The sale is raising questions about whether Teck Resources is laying the groundwork to pivot away from its smelting business to focus on other businesses elsewhere
Mike Mozak’s union was in the middle of labour negotiations with Teck Resources Ltd. last spring when the company announced a proposed $1.2-billion deal to sell its hydroelectric dam that powers the lead and zinc smelter where his members worked. “It was a shock to all of us,” said Mozak, president of United Steelworkers Local 9705, who questions how the sale could affect the smelter’s future.
Nestled on a hill overlooking the town of Trail in British Columbia’s West Kootenay region, the smelter complex has operated for more than 100 years and is one of the largest in the world, certainly the largest in Canada where it supplies 1,400 jobs and props up the regional economy.
Last year, through the first three quarters, the smelter produced more than 230,000 tons of zinc, essential for rustproofing the steel and iron found in everything from bridges to frying pans, and a component used in fertilizers and batteries.
The British Columbia Utilities Commission (BCUC) has just started studying whether to give final approval on the sale of Waneta Dam to B.C. Hydro. But the transaction is already raising questions about whether Teck Resources is laying the groundwork to eventually pivot away from its smelting business, and possibly devote more resources to some of its newer energy and mining projects located elsewhere in Canada as well as the U.S., Peru and Chile.
So far, the company has said the sale does not signal any changes in its strategy, and chief executive Donald Lindsay has emphasized in announcements that the deal includes a 20-year leaseback of the electricity from the dam at “below-market” rates.