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Teck CEO Don Lindsay


Mining giant Teck Resources Inc. has been hit with its second coal production shutdown this summer after a strike halted operations at its Coal Mountain mine in southeastern British Columbia over the weekend.

Coal Mountain, which represents more than 10 per cent of Teck's annual coal production forecast for this year, produces both metallurgical coal used in steel making and thermal coal used for power generation.

As of late Sunday, no new talks were scheduled between the company and the union, represented by the United Mineworkers of America.

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Teck, one of the world's largest producers of metallurgical coal, was also forced to shut down its Greenhills mine in B.C. in late June after an explosion.

Coal from Greenhills is now being shipped to its nearby Fording River operations. The initial loss in production at Greenhills led to the company to recently lower its overall coal production forecast by about half a million tonnes to between 23.5 and 24.5 million tonnes.

Global coal production is estimated at between 220 to 240 million tonnes this year.

Coal Mountain was scheduled to produce about 2.5 million tonnes this year. Annual production capacity at the mine is about 2.7 million tonnes and about 3.5 million at the processing plant. The plant also processing coal from the nearby Elkview mine.

Teck's production issues come amid a global slowdown in steel production, which is expected to result in lower quarterly contract prices for coal later this year after spot prices rose to about $260 (U.S.) per tonne in April and since fallen to about $200.

The 168 workers at Coal Mountain went on strike late Friday, citing lower wages compared with their peers at other Teck mines as the main issue.

"When I go to the grocery store, the guy at the checkout beside me who works at the other [Teck]mine is making $3 an hour more than me," said Gordon Nearing, president of United Mineworkers of America, Local 7292.

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"We are looking for parity. ... We are producing coal for the same company."

Top-earning tradespeople make about $33 an hour at Coal Mountain, compared with about $36 an hour at other mines, Mr. Nearing said.

The last labour agreement for Coal Mountain workers expired at the end of 2009. Negotiations have been ongoing since last November, Mr. Nearing said.

The last strike at Coal Mountain was in 1980 and lasted eight months.

A Teck official said there were no plans at this time to operate the mine with replacement workers.

"We are committed to finding a resolution and will work with the union to achieve a settlement that is fair for all," said Marcia Smith, Teck's vice- president, corporate affairs.

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She also said Teck's mines are represented by different unions that have negotiated varying collective agreements. "No two mines have the same wages and benefits," she said.

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About the Author

Brenda Bouw is a freelance writer and editor based in Vancouver. She has more than 20 years of experience as a business reporter, including at The Globe and Mail, The Canadian Press, the Financial Post and was executive producer at BNN (formerly ROBTv). Brenda was also part of the Globe and Mail reporting team that won the 2010 National Newspaper Award for business journalism. More

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