Grant of incentive stock options
Improved RACE21™ operational performance in the following key areas:
Mine optimization – $450 million: Harnessing data, machine learning and digital applications in Teck’s mining equipment has increased truck productivity by up to 10% on certain operations, reduced drilling and fuel costs and optimized mine quality. materials sent to processing plants. For example, in our Fording River operations, machine learning models use real-time information such as truck speed and location to quickly identify road maintenance tasks and optimal truck allocation to to maximize production. In our Red Dog operations, 3D visualization and modeling applications are used to accurately predict the movement of materials during an explosion, improving the zinc content delivered to the plant by approximately 5%. Approaches similar to our Elkview operations have reduced material ash variability in the plant, increasing plant throughput by approximately 0.5% from December 2021.
Processing improvements – $300 million : Automation and machine learning models within Teck’s processing plants have increased throughput capacity by up to 9% and recovery by up to 3% at some sites. For example, in our Red Dog operations, automation has been used to improve the stability of crushing processes, increasing production rates by 9%. In our Highland Valley copper operations, automation and machine learning models that use real-time information from flotation processes – such as chemical additions and equipment settings – have driven a 3% increase in copper recovery. Combined with simulation models that track ore characteristics through our crushers, process control improvements and data analytics that support more informed blasting decisions, the site has achieved a 15% increase in crusher throughput capacity.
Integrated Operations and Maintenance – $150 million: Digital scheduling applications that better connect operations to logistics teams have reduced costs and maximized throughput between Teck’s steelmaking coal operations and newly upgraded Neptune Bulk terminals. Automated train loading at our Fording River operations has increased loading per car by 2% and loading speed by 40%. Predictive maintenance enabled by equipment sensors has reduced equipment downtime and operational interruptions at all sites.
Reduced health and safety risks: Safety initiatives across various Teck operations, including light vehicle monitoring systems, collision and proximity detection, and autonomous transportation systems, have reduced the overall risk associated with vehicle interactions and contributed to a 38% reduction in the frequency of high potential incidents at Teck in 2021 compared to the previous year.
Improving sustainability: Digital technology is implemented in all Teck operations to improve decision making in the areas of water use, air quality and energy consumption. For example, in our Trail operations, various automation initiatives have increased the throughput of the KIVCET dryer and at the same time reduced sulfur dioxide emissions by 19% in 2021 compared to the previous year. At our Fording River operations, we are developing machine learning using weather and water quality data to provide improved operational recommendations for mine water storage and movement.
These RACE21™ initiatives follow other successful technology programs at Teck, including the previously announced adoption of saturated rockfill technology for our Elk Valley water quality program, which accelerated the implements water treatment in the Elk Valley and provides a long-term, sustainable alternative to in-tank treatment plants.
“RACE21™ represents the latest advancement in a long history of technology and innovation at Teck,” said Andrew Milner, Senior Vice President and Chief Transformation Officer. “Teams of developers, data engineers, data scientists, and user experience designers leverage data and insights, while collaborating with our operations, to solve complex problems in real time. The work we performed is embedded across the organization, helping to offset the increased transportation profiles, declining ore grades and significant inflationary impacts that Teck and the rest of the global mining industry are experiencing.”
The expected annualized benefits are measured by the average of the impacts on the estimated current and future pre-tax cash flows of the various initiatives, based on a number of assumptions, including assumptions regarding the ramp-up of the initiatives, production, raw material prices, exchange rate and sales and other assumptions, and aggregating these estimated impacts to estimate the expected future benefits. Certain benefits are not expected to be fully realized until future periods, and the expected impact of these initiatives is factored into our existing guidance.
This press release contains certain forward-looking information and forward-looking statements as defined in applicable securities laws (collectively referred to as forward-looking statements). These statements relate to future events or our future performance. All statements other than statements of historical fact are forward-looking statements. The use of any of the words “anticipate”, “plan”, “continue”, “estimate”, “expect”, “may”, “will”, “project”, “predict”, “potential “, “should”, “believe” and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in these forward-looking statements. These statements speak only as of the date of this presentation.
Forward-looking statements contained in this press release include, but are not limited to: statements about the expected benefits of RACE21™ and Teck’s other technology initiatives; and the improvements expected, or the continuation of improvements already made, by these initiatives, including, but not limited to, increased truck productivity, production rates, copper recovery, increased factory flow. The expected profits that will be generated do not constitute a guarantee of any level of future financial, operational or other results.
These statements are based on a number of assumptions, including, but not limited to: assumptions regarding future commodity prices and the prices we will achieve for our products and that all production is sold at those prices assumed; exchange rate assumptions; assumptions regarding future production and future production improvements associated with RACE21™ and other technology initiatives; assumptions regarding our ability to sell all production; assuming that RACE21™ and other initiatives are implemented and scaled according to current plans; assumptions that future implementation and scale will achieve expected benefits; assumptions regarding general business and economic conditions and the supply and demand for deliveries of our products. The foregoing list of assumptions is not exhaustive. Events or circumstances could cause actual results to differ materially.
Factors that could cause actual results to vary materially include, but are not limited to: actual commodity prices and prices we obtain for our products; difficulties or inability to implement or scale technology initiatives; changes in demand for our product; actual production and our ability to sell all production as planned; changes in exchange rates; unforeseen operational and construction difficulties that cause Teck to fail to meet its anticipated sales, production or other targets; changes in our operations, including but not limited to grades, which impact the expected benefits of our initiatives; unforeseen difficulties in realizing or continuing to realize the benefits of our initiatives; and other factors that affect our business generally. The foregoing list of factors is not exhaustive.
We undertake no obligation to update forward-looking statements, except as required by securities laws. Further information regarding the risks and uncertainties associated with these forward-looking statements and our business is available in our Annual Information Form for the year ended December 31, 2021, filed under our profile on SEDAR (www.sedar.com) and at EDGAR (www.sec.gov) under the guise of Form 40-F, as well as subsequent filings which can also be found under our profile.
As one of Canada’s leading mining companies, Teck is committed to responsible mining and mining development with significant business units focused on copper, zinc and steelmaking coal, as well as investments in assets energy. High-quality copper, zinc and steelmaking coal are needed for the transition to a low-carbon world. Based in Vancouver, Canada, Teck’s shares trade on the Toronto Stock Exchange under the symbols TECK.A and TECK.B and on the New York Stock Exchange under the symbol TECK. Learn more about Teck at www.teck.com or follow @TeckResources.
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