further expenditure will be funded on a 50:50 basis. If the feasibility study is completed after 2011, Anglo's overall funding requirement increases to US$1.5 billion.

Anglo was represented by an in-house team headed by Ben Keisler and Vanessa Dennett and a team in Canada from McCarthy Tétrault LLP led by Roger Taplin and including Sven Milelli, Tony Knox, Ormonde Benson, Rob Miller, Sandy Gill and Sam Adkins (corporate), Rosemarie Wertschek and Robert Nearing (tax). Anglo's US counsel were Holland & Hart LLP (Denver) with a team comprising Bob Bassett, Kevin Johnson (corporate), John Wilson and Adam Cohen (tax) and Guess & Rudd P.C. whose team included Joe Perkins, Jamie Linxwiler and Mike McLaughlin.

Northern Dynasty was represented by an in-house team headed by Trevor Thomas and a team in Canada from Lang Michener LLP led by Bernhard Zinkhofer and including Amandeep Sandhu, Peter Torn (corporate) and Peter Botz (tax). In the United States, Northern Dynasty was represented by Davis Wright Tremaine LLP by Brian Todd and by Amodio Stanley & Reeves, LLC by Roberts Reges.