Teck Resources Limited Class A · TSX:TECK.A
Teck Resources Limited Class A — Goldman Sachs Global Natural Resources Conference 2021
183 slides from Teck Resources Limited Class A's conference presentation, Nov 10, 2021
Slide 1: Global Natural Resources Conference
Global Natural Resources Conference November 10, 2021
Slide 2: Caution Regarding Forward-Looking Statements
Caution Regarding Forward-Looking Statements Both these slides and the accompanying oral presentations contain certain forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward-looking information within the meaning of the Securit
Slide 3: Caution Regarding Forward-Looking Statements
Caution Regarding Forward-Looking Statements otherwise that would impair their ability to provide goods and services as anticipated during the suspension period or ramp-up of construction activities. Assumptions regarding the benefits of the Neptune Bulk Terminals expansion include assumptions that
Slide 4: Teck is Poised for Growth
Teck is Poised for Growth Providing essential metals and minerals for a low-carbon world Right Opportunities • Strong demand for our metals and minerals, led by growth and decarbonization Right Assets • Industry leading copper growth, strengthening existing high-quality, low carbon assets Right Appr
Slide 5: Health & Safety and Sustainability
Health & Safety and Sustainability Health & Safety Inclusion & Climate Communities Water A core value for Teck Diversity Rebalancing to Serving the needs of Protecting water Enhancing low-carbon metals communities and quality and reducing 80% reduction in Indigenous Peoples use representation and HP
Slide 6: Accelerated Need for Essential Metals and Minerals for a Low-Carbon World
Accelerated Need for Essential Metals And Minerals for a Low-Carbon World • Strong demand for Copper Demand1 (kt) metals and minerals driven by decarbonization, population growth and a rising middle class • Unprecedented pandemic monetary and fiscal stimulus Generation and Grid Charging Non-ICE Grid
Slide 7: High-Quality Steelmaking Coal Is Required for the Low-Carbon Transition
High-Quality Steelmaking Coal Is Required for the Low-Carbon Transition Seaborne Steelmaking Coal Supply Changes With All Projects Through 20501 (Mt) • The magnitude of 235 222 188 steelmaking coal demand will be 216 ultimately driven by 191 185 147 the pace of decarbonization (38) 60 3 (64) 8 25 (5
Slide 8: Teck and the Low-Carbon Transition
Teck and the Low-Carbon Transition We believe Teck’s strategy will ensure we are well-positioned for changes in demand for mining commodities driven by the transition to a low-carbon world Today 10+ Years 20+ Years 1 Focus on copper growth to 2 Prudently growing our copper 3 Leading copper producer
Slide 9: Prudent Copper Growth Strategy
Prudent Copper Growth Strategy Accelerate capital efficient growth in copper Maximize cash flows from operations Canada to fund copper growth and shareholder returns 156 kt Chile Strengthen Peru 227 kt existing high-quality assets through RACE21TM 86 kt Discipline in capital allocation, maximizing s
Slide 10: Industry Leading Copper Growth
Industry Leading Copper Growth Teck has continued to invest in growth projects; peers have not WoodMac: Consolidated Copper Production Growth1 Teck2 vs. Peers3 2021E-2023E 120% 102% 100% 80% 60% 40% Peru 21% 86 kt 20% 11% 0% Teck Copper Peer Diversified Peer Average Average Teck provides investors e
Slide 11: Portfolio of Copper Growth Options
Portfolio of Copper Growth Options Well understood resource base creates multiple options • High quality resources in very attractive mineral Teck’s Consolidated Copper Asset districts including Canada, the U.S., Mexico, Reserves and Resources (CuEq Mt)2 Chile, and Peru ‒ Including ~22 million ounce
Slide 12: Significant Base Metals Growth
Significant Base Metals Growth Base Metals business growth rivals leading copper peers Consolidated Copper Equivalent Production 1 (kt CuEq) Copper Zinc (CuEq) Other (CuEq) Attributable (CuEq) Teck First Quantum Antofagasta 11% 988 855 887 0% 832 828 62% 528 Teck Teck First Quantum First Quantum Ant
Slide 13: QB2 is Delivering to Key Milestones and Positioning for Start-Up
QB2 is Delivering to Key Milestones and Positioning for Start-Up World class COVID-19 protocols deliver results • Surpassed 2/3 completion • Vaccinations, COVID-19 protocols and testing key enablers • Continued ramp-up of construction workforce Focus on delivering to key milestones • Critical path t
Slide 14: Teck is Nearing an Inflection Point
Teck is Nearing an Inflection Point Transitioning from cash outflows to potential for significant EBITDA1 generation 2021 QB2 Illustrative QB2 EBITDA1 Scenarios Capex Guidance2 At Full Production C$2.6B C$2.2B C$1.8B US$4.50/lb Copper US$4.00/lb Copper US$3.50/lb Copper (C$2.5B) Illustrative Proform
Slide 15: Solid Track Record of Cash Returns to Shareholders
Solid Track Record of Cash Returns to Shareholders >C$3.0 billion of dividends and C$1.7 billion of share buybacks 2011-2020 Teck’s Dividends and Buybacks (C$M) $800 $600 $400 $200 $0 1 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 YTD Total Dividend Paid Share Buybacks Significant EBITDA2
Slide 16: Teck is Poised for Growth
Teck is Poised for Growth Right Right Right Right Opportunities Assets Approach Team Strong demand for Industry leading Highest standards Our people deliver our metals and copper growth, of sustainability in the optimal mix of minerals, led by strengthening everything we do, industry leading growth
Slide 17: Appendix
Appendix Teck
Slide 18: Endnotes
Endnotes Slide 6: Accelerated Need for Essential Metals and Minerals for a Low-Carbon World 1. Source: CRU Mobility and Energy Futures – Perspectives towards 2035. Approximate figures; total copper demand from CRU’s Copper Market Outlook. 2. Consolidated basis. Slide 7: High-Quality Steelmaking Coal
Slide 19: Overview and Financial Strategy
Overview and Financial Strategy
Slide 20: About Teck
About Teck High-quality assets in the Americas Proven operational excellence underpinning cost competitiveness Doubling of copper production by 2023 through QB21 Significant value potential from a portfolio of copper growth options Recognized industry leader in ESG performance Strong balance sheet a
Slide 21: Global Customer Base
Global Customer Base Revenue contribution from diverse markets 2020 Gross Profit Before 2020 Revenue by Depreciation and Amortization1 2020 Revenue by Business Unit by Business Unit Geography Latin America 2% Energy 5% Energy -8% Europe 13% China 21% Copper 27% Copper 44% India 6% North Zinc 30% Zin
Slide 22: Strong Financial Position
Strong Financial Position Balance Sheet • Rated investment grade by all four agencies • No significant note maturities prior to 20301 Liquidity • C$5.4 billion2 of liquidity available • Converted our US$4 billion committed credit facility into a Sustainability-Linked facility in support of Teck’s su
Slide 23: Illustrative Cash Flows - QB2 Full Production
Illustrative Cash Flows - QB2 Full Production Scenarios indicate potential Available Cash Flow of C$4–6/share US$4.50/lb Copper Scenario US$4.00/lb Copper Scenario US$3.50/lb Copper Scenario $5.73/share $4.93/share $4.13/share For further details please see Teck Illustrative Cash Flows – QB2 Full Pr
Slide 24: Teck Illustrative Cash Flows - QB2 Full Production
Teck Illustrative Cash Flows - QB2 Full Production Scenarios indicate potential Available Cash Flow of C$4–6/share Illustrative Available Cash Flow (C$B) US$4.50/lb US$4.00/lb US$3.50/lb Copper C$/share9 Copper C$/share9 Copper C$/share9 Adjusted EBITDA1 $6.0 $5.6 $5.3 QB2 EBITDA (100%)2 2.6 2.2 1.8
Slide 25: Capital Allocation Framework
Capital Allocation Framework Shareholder distributions of 30-100% of Available Cash Flow1 SUSTAINING SUPPLEMENTAL BASE CAPITAL SHAREHOLDER DIVIDEND (including stripping) DISTRIBUTIONS CASH FLOW FROM OPERATIONS after interest and finance Plus at Least 30% charges, lease payments Available Cash Flow1
Slide 26: Disciplined Approach to M&A
Disciplined Approach to M&A $1,500 Recent Transaction History QB2 Divestment Waneta Dam, (30%)7 $1,200M6 $1,072M Net Proceeds (Cost) (C$M) Antamina $1,000 Silver Stream2 $795M CdA Gold $500 Stream1, Osisko Royalty Sandstorm Royalty $206M Project Corridor Package, Package3 /Nueva Union, Wintering Hil
Slide 27: Production Guidance
Production Guidance 2020 2021 Guidance1 3-Year Guidance1 Units in 000’s tonnes (excluding steelmaking coal, molybdenum, and bitumen) (2022-2024) Copper2,3,4 Highland Valley 119.3 128-133 135-165 Antamina 85.6 91-95 90 Carmen de Andecollo 57.4 46-51 50-60 Quebrada Blanca6 13.4 10-11 - Total copper 27
Slide 28: Sales and Unit Cost Guidance
Sales and Unit Cost Guidance Sales Q3 2021 Q4 2021 Guidance1 Zinc2 Red Dog (kt) 162 140-155 Steelmaking coal (Mt) 5.9 6.4-6.8 Unit Costs 2020 2021 Guidance1 Copper3 Total cash unit costs7 (US$/lb) $1.57 $1.65-1.75 Net cash unit costs4,7 (US$/lb) $1.28 $1.30-1.40 Zinc5 Total cash unit costs7 (US$/lb)
Slide 29: Water Treatment Guidance
Water Treatment Guidance Excerpt from Teck’s Q3 2021 Press Release There is no change to our 2021 guidance on water-related spending. We expect capital spending of approximately $255 million in 2021 on water treatment (AWTFs and SRFs) and water management (source control, calcite management and trib
Slide 30: Capital Expenditures Guidance
Capital Expenditures Guidance Sustaining and Growth Capital QB2 2020 2021 2020 2021 (Teck’s share in CAD$ millions) Guidance1 (Teck’s share in CAD$ millions) Guidance1 Sustaining QB2 capital expenditures $ 1,643 $ 2,500 Copper $ 161 $ 160 Total before SMM/SC contributions 3,129 3,945 Zinc 188 155 Es
Slide 31: Commodity Price Leverage
Commodity Price Leverage1 2021 Mid-Range Estimated Effect on Estimated Effect on Production Estimates2,5 Change Annualized Profit3 ($M) Annualized EBITDA3 ($M) US$ exchange C$0.01 $ 78 $ 123 Copper (kt) 282.5 US$0.01/lb 4 7 Zinc4 (kt) 905.0 US$0.01/lb 9 12 Steelmaking coal (Mt) 25.5 US$1/tonne 18 29
Slide 32: Tax-Efficient Earnings in Canada and Chile
Tax-Efficient Earnings in Canada and Chile Canada: ~C$4.5 billion in available tax pools at December 31, 2020 • Includes: ‒ $3.8 billion in Canadian federal net operating loss carryforwards ‒ $0.3 billion in Canadian Development Expenses (30% declining balance p.a.) ‒ $0.4 billion in allowable capit
Slide 33: Share Structure & Principal Shareholders
Share Structure & Principal Shareholders Teck Resources Limited at December 31, 2020 Shares Held Percent Voting Rights Class A Shareholdings Temagami Mining Company Limited 4,300,000 55.4% SMM Resources Inc (Sumitomo) 1,469,000 18.9% Other 1,996,503 25.7% 7,765,503 100.0% Class B Shareholdings Temag
Slide 34: Collective Agreements
Collective Agreements Operation Expiry Dates Antamina July 31, 2021 Highland Valley Copper September 30, 2021 Trail Operations May 31, 2022 Cardinal River June 30, 2022 January 31, 2022 Quebrada Blanca March 31, 2022 November 20, 2022 September 30, 2022 Carmen de Andacollo December 31, 2022 Line Cre
Slide 35: Endnotes: Overview and Financial Strategy
Endnotes: Overview and Financial Strategy Slide 21: Global Customer Base 1. Gross profit before depreciation and amortization is a non-GAAP financial measure. See “Non-GAAP Financial Measures” slides. Slide 22: Strong Financial Position 1. As at September 30, 2021. 2. As at October 26, 2021. Slide 2
Slide 36: Endnotes: Overview and Financial Strategy
Endnotes: Overview and Financial Strategy Slide 26: Production Guidance 1. As at October 26, 2021. See Teck’s Q3 2021 press release for further details. 2. Metal contained in concentrate. 3. We include 100% of production and sales from our Quebrada Blanca and Carmen de Andacollo mines in our product
Slide 37: ESG Leadership
ESG Leadership Teck
Slide 38: Health, Safety, Environment and Communities Performance
Health, Safety, Environment and Communities Performance Responding to COVID-19―Five Pillar Approach Prevention Employee Communities & Business Communication Support Public Health Continuity Prioritizing the health and safety of our people and communities 38
Slide 39: Health, Safety, Environment and Communities Performance
Health, Safety, Environment and Communities Performance • Safety performance in H1 2021 vs. FY 2020 Teck Operated Incident Frequency - 38% reduction in High-Potential Incidents (per 200,000 hours worked) - 26% decrease in Lost-Time Injury Frequency 0.70 0.60 • Continued implementation of High 0.50 P
Slide 40: Health, Safety, Environment and Communities Performance
Health, Safety, Environment and Communities Performance Indigenous Communities Peoples Engaging throughout the mining Respect for culture and heritage; early life-cycle to create lasting benefits engagement and focus on working to achieve Free, Prior and Informed Consent (FPIC) • $10.8 billion in ec
Slide 41: Health, Safety, Environment and Communities Performance
Health, Safety, Environment and Communities Performance Water Tailings Working to protect water quality and Meeting global best practices for safety at our reducing use in water-scarce regions. tailings facilities throughout their life-cycle • Tripling Elk Valley treatment capacity • Fully applying
Slide 42: Health, Safety, Environment and Communities Performance
Health, Safety, Environment and Communities Performance Biodiversity & Responsible Reclamation Production Working towards a net-positive impact Reducing waste and pollution and keeping on biodiversity materials in use • 5,930 hectares of cumulative land • 27,583 tonnes of waste recycled in 2020 recl
Slide 43: Health, Safety, Environment and Communities Performance
Health, Safety, Environment and Communities Performance Inclusion, Equity & Diversity Governance Fostering a workplace where everyone is Transparency and accountability to drive results included, valued and equipped for today for all our stakeholders and the future • 25% of Teck’s board of directors
Slide 44: Focus on Sustainability Leadership
Focus on Sustainability Leadership Ambitious sustainability goals in eight strategic themes Health and Safety Climate Change Responsible Production Our People Water Tailings Management Communities and Biodiversity and Indigenous Peoples Reclamation 44
Slide 45: Climate Change
Climate Change Starting from a strong position Well-positioned Among lowest Carbon pricing for a Low-Carbon carbon intensity already built into Economy miners globally majority of business CO2 Copper Intensity Curve (2020), t CO2e/t Copper equivalent CO2 Zinc Intensity Curve (2020), t CO2e/t Zinc eq
Slide 46: Climate Change
Climate Change Our climate strategy Positioning Teck for Support for appropriate Reducing our Adapting to the a low-carbon economy carbon pricing policies carbon footprint physical impacts • Producing metals and • We support broad-based Long-term targets: of climate change minerals required for effe
Slide 47: Climate Change
Climate Change Our pathway to net zero 2020‒2030: Target readily available; cost-competitive technologies in these areas Electrification & Abatement alternative material Electrification & Methane recovery Options Renewable energy handling low-carbon fuels & abatement Offsets Emissions Power supply M
Slide 48: Sustainability Reporting and Rankings
Sustainability Reporting and Rankings Our Reporting Frameworks ESG Rankings Top-ranked mining company GRI Standards World & North American Indices Gold Class Award 2021 SASB Standards Top ranked North American company Task Force on Climate Related Financial Disclosures (TCFD) Top percentile, mining
Slide 49: ESG Resources for Investors
ESG Resources for Investors Holistic reporting suite • Sustainability reporting for 20 years in Core accordance with the Global Reporting Initiative (GRI) Standards and G4 Mining and Metals Sector Disclosures • Sustainability Report is aligned with Sustainability Accounting Standards Board (SASB) •
Slide 50: Near-Term Copper Growth - QB2 Project
Near-Term Copper Growth - QB2 Project Photo: Concentrator, August 2021
Slide 51: QB2 Project
QB2 Project Executing on a world class development asset Highlights Location Large, long-life deposit Chile Peru Very low strip ratio Bolivia Arica y Arica Parinacota Region Low all-in sustaining costs (AISC)1 Cerro Tarapacá Colorado Collahuasi Region Potential to be a top 20 producer BHP An
Slide 52: QB2's Competitive Cost Position
QB2’s Competitive Cost Position Competitive Operating Cost & Capital Intensity Low Cash Cost Position • Given the exceptionally low strip ratio, consistent grade C1 Cash Cost2 & AISC3 Curve1 (US$/lb, 2023E) profile, compact site layout, and high level of automation, QB2 is expected to have attractiv
Slide 53: Large, Long Life Deposit at Quebrada Blanca
Large, Long Life Deposit at Quebrada Blanca • QB2 uses only ~18% of the 2020 reserve and Significant extension potential resource tonnage1 • Deposit is capable of supporting a very long mine life based on throughput rate of 143 ktpd2 Reserve and Resource Tonnage (Mt) by utilizing further tailings ca
Slide 54: QB2 Funding Model
QB2 Funding Model Minimized Teck execution funding through partnership and project finance QB2 Funding Model - Post January 2019 (US$B) 6.0 Ownership – 0% US$5.2 billion Funding – 48% 5.0 0.3 1.3 1.1 4.0 Ownership – 30% 1.1 Funding – 37% 3.0 1.8 0.3 0.3 2.0 Ownership – 60% 1.3 Funding – 15% 1.0 2.1
Slide 55: QB2 Project Finance Facility
QB2 Project Finance Facility • Senior debt will continue to be drawn pro-rata under a pre-determined Senior Debt-to-Shareholder funding ratio until US$2.5 billion is drawn • Pre-completion, senior debt is guaranteed on a pro-rata basis (after consideration of ENAMI’s 10% carried interest) ‒ Teck 66.
Slide 56: ENAMI Interest in Quebrada Blanca
ENAMI Interest in Quebrada Blanca Organizational Chart • The government of Chile owns a 10% non-funding interest in Compañía Minera Teck Quebrada Blanca Teck SMM SC S.A. (CMTQB) through its state-run minerals company, Empresa Nacional de Minería (ENAMI) 100% 83.33% 16.67% • ENAMI has been a partner
Slide 57: Quebrada Blanca Accounting Treatment
Quebrada Blanca Accounting Treatment Balance Sheet Cash Flow • 100% of project spending included in property, plant and • 100% of project spending included in capital equipment expenditures • Debt includes 100% of project financing • Sumitomo1 contribution recorded within financing • Total sharehold
Slide 58: QB2 Project Economics Comparison
QB2 Project Economics Comparison 7 8 Reserve Sanction Case1 Case2 Mine Life Years 28 28 Strip Ratio First 5 Full Years 0.16 0.44 LOM3 0.41 0.70 C1 Cash Cost4 First 5 Full Years US$/lb $1.29 $1.28 LOM3 US$/lb $1.47 $1.37 AISC5 First 5 Full Years US$/lb $1.40 $1.38 LOM3 US$/lb $1.53 $1.42 The descript
Slide 59: QB2 Reserves and Resources Comparison
QB2 Reserves and Resources Comparison Reserve Case (as at Nov. 30, 2018)1,2 Sanction Case (as at Nov. 30, 2018)2,4 Cu Mo Silver Cu Mo Silver Reserves Mt Grade % Grade % Grade ppm Reserves Mt Grade % Grade % Grade ppm Proven 476 0.51 0.018 1.40 Proven 409 0.54 0.019 1.47 Probable 924 0.47 0.019 1.25
Slide 60: Endnotes: Near-Term Copper Growth - QB2 Project
Endnotes: Near-Term Copper Growth - QB2 Project Slide 51: QB2 Project 1. All-in sustaining costs (AISC) are net cash unit costs (also known as C1 cash costs) plus sustaining capital expenditures. Net cash unit costs are calculated after cash margin by-product credits assuming US$10.00/lb molybdenum
Slide 61: Endnotes: Near-Term Copper Growth - QB2 Project
Endnotes: Near-Term Copper Growth - QB2 Project Slide 59: QB2 Reserves and Resources Comparison 1. Mineral reserves are constrained within an optimized pit shell and scheduled using a variable grade cut-off approach based on NSR cut-off US$13.39/t over the planned life of mine. The life-of-mine stri
Slide 62: Copper Growth Strategy
Copper Growth Strategy Teck
Slide 63: Right Approach: Portfolio of Copper Growth Options
Right Approach: Portfolio of Copper Growth Options Value realization through production or M&A Teck is positioned to realize value from a robust pipeline of copper projects QB2 Case Study • Investment in exploration and strategic M&A over the last De-risked at project sanction: 20 years has secured
Slide 64: Actively Strengthening our Portfolio
Right Approach: Actively Strengthening our Portfolio Prudent investments in near-term, medium-term, and future growth options 2017 2021 Zafranal Feasibility (Q2 2019) Prefeasibility Near Term Teck’s copper growth portfolio is Cu-Au SEIA submission in H2 2021 supported by recent and extensive studies
Slide 65: Right Assets: Portfolio of Copper Growth Options
Right Assets: Portfolio of Copper Growth Options Value optionality guided by commercial discipline Framing Options Medium-term Options Near-term Options Delivering Value CuEq Production Legend 105.0% San 150 300 Nicolás ktpa ktpa Value Creation Potential QB3 Galore Creek Zafranal QB2 50.0% Mesaba Sc
Slide 66: Zafranal Cu-Au Porphyry (80%)
Zafranal Cu-Au Porphyry (80%) Peru Feasibility complete, SEIA submission in H2 20211 Long Life Asset Feasibility Study Production Profile • 19 year mine life with mine life extension 225 100% 200 opportunities though pit expansion and district 175 75% resource development 150 125 50% 100 Quality Inv
Slide 67: San Nicolás Cu-Zn (Ag-Au) VHMS (100%)
San Nicolás Cu-Zn (Ag-Au) VHMS (100%) Mexico Prefeasibility and Environmental Impact Assessment completed1 Long Life Asset Prefeasibility Study Production Profile • One of the world’s most significant 150 100% undeveloped VHMS deposits 125 75% • Updated Resources Statement 100 75 50% Quality Investm
Slide 68: Medium-Term Development Options
Medium-Term Development Options Chile and Canada Partnerships reduce capital needs | Options allow more flexible capital allocation QB3 Cu-Mo-Ag (60% Interest) Galore Creek Cu-Au-Ag (50% Interest) Long section looking north Long section looking west Surface Cu% 0.8 Surface QB2 Sanction Case Pit 0.5
Slide 69: Right Assets: Portfolio of Copper Growth Options
Right Assets: Portfolio of Copper Growth Options Multiple high quality copper options Near Term Options 1 Zafranal (Cu-Au), Peru1,2 Teck 80% | MMC 20% Feasibility Study complete; SEIA submission in H2 2021 First five years: 133 ktpa CuEq; C1 Costs US$1.18/lb Cu. US$1.2B capex; NPV8 US$1,026M; IRR 23
Slide 70: Endnotes: Copper Growth Strategy
Endnotes: Copper Growth Strategy Slide 63: Right Approach: Portfolio of Copper Growth Options - Value realization through production or M&A 1. Total debt repayment between Q4 2015 and Q3 2019. 2. Share buybacks and dividends since Q4 2017 (one year prior to project sanction). Slide 65: Right Assets:
Slide 71: RACE21 Technology and Innovation Program
RACE21TM Technology and Innovation Program Please see the video of the RACE21TM presentation at our Investor & Analyst Day here, starting at ~1:28
Slide 72: RACE - Teck's Path to Transformation
RACE - Teck’s Path to Transformation A journey kickstarted in 2019 to unlock the potential of technology and our people Renew the technology and data infrastructure Automate operations Connect systems across the value chain Empower Teck’s workforce through digital … to reduce operating cost and sign
Slide 73: Strengthen Existing High-Quality Assets Through RACE21
Strengthen Existing High-Quality Assets Through RACE21TM Focus Transformational Step-change impact to Increased productivity Increased margins safety impact operational efficiency through technology and innovation Advanced data analytics Increased copper Record haul truck Improved zinc feed Examples
Slide 74: Base Metals Business Units – Copper and Zinc
Base Metals Business Units – Copper and Zinc
Slide 75: Significant Base Metals Growth
Significant Base Metals Growth Expanding our high-quality Base Metals business • High-quality operating assets with strong ~100% >850kt margins Near-term copper Per year copper • Substantial near-term growth from QB2 production growth1 equivalent production by 20232 • Operational excellence underpin
Slide 76: Significant Base Metals Growth
Significant Base Metals Growth Teck’s Base Metals business rivals leading copper peers Consolidated Copper Equivalent Production 1 (kt CuEq) Copper Zinc (CuEq) Other (CuEq) Teck First Quantum Antofagasta 11% 988 855 887 0% 832 828 62% 528 Teck Teck First Quantum First Quantum Antofagasta Antofagasta
Slide 77: Significant Base Metals Growth
Significant Base Metals Growth Teck’s Base Metals business rivals leading copper peers Consolidated Copper Equivalent Production 1 (kt CuEq) Copper Zinc (CuEq) Other (CuEq) Attributable (CuEq) Teck First Quantum Antofagasta 11% 988 855 887 0% 832 828 62% 528 Teck Teck First Quantum First Quantum Ant
Slide 78: Industry Leading Copper Growth
Industry Leading Copper Growth Building on our foundation of quality assets and operating discipline Gross Profit Margin Before Depreciation & Amortization Quality assets with strong margins from Operations Consistently ~45-55%1 • Antamina, Highland Valley and Carmen de Andacollo 70% provide a stabl
Slide 79: World Class Zinc Business
World Class Zinc Business Large scale, low-cost integrated business Gross Profit Margin before Depreciation & Amortization Quality assets with strong margins from Mining Operations Consistently >50%1 70% • Red Dog is a first quartile cash cost operation • Trail produces refined zinc, lead, and other
Slide 80: RACE21 – Processing Analytics Journey
RACE21TM – Processing Analytics Journey Significant improvements realized within our processing plants Highland Valley Copper IPM Flotation Recommendations Red Dog Operations • Advanced grinding control has realized a ~9% increase in production rates1 Highland Valley Copper • Deployed real-time opti
Slide 81: Significant Base Metals Cash Flow
Significant Base Metals Cash Flow Expanding our high-quality Base Metals business • High quality, growing copper business • World class zinc business • Focus on operating discipline • Significant improvements driven by RACE21TM Building on our foundation of quality assets and operating discipline Ph
Slide 82: Operations Improvement and Cash Flow Focus in Copper
Operations Improvement and Cash Flow Focus in Copper Productivity & Cost Management Focused Investment Priorities • Focus on reliability and maintenance • Key water, tailings and regulatory projects and cross site sharing drive sustaining capital requirements • RACE21TM and continuous • Near-term hi
Slide 83: Copper Unit Costs
Copper Unit Costs Unit Costs1 in 2020 Operating Cost1 Breakdown in 2020 Depreciation Labour 30% and Amortization Contractors and Consultants 11% 24% Operating Royalties OperatingCosts Costs Operating Supplies 16% 68% 47% 2% Repairs and Maintenance Parts 16% Transportation 6% Energy 20% Other 6% Tota
Slide 84: Operations Improvement and Cash Flow Focus in Zinc
Operations Improvement and Cash Flow Focus in Zinc Productivity Focused Investment Priorities • Focus on asset management and cross • Key water, tailings and regulatory projects site sharing drive sustaining capital requirements • RACE21TM and continuous • Near term higher sustaining spending from i
Slide 85: Zinc Unit Costs
Zinc Unit Costs Unit Costs1 in 2020 Depreciation and Amortization Operating Cost1 Breakdown in 2020 13% Depreciation Labour 35% and Amortization Royalties Operating Contractors and Consultants 10% 11% 24% Costs Operating OperatingCosts Operating Supplies 11% 38% Costs 68% 47% Repairs and Maintenance
Slide 86: Red Dog Sales Seasonality
Red Dog Sales Seasonality • Operates 12 months Zinc Sales 1 (%) • Ships ~ 4 months 40% 32% 31% 30% • Shipments to inventory in Canada 20% 21% 16% and Europe; Direct sales to Asia 10% • ~65% of zinc sales in second half 0% Q1 Q2 Q3 Q4 of year • ~100% of lead sales in second half Lead Sales1 (%) of ye
Slide 87: Red Dog Net Cash Unit Cost Seasonality
Red Dog Net Cash Unit Cost Seasonality Five-Year Average Red Dog Net Cash Unit Costs1 (US$/lb) 0.60 0.40 0.20 - Q1 Q2 Q3 Q4 • Seasonality of Red Dog unit costs largely due to lead sales during the shipping season • Higher net cash unit costs expected in 2021 compared to 2020 due primarily to lower p
Slide 88: Red Dog in Bottom Quartile of Zinc Cost Curves
Red Dog in Bottom Quartile of Zinc Cost Curves Higher zinc prices illustrate continuing tight market Total Cash + Capex Cost Curve 20211 (US¢/lb) 180 2021 Costs Based on Current Prices Current Spot LME Price 160 140 120 100 80 60 40 RED DOG 20 0 0% 25% 50% 75% 100% 88
Slide 89: Red Dog Extension Project
Red Dog Extension Project Long Life Asset Looking Northwest • Aktigiruq exploration target of 80-150 Mt @ 16-18% Zn + Pb1 Su-Lik Anarraaq Aktigiruq • Anarraaq Inferred Resource2: 19.4 Mt @14.4% Zn, 4.2% Pb Quality Project • Premier zinc district Paalaaq • Significant mineralized system Aqqaluk • Hig
Slide 90: Endnotes: Base Metals Business Units
Endnotes: Base Metals Business Units Slide 75: Significant Base Metals Growth - Expanding our high-quality Base Metals business 1. Source: Wood Mackenzie base case copper production dataset. Consolidated production estimate was derived based on accounting standards for consolidation. Copper producti
Slide 91: Endnotes: Base Metals Business Units
Endnotes: Base Metals Business Units Slide 79: World Class Zinc Business 1. Mining operations only, and therefore excludes Trail. Calculated as Gross Profit before D&A divided by reported Revenue, sourced from Teck’s public disclosures. Margin data from 2017-2020 are for the full year, while margin
Slide 92: Copper Market
Copper Market
Slide 93: Copper Supply Needed for Electrification Targets
Copper Supply Needed for Electrification Targets Supply committed pre-pandemic insufficient to meet growing demand Supply response falling short Copper Mine Growth1 (kt) • >80% of the current committed mine projects were 2019-2021 2021-2023 2023-2026 21,000 890 kt 1,730 kt -170 kt sanctioned prior t
Slide 94: Copper Market
Copper Market Physical inventories continue to tighten Available LME Stocks Drop to Historic Lows1 • Demand for raw materials and mine disruptions $11,000 300 keep concentrate demand high $10,000 250 ‒ Mine production cuts YTD 2021 ~0.6 Mt $9,000 200 150 ‒ Chinese/EU smelters face power restrictions
Slide 95: Global Copper Mine Production Increasing Slowly
Global Copper Mine Production Increasing Slowly Mine Production Set To Increase 2.2 Mt By 20241 Global Copper Mine Production2 (kt contained) Includes: Mine kmt 22,000 Kamoa – Kakula 535 20,000 PT – Freeport (vs 2019) 435 Quebrada Blanca 2 300 18,000 Quellaveco to 2024 275 16,000 Cobre Panama 252 Ch
Slide 96: Copper Disruptions Continue To Impact Mines
Copper Disruptions Continue To Impact Mines Smelters now facing power supply issues TC/RCs Spot and Annual Falling1 (US$/lb) Disruptions (kt)2; $120 2005 2007 2009 2011 2013 2015 2017 2019 2021 $110 0 $100 -200 $90 $80 -400 $70 -600 $60 2.7% 4.0% $50 -800 3.6% Run $40 Rate -1,000 4.0% $30 -1,200 $20
Slide 97: Growth in Copper Smelter Capacity
Growth in Copper Smelter Capacity China added 3.2 Mt since 2019; 1.9 Mt of new announcements ex-China Copper Mine Growth1 +1.9 Mt of New/Restarted Chinese Smelting Capacity (kt) +1.9 Mt of Ex-China Capacity 22,000 2023+ 1000 1,900 kt 2019 - 2021 2021- 2023 2023 - 2025 21,000 900 2021 – 2023 200kt 2,
Slide 98: Copper Supply
Copper Supply Chinese imports shift to concentrates to feed smelter capacity increases Chinese Scrap/Blister Imports Fall2 Chinese Imports Shift to Concentrates3 (Copper content, kt) (Copper content, kt) 2,500 12,000 10,000 2,000 8,000 1,500 6,000 1,000 4,000 500 2,000 0 0 2013 2014 2015 2016 2017 2
Slide 99: Copper Metal Stocks
Copper Metal Stocks Raw material shortages increase cathode demand • Exchange stocks have fallen 150 kt since June, Daily Copper Prices (US$/mt) and Stocks1 (kt) now equivalent to 3.9 days of global consumption $12,000 1,800 • Available stock days are now 1.5 days of global 1,600 consumption $10,000
Slide 100: Endnotes: Copper Market
Endnotes: Copper Market Slide 93: Copper Supply Needed for Electrification Targets 1. Copper concentrate supply and smelter demand 2019 – 2020 actuals and 2021 – 2026 forecasts, includes committed projects and projected 4% disruption allowance. Wood Mackenzie, CRU, Teck. As at September 30th, 2021.
Slide 101: Zinc Market
Zinc Market Teck
Slide 102: Zinc Outperforms Market Expectations
Zinc Outperforms Market Expectations Chinese mine production continues to underperform expectations Concentrate market remains tight through 2021 China Zinc Concentrate Supply1 (Kmt) • Spot TCs unchanged all year at historically low levels 8,000 40% • China energy shortages have minor impact on Chin
Slide 103: Zinc Market
Zinc Market Raw materials shortages and strong demand support prices Steel Demand in China Supporting Zinc Price1 • Demand for raw materials and mine disruptions due to COVID-19 kept concentrate demand strong Operating Rates % 100 ‒ Mine production in 2020 declined ~1 Mt, while 75 smelter cuts were
Slide 104: Chinese Zinc Mine and Smelter Production
Chinese Zinc Mine and Smelter Production Mine production flat while smelter production increases Chinese Mine Production Flat Since 20181 Chinese Refined Production Up 13% Since 20182 (kt Contained) (kt Contained) 7,000 7,000 6,000 6,000 5,000 5,000 4,000 4,000 3,000 3,000 2,000 2,000 1,000 1,000 0
Slide 105: Global Zinc Mine Production Remains Under Pressure
Global Zinc Mine Production Remains Under Pressure Ongoing risk to supply growth in 2021 Estimated Chinese Zinc Mine Growth Changes in Mine Production Since Q1 20182 Rarely Achieved1 (Kmt Contained) New Mines China Mines ROW Mines Change 800 1,000 0 600 557 -1,000 495 400 -2,000 360 350 392 270 300
Slide 106: Zinc Stocks Continue to Decrease
Zinc Stocks Continue to Decrease Despite Refined Production Increases in China De-stocking Continues Additional Zinc Metal Chinese Stocks at Record Lows1,2 (kt) Required to Fill the Gap3 (kt) 1,600 1,400 1,400 1,174 1,200 1,200 1,095 1,109 1,000 1,000 800 770 788 800 600 627 627 400 600 503 200 400
Slide 107: Zinc Supply
Zinc Supply Mine production increasing in 2021, but remains at risk due to COVID-19 • Following the return of Chinese mine production Zinc Mine Production1 (kt contained) after COVID-19 shutdowns, increasing smelter 16,000 production kept China reliant on imported 14,000 concentrate • Chinese mine p
Slide 108: Zinc Concentrate Treatment Charges
Zinc Concentrate Treatment Charges Stable in 2021, near historical lows Treatment Charges1 (USD/dmt) 350 Benchmark TCs down 47% YoY 300 250 200 150 100 Spot TCs 50 down 75% vs. Feb 2020 peak 0 Spot TC Benchmark TC 108
Slide 109: Zinc Metal Stocks
Zinc Metal Stocks Global shipping backlog unable to keep up with demand causing falling inventory • Deficits over past 5 years drove down stocks, with Daily Zinc Prices1,2 (US$/mt) total stocks at only 7.2 days of global consumption and Stocks1,2 (kmt) by the middle of October 2021, compared to 38 L
Slide 110: Largest Global Net Zinc Mining Companies
Largest Global Net Zinc Mining Companies Teck is the Largest Net Zinc Miner1(kt) Provides significant exposure to a rising zinc price 300 Public Company 250 Teck Private Company 200 150 100 50 0 110
Slide 111: Endnotes: Zinc Market
Endnotes: Zinc Market Slide 102: Zinc Outperforms Market Expectations 1. China zinc concentrate supply requirements 2016 – 2023 estimates. Source: China NBS/CNIA, BGRIMM, Teck. 2. Global Visible Stocks. Source: LME, ICE, SHFE, SMM. To September 30th, 2021. Slide 103: Zinc Market 1. Source: Shanghai
Slide 112: Steelmaking Coal Business Unit
Steelmaking Coal Business Unit
Slide 113: Tier-One Steelmaking Coal Portfolio
Tier-One Steelmaking Coal Portfolio • Diversified, long term customer base 49% $2.2B • Stable long term strip ratio Steelmaking Coal Steelmaking Coal 12-year Historical Average 12-year Historical Average • Long term production run rate of Annual Impairment Annual Impairment 26-27 million tonnes per
Slide 114: Steelmaking Coal Operating Strategy
Steelmaking Coal Operating Strategy Optimized Supply Chain Map and Production Capacity1 • Improved market access and reliability for customers 20km • Pit to port integration maximizes short and long term Elk Valley synergies Fording River Increase Margins Not Volumes ~9.0 Mtpa • Strategically replac
Slide 115: Executing on the Elk Valley Water Quality Plan
Executing on the Elk Valley Water Quality Plan Saturated Rock Fill (SRF) Active Water Treatment Facilities (AWTF) • Tank based biological treatment process removes nitrate and transforms selenium into a solid form Saturated Rock Fill (SRF) • Uses naturally-occurring biological process in old mining
Slide 116: Optimally Positioned For a Decarbonizing Future
Optimally Positioned For a Decarbonizing Future • Teck’s premium hard coking coal improves blast Steelmaking Coal CO2 Intensity Curve1 furnace efficiency and decreases CO2 emissions (t CO2e/t saleable coal) per tonne of steel Will be even more cost competitive with rising CO2 prices globally • Withi
Slide 117: Proven Operator, Managing for Margin And Costs Through Cycles
Proven Operator, Managing for Margin And Costs Through Cycles Low Price Environment Steelmaking Coal Impairment Adjusted EBITDA1 Cost focus to protect margins and maximize Free Cash Flow1 & Impairment Adjusted EBITDA Margin1 (%) Annual Impairment Annual Impairment Annual ★ 2013: Cost Reduction Progr
Slide 118: Top Quartile Margins in Steelmaking Coal
Top Quartile Margins in Steelmaking Coal Managing our Core Business Drivers to Strong Cash Flow Generation Potential2 Optimize Margins Clean Coal Production per Estimated Effect on Estimated Effect on Annum Change Annualized Profit3 Annualized EBITDA3 • Neptune capacity increase and third-party logi
Slide 119: Steelmaking Coal Unit Costs
Steelmaking Coal Unit Costs Unit Costs1 in 2020 Operating Cost1 Breakdown in 2020 Depreciation Labour 34% and Amortization Contractors and Consultants 13% 24% Operating Costs Operating Supplies 16% 47% Repairs and Maintenance Parts 19% Transportation Energy 14% 29% Other 4% Total 100% 119
Slide 120: Sustain Production Capacity and Productivities In Steelmaking Coal
Sustain Production Capacity and Productivities In Steelmaking Coal Maintaining historical dollar per tonne Sustaining Capital, Excluding Water Treatment1 ($/t) sustaining investment levels 2010-2016: Average spend of ~$11 per tonne1 • Swift at Fording River and Line Creek • Reinvestment in 5 shovels
Slide 121: Haul Truck Rebuild Strategy
Haul Truck Rebuild Strategy Potential to significantly reduce capital costs Significant benefits from moving to a haul truck rebuild strategy, vs. replacing 930E trucks at the end of truck life • Reduces capital spending for new truck purchases • Increases fleet operating hours • Reduces fleet opera
Slide 122: Steelmaking Coal Supply Chain Transformation
Steelmaking Coal Supply Chain Transformation Neptune upgrade in site-wide ramp up phase • Ramp up in Q3 2021 • Equipment performing according to, or exceeding, plan • Starting to see the benefit of lower port costs, with a higher percentage of sales volumes loaded at Neptune • In Q3 2021: ‒ Throughp
Slide 123: West Coast Port Capacity
West Coast Port Capacity NEPTUNE COAL TERMINAL • World class design and equipment for enhanced reliability Teck’s Contracted West Coast • Capacity >18.5 Mtpa Port Capacity (Nominal Mt) • Upstream supply chain functioning to plan, supported by ~$150M infrastructure investment • 100% ownership of coal
Slide 124: Endnotes: Steelmaking Coal Business Unit
Endnotes: Steelmaking Coal Business Unit Slide 113: Tier-One Steelmaking Coal Portfolio 1. The 12-year historical average annual Impairment Adjusted EBITDA and Impairment Adjusted EBITDA Margin are for the 2009 to 2020 period, inclusive. Impairment Adjusted EBITDA and Impairment Adjusted EBITDA Marg
Slide 125: Steelmaking Coal Market
Steelmaking Coal Market Teck
Slide 126: Steelmaking Coal Facts
Steelmaking Coal Facts Global Coal Production1: ~7.4 billion tonnes Steelmaking Coal Production2: ~1,130 million tonnes Export Steelmaking Coal2: ~320 million tonnes Seaborne Steelmaking Coal2: • ~0.7 tonnes of steelmaking coal is used to ~285 million tonnes produce each tonne of steel3 • Up to 100
Slide 127: Steelmaking Coal Prices Resilient Despite Import Ban
Steelmaking Coal Prices Resilient Despite Import Ban Australian banned exports absorbed by strong steel market Steelmaking coal prices diverge on import ban Steelmaking Coal Prices1 (US$/t) • CFR prices into China hit all time high 800 • Chinese steel production continues to grow at 1.1 Gt 600 annua
Slide 128: Australian Coal Ban Absorbed
Australian Coal Ban Absorbed Displaced Australian coal taken up by ex-China market Australian HCC finds new homes; market pivots Australian HCC Exports1 (Mt) • Australian coal banned; ROW to fill the Chinese gap 100 43 • Australian exports to China drop to zero from ~34 Mt 33 33 31 • Increased deman
Slide 129: Long Term Steelmaking Coal Demand Well Supported
Long Term Steelmaking Coal Demand Well Supported Planned blast furnace capacity set to grow Asian blast furnace capacity continues to grow Blast Furnace Capacity2 (Mt) • Asia committing to 20+ years of traditional steel making 180 • European steel mills seek alternatives to coal feed 160 • Hydrogen
Slide 130: Steelmaking Coal Demand Growth Forecast
Steelmaking Coal Demand Growth Forecast Continued recovery with majority of banked blast furnaces restarted Seaborne Steelmaking Coal Imports1 (Mt) Change 2021 vs. 2019 330 7 17 320 320 5 310 304 10 3 2 300 5 4 2 293 22 13 290 9 280 270 260 2019 China Europe India JKT Brazil SE Asia 2020 China Europ
Slide 131: Steelmaking Coal Demand Growth Forecast
Steelmaking Coal Demand Growth Forecast Continued recovery with majority of banked blast furnaces restarted Seaborne Steelmaking Coal Imports1 (Mt) Change 2019 to 2022 330 7 17 320 320 5 304 1 1 3 311 310 10 2 2 3 1 Flat 300 5 4 2 293 22 13 290 9 280 270 260 Includes: • India: Growing steel producti
Slide 132: Indian Steelmaking Coal Imports
Indian Steelmaking Coal Imports Mid- & long-term imports supported by strong demand and government targets Indian Crude Steel Production1 (Mt) Indian Seaborne Coking Coal Imports2 (Mt) 120 60 100 50 80 40 60 30 40 20 20 10 0 0 India 2021 crude steel production and seaborne coking coal imports surpas
Slide 133: Chinese Steelmaking Coal Imports – Australia Ban
Chinese Steelmaking Coal Imports – Australia Ban 2021 ex-Australia seaborne imports up to new record high of 33Mt Chinese Crude Steel Production (CSP), Hot Metal Chinese Coking Coal Imports2 (Mt) Production (HMP) and Coal Production (Mt)1 1,200 600 80 70 16 1,000 500 60 34 24 15 26 800 400 50 28 24
Slide 134: Chinese Steel Margins
Chinese Steel Margins Steel margins moderated but remain very healthy China Hot Rolled Coil (HRC) Margins and Steelmaking Coal (HCC) Prices1 (US$/t) 700 600 500 400 300 200 100 0 -100 Gross HRC profits Argus PHCC CFR China TSI 62% Fe CFR China 134
Slide 135: Chinese Scrap Use Remains Low
Chinese Scrap Use Remains Low Scrap supply limits EAF share in steel output China’s scrap ratio lower than global average of 38%1 China Steel Use By Sector (2019)2 (2000-2020)3 100% 83% 80% 69% 55% 60% 42% 40% 34% Others 40% 22% 15-25% 20% 0% Turkey USA EU Russia Korea Japan China Auto 2025 EAF shar
Slide 136: Steelmaking Coal Supply Growth Forecast
Steelmaking Coal Supply Growth Forecast Supply partially recovers; while crude steel production up significantly Seaborne Steelmaking Coal Exports1 (Mt) Change 2021 vs. 2019 320 314 12 310 11 300 5 3 0 1 1 289 290 7 2 1 1 281 6 2 280 4 270 260 • Australia: Production to increase in 2022 • Russia: Hi
Slide 137: Steelmaking Coal Supply Growth Forecast
Steelmaking Coal Supply Growth Forecast Supply partially recovers; while crude steel production up significantly Seaborne Steelmaking Coal Exports1 (Mt) Change 2019 to 2022 320 314 12 310 11 301 300 1 1 0 5 1 289 2 4 3 0 1 1 290 7 5 2 1 1 281 6 2 4 280 270 260 • Australia: Production to increase in
Slide 138: Australia and US Steelmaking Coal Exports
Australia and US Steelmaking Coal Exports 2021 Australia and US coal exports down vs. 2019 Australian Exports1 (Mt) US Exports2 (Mt) 200 70 180 60 160 140 50 120 40 100 30 80 60 20 40 10 20 0 0 2021E 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Slide 139: Canadian & Mozambique Steelmaking Coal Exports
Canadian & Mozambique Steelmaking Coal Exports 2021 Canadian exports impacted by B.C. wildfires Canadian Exports1 (Mt) Mozambique Exports2 (Mt) 40 9 8 35 7 30 6 25 5 20 4 15 3 10 2 5 1 0 0 139
Slide 140: 2nd Largest Seaborne Steelmaking Coal Supplier
2nd Largest Seaborne Steelmaking Coal Supplier Competitively positioned to supply steel producers worldwide Sales Distribution CHINA 2013: ~30% EUROPE 2017: ~15% 2013: ~15% INDIA 2017: ~20% 2019: ~10% 2013: ~5% 2019: ~15% 2020: ~15% AMERICAS 2017: ~10% 2020: ~15% 2019: ~15% ~5% 2020: ~15% ASIA EXCL.
Slide 141: Endnotes: Steelmaking Coal Market
Endnotes: Steelmaking Coal Market Slide 126: Steelmaking Coal Facts 1. Source: IEA. 2. Source: Wood Mackenzie (Long Term Outlook H2 2020). 3. Source: World Coal Association. Assumes all of the steel required is produced by blast furnace-basic oxygen furnace route. 4. Source: The Coal Alliance. Assum
Slide 142: Endnotes: Steelmaking Coal Market
Endnotes: Steelmaking Coal Market Slide 136: Steelmaking Coal Supply Growth Forecast 1. Source: Wood Mackenzie (Short Term Outlook September 2021). 2. Source: T. Parker. Slide 137: Steelmaking Coal Supply Growth Forecast 1. Source: Wood Mackenzie (Short Term Outlook September 2021). 2. Source: T. Pa
Slide 143: Steelmaking Coal Resilience
Steelmaking Coal Resilience
Slide 144: Executive Summary
Executive Summary Steel demand is forecast to Demand for high-quality Global steel industry emits Blast furnace CCUS is the only remain strong through to 2050 seaborne hard coking coal 7-10% of total GHG emissions technology capable of used in blast furnace decarbonizing steelmaking at steelmaking i
Slide 145: Steel is Essential for Economic Growth In a Low-Carbon World
Steel is Essential for Economic Growth In a Low-Carbon World World’s largest metal Enables low-carbon Suited for a circular Essential to lifting market today energy system economy global living standards Steel is widely used and hard Fundamental to renewable Easily recyclable (e.g., without Middle c
Slide 146: Steel Demand Is Robust Through 2050 In all IEA Scenarios
Steel Demand Is Robust Through 2050 In all IEA Scenarios Finished steel demand, billion tonnes Billion tonnes 2.5 2.1 2.1 2.0 Standard Growth scenario – IEA SDS1 2.0 1.8 ▪ Industrialized growth in India and Developing South East Asia 1.5 India ▪ China plateaus until 2030 before converging to Japan/G
Slide 147: Steelmaking Technologies are Driven by Regional Factors
Steelmaking Technologies are Driven by Regional Factors Blast Furnace + CCUS Proven technology with favorable economics in regions with young blast furnaces (Asia) and abundant sequestration capacity, deriving the best combination of speed and scale for decarbonization Scrap Currently accounts for ~
Slide 148: Blast Furnace + CCUS Will Lead Large-Scale Decarbonization Adoption
Blast Furnace + CCUS Will Lead Large-Scale Decarbonization Adoption Blast Furnace + CCUS is adoption ready Blast Furnace + CCUS adoption will lead through 20502 Proven technology in hard-to-abate industries 100% • CCUS operates in power generation, refining, petrochemicals, agrichemicals, and steel/
Slide 149: Blast Furnace + CCUS is the Only Technology That Can be Adopted with Speed and Scale
Blast Furnace + CCUS is the Only Technology That Can be Adopted with Speed and Scale Total Cost of Ownership1 (US$/t liquid steel) To make hydrogen steelmaking cost competitive, China (SDS – 1.7o scenario) ample access to low-cost hydrogen (US$1-2/kg) is 800 required. This implies: 750 Stable supply
Slide 150: Despite Robust Steel Demand, Long-Term Demand for Steelmaking Coal Is Expected to Decline…
Despite Robust Steel Demand, Long-Term Demand for Steelmaking Coal Is Expected to Decline… Steelmaking Coal Demand1 (Mtpa) Global demand for non-seaborne hard coking coal is expected to decline by 2050 due to 3 factors: 1. Increased steel scrap availability The magnitude and recycling in mature regi
Slide 151: …But Long-Term Demand for Seaborne Hard Coking Coal Will Remain Robust
…But Long-Term Demand for Seaborne Hard Coking Coal Will Remain Robust Seaborne Steelmaking Coal Demand1 (Mtpa) 235 • Seaborne HCC demand is expected to 188 remain resilient due to steel demand growth in 191 Seaborne hard regions that rely on lower-cost seaborne hard Rest of World coking coal (HCC)
Slide 152: Blast Furnace Capacity Development is Well Underway in India and South-East Asia
Blast Furnace Capacity Development is Well Underway in India and South-East Asia • Asia committing to 20+ years of traditional steel making Blast Furnace Capacity2 (Mt) • European steel mills seek alternatives to coal feed 180 • Hydrogen pilot plants only, commercial technology still 160 decades awa
Slide 153: Teck's Hard Coking Coal Is Optimally Positioned For a Decarbonizing Future
Teck’s Hard Coking Coal Is Optimally Positioned For a Decarbonizing Future Teck’s HCC has amongst lowest Highest quality HCC leading to Globally advantaged seaborne Scope 1 and Scope 2 emissions lowest CO2 emissions in logistics and cost position relative to peers steelmaking • Teck’s emissions inte
Slide 154: Endnotes: Steelmaking Coal Resilience
Endnotes: Steelmaking Coal Resilience Slide 145: Steel is Essential for Economic Growth In a Low-Carbon World 1. Source: Teck. 2. Source: WSA, IEA. 3. India (from ~100 Mt in 2019 to 300 Mt in 2050) and South-East Asia (from ~100 Mt in 2019 to ~230 Mt in 2050) IEA SDS Scenario assumptions on CO2 pric
Slide 155: Energy Business Unit
Energy Business Unit Teck
Slide 156: Fort Hills Oil Sands Mine
Fort Hills Oil Sands Mine State of the art oil sands mining facility Capacity High Ore Quality1 200+kbpd (11.4% bitumen grade) (Dec 2018) Low GHG Long Life Intensity2 Resource1 (550Mbbls Teck share) 156
Slide 157: Fort Hills Operations Update
Fort Hills Operations Update Operational problems being addressed, with continued focus on production ramp-up • Mining contractors now on site to support ramp-up • Major water inflows are capped • Process underway to stabilize and maintain pit wall slope • Recent operational performance show clear s
Slide 158: Fort Hills Financial Outlook
Fort Hills Financial Outlook Financial performance improves once production is stabilized Assumptions EBITDA3 – Teck’s Share (C$ million) Fort Hills $600 2021 Potential $500 NYMEX WTI US$67.93 US$75.00 Nameplate Nameplate $400 Capacity Capacity 194,000 bpd1 WTI-WCS differential US$13.01 US$12.00 194
Slide 159: Significant EBITDA Upside Potential in Energy
Significant EBITDA Upside Potential in Energy Providing the basis for strong and steady cash flow for decades Assumptions EBITDA1 Potential – Teck’s Share (C$ million) WTI @ WTI @ $900 US$75/BBL US$60/BBL $800 WTI-WCS differential US$10.75 US$10.75 $700 +$150M $600 C$/US$ exchange rate 1.25 1.25 $50
Slide 160: Best In Class Low Carbon Intensity Production
Best In Class Low Carbon Intensity Production Our Fort Hills blend can displace carbon intensive crudes • Emissions intensity of Canadian oil sands Total Life Cycle Emissions Intensity has declined by 25%; estimated reduction (kg CO2e/bbl refined product – gasoline/diesel) of 15% to 20% by 2030 • PF
Slide 161: Endnotes: Energy Business Unit
Endnotes: Energy Business Unit Slide 156: Fort Hills Oil Sands Mine 1. Source: Oil Sands Magazine. https://www.oilsandsmagazine.com/projects/suncor-fort-hills-mine 2. Source: Oil Sands Magazine. https://www.canadianenergycentre.ca/this-oil-sands-crude-has-lower-ghg-emissions-than-the-u-s-average/ Sl
Slide 162: Energy Market
_ o 4 Same a) = D> ©) Same oO Cc LU Teck
Slide 163: Crude Oil Prices Supported by Strong Demand
Crude Oil Prices Supported by Strong Demand Demand-supply imbalance leading to price recovery Demand returning to pre-COVID-19 levels Global Crude/Liquids Demand/Supply (Mbpd) • Q4 2021 and 2022 annual forecast ~100 Mbpd 110 • Mobility levels improving, including jet travel 100 • Fuel switching adds
Slide 164: Endnotes: Energy Marketing
Endnotes: Energy Marketing Slide 162: Crude Oil Prices Supported by Supply Restraints 1. Source: Monthly Market Reports published by Energy Aspects, International Energy Agency (IEA), Energy Information Agency (EIA), Organization of Petroleum Exporting Countries (OPEC). 2. Source: CME Group, NetEner
Slide 165: Non-GAAP Financial Measures
Non-GAAP Financial Measures
Slide 166: Non-GAAP Financial Measures
Non-GAAP Financial Measures Our financial results are prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board. This document refers to a number of Non-GAAP Financial Measures which are not measures recognized under IFRS
Slide 167: Non-GAAP Financial Measures
Non-GAAP Financial Measures Adjusted cash cost of sales – Adjusted cash cost of sales for our copper and zinc operations is defined as the cost of the product delivered to the port of shipment, excluding depreciation and amortization charges, any one-time collective agreement charges or inventory wr
Slide 168: Reconciliation of Profit (Loss) and Adjusted Profit
Non-GAAP Financial Measures Reconciliation of Profit (Loss) and Adjusted Profit 168
Slide 169: Reconciliation of Earnings Per Share to Adjusted Earnings Per Share
Non-GAAP Financial Measures Reconciliation of Basic Earnings (Loss) Per Share to Adjusted Basic Earnings (Loss) Per Share and Reconciliation of Diluted Earnings (Loss) Per Share to Adjusted Diluted Earnings Per Share 169
Slide 170: Reconciliation of Net Debt to Adjusted EBITDA Ratio
Non-GAAP Financial Measures Reconciliation of Net Debt to Adjusted EBITDA Ratio We include net debt measures as we believe they provide readers with information that allows them to assess our credit capacity and the ability to meet our short and long-term financial obligations, as well as providing
Slide 171: Reconciliation of EBITDA and Adjusted EBITDA
Non-GAAP Financial Measures Reconciliation of EBITDA and Adjusted EBITDA Reconciliation of EBITDA by Business Unit Three months ended September 30, 2021 Steelmaking (CAD$ in millions) Copper Zinc Coal Energy Corporate Total Profit (loss) before tax $ 296 $ 246 $ 1,009 $ (37) $ (159) $ 1,354 Net fina
Slide 172: Reconciliation of Impairment Adjusted EBITDA and Margin
Non-GAAP Financial Measures Reconciliation of Impairment Adjusted EBITDA and Impairment Adjusted EBITDA Margin For the 12 Years Ending (C$ in millions) December 31, 2020 Steelmaking Coal Profit (loss) before taxes $ 15,847 Finance expense net of finance income 398 Depreciation and amortization 7,808
Slide 173: Reconciliation of Gross Profit Before Depreciation and Amortization
Non-GAAP Financial Measures Reconciliation of Gross Profit Before Depreciation and Amortization and Reconciliation of Gross Profit (Loss) Margins Before Depreciation 173
Slide 174: Gross Profit Margin from Mining Operations
Non-GAAP Financial Measures Reconciliation of Gross Profit Before Depreciation & Amortization Margin from Mining Operations Year ended Year ended Year ended Year ended Six months ended (C$ in millions, except where noted) December 31, 2017 December 31, 2018 December 31, 2019 December 31, 2020 June 3
Slide 175: Gross Profit Margin from Mining Operations (cont.)
Non-GAAP Financial Measures Reconciliation of Gross Profit Before Depreciation & Amortization Margin from Mining Operations (cont.) Year ended Year ended Year ended Year ended Six months ended (C$ in millions, except where noted) December 31, 2017 December 31, 2018 December 31, 2019 December 31, 202
Slide 176: Copper Unit Cost Reconciliation
Non-GAAP Financial Measures Copper Unit Cost Reconciliation 1. Average period exchange rates are used to convert to US$ per pound equivalent. We include unit cost information as it is frequently requested by investors and investment analysts who use it to assess our cost structure and margins and co
Slide 177: Copper Unit Cost Reconciliation
Non-GAAP Financial Measures Copper Unit Cost Reconciliation Three months ended Three months ended Year ended Year ended (C$ in millions, except where noted) December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Revenue as reported $ 820 $ 592 $ 2,419 $ 2,469 By-product revenue (A)
Slide 178: Zinc Unit Cost Reconciliation (Mining Operations)
Non-GAAP Financial Measures Zinc Unit Cost Reconciliation (Mining Operations) 1. Red Dog mining operations. 2. Average period exchange rates are used to convert to US$ per tonne equivalent. We include unit cost information as it is frequently requested by investors and investment analysts who use it
Slide 179: Steelmaking Coal Unit Cost Reconciliation
Non-GAAP Financial Measures Steelmaking Coal Unit Cost Reconciliation 1. Average period exchange rates are used to convert to US$ per tonne equivalent. We include unit cost information as it is frequently requested by investors and investment analysts who use it to assess our cost structure and marg
Slide 180: Energy Operating Netback and Adjusted Operating Costs
Non-GAAP Financial Measures Energy Operating Netback, Bitumen & Blended Bitumen Price Realized Reconciliations and Adjusted Operating Costs and Adjusted Operating Costs1 1. Calculated per unit amounts may differ due to rounding. 2. Bitumen price realized represents the realized petroleum revenue (bl
Slide 181: Energy Operating Netback and Adjusted Operating Costs
Non-GAAP Financial Measures Energy Operating Netback, Bitumen & Blended Bitumen Price Realized Reconciliations and Adjusted Operating Costs and Adjusted Operating Costs1 3. Reflects adjustments for costs not directly attributed to the production of Fort Hills bitumen, including transportation for no
Slide 182: Reconciliation of Free Cash Flow
Non-GAAP Financial Measures Reconciliation of Free Cash Flow (C$ in millions) 2003 to Q3 2021 Cash Flow from Operations $ 40,790 Debt interest paid (6,130) Capital expenditures, including capitalized stripping costs (32,038) Payments to non-controlling interests (NCI) (608) Free Cash Flow $ 12,014 D
Slide 183: Global Natural Resources Conference
Global Natural Resources Conference November 10, 2021
Teck Resources — Goldman Sachs Global Natural Resources Conference 2021 on 6ix