Teck Resources - 2015 -

Our liquidity remains strong at approximately $4.8 billion, including US$3.0 billion of undrawn, committed credit facilities and $1.0 billion of cash at February 13, 2018. During the quarter, we extended the maturity date of our US$3.0 billion credit facility from July 2020 to October 2022. We expect to realize $1.2 billion in cash on closing of the sale of our two-thirds interest in the Waneta Dam, which we do not expect to close before the third quarter of 2018.


Fort Hills produced its first oil on January 27 and remains on track to reach 90% of capacity by the end of 2018. The first train is currently producing and ramping up to capacity. The two remaining secondary extraction trains are mechanically complete, are currently being insulated and expected to begin producing on schedule in the first half of 2018.


During the fourth quarter, we acquired an additional working interest in Fort Hills, increasing our interest to 20.89% from 20.0% for a cost of $121 million. Our interest has continued to increase and depending on the final project cost and funding elections we make, we expect our final ownership interest to be approximately 21.3%.


In December, we paid a dividend of $0.45 per share consisting of a supplemental dividend of $0.40 per share and our regular base quarterly dividend of $0.05 per share, which totaled approximately $260 million. In addition, taking into account our strong cash position, we also announced our intention to apply an additional $230 million to the repurchase of shares through March 31, 2018, of which 5.9 million Class B subordinate voting shares were repurchased for $175 million in the fourth quarter.


In November, for the first time, we were named as one of Canada's Top 100 Employers by Mediacorp

We received regulatory approval for our Quebrada Blanca Phase 2 (QB2) project in late August with a unanimous vote from Chilean authorities, a major step forward in advancing the project. Our search for an additional partner for QB2 continues to advance and our objective is ultimately to hold a 60–70% interest in the project. We are encouraged by our progress and continue to consider that a transaction may be announced in the fourth quarter of 2018.

In July, we completed the sale of our two-thirds interest in the Waneta Dam to BC Hydro for $1.2 billion cash. We recorded a pre-tax gain of $888 million, with no cash taxes payable on the transaction.

In August, we purchased US$1.0 billion principal amount of our near-term debt maturities, reducing the outstanding balance to US$3.8 billion. We recorded a CAD$26 million pre-tax charge on the transaction.

Customer sales in steelmaking coal in the third quarter were strong and would have significantly exceeded our guidance of 6.8 million tonnes. However, reduced volumes due to operating problems at Westshore Terminals once again negatively affected deliveries by approximately 250,000 tonnes and our revenues by approximately $55 million.

The Red Dog concentrate shipping season is expected to be complete in late October. We expect to ship approximately 1.05 million tonnes of zinc concentrate and 175,000 tonnes of lead concentrate, representing all of the concentrate available to be shipped from the operation.

In early October, we received regulatory approval to renew our normal course issuer bid allowing us to purchase up to 40 million of our Class B subordinate voting shares during the period starting October 10, 2018 and ending October 9, 2019.

For the ninth straight year, we have been named to the Dow Jones Sustainability World Index, indicating that our sustainability practices are in the top 10% of the 2,500 largest companies in the S&P Global Broad Market Index.

Our liquidity remains strong at over $5.7 billion inclusive of $1.8 billion in cash at October 24, 2018 and US$3.0 billion of undrawn, committed credit facilities.

“Teck and its people are proud to play our part. There are many examples of our local operations embodying that same spirit, such as donating PPE to local frontline health workers, sharing their health and safety expertise with the community, and providing funding to local food banks. The collective response to this unprecedented threat has been truly extraordinary. It should give us every confidence that we will prevail and once it passes, as it surely will, we will all emerge stronger and more resilient than ever.”
Donations to date through the fund include:
         •§One million masks for healthcare in British Columbia: Working in collaboration with government agencies and utilizing its supply chain network, Teck has procured 1 million KN95 masks to donate to B.C.’s healthcare system with delivery expected in the coming weeks.
         •§Teck Community Response Fund for local communities in Canada, Alaska and Chile: A dedicated community investment fund will support local organizations in areas where Teck operates directly involved with COVID-19 response (such as healthcare and social services) or those directly experiencing impacts resulting from COVID-19. A portion of this fund will be specifically dedicated to support for Indigenous communities. Teck is also expediting payments to local and Indigenous suppliers to support their ongoing economic resiliency.
         •§Healthcare services in Chile: Teck will support healthcare services in the Tarapaca and Coquimbo regions of Chile, including funding medical supplies, equipment, facilities and professionals at the Iquique hospital; family and primary health services in Pica, Pozo Almonte, and Chanavayita; and healthcare services in La Serena.
         •§Investments in use of copper towards infection prevention initiatives: Through its Copper & Health program, Teck will continue to collaborate with public agencies and is making an additional $1 million available to advance the use of copper products to support infection control and prevention.
         •§Contributions to Canadian relief efforts: Teck is providing $250,000 to the Canadian Red Cross towards supporting health services and public health in the battle against COVID-19, including the deployment of the Red Cross’s Emergency Response Unit field hospital and the supply of medical equipment.
         •§Support for international relief efforts: Teck has contributed to international aid efforts including $500,000 to UNICEF (in collaboration with the World Health Organization Solidarity Response Fund) to provide critical medical and sanitation supplies, equipment and training in over 180 countries, and $250,000 to the China Foundation for Poverty Alleviation to support children in rural communities in China.
         •§Support for medical research programs in Canada: Teck has provided a $250,000 contribution to the VGH & UBC Hospital Foundation for targeted drug discovery into therapeutic solutions to the COVID-19 virus carried out at the Vancouver Prostate Centre.
Further donations through the fund will include procuring additional supplies or PPE for healthcare and community use, contributions to global relief efforts, medical research, and long-term economic recovery from the impacts of COVID-19.