Teck Announces Partners Proceeding with Fort Hills Oil Sands Project

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Oct. 30, 2013) - Teck Resources Limited (TSX: TCK.A and TCK.B, NYSE: TCK)("Teck") announced today that, along with its partners Suncor and Total, it is proceeding with the construction of the Fort Hills oil sands project.

"With an expected mine life in excess of 50 years, Fort Hills is one of the best undeveloped assets in the Athabasca region and is a natural fit with our business strategy of acquiring and developing long-life assets in stable jurisdictions," said Don Lindsay, President and CEO at Teck. "With Fort Hills and our other oil sands assets, we are building a new division within Teck that will create value, significant cash flow and diversification for our business for decades to come."

The Fort Hills partnership has three limited partners: Suncor (40.8%), Total E&P Canada (39.2%) and Teck (20%). Suncor is the developer and operator of the Fort Hills project under an operating services contract.

The project is located in Northern Alberta, approximately 90 kilometres north of Fort McMurray. Fort Hills has an estimated contingent resource of 3.3 billion barrels of bitumen. The project is scheduled to produce first oil as early as the fourth quarter of 2017 and achieve 90% of its planned production capacity of 180,000 barrels per day (bpd) of bitumen within 12 months. Teck's share of production is expected to be 36,000 bpd (13 million barrels per year) of bitumen.

The project has been designed to optimize and protect land use by utilizing the latest technology and approaches to tailings management and reclamation processes. Existing and future water quality standards and environmental regulations will be met or exceeded throughout the life of the project. The project will aim to return all disturbed lands to as close to a natural state as possible.

Based on Suncor's project cost estimates, Teck's portion of the fully-escalated capital investment in Fort Hills from the date of project sanction is estimated at approximately C$2.94 billion over four years (2014-2017), including remaining earn-in commitments of C$240 million. The gross overall project costs (all partners) since the project restart in 2011 are estimated by Suncor at a capital intensity of approximately $84,000 per flowing barrel of bitumen, within the range of similar recent oil sands projects.