UPDATE 1-Shares in Alaska mine developer Northern Dynasty slump on EPA move

(Adds shareholder, conservation group comment, background, stock prices)

VANCOUVER, Jan 29 (Reuters) - Shares in mine developer Northern Dynasty Minerals Ltd fell as much as 26 percent on Monday after a U.S. regulator reversed himself and maintained proposed restrictions on the company's big copper and gold mine project in Alaska.

Both Canada-based Northern Dynasty and U.S. Environmental Protection Agency Administrator Scott Pruitt said on Friday the move would not derail the Pebble mine's permit application process. But it was the first sign the project's path may not be as smooth under the mining-friendly Trump administration as some analysts and the company predicted.

Pebble, located in Alaska's Bristol Bay region, holds one of the world's largest undeveloped copper and gold deposits. Its development, in one of the biggest sockeye salmon fisheries on earth, has been fiercely opposed for years by environmentalists, native groups and fisherman.

"The news was a surprise," said Chris Mancini, research analyst at Gabelli Funds, which owns Northern Dynasty shares.

Its U.S.-listed shares were down 20.3 percent at $1.22. In Toronto, the stock fell 20 percent to C$1.51 after dropping as low as C$1.39.

The Obama administration had proposed restrictions on the mine in 2014 due to environmental concerns. Last year, Pruitt started a process to reverse the proposal.

In a statement on Friday, Pruitt said he was suspending the process. "It is my judgment at this time that any mining projects in the region likely pose a risk to the abundant natural resources that exist there."

One environmental group applauded the move. "The Pebble Partnership has been touting that they had smooth sailing at the state and federal level for the past year... and with this news, they clearly don't," Nelli Williams, Alaska director for fishing conservation group Trout Unlimited, said in an email. (Reporting by Nicole Mordant in Vancouver; Editing by Chizu Nomiyama and Jeffrey Benkoe)