Teck s Coal Export Ports. Brad Johnston General Manager, Marketing & Logistics, Coal

Transcription

1 Teck s Coal Export Ports Brad Johnston General Manager, Marketing & Logistics, Coal September 27 29, 2011

2 Forward-looking Information Both these slides and the accompanying oral presentation contain certain forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward-looking information within the meaning of the Securities Act (Ontario) and comparable legislation in other provinces. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Teck to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These forward-forward forward looking statements include statements relating to our future coal production and shipment volumes, and our statements as to management s expectations with respect to, among other things, business and financial prospects, our production growth profile for coal, mine lives and mineral reserves and resources, and relating to future trends, plans, strategies and objectives, including with respect to future operations and projects, progress in development of mineral properties, future production, and the demand and market outlook for commodities. These forward-looking statements involve numerous assumptions, risks and uncertainties and actual results may vary materially. These statements are based on a number of assumptions, including, but not limited to, assumptions regarding general business and economic conditions, interest rates, the supply and demand for, inventories of, and the level and volatility of prices of coal, the outcome of engineering studies currently underway in connection with port expansions, the timing of receipt of regulatory and governmental approvals for port expansion projects and other operations, Teck s costs of production and production and productivity levels, as well as those of its competitors, market competition, the accuracy of Teck s reserve and resource estimates (including with respect to size, grade and recoverability) and the geological, operational and price assumptions on which these are based, our ongoing relations with our employees and partners and joint venturers, and the future operational and financial performance of the company generally. The foregoing list of assumptions is not exhaustive. 2

3 Forward-looking Information (cont'd) Events or circumstances could cause actual results to differ materially. Factors that may cause actual results to vary include, but are not limited to: unanticipated developments in business and economic conditions in the principal markets for Teck s products or in the supply, demand, and prices for metals and other commodities to be produced, changes in interest or currency exchange rates, inaccurate geological or metallurgical assumptions (including with respect to the size, grade and recoverability of reserves and resources), legal disputes or unanticipated outcomes of legal proceedings, unanticipated operational difficulties (including failure of plant, equipment or processes to operate in accordance with specifications or expectations, cost escalation, unavailability of materials and equipment, government action or delays in the receipt of permits or government approvals, industrial disturbances or other job action, and unanticipated events related to health, safety and environmental matters), decisions made by our partners or co-venturers, political risk, social unrest, failure of suppliers to meet their contractual commitmements and changes in general economic conditions or conditions in the financial markets. Certain of these risks are described in more detail in Teck s annual information form available at and in public filings with the SEC. Teck does not assume the obligation to revise or update these forward-looking statements after the date of this document or to revise them to reflect the occurrence of future unanticipated events, except as may be required under applicable securities laws. 3

4 Agenda 1. Overview of coal terminals Partners in growth 2. Port capacity Flexible, secure, long term arrangements 3. Increasing terminal volumes Capital and innovation for the future 4. Summary 4

5 Agenda 1. Overview of coal terminals Partners in growth 2. Port capacity Flexible, secure, long term arrangements 3. Increasing terminal volumes Capital and innovation for the future 4. Summary 5

6 Our Steelmaking Coal A Key Canadian Export Five steelmaking coal mines in southeast B.C. and one in west-central Alberta, producing ~85% of Canadian steelmaking coal Our product represents the largest single Canadian export to Japan, Korea, Taiwan, Brazil and Turkey Coal alone accounts for one-quarter of all tonnes shipped through Port Metro Vancouver 6 Sources: Natural Resources Canada - Canada s Natural Resources Now and for the Future, 2010 / Port Metro Vancouver Facts and Statistics, 2010

7 Coal Markets 2010 Supplying the Global Steel Industry 7 Source: Teck Resources Limited

8 Transporting our Coal A Journey from Mine to Port Rail Lines from Teck s Coal Operations to Ports Legend CN Rail CP Rail Quintette 8

9 Vancouver Gateway Infrastructure A Closer Look Coal Route Vancouver Lower Mainland Legend Highway 1 CN Rail line CP Rail line Joint Trackage CN, CP, BCR Congestion Risk 9

10 Neptune Terminals Quick Facts: Single rotary dumper Single Stacker Reclaimer 2 Quadrant shiploaders, up to 2,700 tph Vessels up to 185,000 DWT Coal, potash and vegetable oil export facility located at North Vancouver, B.C. We own 46% of the terminal and have sole rights to the coal system Served by CN Rail Southeast B.C. and Cardinal River traffic 10

11 Westshore Terminals Located at Roberts Bank, B.C. Served by B.C. Rail from CP track SE BC and Cardinal River traffic Quick Facts: One double and one single rotary dumper 4 Stacker / Reclaimers 3,500 7,100 tph stacking / reclaiming Berth 1 rail mounted shiploader, vessels up to 260,000 DWT Berth 2 dual quadrant shiploaders, vessels up to 170,000 DWT 11

12 Ridley Terminals Quick Facts One double rotary dumper 2 Stacker Reclaimers 2 dual quadrant shiploaders Single berth vessels up to 250,000 DWT Located at Prince Rupert, B.C. Served by CN Rail Quintette and Cardinal River traffic SE BC traffic through Kamloops Interchange 12

13 Terminal Overview Others Thunder Bay Terminals Approx. 1 Mtpa Eastbound coal, domestic customers Pacific Coast Terminals Sulphur terminal in Port Moody, B.C. Coal pilot project Three pilots in

14 Terminal Process Step by Step Unit train arrives, positioned by indexer Cars dumped by rotary dumper Coal stacked in stockpiles awaiting vessel Coal loaded onto vessel 14

15 Agenda 1. Overview of coal terminals Partners in growth 2. Port capacity Flexible, secure, long term arrangements 3. Increasing terminal volumes Capital and innovation for the future 4. Summary 15

16 Growing our Coal Business Production from existing operations building to 28 Mtpa Quintette restart expected in 2013 with production ramping up to 3 Mtpa 16

17 Commercial Arrangements Securing Capacity to Facilitate Growth Westshore Contracted volumes reaching 19 Mtpa Four year agreement ( ) Guaranteed position in expansion Ridley Terminals Contracted volumes of at least 3 Mtpa Long term agreement to 2024 Neptune Bulk Terminals Current capacity 9 Mtpa, expanding to 12.5 Mtpa (2013) CN a partner in North Shore expansion 17 Source: Teck Resources Limited

18 Ports Increasing Port Capacity to Meet Growing Demand Westshore Terminals Current capacity: 29 Mtpa, expanding to 33Mtpa Teck is largest single user Potential Growth Planned Expansion Throughput Capacity Neptune Coal Terminal 20 Exclusive usage Expanding to 12.5 Mt Ridley Terminals 5 Flexibility and growth 0 Neptune Bulk Terminal Ridley Terminals Westshore Terminals Combined current throughput capacity of ~50mtpa 18

19 Agenda 1. Overview of coal terminals Partners in growth 2. Port capacity Flexible, secure, long term arrangements 3. Increasing terminal volumes Capital and innovation for the future 4. Summary 19

20 Westshore Terminals Expansion (33 Mtpa) Dumper 32 Refit Barrel replacement to make a second double rotary dumper Reduction in train dump times Decreases dumping bottleneck Transfer Chute Work Improves flow and handling of coal Should reduce unplanned downtime Stacker Reclaimer Automation Improves stockpile configuration Decreased labour cost 20

21 Neptune Terminals Expansion Indexer Installation of indexer system complete Reduces train dump times by 10% Allows unloading of next generation of train lengths; ~152 cars or ~8,500' Stacker/ Reclaimer Additional stacker / reclaimer Increases terminal capacity from 9.0 Mtpa to ~12.5 Mtpa Two line system reduces dumping / loading conflicts Track and Overpass work Allows improved handling of long trains Decreases conflicts with other rail traffic Completion Q2-3, 2012 Capital expenditure of ~ $70M 21

22 Ridley Terminals Strategic Link to the Pacific Rim Nautical Miles Between Ports Approximately 450 nautical miles closer to Shanghai than Vancouver Potential to reduce sailing times by one full day Operating since

23 Ridley Terminals Efficient & Reliable Movement of Coal Natural deep sea port Capable of handling vessels up to 250,000 DWT 12 Mtpa of throughput capacity ~1.2 Mt of storage space 2 X 4,500 TPH shiploaders 2 X 7,000 TPH stacker/reclaimers Train unloading ~6,000 TPH 23

24 Ridley Terminals Potential to Expand with Growing Demand Stated intent is to double capacity Stated capital expenditure of ~$180M New rotary dumper, Dec Third Stacker Reclaimer 2013 Additional rail tracks Conveyor and chute upgrades Increased stockyard space Additional expenditures and improvements 24

25 Port Throughput Initiatives Slot Pilot(s): Goal is to create more regular and predictable rail service Scheduled service to Neptune Delivery and pickup windows Guaranteed dump time Mine load times ETAs: Goal is to increase transparency of train arrivals +/- 2 hours at Golden +/- 2 hours at Kamloops 25

26 Agenda 1. Overview of coal terminals Partners in growth 2. Port capacity Flexible, secure, long term arrangements 3. Increasing terminal volumes Capital and innovation for the future 4. Summary 26

27 Summary 1. Stable long term relationships with three West Coast and one Great Lakes terminals 2. Flexibility to move product between terminals as required based on demand or terminal performance 3. Surplus contracted capacity to meet growth targets 4. Collaborative process occurring to ensure continuous improvement in coal throughput 27