Teck

THE STEELMAKING COAL BUSINESS UNIT LEADS THE WAY FOR CANADA’S LARGEST DIVERSIFIED RESOURCE COMPANY

April 24, 2014

Komatsu equipment - heavy, powerful, and reliable

With about 14,000 employees, Vancouver-based Teck is Canada’s largest, and one of the world’s largest, diversified resources companies. While copper, zinc and energy business units are significant, coal is Teck’s largest division. It employs over 4,500 people and accounts for roughly half of the company’s sales and profits.

Teck owns five coal mines located within approximately 100 kilometres of each other in southeastern British Columbia, plus one in Alberta, west of Edmonton. In 2012, the company had coal revenues of more than $4.6 billion from about 24 million tonnes of high-quality, metallurgical-grade coal used to make steel. Unlike many coal producers worldwide, Teck coal sales remain strong, largely because of continued high demand from Asian countries that use it in their steel industries.

“More than 95 percent of our coal is steelmaking coal and much of it is very highly graded,” said Bill Fleming, Vice President, Engineering, Projects and Business Improvement, Coal. “Ours is the good stuff that makes the best and strongest coke – a key ingredient in making steel. Our goal is to work with individual customers to deliver the coal product they want and need.”

Teck’s coal is not necessarily the easiest to get to. Depending on the mine and the specific location within the mine, Teck operators may have to move as much as 20 to 25 tonnes of rock for every tonne of coal produced.

“I guess that would be the bad news,” said Fleming. “The good news is that we have a product that’s in demand and is worth going after, and we have a lot of it here. We have decades of proven reserves and billions of tonnes of steelmaking coal here in the valley. It’s literally one of the best coal-mining regions in the world.”

With five mines in such close proximity, but without a large population base nearby, finding qualified workers is an ongoing challenge.

“We have an excellent training program and a nice mix of new employees and veterans, but we’re always on the lookout for good workers,” said Fleming. “Because the mines are so close together, one of the real benefits of working here is that it’s easy for our employees to visit our other properties to learn and share techniques that make us all more efficient. It’s also a big plus when we promote people. They get a new and better job at a different Teck mine, but they don’t have to move and uproot their families. They can stay in the same house and just take a different road to work.”

Greenhills Operations

Teck’s Greenhills Operations is one of its five southeastern British Columbia mines. It employs about 600 people and produces 16,000 tonnes of coal per day (nearly 5 million tonnes annually). Greenhills’ steelmaking coal is railed to Vancouver for shipment overseas.

“This is an excellent operation,” said Don Sander, who has worked in various positions at a number of Teck mines. He came to Greenhills as General Manager last year. “It’s certainly one of the most productive operations. In fact, based on global benchmarking standards, I would say our productivity is ‘world-class.’

“But as good as the operation is, there’s always opportunity for improvement,” he acknowledged. “At Teck, we emphasize safety and environmental values, as well as our production goals. As we work together toward common goals here at Greenhills, I believe we can improve.”

There’s a common assumption that emphasizing safety and concern for the environment hinders productivity. Sander says the opposite is true.

“The goal of a safety system is to reduce risk and harm to employees so everybody goes home safe and healthy after every shift. A side benefit is that it may also enable us to be more productive. When you don’t have incidents, activities can continue, and you achieve safe production. A simple safety measure, such as keeping a jobsite organized, will help lessen the likelihood of an incident. We have high standards and work with everyone to maintain these standards. So yes, we firmly believe that working safely goes hand-in-hand with improved productivity.

“Similarly, managing our environmental impacts, by reducing our carbon footprint, improving water quality, reducing our spills and reclaiming our operation quickly and effectively, are necessary. Ultimately, we want everyone working at Greenhills to take pride in the contribution they make toward our success.”

All in it together

Sander is not alone among Greenhills employees to support the company culture promoting safety and more environmental awareness.

“It’s important to Teck, and it’s important to all of us who work here,” confirmed Todd Kniert, Superintendent of Operations. “The safety culture starts with the first day on the job and continues to the last. Every manager looks at every job with a critical eye, trying to identify potential hazards and how to mitigate them. We also stress to all employees that it’s their responsibility to watch out for their fellow employees.”

“We’ve seen many changes in the last five years or so, and they’re all for the better,” added Rob Foy, General Foreman of Operations. “The mind-set used to be, ‘I’ll take care of myself.’ Now, everybody realizes, we’re all in it together, and the best way to ensure that we go home safely each day is to look out for one another.”

As for environmental commitment, Kniert and Foy say it’s not just for today.

“Rob and I have both lived here all our lives,” Kniert pointed out. “We’re fourth-generation miners, and our kids will probably be fifth-generation. These are good, high-paying jobs. We want to do the right things now to ensure that jobs will continue to be here for years to come.”

“We’ve come a long way in a fairly short time, and it makes me proud to be a part of what we’re doing now,” Foy added.

Teck recently went to work on a five-year, $600 million program to improve water quality in and around its British Columbia mines. The company is also about to begin a concerted effort to reduce machine idling as part of its environmental improvement program.

“The main focus of our ‘Idle Free’ program is to reduce emissions and thereby lessen our carbon footprint,” said Fleming. “A side benefit is that we’ll also save money. We anticipate fuel savings of 3 percent to 5 percent. Because our annual consumption of diesel fuel is about 250 million litres, that would be a minimum of 7.5 million litres per year. Multiply that times the price of fuel and you see that the savings can be significant.”

Komatsu equipment and SMS support

To run a mine the size of Greenhills requires a large equipment fleet. Teck turns to Komatsu mining machines from SMS for a large chunk of its equipment needs, including most of its trucks and dozers.

The mine has 32 Komatsu haul trucks, including 18 new 930Es purchased about a year ago. The 930E is a 320-tonne A/C drive electric truck that hauls 25-percent more material than the 240-tonne Komatsu 830Es that Greenhills had used previously.

“We up-sized in order to boost productivity,” explained Kniert. ”But it’s not just the size of the 930E that enables us to be more productive – it’s also because the new technology on the haul truck allows us to safely operate with increased speeds.”

“The production factor in big trucks is largely a function of braking/retarder capability, and that’s much improved in the 930E,” added Foy. “Most of our hauls are downhill with speeds reaching 60 kilometres per hour, so braking is a huge factor. The stronger retarder in the 930E allows us to run faster with confidence that the truck will slow and stop as needed, even with a larger load. It’s a reliable system that gives us a production advantage.”

“In these big trucks, service brakes are for emergencies; the retarder is what the operator needs to remain under control at all times, and this system is very effective,” said Kniert.

In addition to the trucks, Greenhills has a WA1200 wheel loader, which Maintenance Foreman Mike Thibeault calls “bulletproof” and has proven to be a very reliable machine. The mine also leases Komatsu D475 dozers from SMS.

“We like Komatsu dozers,” confirmed Kniert. “They’re heavy and powerful. And now we’re working with Komatsu and SMS to make them even better for our specific needs, with bigger idlers and a strengthened drive system. We’re also changing the controller to better suit our application of side-cutting coal. SMS is customizing the machine to help us do our jobs in the most effective manner. We really appreciate providing input and working with our dealer and OEM to improve the product for our application.”

To keep the equipment running, Greenhills has 52 mechanics, 20 electricians and a dozen welders. Numerous contracted support personnel also work on site.

“SMS is an excellent partner to Teck and Greenhills and has been for many years,” reported Thibeault. “They are effective in providing us with the parts and service we need to support our equipment.”

“We use SMS for warranty work, in-depth tear-downs and when we need additional manpower,” said Kniert. “The support we get from them is very much appreciated, especially Sales Rep Larry Wakeford, who is always available to answer our questions. The SMS team demonstrates their commitment to us being successful. They do a good job of taking steps to ensure that we are.”

Committed to growth and preservation

Teck is the world’s second-largest exporter of seaborne, steelmaking coal, and it foresees continued strong demand for its products in the years to come.

“Our intention is to grow, as necessary, to meet that demand,” said Fleming.

“Of course, we’ll continue to work with regulators and others to ensure that we mine responsibly,” he added. “We’re currently building our first water-treatment facility at one of our mines to improve water quality in the region. We have plans to build as many as six treatment plants and will take other steps as necessary to protect the water resources in the valley. It’s not just about being a good corporate citizen, although that’s important to us, it’s because we live here as well as work here. We’re committed to not only preserving the environment, but also preserving a way of life.”