Canadian Manufacturing

COVID delay costs calculated for Teck’s Quebrada Blanca copper mine in Chile

About 7,500 workers were at the construction site for the US$5.2-billion project when the pandemic erupted in March and all but a small care and maintenance crew were sent home

September 18, 2020  The Canadian Press

VANCOUVER — Construction delays related to a COVID-19 shutdown of its Quebrada Blanca Phase 2 copper mining project in Chile will add between US$260 million and US$290 million in costs and delay startup by five to six months, mining company Teck Resources Ltd. says.

About 7,500 workers were at the construction site for the US$5.2-billion project when the pandemic erupted in March and all but a small care and maintenance crew were sent home, Teck CEO Don Lindsay said during an online industry conference Sept. 17.

“We’re close to 6,000 people on site (now) with a target to get to full strength of 8,000 by the end of October … This is a very crucial couple of months as we ramp up,” he said.

Work that was able to move forward during the shutdown included permitting, offsite equipment manufacturing, transporting of goods to the site and road construction.

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“We’ve actually made a small amount of progress so we’re actually at roughly 30% completion. Our target is to get to 40% by year-end,” he said, adding the mine is to begin production in the third quarter of 2022.

Teck is the operator and owns a 60% stake in the project.

The Vancouver-based miner said it is constructing more camp space to reduce the risk of disease transmission at a cost of US$25 million to US$40 million and warned that any additional delays would cost between US$25 million and US$35 million per month.

Earlier Sept. 17, Teck announced another step toward its vow to be carbon emission neutral by 2050 by signing a long-term renewable power purchase agreement for its Carmen de Andacollo copper mine in Chile.

The mine will source 72 megawatts (550 gigawatt-hours per year) from AES Gener’s renewable portfolio of wind, solar and hydroelectric energy.

AES Gener, owned by the AES Corp., is also to be the supplier of renewable power for Quebrada Blanca, providing more than half of its total operating power needs when completed.

Teck has set a goal of using only renewable power in Chile and reducing the carbon intensity of all of its operations by 33% by 2030.

The Carmen de Andacollo renewable power deal is in effect as of Sept. 1 and is to run through to the end of 2031. The mine is about 350 kilometres north of Santiago.