Teck puts growth on hold to address production challenges at Chile’s Quebrada Blanca Mine

Teck Resources pauses major expansion at Chile’s Quebrada Blanca copper mine to fix tailings issues, revise production guidance, and focus on operational improvements, impacting 2025 copper output.

Teck Resources (TSX: TECK.A, TECK.B; NYSE: TECK), Canada’s largest diversified mining company, has temporarily deferred major expansion projects as it works to resolve output issues at its flagship Quebrada Blanca (QB) copper mine in Chile.

The high-altitude mine in the Andes has faced significant operational hurdles, with a major expansion coming $4 billion over budget and years behind schedule. In July, CEO Jonathan Price lowered production guidance, citing tailings storage as the main bottleneck.

Teck’s decision follows a comprehensive operational review launched in August, scheduled to conclude in October. The review focuses on improving QB’s performance and includes a detailed action plan targeting its tailings facility, where slow sand drainage has delayed development and restricted production. Planned measures include mechanically raising the dam wall, adding new rock benches to increase crest height, and accelerating drainage improvements.

BMO Capital Markets analysts described the review as a “necessary step” that may involve short-term disruptions, including personnel changes and potential updates to future guidance. Matthew Murphy, Managing Director of Equity Research for Metals & Mining at BMO, noted:

“We do not think this will be especially surprising to the Street, but uncertainty should remain until October. We expect this process to ultimately drive greater confidence in the outlook and bolster near-term free cash flow by deferring further new project sanctioning.”

Management Changes and Project Updates

The company announced management changes, including the retirement of Chief Operating Officer Shehzad Bharmal and the appointment of an unnamed industry veteran as an advisor to senior leadership.

Large-scale project approvals are now on hold until QB achieves steady-state operations and meets ramp-up targets. However, developments already sanctioned—such as the $2.4 billion Highland Valley expansion—are expected to proceed unaffected. Other projects, including San Nicolás in Mexico (in partnership with Agnico Eagle) and Zafranal in Peru, remain unsanctioned, with timelines and near-term spending likely to be revised.

Impact on Copper Output

QB is central to Teck’s strategy to focus on energy transition metals following its exit from the coal business. The mine is a cornerstone of the company’s goal to produce 800,000 tonnes of copper annually by 2030.

Teck now forecasts QB’s 2025 production at 210,000–230,000 tonnes, down from previous guidance of 230,000–270,000 tonnes. Overall copper production for 2025 is now expected to fall between 470,000 and 525,000 tonnes, with updated figures to be reported in third-quarter results.

Last year, QB produced just over 200,000 tonnes of copper. Teck holds a 60% stake in the mine, Japan’s Sumitomo Corp. 30%, and Chile’s state-owned Codelco 10%. The company is also exploring synergies with the nearby Collahuasi mine, jointly owned by Anglo American and Glencore.