Teck Resources is putting in place additional measures to reduce costs and save capital as a result of persistent low commodity prices.
The company will pay an eligible dividend of CAN$0.05 per share on its outstanding Class A common shares and Class B subordinate voting shares on 30 December 2015.
The following capital reductions and deferrals are in comparison to preliminary 2016 capital spending plans. The 2016 capital budget is still under review and Teck will announce forecast 2016 capital spending in February 2016.
Teck intends to reduce spending of CAN$650 million in 2016. This is reported to be accomplished through CAN$350 million of capital spending reductions and deferrals of CAN$300 million of operating cost saving identified as part of the 2016 operating budget.
The company will cut back jobs through lay offs and attrition across its global offices and operations in order cut 1000 positions. Senior management positions will also be at risk of being cut. These job cuts will bring labour force reductions over the past 18 months to approximately 2000 positions.
The Coal Mountain Phase 2 (CMO) project will not go ahead to the Environmental Assessment process and further work on the project will be halted. Mining at the current Coal Mountain operations will finish in 4Q17.
Teck has pointed out it will identify options between now and the end of 2017 to potentially replace the 2.25 million tpa of coal production that were planned from CMO Phase 2 by optimising production from its five other metallurgical coal mines.
"We are implementing these additional measures to conserve capital, lower our operating costs and maintain financial flexibility in light of very difficult market conditions," commented Don Lindsay, President and CEO. "These steps build on our ongoing cost reduction programme and I want to thank all employees for their efforts to improve efficiency and productivity, while remaining keenly focused on safety and sustainability."
Edited from press release by Harleigh Hobbs
Read the article online at: https://www.worldcoal.com/coal/19112015/teck-resources-cutting-back-costs-3178/
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