Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.
Teck Cominco incurred huge loans ($10 billion) at the worst possible time (October 2008) for the acquisition of Fording Coal. Hit with the double whammy of plummeting commodity prices and a huge debt load, management in Vancouver is digging in to ensure that the company not only survives, but prospers.
Teck told investors at the recent BMO Capital Markets that it will cut sustaining capital needs by $330 million and capital projects by $400 million this year from 2008 levels. It has slowed the development of the Fort Hills oil sands project and withdrawn from the Petaquilla copper project. Zinc production at the Trail metallurgical complex has been reduced by 20%, and the Pend Oreille zinc mine has been temporarily closed.
Teck is selling its 50% share in the Williams and David Bell gold mines at Hemlo, Ont., to Barrick Gold, its joint venture partner. The deal is worth $US65 million.