Teck suspends B.C. copper mine due to wildfires

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Teck Resources Ltd. (TECK.B-TSX, TECK.A-TSX, TECK-NYSE) said its operations at the Highland Valley Copper mine in south-central British Columbia have been temporarily suspended due to wildfire activity in the region.

The decision to suspend operations was taken on August 14, 2021, and followed an evacuation order issued by the District of Logan Lake.

“All workers are being safely demobilized from the site with the exception of a small number of employees necessary to responsibly ensure safety and environmental protection,” the company said in a press release. “There is currently no risk to infrastructure of the operation,’’ it said.

Teck said it is closely monitoring wildfire conditions and will restart operations once the evacuation order is lifted and it is deemed safe to do so. It said the impact on production at Highland Valley is dependent on the length of the suspension.

The Highland Valley suspension order comes just days after Teck announced the resumption of operations at in Trail (B.C. smelter), which had been previously shut down due to wildfire-associated air quality issues.

On Monday, Teck’s Class B common shares dropped 3.04% or 87 cents to $27.72 on volume of 785,830. The shares are currently trading in a 52-week range of $32.27 and $14.37.

The Highland Valley Copper operations are located approximately 17 kilometres west of Logan Lake, and about 50 kilometres southwest of Kamloops, B.C. Teck has 100% interest in the operations.

Highland Valley produces both copper and molybdenum concentrates through autogenous and semi-autogenous grinding and flotation. Once processed, the metal concentrates are exported overseas, where the majority is sold under long-term sales contracts to smelters.

Copper production in 2021 is anticipated to be between 128,000 and 133,000 tonnes, with lower production in the first half of 2021. Annual copper production from 2022 to 2024 is expected to be 135,000 and 165,000 tonnes annually.

By comparison, Teck is developing the QB2 operation in the Tarapaca Region of northern Chile. QB2 is essentially a continuation of the existing Quebrada Blanca open pit operation, which is expected to produce up to 8,000 tonnes of cathode copper this year.

QB2 will boast an initial mine life of 28 years, the company has said. Project highlights include 316,000 tonnes of copper equivalent production per year for the first five full years of mine life, putting QB2 among the world’s top 20 copper producers.

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.

Meanwhile, due to the impact of west coast wildfires on transportation, the Vancouver-based metals giant recently trimmed its 2021 coal production forecast to between 25.0-26.0 million tonnes. That compares to the previous estimate of 25.5-26.5 million tonnes.

Teck’s met coal business accounts for 40% and 47% of attributable earnings before interest, tax, depreciation and amortization in each of 2021 and 2022.

 


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