Copper mine prioritized by B.C. government gets green light to run for an extra 18 years

Teck Resources Ltd. says its board has given the green light to extending the life of Canada's biggest copper mine by almost two decades, with an investment of up to $2.4 billion.

With the Highland Valley Copper Mine Life Extension project south of Kamloops, B.C., the Vancouver-based miner aims to produce 132,000 tonnes of copper per year on average and extend its life from 2028 to 2046. 

"This is a lower risk and lower complexity brownfield project," chief executive Jonathan Price told analysts on a conference call Thursday. 

The company bills the project as the largest critical minerals investment in B.C. history. 

The extension is one of 18 resource projects the province announced in February it would be fast-tracking to reduce reliance on the United States.

The capital cost is expected to range from $2.1 billion to $2.4 billion, up from an earlier estimate of $1.8 billion to $2 billion.

The cost increase was a result of additional engineering work meant to optimize the project. 

"This now includes project-level contingencies, accounts for inflation, input cost escalation, and the impact of potential tariffs on construction materials and reflects the accelerated procurement of mobile equipment originally planned for later project phases," Price said. 

Major permitting has wrapped up, engineering is 70 per cent complete, and construction is set to begin in a few weeks, he added. 

"We have operated Highland Valley for decades and have successfully executed several mine-life extensions there."

The project is "foundational" to Teck's ambitions to double production of copper — "an energy transition metal" — by the end of the decade, he said. 

Teck estimates 2,900 jobs and $435 million in additional gross domestic product will be generated during construction. 

In a Teck news release, B.C. Premier David Eby called the investment "just one example of how British Columbia can drive our country's economy forward even in challenging times."

Federal Natural Resources Minister Tim Hodgson said projects like the Highland Valley extension put Canada on the map. 

"By extending the life of Canada's largest copper mine, we are strengthening our critical minerals sector here at home and becoming the international supplier of choice when it comes to critical metals and minerals," he said in the release. 

Chief Christine Walkem of Cook's Ferry Indian Band said in the release that the decision is a "defining moment" for both industry and local communities participating in the Citxw Nlaka'pamux Assembly (CNA). The CNA manages and administers agreements between Teck and eight First Nations bands. 

"Our communities are not bystanders to development — we are decision-makers. We are forging a new path with Industry and the Crown for how major projects unfold in our territory: grounded in respect, guided by our values and focused on long-term benefit for our people," said Walkem, who chairs the CNA's board. 

"As the project enters construction, we remain firm in our expectations. Our voices must continue to be heard. Our laws must continue to guide the process. Our people must continue to share in the benefits — now, and for generations to come."

Mine and community need each other, mayor says

The mayor of Logan Lake says she's pleased.

"We obviously depend quite heavily on the mine, both for taxation and economics, so the fact that they have approved the expansion is absolutely welcome news for us," said Robin Smith.

Currently, the mine pays three-quarters of all the taxes that the municipality gathers.

"[The mine's] why Logan Lake was built in the first place."

However, Smith said the lengthened mine life and the increase in employees mean the community will need to plan for additional services and housing. 

"We're definitely planning and looking at ways that we're going to sort of ease some of that tension, but I think that overall, I think it's excellent for the entire region."

Teck shares were trading almost six per cent lower on the TSX on Thursday afternoon at $49.42. 

Also, Thursday, Teck said its profit from continuing operations attributable to shareholders amounted to $206 million or 41 cents per diluted share for the quarter ended June 30.

The result compared with a profit of $21 million or four cents per diluted share in the same quarter last year.

On an adjusted basis, Teck says its profit from continuing operations amounted to 38 cents per diluted share for its latest quarter, up from 12 cents per diluted share a year earlier.

Revenue for the quarter totalled $2.02 billion, up from $1.80 billion.