Glencore said on July 4 that it received approval from the Government of Canada under the Investment Canada Act (ICA) for the acquisition of a 77% interest in Elk Valley Resources (EVR) from Teck Resources. This was the final regulatory approval for the transaction, which was expected to close on July 11, 2024.
EVR is expected to produce 24 to 26 million metric tons (mt) of metallurgical grade coal in 2024 from four surface operations: Elk Valley, Fording River, Greenhills, and Line Creek. Last year, Teck’s met coal production represented $8.5 billion of the company’s total $15 billion in revenue.
“Glencore’s Canadian assets form a significant part of our global business, and some have a history that dates back more than 100 years,” said Gary Nagle, CEO, Glencore. “The investment in EVR will further support our position as one of the largest diversified miners and suppliers of critical minerals in Canada.”
Teck expects to receive $6.9 billion (C$9.5 billion) in cash from the sale, excluding closing adjustments. The transaction allows Teck to separate its metals and coal businesses.
“Moving forward as a pure-play energy transition metals company, we will build on our core portfolio of strong, cash-generating assets through development of our near-term copper growth projects,” said Jonathan Price, president and CEO, Teck Resources. “Completion of this transaction will provide substantial funding for our projects, giving Teck a pathway to increase copper production by a further 30% as early as 2028.”
With the ramp up of the Quebrada Blanca (QB) copper mine in Chile during 2024, Teck expects to double its copper production to approximately 600,000 mt/y. In parallel, Teck is employing a rigorous investment framework in executing on its near-term copper pipeline, including QB debottlenecking, the Highland Valley Copper Mine Life Extension, Zafranal Project and San Nicolas Project.
