Teck Resources (NYSE: TECK) has received regulatory approval for one of its up and coming Peruvian copper assets, as it works to expand its copper business.
The approval is for the firms Zafranal copper project, which the company refers to as a mid-sized copper-gold development project, which is found in the porphyry copper belt of southern Peru. The project is held in a joint venture, of which Teck owns 80%, while Mitsubishi Materials owns the remaining 20%.
“Zafranal will be a low-cost, long-life operation, and is a key part of Teck’s industry-leading pipeline of high-quality, low-cost copper assets in well-established mining jurisdictions in the Americas,” commented CEO Jonathan Price.
Regulatory approval for the development comes from SENACE, which is Peru’s National Service of Environmental Certification for Sustainable Investments. Teck had previously forecasted that the approval would come some time in the second quarter of 2023.
A feasibility study that was updated in 2020 estimates that the mine will have a life of 19 years once production commences, producing copper-gold concentrate via open pit mining and subsequent processing. Estimates currently peg annual production at 133,000 tonnes of copper concentrate in the first five years of production.
Capital and operating cost estimates are currently being updated for the project, with detailed engineering plans also being drawn up, with minor permitting expected to begin this year. A formal project decision is expected to be made in the first half of next year.
“Regulatory approval of the Zafranal Project is an important step forward in our strategy to grow our copper business and unlock significant value for shareholders,” continued Price.
Sunset clause on dual class structure
At the same time, Teck also revealed this morning that it will be setting a sunset clause on its current dual class share structure. Under the arrangement, each Class A share will be exchanged for a new Class A share and 0.67 of a Class B share.
The sunset clause calls for all Class A shares on May 12, 2029, to be converted to Class B shares automatically, with the Class B shares to then be referred to simply as common shares.
Class A shares are set to trade ex-distribution as of May 23, 2023.
Teck Resources Class B shares last traded at $58.00 on the TSX.
Information for this briefing was found via Sedar and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
