TECK Revises Coal Guidance downTECK UPDATES COAL GUIDANCE
Teck Resources Ltd. has released an update on its coal pricing and sales guidance. Teck has completed fourth-quarter negotiations with a majority of its traditional customers in both the Pacific and Atlantic regions with pricing generally at $209 per tonne for its top-quality brand, with other brands priced in line with market settlements announced by other producers for similar-quality products. Teck also said that that its coal sales for the quarter and the year are being negatively affected by some temporary capacity constraints at Westshore Terminals.
Third-quarter coal sales are now expected to be in the range of 5.2 million to 5.5 million tonnes, in comparison with Teck's previous guidance for the quarter of 5.8 million to 6.2 million tonnes. Sales for the calendar year are expected to be in the range of 23.0 million to 23.8 million tonnes, in comparison with Teck's guidance of 23.5 million to 24.5 million tonnes previously announced in Stockwatch on Dec. 7, 2009. Shipments through Westshore have been affected by Westshore not operating at its stated annual capacity of 29 million tonnes during the current quarter. Neither the continuing strike at the Coal Mountain mine, nor the June, 2010, explosion in the Greenhills processing plant, has had a material impact on sales. Teck continues to load vessels with Coal Mountain coal from port inventory. The rebuilt Greenhills dryer is expected to begin commissioning in December, 2010, but the mine will continue to ship higher-moisture coal in the interim.
Teck is in discussions with Westshore concerning the shortfall in shipments and possible measures to alleviate the situation. Westshore has advised that improvements at the port are expected to permit Westshore to load all of Teck's expected deliveries to Westshore in 2011. In the interim, Teck is taking all available steps to mitigate the impact of the shortfalls at Westshore, including diverting shipments to Neptune Bulk Terminals (Canada) Ltd., in which it has a 46-per-cent ownership interest, and to Ridley Terminals Inc. in Prince Rupert.