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“Trump’s Gold” from Stansberry’s Investment Advisory

A Quick Check of Stansberry's ad: "Will Trump Open Development of the World's Biggest Gold Mine... Right here in America?"

By Travis Johnson, Stock Gumshoe, January 20, 2017

This is getting a little ridiculous.

I don’t think I’ve ever seen a single mining stock as aggressively endorsed by investment newsletters as Northern Dynasty has been over the past few months. So this is just a short note to let you know that, yes, you can add another one to the pile — it’s not brand new, Porter Stansberry has been sending out this ad for at least a week or so now, and it’s dated January 3, but a recent ad for his Stansberry’s Investment Advisory is pitching Northern Dynasty as “Trump’s Gold.”

The argument is functionally identical to the arguments that have been made in favor of Northern Dynasty Minerals (NAK, NDM in Toronto) by many others over the past several months — that the EPA overstepped its authority by blocking the permitting process for the Pebble Mine, which by many estimates would be the largest gold and copper mine in the world if it is built, and that the EPA is going to back off or lose in court.

The argument was reasonably compelling back in the Summer and Fall, when it looked like there would be movement in the court case (Northern Dynasty sued the EPA), with both sides agreeing to mediation… and it became more compelling after Trump’s surprise election victory, mostly because Northern Dynasty said they had met with Trump’s nominee for the head of the EPA and because candidate Trump pretty consistently talked about rolling back environmental regulations, which was widely interpreted as opening up the floodgates for new mine development (or, at least, for letting Northern Dynasty proceed with the permitting process to see if the mine can be safely built without undue risk to Bristol Bay and the large salmon fishery there).

That’s why I have a position in Northern Dynasty through some derivatives, mostly long-term warrants — I think there’s a reasonable chance that the permitting will be allowed to proceed, either because of executive action or because Northern Dynasty wins in the courts over the next 6-9 months, and the absolutely massive size of the mine means that there’s a chance for large gains if the odds of this becoming a real project again improve in a dramatic way because of regulatory or legal action.

There’s still a risk, of course, that the mine won’t be built (or even released from purgatory so it can go through the permitting process) — and whether the probability of that happening is 10% or 90% or somewhere in between, it’s important to note that if the Pebble Mine can’t eventually get permitted and built (as was the widespread assumption until just a few months ago), the stock is essentially worthless. The huge size of the mine makes it a reasonable risk-reward speculation for me, but I think of it like a spin of the roulette wheel… you know that you’ll win big if they ball lands on black, but you’re not sure whether there’s one black square or 20 black squares on the wheel, and landing on red means your money is gone.

Many people have much, much more conviction than I do that the mine will be permitted and that President Trump will call off the EPA’s lawsuit within moments of taking office, which would give you perhaps more certainty that there are a lot more black squares on that roulette wheel than there are red ones, but remember: newsletter editors don’t get bigger and more successful by being human and uncertain, they thrive by having strong and certain views and positions and opinions that get a lot of attention (Doug Casey hinted that this will be “Executive Order 0001”, after having previously talked about this as his biggest speculation in early November, and Marin Katusa, who also says he has personally invested heavily in Northern Dynasty, has spoken several times over the past year about his certainty that the mine will be built, just to give a couple examples — and yes, Katusa used to work for Doug Casey, which stopped when Casey sold his publishing business to… Porter Stansberry. Everyone’s interrelated in the newsletter world, time for a game of “six degrees of Bill Bonner”).

So that’s the story — “Trump’s Gold” is, of course, Northern Dynasty yet again… and it’s getting both newsletter and mainstream media attention (including this piece in Bloomberg yesterday). It’s still a far-from-production gold and copper mine, still is not allowed to enter the permitting process, and still is certainly a speculation — but a lot of its fate does rest in the hands of the new President and his Environmental Protection Agency appointees, and it could be, if allowed to proceed, the biggest mine in the world. I’ve laid my chips on the table, and will wait to see what happens.

It’s also worth noting that the huge volume of attention piled on Northern Dynasty because of the expectation that President Trump will do something to help them move forward has led not just to a much higher stock price (NAK has jumped almost 500% in six months, and almost 200% just since the election), but also to much higher expectations — including some folks who probably take literally the newsletter promises that President Trump will effectively send the Pebble Mine into permitting on day one (which is today, in case you haven’t noticed). If we assume that things don’t usually move that fast or that certainly when it comes to politics, we should also anticipate that perhaps those who were betting on a “day one” move to help Northern Dynasty could be disappointed and sell if progress is slower than that.

Disclosure: I personally have long exposure to Northern Dynasty Minerals through derivatives (options and warrants), as I’ve noted when covering other teasers for this stock over the past few months (I haven’t sold any yet). I will not trade in those positions or in the stock of the company for at least one week following publication of this note (usually the blackout period is three days, but I often extend it for volatile or illiquid securities).

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tonybocc
January 20, 2017 1:43 pm

“the expectation that President Trump will do something to help them move forward has led not just to a much higher stock price , but also to much higher expectations”

Riding the wave until we get closer to March, then I’m going to reevaluate.

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JDV1956
Guest
JDV1956
January 20, 2017 1:47 pm

NAK is trading at 52 week high, after trading on news and hype…will it actually take off? from here… I am not betting on it, as the entire region of this “potential find” is totally against any mining. That said the stock will probably move higher if the permitting process is granted…but NAK is a lonnng way from actually getting any type of ore out of the ground…I’ll sit on the sidelines and watch

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Karen
Karen
January 20, 2017 9:42 pm

Which doesn’t tell you much.

thinairmony
January 21, 2017 1:03 am

This is a subject that will never be politically correct. It’s like religion. Separation of Church and State is in the Constitution that the forefathers didn’t see as a problem. (But in today’s world if they had only seen. Hind sight is 20/20). Because any true Christian does not see Christianity as a Church or religion but a faith. In Ephesians Apostle Paul put it the best way. Saved by grace through faith not of yourself, least anyone boast. But I hope you readers get the point.

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lobstom
Member
lobstom
January 20, 2017 5:42 pm
Reply to  JDV1956

I can see that it might go into permitting, but get stuck there for say a long while. Looking at the size of the fishery this project has a lot going against it. If I were to jump in it would be atfter a major drop in share price. Like say the one coming up, Trump might help this project along, but he’s not going to turn it into a producer by spring.

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Marco Polo
Marco Polo
January 21, 2017 9:34 am

Not that you need any encouragement, but the way you’ve played this should be textbook for Irregulars; having exposure that can be capitalized on should the permitting go through-albeit that’s still a long way from pulling ore out via warrants etc., yet only having small dollars at risk should the investment target tank.
With all the newsletters hawing the play, I’d posit has much to do with the price rise vs. real analysis.
Well played!! And, a exposure to a lesson in investment learning for all us irregulars.
Thanks for “course:-)”

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thinairmony
January 20, 2017 6:21 pm
Reply to  JDV1956

Northern Dynasty [NAK] was $5.35High on 4-1-2004 and $21.72 High on 8-1-2007. It wash just .43 cents not long ago. Keep a eye on it. I plan picking up 1,000 shares. Now is the time to invest. Options are something I don’t understand good enough. To old to find someone explain it or a article written in old school language to underrstand. LOL

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Karen
Karen
January 20, 2017 9:41 pm
Reply to  thinairmony

…and stay away from things you don’t understand. For me, it’s annuities!

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Rusty Brown in Canada
Member
Rusty Brown in Canada
January 20, 2017 10:25 pm
Reply to  thinairmony

More like .43 dollars, I suspect. Or 43 cents.

santa
santa
January 21, 2017 9:03 am
Reply to  thinairmony

thinairmony, check out dough.com, tastytrade.com,tastyworks.com they will give you old school kitchen table talk info on options in free 15 minute video bites to chew on at your own pace. very highly recommend doughjo in dough.com on the left side bar

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SoGiAm
January 21, 2017 9:45 am
Reply to  santa

Thanks santa68. 🙂
Also, over 60 hours of videos and much more by Matt Owens available at http://triforcetrader.com/

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thinairmony
January 22, 2017 12:42 am
Reply to  santa

Will check that out tomorrow. Thnku thinairmony

david
Guest
david
January 22, 2017 9:10 pm
Reply to  JDV1956

I see very low grades so I think that there are other much better options with other miners

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thinairmony
January 20, 2017 2:17 pm

Stocks are like lending money. If you lend it don’t ex speck it back. Save’s a lot of anger and heart ache. Old Proverb. DAK is at $2.65 2:00 PM ET. I know you mentioned warrants once. I’m going to look at that and see how they work.

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thinairmony
January 20, 2017 6:39 pm
Reply to  thinairmony

I wrote DAK it should be as follows NASDAQ-Northern Dynasty symbol [NAK], I do not have any NAK.

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mseager
mseager
January 20, 2017 2:32 pm

New subscriber here, I’m loving this site Travis and Dr. KSS, your articles are so awesome and the comments are great too. I bought a small position in NAK after your previous article on Navellier’s newsletter. It’s up 10% since then, so happy to ride the wave and see where it lands.

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Dave S.
Dave S.
January 20, 2017 2:48 pm
Reply to  mseager

Might be wise to also use a trailing stop in case you aren’t yet. Small gold stocks can drop off of cliffs.

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jyoung0071
jyoung0071
January 20, 2017 4:00 pm

What are symbols for the warrants, exp dates and strike prices?

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KCBill
Member
KCBill
January 20, 2017 8:25 pm
Reply to  jyoung0071

Northern Dynasty Minerals has 3 classes of warrants trading on the TSX. The best place to learn about available warrants, preferred stock, etc is by going to the company/corporation website. Available options are available at my discount brokers website and I assume at all other brokerages also.

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Karl
Member
Karl
January 20, 2017 7:52 pm

My first stock to go +100%! I saw 112% today. Good to learn more about what’s driving the price up and what could kill it.

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MCGILTON98846
January 20, 2017 8:37 pm

I think not on (NAK) too much risk,with out real action.I did get some (SAND)SandstormGold though .Thanks Travis for that rep ort .Ihave ben watching (FNV) and (SLW)in a streamer stock,SAND fit in perfict for me .Please read threw my typing ,I only started on the computer two years ago when I retired after 32 years working as a prion guard.Thanks again for all of the great information. Groundhog

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Jason
Jason
January 20, 2017 8:56 pm

The locals voted against this project by a wide margin (statewide). If they try to go ahead with this anyway as was rumored way before the presidential election, then there may be big trouble ahead. Also it is a fact that after the election, donations to prominent environmental groups soared to all time highs and guess where a lot of that cash was headed

Karen
Karen
January 20, 2017 9:36 pm

After seeing Trump Champagne being sold off the counter at my local packy, think I’ll sit this one out. It’s all hype, imo.

Link Quist
Member
January 20, 2017 9:41 pm

I liked NAK below $2, but then again, if Trump does audit the FED and return us to a Gold Standard, then it is GAME ON for just about every Miner… I find more value in First Mining Finance at the moment, as it is trading at about $.64/share, but given the TOTAL SIZE of NAK, it is cheaper than Continentals’ (CGOOF) Buritica (~$3.40 but Fully Permitted), Lundin’s (FTMNF) Fruta del Norte (~$4.25 also Fully Permitted), NovaGolds’ (NG) behemoth Donlin, which is partially owned by Barrick, the KSM owned by Seabridge (SA) which is absolutely enormous with 75M oz Au, 440M oz Ag, and over 10Bn lbs of Copper trading for $9.60-Also Fully Permitted), Pretium (PVG)s Brucejack and Snowden (Trading now just OVER $10 and THE BEST BET w/$12 Calls expiring in June IMHO, which have total resources of over 51M oz Au, 240M oz Ag, and ~6.6Bn Lbs Copper AND is not only fully permitted, BUT WILL BEGIN FIRST POUR in Q1 This Year with RECORD LOW AISC, and Nevsun (NSU)’s recent acquisition of Reservoir Minerals.

Also really like the miners which will be bought out, for example Almaden, Auryn, Alacer Gold, Atlantic Gold, Barkerville, BTG, Gold Standard Ventures, Silver Lakes, Silver Bear, Midas Gold, Lexam VG, Mirasol Resources, Marianna Resources, Falco Resources, Integra Gold, Dalradian, Gowest Gold, Vista Gold, Minco Silver, Avino Gold and Silver, Sabina Gold and Silver, Alamos Warrants for JUNE 2017, Golden Minerals, Golden Arrow, Golden Reign, Golden Star, Golden Predator, Pure Gold, White Gold, Colorado Resources, Treasury Metals, Gran Columbia, and Optionality plays like Exeter, Jaguar, DRD, Chesapeake Resources, and Tower Hill…

How much bigger is Pebble Beach than Seabridge’s KSM?

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Marco Polo
Marco Polo
January 21, 2017 9:53 am
Reply to  Link Quist

Trump can’t return us to a gold standard, Congress has to, and the likelihood of that is the same as being lasered by an alien in Times Square at noon on Friday. The more interesting play is to get the Treasury via exec order to peg gold at $5,000/oz., or maybe $10K.
This is an old Rickards postulate. FDR actually did this when re-pegged from 20 to 35, and we had inflation, economic growth and moved up for a short time out of the depression era measurements; equities moved up. Then we wizzed it all away and back in the toilet we went with the rest of the “new deal” programs.
We have $20T in debt denominated in dollars let alone the unfunded liabilities also in dollars. At today’s price, there’s only $7Trillion of gold on the planet.

Re-pegging vs. letting the COMEX players jerk everything around, might work; although I think he’d get hundreds of invites to visit Dallas from the CB’s and their stooges.

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1paglee
1paglee
January 21, 2017 3:27 pm
Reply to  Link Quist

Link, if you bought NAK at less than $2 you are lucky — I bought a few thousand NAK at 2.06 and am delighted now, but the chart seems to be in a rounding top so it bears watching. I dived in when I read that a competent investment group around a month ago had invested $25 MM in a special deal at $1.75.

The charts for CGOOF look poised for growth — a P&F triple top now at 3.41 — if it penetrates to 3.50, I may buy some. But FFMGF is too cheap and I cannot find a symbol for Buriticia nor a chart for FTMUF.

Generally, gold miners are too volatile for my tastes, but NAK is a special situation with an unfair EPA killing.

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Myron Martin
Irregular
January 21, 2017 11:53 am

I owned shares in Northern Dynasty in its early stages and sold it at a good profit years ago when it became evident that permitting was going to be a problem. For several months now it has been appearing on my CIBC Alerts for both daily percentage increase and volume increases which at this point is definitely still speculation, so somebody is accumulating a lot of shares in anticipation of permitting finally being able to proceed. I bought in again last week, maybe I should have done so earlier, but I consider it a reasonable gamble because Trump’s inauguration has a high probability of changing the dynamics of the situation. Not necessarily a slam dunk, but a reasonable hypothesis that potentially billions of dollars waiting to be harvested and thousands of jobs created will carry the day however long it takes to actually implement. The potential for a price decline if Trump does not act quickly enough to suit fickle investors just looking for a quick profit is very real, but I am confident ways to develop a project of such enormous economic potential will be implemented by the new administration. As Travis noted, a 500% increase in 6 months and 200% just since the election makes this a well rewarded speculation for risk takers willing to take a positive view of the unfolding situation, and YES I am already up nicely even though I waited until the inauguration was imminent. Will probably buy more when the actual executive order is made public, whether it takes a few days, weeks or even months. No matter what happens I expect precious metals prices to rise whether Trump follows through on his “draining the swamp” rhetoric or not. If he fails to act, or borrows so much it sends the national debt skyrocketing, precious metals prices will rise as more and more people lose faith in fiat currencies and look for a safe haven to preserve their wealth.

thinairmony
January 22, 2017 1:04 am
Reply to  Myron Martin

Very good evaluation Myron Martain. There are a multitude of things as you pointed out. Holding gold and silver in one’s position is a good hedge. New 1oz.walking liberties silver Dollars and .10 oz $5.00 gold coin circulated are great also. One thing all angles have to be looked at wisely.

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Marc Pearsall
Guest
Marc Pearsall
January 21, 2017 2:47 pm

I have made several hundred percent on my NDK shares so far and have sold 1/2 my position, so I am sitting on ‘house shares’ now. That said, this mine will probably not go into production for at least 5 years, even if it’s permitted on Monday. I think this is a stock that you ‘buy the rumour, sell the fact’, which I will be doing soon after permitting. Northern Dynasty been a fun ride, and as another post mentioned already, lots of other junior mining stocks are good for 10 baggers from here.

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A. B.
Guest
A. B.
January 22, 2017 12:18 am

I really enjoy this website, and thank you to the Gumshoe for making it work.
As for the mine in Bristol Bay, while I am a big fan of gold/silver as counters to the sloppy fiat currencies, I am firmly opposed to wrecking this extraordinary part of Alaska with a filthy mine. I am sending a substantial part of my stock market winnings to the most vigorous environmental groups who will tie up this wretched mine in court until the whole project folds up like a cheap lawn chair.
Playing the stock market is one thing, but ruining the precious places on earth for some money is absolutely
disgusting.

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Jason
Jason
January 22, 2017 1:09 am

Isn’t this actually a Canadian company? They don’t give a rats —- about the U.S and may have already signed a contract with China to buy all the gold and that would be treason

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Andrew
Member
January 22, 2017 7:53 pm

Great info Travis, looks like the horse has bolted, been on quiet a run, dividend paying miners are not easy to find http://eqibeat.com/top-20-global-mining-stocks-by-dividend-yield/

rainsonme
rainsonme
January 22, 2017 8:31 pm

several small points. And I sincerely intend no offense; if I say something rude, I did not mean it.
1. I invest for money; its capitalism; its greed. I own MO, although I abhor cigarettes and discourage every smoker I know. If NAK pops with a barbarian in charge of EPA, my advice would be to buy NAK, make money on it, and donate that money to whatever environmental cause has the most impact.
2. The US will not be returning to the gold standard; it is not realistic; currency is rapidly moving the other direction into electronic abstratctions of an abstraction of an abstraction of something physical.
3. Trump is a populist. He wants soft money. WJ Bryant “free silver”, dont crucify mankind on a cross of gold. Trump has told you over and over again he likes debt, he is comfortable with high leverage and big debt. Trump will weaken the dollar dramatically as part of his re-invigorate US exports along with all the infrastructure and military spending.
4. I am not sure the commodity waterfall crash is truly ended, but it does seem like a combination of reduced regulations, continued low energy costs, and a promise of increased manufacturing should boost commodity prices and miners. I hold SAND, RGLD, and NAK. I will look at the guest post more closely, looking for some miners.

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SoGiAm
January 22, 2017 10:00 pm
Reply to  rainsonme

Rainsonme, believe this article shall interest you – link: http://www.stockgumshoe.com/2016/11/microblog-gold-and-silver-and-hard-asset-investmentsfall-2016/ Welcome and best2you.

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alaska51
January 25, 2017 9:37 pm

I am a commercial fisherman in Alaska for the past 40 years. The Pebble Mine will never be allowed. It can/will have a potentially devastati8ng impact on the biggest Sockeye salmon run in the world. Don’t waste your time and money. It ain’t gonna happen-ever.

hendrixnuzzles
January 30, 2017 2:24 pm

NAK…one thing Trump cannot do is create an economically viable gold deposit.

Can someone please show any evidence that all the gold there can be mined economically, even if the permitting is eventually completed ?

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Borealis
January 30, 2017 4:05 pm
Reply to  hendrixnuzzles

HN – regarding $NAK np – The Pebble Mine deposits are massive. Estimates run to $300 billion plus. It has the potential to be the largest gold deposit in the world. It is the largest undeveloped copper ore body in existence and may also hold the record as the largest ore deposit of its type in the world. My opinion is that a lot of money would be made if $NAK received all the needed permitting. The most pertinent question that needs to be asked here is whether the permitting will go through. If you are considering investing in $NAK and your investment thesis in $NAK is predicated on approval of the Pebble Mine, I would strongly advise you to tread carefully. There is a tremendous amount of opposition (with monied support). You will have a hard time convincing people that the extraction can be done safely without damaging the most prolific sockeye salmon run in the world, which is downstream. I don’t see how something of this scale can be built safely when considering the fact that it lies in an earthquake zone and could be subjected to a magnitude 7 earthquakes or greater. Mines operate for decades, but mine waste stays on-site forever. That’s a long time for a toxic solid-water slurry waste to be stored behind dams that must remain stable for centuries, through recurring earthquakes.

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Matthew
Member
Matthew
February 7, 2017 1:12 pm
Reply to  Borealis

This has already risen 10x what it was this time last year– is there any point expecting anything in the way of activity anymore, despite the seemingly huge influx institutional buying recently around the $1.50-$2.00 share point?
It seems like the $3.00 buy-to price given by Casey Research has held.

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carlosrivers
carlosrivers
February 16, 2017 5:00 am

its pulling back a bit here. Anybody know what Stansberry’s venture small cap stocks are from todays tease webcast? He claims 1) the next mcdonalds small cap. 2) a property damage insurance co business in a state in the richest part of the country making massive growth revenue gains.
He wanted 5999.00 for three stock picks which includes a lifetime subscription. His newsletters are getting kind of pricey. don’t know who would pay that much.

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galtgulch
Member
galtgulch
April 8, 2021 1:27 pm

President Biden is quoted on the subject of the NAK mine saying that from his point of view Alaska is not a place for a mine with his typical know it all attitude and condescending tone.
The fact that former President Trump was in favor of the mine being permitted to pursue the permits is reason enough to expect the President Biden will not yield on this.

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galtgulch
Member
galtgulch
April 8, 2021 5:58 pm

Appreciate your response. The company which owns the land the mine would be on has spent a small fortune jumping through the hoops to please those who must be pleased and have the power to let the company create quite a few jobs for Alaskans. They certainly have plans so that they do not pollute anyone’s nearby business or water supply. I own a few shares and hope that they get the go ahead in my lifetime or perhaps my grandson’s.

In the meantime the Court will decide.

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