Teck Resources talks Quebrada Blanca work

Executive Summary

• Teck Resources provided an update on the proposed merger with Anglo American PLC, highlighting the creation of a top-five global copper producer with significant synergies, including the integration of Quebrada Blanca (QB) and Collahuasi.
• The company detailed progress on the QB ramp-up, noting improved performance following an action plan implemented in August, with specific milestones for mill throughput, cyclone replacement, and tailings management facility development.
• The merger is projected to generate $800 million in annual pretax corporate synergies and unlock substantial production growth through the QB-Collahuasi adjacency, estimated at 175,000 tonnes of incremental copper per annum.

Key Details

• Merger Structure & Synergies:
  • The proposed merger creates a global critical minerals champion with more than 70% copper exposure.
  • Expected to be a top-five global copper producer with combined copper production of 1.2 million tonnes, growing to approximately 1.35 million tonnes in 2027.
  • Teck shareholders benefit from $800 million (U.S.) in pretax recurring annual corporate synergies.
  • Near-term growth potential of 120,000 to 165,000 tonnes per annum of additional copper production through asset optimization.
  • Medium-term potential for approximately 295,000 tonnes per annum of additional copper production through capital-efficient adjacencies (including QB-Collahuasi and Los Bronces-Andina synergies).
• QB-Collahuasi Integration:
  • Combining QB and Collahuasi creates one of the largest global copper complexes.
  • Expected incremental copper production of approximately 175,000 tonnes per annum.
  • Approximately $1.4 billion (U.S.) (100% basis) additional EBITDA.
  • Capital-efficient growth at approximately $11,000 (U.S.) per tonne of incremental production.
  • Includes construction of a 15-kilometre conveyor from the Collahuasi pit to the QB plant.
• Quebrada Blanca (QB) Operational Progress:
  • Current mine plan utilizes only 15% of the resource base.
  • Mill throughput and recoveries ran in line with expectations through October.
  • Construction of three rock benches completed; fourth bench on track for end of 2025, fifth for first half of 2026.
  • 59% of cyclones replaced to date, with 100% replacement targeted by end of 2025.
  • Sand drainage rates improving since the first cyclone battery refit.
  • Targeting completion of sand wedge in H1 2026 to enable transition to steady-state operations in 2026.
• Portfolio Highlights:
  • Six world-class copper mines.
  • One of the world's largest zinc mines.
  • Two highly cash-generative premium iron ore operations.

Notable Quotes

• "We have a clear path to creating tremendous value for shareholders by completing the transformative merger of equals with Anglo American and continuing to advance the ramp-up and optimization of QB," said Jonathan Price, president and chief executive officer.
• "Completion of the merger will create a leading growth-oriented copper investment vehicle with resilience and capacity to realize significant value across the combined portfolio. Integrating QB and Collahuasi is widely recognized as one of the most compelling industrial synergy opportunities in the industry today and will establish one of the largest global copper complexes, unlocking additional production and value for all stakeholders."
• "The value that will be created in combining Teck and Anglo American -- for shareholders of both companies, QB-Collahuasi partners, and our customers, employees and the communities where we operate -- is clear and compelling," said Mr. Price.