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Canada's Teck sees 200,000 mt coking coal loss from Elkview plant issue

London — Canadian miner Teck Resources said damage at the Elkview coking coalprocessing plant may take out 200,000 mt of salable coal output, and affectcoal blending operations during repairs.

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Repairs to the coal dryer, hit by a build-up in pressure as reportedJanuary 19, are not expected to exceed C$5 million-C$10 million ($4 million-$8million), Teck said in an update Thursday.

"Preliminary damage assessment has determined that repairs to the dryermay take in the range of four to six weeks," Teck said.

Elkview has been producing higher moisture coal products at around 80% ofplanned production since the incident.

"In order to manage the overall moisture level of our product we arecoordinating production with our other operations in the Elk Valley, andblending the higher moisture coal with dry finished coal inventory and drycoal from other operations to the extent possible," it added.

On January 19, Teck said the pressure build up at the unit did not resultin any adverse health or environmental impacts. Elkview had continued tooperate at a reduced rate using unaffected facilities at the mine since theproblem occurred.

The Elkview mine, in British Columbia, has a 7 million mt/year met coalproduction capacity.

The Elkview mine produces a premium hard coking coal, Elkview Standard,with around 72% coke strength after reaction, 21% volatile matter and 9.5%ash.

Teck has buyers for its coking coal in Northeast Asia, China, and in theAtlantic Basin. The company has expressed an interest in increasing sales toIndia because mills there are looking to diversify supplies away fromAustralia. Market sources say it has also been selling more to WesternEurope.Teck has lost sales to Ukraine on disruption to the steel industry andchanges in operations there. --Hector Forster, hector.forster@spglobal.com

--Edited by Jonathan Dart, jonathan.dart@spglobal.com