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Teck Resources Ltd.’s new chief aims to leverage his company’s booming coal business to get bigger in copper and become a “significant” miner of the metal behind the global energy transition.
“We’re so focused on copper just because of the critical role that the metal is going to play in decarbonization through electrification,” Chief Executive Officer Jonathan Price said in his first interview since taking the top job in September. “It’s really the cornerstone of what we’re doing.”
Demand for copper, which is used in wiring and electric-vehicle batteries, is accelerating as part of a worldwide move away from fossil fuels. The threat of severe supply shortages in the coming decade is prompting miners worldwide to scour the world for new deposits and accelerate existing mining projects.
Teck’s copper drive is part of a longstanding push to reposition the company, whose business of producing steelmaking coal has been the biggest revenue contributor for more than a decade. Copper represents less than a fifth of sales so far this year, while metallurgical coal accounts for more than half of revenue.
“We like those cash flows very much,” Price, 46, said. “The intent is to invest those cash flows into further growth in copper.”
The Vancouver-based company has copper projects that could be developed in Chile, Peru, Mexico, Canada and the US, though the key push is finishing the second phase of its Quebrada Blanca mine in Chile. Price said the project will ramp up production next year, doubling the company’s copper output. Teck operates or has interests in four copper mines in Canada and South America, which produced 287,000 metric tons last year.
Price sees a “balanced” copper market next year, though he sees an “extremely strong” outlook for the industrial metal in the medium to long term.
“We expect to see an undersupplied copper market for some time yet, which will be very constructive for prices,” he said.
Price said he has no plans to expand the steelmaking coal business. The company was exploring the sale of a minority stake in the business earlier this year, people familiar with the matter said at the time. Metallurgical coal is a key raw material used in steelmaking, which remains one of the most polluting industries on the planet.
The increased copper focus comes as Price highlights Teck’s goal to be a “nature positive” mining company by 2030, which includes conservation agreements to protect 14,000 hectares of land — more than 40% of its current mining footprint. Price is attending the United Nations biodiversity conference in Montreal this week, where he will be participating in two panel discussions on Tuesday.
Price said he doesn’t see any contradiction between its environmental position and mining, since the world will need a variety of metals and minerals to reduce carbon dioxide emissions.
“Copper of course is key to electrification, but steel is going to be vitally important to build out the infrastructure,” Price said. “To continue to produce that steel, we’re going to continue to need steelmaking coal, and that’s entirely consistent with the desire to produce the materials that the world needs to decarbonize.”
(By Jacob Lorinc)
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