Teck Provides Update on Fort Hills Production Plan
March 24 2020 - 7:19PM
Teck Resources Limited (TSX: TECK.A and TECK.B, NYSE: TECK)
announced that in light of depressed prices for Western Canada
Select, and to reduce negative cash flow from Fort Hills, the
Partners in the Fort Hills limited partnership have decided to
temporarily operate Fort Hills as a single train facility. Assuming
ongoing production at Fort Hills on this basis through the balance
of 2020, Suncor, as operator, advises that it now expects Fort
Hills production to be approximately 100,000 to 120,000 barrels per
day, of which Teck’s share is 21.3%. Teck expects its 2020 share of
Fort Hills production will be reduced to approximately 8 to 9
million barrels of bitumen, which will significantly reduce
variable costs. However, unit costs for the remaining production
will be higher as a result of fixed costs being covered by lower
volumes. On the basis of these assumptions, unit operating costs
are expected to be C$37 to C$40 per barrel. Work is ongoing
to assess opportunities to reduce or defer capital spending on the
project in the context of the new plan. The Fort Hills partners
intend to monitor market conditions and may adjust the operating
plan for Fort Hills accordingly.
Forward-Looking StatementsThis press release
contains certain forward-looking statements within the meaning of
the United States Private Securities Litigation Reform Act of 1995
and forward-looking information as defined in the Securities Act
(Ontario). Forward-looking statements in this news release include
statements regarding plans for operation of Fort Hills through the
balance of 2020. These statements involve known and unknown risks,
uncertainties and other factors that may cause actual results or
events to differ materially from those anticipated. These
statements speak only as of the date of this news release.
These statements are based on a number of assumptions,
including, but not limited to, assumptions regarding market
conditions in the oil market, and that government action or other
measures in response to the COVID-19 pandemic do not interrupt
operations or require additional preventative measures or affect
suppliers, customers or infrastructure providers. Factors that may
cause actual results to vary include, but are not limited to, there
being further measures imposed by regulatory authorities that
further impact or restrict operations or affect the oil market or
other parties.
Certain of these risks are described in more detail in the
annual information form of Teck and in its public filings with
Canadian securities administrators and the U.S. Securities and
Exchange Commission. Teck does not assume the obligation to revise
or update these forward-looking statements after the date of this
news release or to revise them to reflect the occurrence of future
unanticipated events, except as may be required under applicable
securities laws.
About TeckTeck is a diversified resource
company committed to responsible mining and mineral development
with major business units focused on copper, steelmaking coal, zinc
and energy. Headquartered in Vancouver, Canada, its shares are
listed on the Toronto Stock Exchange under the symbols TECK.A and
TECK.B and the New York Stock Exchange under the symbol TECK. Learn
more about Teck at www.teck.com or follow @TeckResources.
Teck Media Contact:Chris StannellPublic
Relations Manager604.699.4368chris.stannell@teck.com
Teck Investor Contact:Fraser PhillipsSenior
Vice President, Investor Relations and Strategic
Analysis604.699.4621fraser.phillips@teck.com
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