Vancouver — On the eve of becoming the third-largest North American-based base metal mining company (aptly dubbed Teck-Cominco), Teck’s (TEK-T) second-quarter profit continued to be propelled by power sales from Cominco’s (CLT-T) Waneta hydroelectric dam near Trail, B.C.
Teck earned $23 million, or 21 per share, on revenue of $582 million in the second quarter ended June 30. This compares with $11 million, or 9 per share, on revenue of $151 million recorded in the second quarter of 2000.
The selling of surplus power to energy-starved American consumers generated an operating profit of $62 million for Cominco’s Trail smelter operation. This marks a significant jump from the $35 million recorded a year ago.
During the second quarter, Cominco’s power sales of 270,000 megawatt-hours (MWh) were up slightly from the 225,000 sold last year, but power prices soared to US$232 per MWh from the US$90 received in the second quarter of 2000.
Zinc production was 75% of design, or 53,400 tonnes, compared with 68,000 tonnes in the year-ago period.
Lower base metal prices during the quarter drove down the operating profits from other base metal assets. At the Red Dog zinc mine in Alaska, profit sank to $3 million, from the $19 million tallied last year. At the 50%-owned Highland Valley copper mine in B.C., 26,800 tonnes copper were produced during the second quarter, down 8% from the year-ago period. Lower copper prices resulted in an operating profit of $8 million, compared with $13 million last year.
Near Lima, Peru, the Cajamarquilla zinc refinery produced 27,800 tonnes of refined zinc in the second quarter, generating an operating profit of $5 million, compared with $9 million in the second quarter of 2000.
Teck’s gold operations produced 164,000 oz. in the second quarter, up from the 139,000 oz. tallied in the corresponding period last year. Driving the increase was the newly minted Carosue Dam mine in Australia, which produced 26,000 oz. Output from the Hemlo mines in Ontario continued to fall, coming in at 76,000 oz., down from 79,000 oz. recorded in the second quarter of 2000.
Teck’s British Columbia coal mines continued to rise on the back of higher sales and prices. Operating profit was $18 million, compared with a $4 million last year.
The merger between the two diversified miners become official July 20.
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