Development Strategy for a Shared Mineral Resource at Teck Coal

Teck Coal Limited is the world’s second largest exporter of seaborne steel-making coal. Teck Coal operates six mines in western Canada and two of the mines, Fording River Operations and Greenhills Operations, are in located adjacent to each other with both sites advancing on the same future mining area known as Greenhills Ridge. Steel-making coal is a bulk resource commodity, and Teck is a price-taker in the market. This paper will examine and evaluate, from an organizational and structural standpoint, how key the metrics of costs, flexibility, sustainability, efficiency, and dependability changes with increased levels of integration between the sites to determine if there is a preferred strategy to develop the ridge. Four scenarios will be examined, including the status quo of continuing to operate as independent mine sites. Key barriers will also be examined, with risks weighed against the benefits for each scenario. A path forward will be recommended, as well as a strategy for successful implementation.