Thompson Creek Metals

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Thompson Creek Metals Company Inc.
Type Public
Traded as TSX: TCM NYSE: TC
Industry Mining
Founded 1993
Headquarters Toronto, Ontario, Canada
Key people Kevin Loughrey,chair,ceo
Pamela L. Saxton,ceo,vp
S.Scott Shellhaas,coo,vp
Wendy Cassity,vp,gc,sec
Mark A. Wilson,vp sales
Timothy J. Haddon,dir
Products Molybdenum Silver Copper
Zinc Lead
Revenue US$594.8 mil (2010)Increase59.3%[1]
Operating income US$174.4 mil (2010)Increase250.9%[1]
Net income IncreaseUS$113.7 mil (2010)[1]
Total assets $2,317.7 bil (2010)Increase72.37%[1]
Total equity $1,429.9 bil (2010)Increase45.11%[1]
Divisions Thompson Creek Metals Company USA
Thompson Creek Holding
Blue Pearl Mining Inc.
Website www.thompsoncreekmetals.com

Thompson Creek Metals Company is a pure play molybdenum mining company, one of the world's largest with two operating mines (which include processing facilities), five mines in the developmental stage and a central roasting facility in Langeloth, Pennsylvania.[2] More recently it expressed interest in diversifying its business by adding other types of minerals to its asset base; on July 15, 2010 the company made a significant move into the non molybdenum mining market by agreeing to a US$623.5 million deal that would give it copper and gold exploration company Terrane Metals Corporation (and with it the Mt. Milligan project in BC).[3][4] Although the deal for Terrane Metals Corp was initially made in July it didn't receive final court approval in British Columbia until September 27; the deal was completed on October 27, 2010 (52% of Terrane was purchased from Goldcorp). A third party has a ten-year agreement with Thompson Creek to distribute and sell 20% of its products in Asia and Oceania effective January 2007.[5] All operations are in the USA and Canada.

About 40% to 50% of global molydenum production comes as a by-product of copper mining. The company produced 23.261 million pounds of molybdenum in the first nine months of 2010 (about 60% from the Thompson Creek mine) 92.1% as much as it did during the entire 2009 fiscal year. Thompson Creek (mine) contributes 5% of global molybdenum output and 10% of molybdenum roasting capacity.[6][7]

History

Originally private Thompson Creek Metals first incorporated in Canada in 2000. On October 26, 2006 it was acquired by Canada based, publicly traded mining company Blue Pearl Mining Ltd for $575 million US, in addition to other payments worth as much as $125 million US depending on the price of molybdenum.[2][8] Blue Pearl Mining Ltd then renamed itself Thompson Creek Metals Company Inc. in May 2007.[9] Though all operations (as of late 2010) involve the mining and processing of molybdenum many of the company's projects also contain significant copper and gold reserves.

After acquiring Terrane Metals (and its $917 million 15 year mine life Mount Milligan property, 155 km NW of Prince George, British Columbia) in October 2010 for about $700 million the company held significant reserves of copper and gold. During the purchase of Terrane Metals a side deal was made with Denver based miner Royal Gold involving the sale of 25% of the gold produced by Mount Milligan during its entire mine life; that transaction helped Thompson Creek finance the Terrane deal by providing it with $226.5 million in cash and another $85 million during the mine's construction.[10] Royal Gold is one of 16 companies listed on the Philadelphia Gold and Silver Index.

Operating Mines

Thompson Creek Mine (near Challis, Idaho) — Known as the Thompson Creek deposit it was discovered in 1968 by Cyprus Minerals Corporation and operated from 1983 to 1992. The mine was sold in 1993 to Thompson Creek Metals Company, which began mining at the site in April 1994. The company has claims on over 22,000 acres of land (includes waste dumps). Currently, it operates as an open pit mine,[9] and includes Bruno Creek Tailings Impoundment, the second tallest center-line tailings dam in the world.[11]

Endako Mine — 3 pit, open pit mine in central British Columbia (other 2 projects Berg and Davidson are west of it). Subsidiary Thompson Creek Holding owns 75% of the mine while Japanese company Sojitz Corporation has the other 25%. The operation also involves processing the molybdenum ore into a disulfide and then molybdenum trioxide through roasting.[12] Expansion projects, which began in 2008 increased capacity by 77.4% (though expansions which include new mills will cut the mine life by 38.5% to 16 years).[13][14]

Projects

Thompson Creek shares ownership in most of the five properties with other companies (although it holds a controlling interest in them all). Though most of the properties have significant reserves of only molybdenum (Emmons, Davidson) at least one also has a significant amount of silver and copper (Berg). The five projects are Mount Emmons (near Crested Butte, Colorado), Berg (West Central BC), Davidson (North West BC near the town of Smithers) Howards Pass (Northern Canada) and Maze Lake (Kivalliq District, Nunavut). Unlike the operating mines many of the projects are polymetallic resources.

Mount Emmons — Between the five projects Mount Emmons has the largest reserves of molybdenum; 94.2% more than Berg, 143% more than Davidson. Subsidiary Thompson Creek Metals Company USA has a controlling interest in the project (with an option to raise that to 75%) with the rest residing with US Energy Corp.[15]

Mount Milligan — Copper and gold containing property located 155 km NW of Prince George, BC. Royal Gold owned 25% of the mine's life of mine gold production until December 2011 when it upped that to 40%. The 25% interest already paid for cost it $252.6 million, the additional 15% interest will cost it $328.9 million more.[16] There were concerns that the federal government of Canada would not approve its development on the basis of environmental concerns (especially since another one Prosperity Mine was not given approval), but in November 2010 it received federal approval. Canada's environmental minister Jim Prentice credited the mine's minimal environmental impact design for its ability to win over support.[17]

As of December 2011 project construction of Mount Milligan is 31% complete. It will be ready to operate by the fourth quarter of 2013.

Howards Pass — Zinc, lead, and silver containing mine located at the border between the Yukon and North West territories. Selwyn Resources, US Steel Corporation, and Thompson Creek Metals share joint ownership.

Maze Lake — With Laurentian Goldfields (57% owner) Thompson Creek Metals (43% owner) conducts gold exploration.

References

  1. ↑ 1.0 1.1 1.2 1.3 1.4 "Thompson Creek Metals Company, Inc. Year Ended 2010 10-K Form". 2011-02-24. 
  2. ↑ 2.0 2.1 "Bleu Pearl buys Thompson Creek Metals". CBC News. 2006-09-05. 
  3. ↑ "Thompson Creek to Buy Terrane for $623.5 Million to Diversify Into Copper". 2010-07-15. 
  4. ↑ "Thompson Creek Receives Final Court Approval For Acquisition Of Terrane Metals". 2010-09-27. 
  5. ↑ "Thompson Creek Metals Co Inc. 2010 10-K SEC Report". 2010-01-28. 
  6. ↑ "Thompson Creek Metals 2009 Annual Report". 2010-02-16. 
  7. ↑ "Thompson Creek Metals Company Third Quarter 2010 Report". 2010-11-04. 
  8. ↑ "King of the Primary Molybdenum World Wonders about Supply Problems". 2007-03-27. 
  9. ↑ 9.0 9.1 "Thompson Creek Metals RPA Report". 2009. 
  10. ↑ "Thompson Creek buys Terrane, done deal". 2010-2010-10-21. 
  11. ↑ "Successful Permitting of Expansion to the 2nd Tallest Centerline-Construction Tailings Dam in the World". Golder Associates. Retrieved 14 August 2011. 
  12. ↑ "Thompson Creek Metals Co Inc businessweek". Retrieved 2010-11-17. 
  13. ↑ "Endako Mine". Retrieved 2010-11-17. 
  14. ↑ "Thompson Creek Metals Third Quarter 2010 Financial and Operational Information". 2010-11-04. 
  15. ↑ "Mount Emmons Project". Retrieved 2010-11-17. 
  16. ↑ "Royal Gold Increases Gold Stream Interest in the Mt. Milligan Project". December 15, 2011. 
  17. ↑ "Mt. Milligan mine approved, good for northwest". 2010-11-10. 

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