- Teck drops its Frontier oil sands line project worth C$20.6 billion.
- Teck to write down the project's C$1.13 billion carrying value.
- PM Trudeau reiterates the government's commitment towards working with Alberta.
Teck Resources Ltd, a leading name in the league of Canadian miners, had previously applied to build its Frontier oil sands mine located in Alberta worth C$20.6 billion. In its announcement on Sunday, however, Teck declared its application to have been withdrawn. The federal government was scheduled to release its verdict regarding the project that was broadly criticized by indigenous groups including environmentalists in a few days.
Teck To Write Down The Project’s C$1.13 Billion Carrying Value
Sunday’s announcement also highlighted that Teck plans on writing down the carrying value of C$1.13 billion associated with the project. In his letter to Canada’s environment minister, CEO Don Lindsay of Teck expressed his disappointment that the miner had to come to this point.
Upon implementation, the mine would have had a total capacity of producing 260,000 BPD (barrels per day) of crude oil that would have made it the largest mine in carbon-intensive oil sands of Alberta.
The decision regarding Teck’s Frontier oil sands mine was a tough one for Prime Minister Trudeau who pledged in 2019 election that Canada will work committedly towards achieving the goal of hitting the net-zero level in greenhouse gas emissions by the year 2050.
The energy and pipeline policy of Trudeau’s government, however, saw the Liberal party losing all of its seats in Alberta. The aforementioned project was seen as essential in Alberta for extending growth and improving employment figures.
PM Trudeau Reiterates Government’s Commitment To Work With Alberta
On the other hand, protestors have joined hands with an aboriginal band in British Columbia in recent weeks to block railway lines in Alberta, Quebec, and Ontario. The protest seeks the authorities to quit the plan of a gas pipeline construction over British Columbian land.
In his statement, Trudeau’s office highlighted on Sunday that the Prime Minister is in contact with Alberta Premier Jason Kenney to discuss the railway blockades and Teck’s decision. The office reiterated the government’s commitment to exploring equally favorable alternatives for Alberta that could help create jobs in the long run.
At the time of writing, Teck is exchanging hands at $10.92 per share in the stock market that marks an around 40% decline in 2020 so far. Teck’s performance in 2019 also remained under pressure in the stock market. While share prices were seen as high as around $21 in January 2019, the stock was reported having closed the last year at a much lower $17 per share that translates into an around 20% annual loss.