Teck Successfully Concludes Steelmaking Coal Sale

In a strategic move to streamline their portfolio and prioritize metals crucial for the low-carbon economy, Teck Resources (TECK) has finalized the divestment of its remaining 77% stake in the steelmaking coal business to Glencore plc. This transaction generates US$7.3 billion in cash for Teck, subject to standard closing adjustments. The divestiture allows Teck to focus its resources on its core copper and zinc businesses, which are essential materials for renewable energy technologies and electrification, key drivers in the fight against climate change. This decision positions Teck to capitalize on future growth opportunities in a sustainable and low-carbon future.

Last week, Teck Resources Limited closed the loop on the sale of its steelmaking coal business, Elk Valley Resources (EVR), to Glencore plc last week. Having secured all regulatory approvals, this divestiture signifies Teck's strategic shift towards becoming a pure-play energy transition metals company.

Sheila Murray, Chair of the Board, expressed satisfaction with the upcoming complete separation of Teck's metals and steelmaking coal businesses. She emphasized that this strategic move positions Teck for its next phase of growth and responsible value creation. Murray voiced confidence in the leadership team's strategy, highlighting its focus on maximizing long-term value for shareholders and all stakeholders.

Jonathan Price, President and CEO of Teck, emphasized that the transaction signifies a transformative moment for the company, now solely dedicated to supplying metals crucial for global development and the energy transition. He outlined Teck's future direction as a pure-play energy transition metals company, leveraging its robust portfolio of cash-generating assets and focusing on the development of near-term copper growth projects. Price noted that the completion of this transaction would provide significant funding for these initiatives, enabling Teck to potentially increase copper production by up to 30% as early as 2028.

Jonathan stated that the transaction would allow Teck to reduce debt, maintain substantial cash reserves for funding near-term metals growth, and ensure a resilient balance sheet. Additionally, he highlighted that the transaction would enable Teck to return a significant amount of cash to its shareholders.

With the sale of EVR complete, Teck has solidified its position as a top-tier producer of energy transition metals, strategically positioned to capitalize on its extensive copper growth portfolio. Teck's operations span a premium portfolio of durable, high-quality assets located in secure jurisdictions across the Americas. Anticipating a significant increase in copper production to about 600,000 tonnes annually with the ramp-up of QB in 2024, Teck aims to leverage these strengths to maximize value and meet growing global demand for essential metals in the transition to a sustainable energy future.

Concurrently, Teck is implementing a robust investment strategy to advance its near-term copper projects, encompassing QB debottlenecking, the Highland Valley Copper Mine Life Extension, Zafranal Project, and San Nicolas Project. These projects are characterized by their manageable complexity, competitive capital requirements, and strategic locations in established mining jurisdictions, with potential approval as early as 2025. Looking ahead, Teck plans to pursue a range of substantial brownfield and greenfield initiatives, including the Galore Creek project in British Columbia and potentially expanding Trail Operations to incorporate an electric vehicle battery recycling facility.