Northern Dynasty Minerals Ltd. (USA) (AMEX:NAK)

diversified and well managed

Resources

It's all there - just need patience

LONG TERM ASSETS.

Pebble NPV..

Gold, new large fine

Acquisition target with great reserve potential.

Pros-Value of minerals in the ground, priced even conservatively, makes this stock a bargin.

Cons-still need funding for NAK's piece of the project, and extraction wont start until 2016.

big time potential

One of my favorite stocks for a long time, and my biggest winner in CAPS as of now. It's finally time to write some commentary.

To understand the potential of this stock, you have to study the history of a fraudulent company called Bre-X Minerals. Wikipedia and some other websites should have a summary.

Bre-X claimed to have discovered a monster gold deposit in the jungles of Borneo. At the mid 1990's gold prices, I think there was an estimated nearly $80 billion of gold in the ground - a veritable legend like El Dorado. The stock rocketed from some low single digits price to nearly $200. It was added to the Toronto Stock Exchange stock index. Fortunes were made.

Until the day it was revealed that Bre-X was a fraud. Not a little fraud, but a complete and total sham. The gold had been planted by salting the mine. Overnight the price of that stock collapsed, lives were ruined, and the legend of Bre-X ended in tragedy.

NAK is the same story, except this time, it is much much much bigger. The estimated gold value alone is nearly $150 billion. Including copper and other metals, the deposit contains nearly $500 billion dollars in metal value. I believe it is the single largest store of mineral wealth in the world. Unlike Bre-X, large mining companies have done close examinations and come away owning substantial stakes: Rio Tinto, Mitsubishi, and Anglo-American. These are major players that Bre-X was never able to get on board, because of course, the deposit was a fraud.

How should one value this deposit? At the current price the market cap is under $2 billion. Bre-X topped out at a market cap around $20 billion - and it was a complete fraud during a time when commodities weren't booming. So now someone tell me, what is a reasonable target for NAK, given that it has been verified by 3 large investors, and given that a commodities bull market cycle is in place?

An analyst said $71. At that price the market cap is still just $6.5 billion or so, nearly 1/3rd where Bre-X peaked.

Frankly I have no idea what the correct valuation is - the NAK Pebble mine might not even get approved. But if you study the history of Bre-X, you can forget the question of approval and permitting because it wasn't even real!

All it's going to take in NAK is the right psychological conditions to develop in the market - at that point history suggests this stock could be shooting star like few others.

The Northern Dynasty Pebble Project is the world’s most significant undeveloped porphyry system and one of the greatest stores of mineral wealth ever discovered. It has the potential to supply as much as one-quarter of America’s annual copper demand for more than 50 years, and up to 10% of the world’s annual molybdenum output. It is also the world’s largest gold resource.

Pebble is an advanced stage project located on American soil in southwest Alaska, listed by the US Geological Survey as the world’s most extensive mineralized system. It lies in close proximity to necessary power and transportation infrastructure and to shipping routes that serve key demand markets. The project setting presents few obstacles to successful mine and infrastructure development.

Northern Dynasty acquired the rights to the Pebble deposit and 153 square miles of associated resource lands in 2001. Since then, it has expanded known resources by more than 1000 %. With ~ 850,000 feet of drilling in ~1,000 holes, a significant percentage of mineralization at Pebble is in measured and indicated categories.

The Pebble deposit is among the world’s most significant accumulations of copper, gold and molybdenum. The deposit comprises 5.94 billion tonnes of measured and indicated and 4.84 billion tonnes of inferred mineral resources, and contains an estimated 81 billion lb of copper, 107 million oz of gold and 5.6 billion lb of molybdenum. Quantities of silver, palladium and rhenium also occur in the deposit.

With gold moving because of tremendous upward average buying volume, home-buyer tax credit being extended, which cause housing starts to increase, therefore cause the demand for copper to increase, and the expectation of the dollar regaining its purchasing power[NAK] should move positively, over the next year;

Also, the Pebbles Group, which owns a controlling interest has cut its invesment in half[from 140 million-to-70 million] which I believe demonstrates that they feel they can achieve their gross/net margins, with less investments.

NAK currently has a $44yr price target;..should be atleast $11 after 11/16/2009 [3rd quarter]earnings announcement;

DISCLOSURE: I own 7.50-put/call options.

As gold approaches 1000, this stock will make a nice jump.

Incredible resources in the Pebble Partnership.
Experienced management
The funds to develop the Pebble project are committed from Anglo-American, which clearly has the resources to meet that commitment.
Balanced approach to environmental and social issues.
Validation of business plan by Anglo-American, Rio Tinto and Mitsubishi.
The question is not whether NAK will make money, but when. Should have lot's of upside as they meet milestones in the development of the Pebble project.

market go down, gold go up

StockTA.com screen

Opportunity for jump on higher prices

We have this one going down but only for a very short period and based only on stock history charts:

http://www.stocktruth.com/chart.php?symbol=NAK

Northern Dynasty Minerals - A nice pop brings many questions asking what’s up? The share price didn’t seem to be the right answer. One could argue our friend from the Far East is buying. I can’t imagine they just wanted to go from 9% to 10%. Consolidation in the gold price should bring some profit-taking into NDM but the stock is starting to look good on the charts.