Copper profits outstripping Coal

American Metal Market by Anne Riley

November 30,2009

Teck Resources Ltd. might see larger fourth-quarter operating profits in copper than in coal, a marked change from profit distribution in the third quarter, in which coal represented 59 percent of profits vs. copper's mere 28-percent share.

"We do have a high-growth copper business and we think actually around this quarter, copper and coal should be fairly equal. Copper could well have larger operating profits than coal," Don Lindsay, Teck's president and chief executive officer, told the Desjardins Basic Materials Conference in Montreal on Tuesday.

Vancouver, British Columbia-based Teck expects to see copper production growth of some 25 percent in the near term, with Chile's Andacollo Mine leading the charge, according to Lindsay.

"Our near-term growth is with Andacollo. The startup is coming shortly," he said. "We have put the first order to the crusher as of this week so it's moving along, and the water solution, we think, is not that far off, so we're looking forward to good growth from Andacollo next year."

The company's Highland Valley Copper complex in British Columbia will also contribute to higher output going forward. In June, Teck said it had suspended mining at parts of the site due to a number of "geotechnical issues," reducing its copper output by some 35 million pounds in the second half of 2009 and by 115 million pounds next year.

"Highland Valley has its challenges related to the geotechnical concerns we announced some months ago but that program is under way, and while we will have reduced production in 2010.