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Higlights
- Teck plans to grow copper production to 800,000 tonnes per year by the end of the decade
- Strong balance sheet supports $5.3 billion in shareholder returns since 2019
- Four key copper projects to drive production growth in the near term
Teck Resources Limited (TSX: TECK.A, TECK.B, NYSE: TECK), one of the world’s leading natural resource companies, presented its long-term growth strategy for copper production during its 2024 Strategy Day held on November 5, 2024. The company’s ambitious plan aims to increase copper production to 800,000 tonnes per year by the end of the decade, positioning Teck as a major player in the global copper market, particularly in light of increasing demand for energy transition metals.
Jonathan Price, Teck’s President and CEO, emphasized that the company is uniquely positioned to deliver near-term copper growth while continuing to generate significant cash returns for shareholders. “We are executing on a disciplined strategy to grow copper production by advancing our portfolio of lower capital intensity, high-returning projects in stable jurisdictions,” said Price. Teck's approach is grounded in its ability to fund growth through a strong balance sheet while maintaining an ongoing commitment to returning cash to shareholders.
Teck’s copper production growth is driven by its portfolio of four near-term, low-capital intensity projects that are expected to boost copper output significantly over the next few years. The company plans to invest between US$3.2 billion and US$3.9 billion over the next four years to develop these projects, which will drive copper production to approximately 800 kilotonnes per annum (ktpa) by the end of the decade.
The four key projects outlined at Strategy Day include:
- Quebrada Blanca (QB) Optimization and Debottlenecking (Chile)
Teck holds a 60% interest in the Quebrada Blanca mine, a major copper asset in Chile. The company plans a low-cost optimization and debottlenecking project that could increase QB’s production by 15-25%. With an estimated capital cost of only US$100-200 million, this project is expected to provide high returns with minimal complexity.
- Highland Valley Copper Mine Life Extension (Canada)
As Canada’s largest copper mine, Highland Valley Copper is a cornerstone of Teck’s production portfolio. Teck plans a low-complexity brownfield project to extend the mine’s life well into the mid-2040s. The expected copper production post-2024 is 137 ktpa, with an estimated capital requirement of US$1.3-1.4 billion.
- Zafranal Project (Peru)
The Zafranal project, in which Teck holds an 80% interest, is a long-life, low-cost copper-gold project with SEIA approval already in place. This project is positioned for a sanction decision in the second half of 2025. Zafranal is expected to produce 126 ktpa of copper in the first five years, with significant additional gold value. Estimated capital costs for this project range from US$1.5 billion to US$1.8 billion.
- San Nicolás Project (Mexico)
Teck’s 50%-owned San Nicolás project is a low-cost, low-complexity copper-zinc project in a well-established mining jurisdiction. The project is expected to produce 63 ktpa of copper and 147 ktpa of zinc in the first five years. Teck is advancing feasibility studies and expects a sanction decision in the second half of 2025, with estimated capital requirements of US$0.3-0.5 billion.
Teck’s ability to fund these growth projects is supported by one of the strongest balance sheets in the sector. The company has reduced its debt by $2.3 billion in 2024, and currently holds a net cash position of $1.8 billion. In addition, Teck has returned $5.3 billion to shareholders since 2019, including over $0.9 billion in share buybacks so far in 2024. A further $2.3 billion in buybacks are already authorized, underscoring Teck’s commitment to shareholder value.
With copper production projected to grow from 297 kt in 2023 to 420-455 kt in 2024, and 510-590 kt in 2025, Teck’s pathway to 800 ktpa of copper production is well underway. The company’s strategy, which balances capital discipline with shareholder returns, positions Teck for continued success in the global copper market, particularly as demand for energy transition metals is expected to rise over the next decade.
Teck’s 2024 Strategy Day marked a key milestone in the company’s long-term growth, and its disciplined approach to copper production is set to enhance value for both shareholders and stakeholders alike.
