Teck Resources Limited
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Teck Resources Limited

September 18, 2017 00:00 ET

Teck Increases Red Dog Production Guidance and Updates Exploration Results in the Red Dog District

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Sept. 18, 2017) - Teck Resources Limited (TSX: TECK.A and TECK.B, NYSE: TECK) ("Teck") today announced increased zinc production guidance for its Red Dog operation and recent results of exploration in the Red Dog District in Alaska.

"We are pleased with the significant improvements in recovery at our Red Dog Operations in the last few months and consequently production will now exceed previous guidance for the year by approximately 50,000 tonnes," said Don Lindsay, President and CEO. "As well, our exploration results at our nearby Aktigiruq deposit show its potential to be one of the best undeveloped zinc deposits in the world."

Red Dog Operations Production Guidance Update

Red Dog's zinc production for 2017 is now expected be in the range of 525,000 to 550,000 tonnes, up from the most recent guidance range of 475,000 to 500,000 tonnes of zinc. The increase in production is due to changes in mine sequencing and improved metallurgical recoveries, enabling higher grade mill feed with a greater percentage of ore from the Qanaiyaq pit in the second half of the year.

Annual zinc production at Red Dog over the next five years is expected to be between 475,000 and 550,000 tonnes of zinc. This assumes completion of a mill upgrade project which is expected to increase average mill throughput by about 15% over the remaining mine life, helping to offset lower grades and harder ore in the Aqqaluk pit. This project has robust economics and is expected to be complete by Q4 2019 at a capital cost of US$110 million. Because the upgrade project will permit lower grade material to be processed, the current mine life, based on existing developed deposits, will remain unchanged through to 2031.

Red Dog District Exploration Update

Teck's regional exploration has focused on a significant high-grade zinc deposit, known as Aktigiruq, for a number of years. Located on 100% Teck owned state claims 12 kilometres North West of Red Dog Operations, Aktigiruq is located adjacent to the Anarraaq deposit, and was previously noted in the NI 43-101 Technical Report for the Red Dog Mine dated February 21, 2017.

Current drill hole spacing is not sufficient for a mineral resource estimate, but the drill data, outlined in Table 1 below, suggests an exploration target for Aktigiruq in the range of 80 million tonnes to 150 million tonnes of mineralization at a grade of between 16% combined zinc plus lead and 18% combined zinc plus lead (12% zinc + 4% lead and 14% zinc + 4% lead, respectively). If realized, this would make the Aktigiruq zinc deposit one of the top undeveloped zinc deposits in the world. Past production since 1989 to the end of 2016 for Red Dog Operations is 78.3 million tonnes at 19.6% zinc and 5.3% lead and Red Dog proven and probable reserves at December 31, 2016 were 50.9 million tonnes at 15% zinc and 4.2% lead.

The potential quantity and grade of the Aktigiruq exploration target is conceptual in nature. There has been insufficient exploration to define a mineral resource and it is uncertain if further exploration will result in the target being delineated as a mineral resource.

Teck continues to explore the Aktigiruq deposit with a 2017 helicopter supported drill program to test internal continuity and lateral extents of the deposit. The $16 million 2017 program includes approximately 18,000 metres in 16 to 20 drill holes and is well underway with 10 holes and 9,862 metres drilled to the end of August 2017. No analytical results for the 2017 program have been received to date, but visual estimates are consistent with the model's expectations and results of this program will be released once all assay results are returned.

Prior to the 2017 drill program a total of 25 wide spaced diamond drill holes have intersected mineralization, similar to other sediment hosted zinc-lead mineralization in the Red Dog district, at Aktigiruq over an area of approximately 3 km by 1.5 km (Figure 1). Table 1 provides a summary of the pre-2017 drill hole locations for 39 holes in and around the mineralized body and Table 2 provides a summary of drill intercepts above 8% zinc plus lead which have intersected the mineralization located at depths of between 400 and 1,000 m below surface. Mineralization remains open in several directions and further drilling is planned both to test the internal continuity of mineralization as well as the limits of the system.

To view Figure 1, Location map showing pre-2017 drill collar locations, please visit the following link: http://media3.marketwire.com/docs/1102330_FIGURE1.jpg

Table 1. Drill hole location, elevation, azimuth, dip, depth for the Aktigiruq drill holes.

Hole ID Easting Northing Elevation
(ft)
Azimuth Dip Hole Length (m) Year Drilled
DDH0781 573934 5180116 1337 0 -90 483 1999
DDH0782 574764 5182489 1343 0 -90 409 1999
DDH0787 573209 5183952 1163 0 -90 337 1999
DDH0788 572404 5180989 1121 35 -88 479 1999
DDH0791 570344 5181035 1168 90 -85 533 1999
DDH0792 572372 5178910 1190 30 -85 469 1999
DDH0795 571127 5177309 1532 20 -84 593 1999
DDH0937 562960 5192160 756 11 -86 911 2000
DDH1112 562570 5191333 748 35 -88 909 2001
DDH1114 569282 5187317 1492 333 -89 1100 2001
DDH1116 569711 5183288 1347 305 -90 913 2001
DDH1120 564716 5191491 880 36 -88 945 2001
DDH1121 569701 5185262 1238 71 -90 1062 2004
DDH1122 568798 5189478 1091 349 -89 981 2004
DDH1123 570592 5182081 1293 45 -86 662 2004
DDH1137 568913 5186565 1417 47 -89 1138 2007
DDH1138 569373 5184190 1295 340 -90 1097 2007
DDH1139 571098 5179451 1579 314 -84 621 2007
DDH1140 569094 5188574 1031 16 -81 964 2007
DDH1142 571057 5184624 1188 109 -89 776 2007
DDH1143 569551 5181689 1338 1 -88 890 2007
DDH1144 570418 5186587 1449 354 -89 1056 2007
DDH1145 570770 5183185 1189 95 -89 710 2007
DDH1149 571979 5187059 1285 240 -88 880 2008
DDH1151 565928 5189726 851 255 -90 1146 2008
DDH1152 571920 5182075 1145 86 -87 648 2008
DDH1153 571026 5187564 1343 111 -89 875 2008
DDH1154 572765 5184365 1162 51 -89 532 2008
DDH1156 568374 5188304 1104 358 -87 1110 2008
DDH1157 571777 5183735 1103 57 -87 560 2008
DDH1159 572409 5185537 1165 59 -88 680 2008
DDH1191 570742 5179841 1549 82 -89 642 2012
DDH1708 573245 5186235 1357 298 -89 624 2014
DDH1730 571417 5185561 1265 109 -90 835 2015
DDH1734 571958 5185017 1159 245 -90 682 2015
DDH1737 570400 5185799 1342 201 -89 1048 2016
DDH1745 572000 5184398 1153 178 -89 611 2016
SUDS-28 575427 5181195 990 0 -90 248 1986
SUDS-31 575820 5183480 1005 0 -90 304 1988

Note: Collar locations are reported in NAD27 - State Plane Alaska Zone 7. Collar positions were determined by differential GPS.

Table 2. Significant drill hole intersections from the Aktigiruq project at >8% Zn+Pb.

Hole ID From
(m)
To
(m)
Length
(m)
Zn (%) Pb (%) Ag (g/t)
DDH0781 345.5 349.0 3.5 7.38 0.73 1.6
DDH0788 261.5 264.6 3.0 9.15 0.30 0.5
307.5 310.6 3.0 10.72 1.90 0.5
334.7 341.7 7.0 9.18 4.13 1.5
DDH0791 447.4 455.1 7.6 7.06 1.56 3.5
DDH1114 991.8 997.0 5.2 45.82 3.49 1.3
1001.6 1015.6 14.0 16.83 4.00 0.8
DDH1116 809.2 812.3 3.0 9.30 0.42 6.8
813.5 816.6 3.0 7.34 1.72 7.1
DDH1120 688.5 693.3 4.8 21.03 1.68 0.5
722.4 726.7 4.3 10.56 0.73 1.4
730.1 736.4 6.2 9.71 0.41 1.6
DDH1121 885.0 896.7 11.7 8.49 2.08 1.83
951.0 985.1 34.1 15.05 1.98 1.2
DDH1122 750.0 753.2 3.2 8.33 1.12 2.6
DDH1123 552.1 555.2 3.0 8.25 0.60 0.4
DDH1137 1002.8 1009.2 6.4 10.47 1.94 1.5
DDH1138 840.3 845.1 4.8 9.97 1.99 1.0
DDH1140 783.6 786.7 3.0 10.91 1.46 0.8
DDH1142 625.4 628.5 3.0 7.79 1.81 1.6
633.4 638.9 5.5 11.20 3.64 1.4
647.1 651.4 4.3 9.10 2.31 1.4
693.7 707.4 13.7 14.74 4.58 6.1
DDH1144 944.0 951.7 7.8 14.60 8.82 0.3
DDH1145 608.7 616.6 7.9 11.10 5.44 2.0
DDH1149 800.7 806.8 6.1 19.01 4.59 n/a
DDH1152 398.6 401.6 3.0 7.36 4.01 2.4
411.9 415.0 3.0 7.46 2.63 0.8
442.1 446.5 4.4 7.18 2.21 8.7
DDH1154 408.0 414.2 6.2 7.87 6.91 1.0
469.1 478.8 9.8 5.68 4.00 26.7
483.7 486.8 3.0 5.13 4.49 26.7
490.0 496.7 6.7 8.74 1.21 10.0
DDH1157 465.6 470.3 4.7 15.47 2.88 0.6
476.4 479.5 3.0 9.31 2.09 2.6
DDH1159 480.2 483.9 3.6 18.87 5.81 6.3
489.1 495.1 6.1 4.62 4.63 0.5
522.1 564.5 42.4 7.56 4.11 8.1
588.9 591.9 3.0 6.68 1.46 2.2
607.8 615.1 7.3 11.30 4.22 2.3
DDH1708 481.1 488.0 6.8 6.09 2.68 3.2
537.4 546.4 9.0 7.67 0.64 7.4
DDH1730 666.9 670.0 3.0 8.71 1.06 0.8
674.5 684.1 9.6 8.61 4.55 1.5
729.4 732.4 3.0 8.86 4.35 1.2
738.1 763.5 25.4 21.45 4.08 2.7
DDH1734 530.2 549.4 19.3 9.79 5.22 1.7
598.9 625.8 26.8 15.94 5.55 4.6
DDH1737 833.2 836.3 3.0 9.17 1.31 0.8
843.7 849.3 5.6 8.84 8.00 0.7
877.8 932.4 54.6 16.80 3.63 1.5
DDH1745 507.3 510.4 3.0 7.67 1.48 0.9
513.2 516.3 3.2 5.13 4.84 2.6
524.9 527.9 3.0 9.85 0.66 1.7
570.3 583.9 13.6 19.68 5.54 3.5

Notes: Intercepts were composited using the bulk mineable interval option in Vulcan V10.0 software at a cutoff of 8% Zn+Pb, minimum 10ft (3.05 m) core length and 10ft (3.05 m) dilution length.

The intersected length of mineralization is reported throughout this release. True thicknesses are not determined as the geometry of the mineralized zone is uncertain. True thickness of the intervals are estimated to be 89-99% of the downhole core lengths based on the interpreted attitude of the mineralized horizons.

Rodrigo Marinho, P.Geo, a qualified person for purposes of National instrument 43-101 and a Teck employee, has verified the data disclosed in this news release including sampling, analytical and test data underlying the information contained herein. Data verification procedures included site visits, review of drill and core collection, logging and sampling practices, and evaluation of quality control sample results and geological interpretations. Core samples can range from approximately 0.9 metres to 2.1 metres in length, and averaged 1.5 metres in length. Half core samples were sent to Bureau Veritas Laboratories in Vancouver, British Columbia, for analysis involving acid digestion and oxidative fusion with X-ray diffraction. The quality assurance-quality control program at Red Dog includes standards and blanks inserted at regular intervals as well as core, coarse crush and pulp duplicates all analyzed by Bureau Veritas.

About Teck

Teck is a diversified resource company committed to responsible mining and mineral development with major business units focused on copper, steelmaking coal, zinc and energy. Headquartered in Vancouver, Canada, its shares are listed on the Toronto Stock Exchange under the symbols TECK.A and TECK.B and the New York Stock Exchange under the symbol TECK. Learn more about Teck at www.teck.com or follow @TeckResources.

Forward-Looking Statements

This press release contains certain forward-looking statements within the meaning of the Unites States Private Securities Litigation Reform Act of 1995 and forward-looking information as defined in the Securities Act (Ontario). Forward-looking statements and information can be identified by the use of words such as "expects", "intends", "is expected", "potential" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "should", "would", "might" or "will" be taken, occur or achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-looking statements in this press release include, among others, statements regarding Red Dog production guidance for 2017 as well as over the next five years, the statement that the Aktigiruq deposit is one of the best undeveloped zinc deposits in the world, timing, capital cost and benefits of the mill upgrade project, Red Dog mine life and the tonnage and grade of mineralization of Aktigiruq.

These forward-looking statements involve numerous assumptions, risks and uncertainties and actual results may vary materially, including, but not limited to, assumptions that future geological work will support, and be consistent with, the Aktigiruq exploration target results, assumptions regarding Red Dog operations being conducted in accordance with our current plans, accuracy of our reserve estimates and geological estimates, assumptions regarding the representativeness of the current Aktigiruq exploration results, and assumptions regarding receipts of any required approvals. Our five year production guidance also completion of the mill upgrade project described above, and further assumes the mill upgrade project operates as projected and is completed by Q4 2019.

Factors that may cause actual results to vary materially include, but are not limited to, inaccurate geological and metallurgical assumptions, results of further exploration work not supporting or being consistent with the Aktigiruq exploration target results, unanticipated operational difficulties, unanticipated operational difficulties at Red Dog, inability to realize exploration potential, conclusions of future economic or geological evaluations, difficulty in obtaining or maintaining permits, and changes or further deterioration in general economic conditions. We will not achieve the maximum mine lives of our projects, or be able to mine all reserves at our projects, if we do not obtain relevant permits relating to our plans and deterioration in economic conditions.

Certain of these risks are described in more detail in the annual information form of Teck and in its public filings with Canadian securities administrators and the U.S. Securities and Exchange Commission. Teck does not assume the obligation to revise or update these forward-looking statements after the date of this document or to revise them to reflect the occurrence of future unanticipated events, except as may be required under applicable securities laws.

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