Teck Resources Ltd. [TECK.B-TSX; TECK.A-TSX; TECK-NYSE] said Thursday February 18 that it has achieved its target of 40% overall completion of the US$4.7 billion Quebrada Blanca Phase 2 (QB2) copper project in Chile, an asset that is expected to double the miner’s consolidated copper production.
The company said the on-site workforce has ramped back up to construction levels that were in place prior to a temporary suspension of construction activity aimed at limiting the spread of COVID-19.
The QB2 update was contained in 2020 Q4 and year-end results that were announced on Thursday. The diversified mining giant posted better-than-expected Q4 adjusted profit attributable to shareholders of $248 million or 47 cents and $561 million or $1.05 per share for the year.
Teck’s Class B common shares advanced on the news, rising 1.7% or 46 cents to $26.78 on volume of 1.2 million. The shares are currently trading in a 52-week range of $27.08 and $8.15.
“Without question 2020 was one of the most challenging years any of us have experienced as we worked to manage through the global pandemic and its impacts on people, communities and the economy,” said Teck President and CEO Don Lindsay. However, in Q4, he said the company delivered the strongest financial results of 2020, while also outperforming the same period in 2019.
Steelmaking coal sales came in near the top of the company’s Q4 guidance range at 6.1 million tonnes, with nearly 20% of sales to Chinese customers.
Teck’s copper business unit had a strong Q4 supported by an increase in copper prices. Copper production in the quarter was 78,100 tonnes with net cash unit costs of US$1.27lb.
QB2 is essentially as continuation of the existing Quebrada Blanca open pit operation in the Tarapaca Region of northern Chile, and is expected to produce up to 8,000 tonnes of cathode copper this year.
The first production is currently planned for the second half of 2022, but is dependent on the Teck’s continued ability to successfully manage through the impacts of COVID-19 among other things.
Teck holds an indirect 60% interest in Compania Minera Teck Quebrada Blanca SA (QBSA), which owns QB2. Sumitomo Metal Mining Co. Ltd. and Sumitomo Corp. together have a collective 30% indirect interest in QBSA. ENAMI, a Chilean state agency, has a 10% non-funding interest in QBSA.