Teck's 2024 Production and 2025 Guidance: A Pathway to Copper Growth and Shareholder Returns

Teck Resources Limited (TSX: TECK.A and TECK.B, NYSE: TECK) has announced its select unaudited fourth quarter 2024 production and sales volumes, annual production volumes for 2024, as well as operational and capital guidance for 2025. The company's strategic shift towards a pure-play energy transition metals business focused on Copper and Zinc has positioned it for significant long-term growth and value creation. Teck's 2024 production results and 2025 guidance update highlight the company's commitment to balancing growth investments with shareholder returns while maintaining a strong balance sheet.



Teck's 2024 annual copper production of 446,000 tonnes increased by 50% compared to the prior year, primarily due to the ramp-up of the Quebrada Blanca (QB) project, which achieved design throughput rates by the end of the year. Record quarterly copper production of 122,100 tonnes in Q4, increased by 19% compared to the same period in 2023, with QB contributing 60,700 tonnes. Copper sales volumes from QB of 66,400 tonnes were higher than production volumes in the fourth quarter as inventory levels decreased. Teck's 2024 annual zinc in concentrate production of 615,900 tonnes decreased by 4% compared to the prior year, as anticipated in its mine plan, primarily due to a higher proportion of copper-only ore relative to copper-zinc ore at Antamina. This was largely offset by an increase of 3% in annual production at Red Dog, with 555,600 tonnes produced. Teck's 2024 annual refined zinc production of 256,000 tonnes was 4% lower than the prior year, as a result of a localized fire in the electrolytic zinc plant at Trail on September 24, 2024, which impacted production in the fourth quarter, as previously disclosed.



Teck's 2025 guidance update outlines the company's pathway to copper growth and shareholder returns. The company plans to grow copper production to approximately 800,000 tonnes per year before the end of the decade, with planned attributable post-sanction project capital expenditures of between US$3.2 to $3.9 billion to develop four key near-term copper projects:

1. Quebrada Blanca (QB) optimization and debottlenecking (Teck 60% owner, Chile) – a low capital intensity option to potentially increase throughput at QB by a further 15-25% (US$100-200 million estimated attributable capital cost).
2. Highland Valley Copper Mine Life Extension (Teck 100% owner, Canada) – a lower complexity brownfield project extending the life of Canada’s largest copper mine to mid-2040s. Estimated life-of-mine copper production of 137,000 tonnes per annum post-2024 (US$1.3-1.4 billion estimated attributable capital).
3. Zafranal Project (Teck 80% owner, Peru) – a long life, competitive capital cost and lower complexity copper-gold project, SEIA approval received and positioned for a potential sanction decision in H2 2025. Estimated copper production of 126,000 tonnes per annum over the first five years with substantial gold by-product credits (US$1.5-1.8 billion estimated attributable capital).
4. San Nicolás Project (Teck 50% owner, Mexico) – a low capital intensity, lower complexity copper-zinc project in a well-established mining jurisdiction in partnership with Agnico Eagle Mines. Estimated production (on 100% basis) of 63,000 tonnes per annum of copper and 147,000 tonnes per annum of zinc in the first five years. Feasibility study and execution strategy are progressing towards a potential sanction decision in H2 2025 (Teck estimated funding requirement US$0.3-0.5 billion).

Teck's capital allocation framework, including debt reduction, shareholder returns, and investment in copper projects, balances growth and value creation with maintaining a strong balance sheet. Upon the sale of its steelmaking coal business, Teck allocated the proceeds as follows:

1. Shareholder Returns: Teck returned a total of $3.5 billion to shareholders, including $1.25 billion through a share buyback program and $2.25 billion in dividends. This represents a significant portion of the total proceeds, indicating a commitment to returning value to shareholders.
2. Debt Reduction: Teck reduced its debt by up to $2.75 billion, which helps maintain a strong balance sheet and improves the company's financial flexibility. This debt reduction program is crucial for navigating market cycles and ensuring the company's long-term sustainability.
3. Investment in Copper Projects: Teck allocated approximately $1.0 billion for its value accretive copper projects, including the Quebrada Blanca optimization and debottlenecking, Highland Valley Copper Mine Life Extension, Zafranal Project, and San Nicolás Project. These investments are expected to increase copper production to about 800,000 tonnes per year before the end of the decade, supporting the company's growth strategy.

Teck's 2024 production results and 2025 guidance update demonstrate the company's commitment to balancing growth investments with shareholder returns while maintaining a strong balance sheet. The company's strategic shift towards a pure-play energy transition metals business focused on Copper and Zinc has positioned it for significant long-term growth and value creation. Investors should closely monitor Teck's progress as it executes its growth strategy and returns value to shareholders.