Under the agreement, coal will be supplied at fixed rates and will originate from Teck’s Elkview, Cheviot and Line Creek operations in British Columbia. The previous Elkview agreement expiring March 31 included varied port rates.
Teck and Westshore have also amended their agreement permitting Westshore to handle coal for the Fording, Greenhills and Coal Mountain mines.
“From and after April 1, 2011, to the end of the term of this contract in 2012, none of Teck's port charges will be linked to the price of coal,” the company noted.
Teck will continue to use Westshore’s facility and will ship additional coal through the Neptune Terminals where the Vancouver producer holds a 48% interest.
The company recently announced production guidance of 23.5-25Mt in 2010 versus 19Mt in 2009, noting that it is “actively planning” for further production increases over the coming two years.
"Our coal team is focused on near-term expansion opportunities in light of the tight market that we expect for high-quality hard coking coal,” Teck president and chief executive Don Lindsay said in December.
“We are fortunate to be able to add production with relatively small incremental capital."
